NANCHAND GANGARAM SHETH versus MALLAVPA MAHALINGAPPA SADALGE

Citation: [1976] 3 S.C.R. 287 · Decided: 30-01-1976 · Supreme Court of India · Bench: R.S. SARKARIA, S. MURTAZA FAZAL ALI · Disposal: Dismissed

Judgment (excerpt)

\ 
I 
NANCHAND GANGARAM SHETH 
v. 
MALLAVPA MAHALINGAPPA SADALGE 
January 30, 1976 
[R. S. SARKARIA AND S. MURTAZA FAZAL ALI, JJ.] 
28 7 
Joint Hindu family-If duty cast on menibers to inform creditors by general 
notice regarding disruption of joint Hindu fa111ily-Creditor-Duty to inquire 
about the capacity of exccutant of a document. 
Partnership Act, 1932-Sections 4 and 5-Difference. 
Limitation Act, 1908-Section 2!(3)(b) "Manager of the family for the 
time being"-Meaning of-Erstwhile kana-1/ could keep an old debt alive 
and extend limitation against all the members of joini Hindu family. 
The plaintiff·appellant had business dealings with the joint family of the 
defendants. 
He had instituted a suit claiming a certain sum of money from 
the defendants, one of the grounds being that even if the defendants proved 
that there had been a partition in the family, the family was still liable for 
the dues pertaining to the ancestral business carried on .bY all- the defendants 
either as members of the joint Hindu family or as partners of a firm. 
Defen-
dant 3 (respondent) stated that there was disruption of the joint family status 
on November 4, 1945. when defendants 1 and 2 and his deceased father un-
equivocally expressed their intention to separate and divided their movables. 
He denied that defendants 1 and 2 had ever acted as managers of the joint 
family. 
The trial Court and the High Court concurrently found that the joint family 
of the defendants had disrupted on November 4, 1945 and that no joint family 
business was in existence on the date when the last dealing of tho plaintiff 
with the defendants took place. 
On appeal to this Court, it was contended that even if the joint family 
stood disrupted from November, 1945, in the absence of public notice by defen-
dants 1 and 2 regarding the disruption of the joint family, the acknowledge-
ments made by them as karta of the joint Hindu family would be binding on the 
erstwhile joint family under s. 45 of the Partnership Act, 1932. 
Dismissing the appeal, 
HEID : ( 1) It is the duty of the creditor to ascertain whether the person 
m~.king the acknowledgement still bolds his representative capacity as karta of 
the family. The law does not cast any duty upon the mem~rs of tho family to 
inform the creditors by a general notice about the disruption of the family. 
If 
the creditor fails to make an enquiry and satisfy himself about the capacity of 
the executant to represent the family at the time of making the acknowledgement, 
he does so at his own peril. Disruption of the joint family status puts an 
end to the representative capacity of the karta and any acknowledgement of a 
deht made by him after such disruption cannot save the creditor's claim from 
bec:oming time barred against the other members. [298B-C] 
Pramod Kumar Pati v. Damodar Sahu, ILR 1953 Cuttack 221; Rengaswami 
Ayyangar v. Sivprakasem Pillai, !LR 1942 Mad. 251 (F.B.); Mutayala Rama-
cht:ndrappa v. Mutayala Narayanappa, AIR 1940 Mad. 339, approved. 
Kashiram Bhagshet Shete v. Bhaga Bhanshet Redii A.i.R. 1945 Born. 511 over 
rukd. 
A 
B 
c 
D 
E 
F 
G 
(2) (a) The Legislature has excluded the joint Hindu trading families from 
the operation of the Partnership Act. Section 4 defines partnership as a rela-
tion between persons who have agreed to share the profits: of a business, and 
H 
according to s. 5 the Act governs only that relation of partnership which arises 
fro.'.Il contract and not from status, such as the one obtaining among the mem· 
bm of a joint Hindu family trading partnership, [297C-DJ 
A 
B 
c 
D 
E 
F 
G 
H 
288 
SUPREME COURT REPORTS 
[1976] 3 S.C.R. 
(b) The words "manager of a family for the time being" occurring in 
s. 21 (3) (b) of the Limitation Act, 1908, indicate that at the time when the 
acknowledgement was made and signed, the person making and signing it, must 
be the manager of a subsisting joint Hindu family. 
If <ft the relevant time 
the joint Hindu family, as such, was no longer in existence, 
any 
acknow-
ledgement made by the erstwhile karta of such family cannot keep the debt 
alive and extend limitation as against aJI the members of the family, his re-
presentative capacity as karta being co-terminus \vith the joint status of the 
family. 
[297F-Gl 
( c) Coparceners do not derive their title through the kart a of the coparcen-
I 
aty. 
Jn the instant case defendants 1 and 2 did not fulfil the requirements of 
4 
sub--s. (I) of s. 21 of the Limitation Ac

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