SUBODH KUMAR GUPTA versus SHRIKANT GUPTA AND ORS.

Citation: [1993] SUPP. 1 S.C.R. 660 · Decided: 19-08-1993 · Supreme Court of India · Bench: A.M. AHMADI · Disposal: Dismissed
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Judgment (excerpt)

A 
SUBODH KUMAR GUPTA 
v. 
SHRIKANT GUPTA AND ORS. 
AUGUST 19, 1993 
B 
[A.M. AHMADI AND N. YENKATACHALA, J.1.J 
Civil Procedure Code, 1908-S.W(c)-Suit for dissolution of paitner-
ship-Where entire rlispwe related to what happened al Mandsaw; agreement 
C for dissolution of pmt1te1~hip executed at Bhilai and only a bald allegation 
that there was a branch officer at Chandigarh where the plaintiff resided--
Held, Chandigmh Cowt would not have te11it01ial jurisdiction 
The. plititioner, his father, brother and one other person \Vere 
partners with a 20% share each in the profits and losses of the firm. The 
D 
partnership was one at will. The registered head office was at Bombay. Its 
factory was at Mandsaur, where the petitioner lived with his father and 
brothers. The petitioner shifted to Chandigarh in 1974 and, according to 
him, the branch office was at Chandigarh as evident from the stationery 
of the firm. His father moved to Rajnandgaon in 1980. Disputes arose 
about the management and accounts of the firm. Consequently in 1992 an 
E agreement for dissolution of the partnership firm and for distribution of 
assets was drawn up at Bhilai with a stipulation that the accounts to be 
settled within one month. 
The petitioner contended that the agreement was void and un-force-
F 
able because material facts had been suppressed, certain assets of the firm 
had not been included in the agreement and the period of one month had 
elapsed. 
G 
The respondent·defendant 1 raised a preliminary contention that the 
Chandigarh Court had no jurisdiction. 
The Trial Judge held that a part of the cause of action had arisen 
withi.n the territorial limits of the Chandigarh Court. On appeal, a learned 
single Judge concluded that a mere allegation that the firm had a branch 
office at Chandigarh could not invest the Chandigarh Court with jurisdic-
H tion. 
660 
S.K. GUPTA v. SHRIKANTGUPTA[AHMADl,J.] 
661 
Dismissing the appeal, this Court 
HELD: 1. As is evident from the averments in the plaint no part of 
the cause of action arose within the territorial jurisdiction of the Chan-
digarh Court. The entire dispute is in relation to what happened at 
Mandsaur. An agreement to settle the dispute and dissolve the partnership 
was executed in 1992 at Bhilai, outside the territorial jurisdiction of the 
Chandigarh Court. Unless this agreement is set aside there is no question 
of the Chandigarh Court entertaining a suit for dissolution of the partner-
ship and rendition of accounts. (665-A-B] 
It is not enough to state that the agreement is a void document. A 
competent Court has to declare it void before the petitioner - plaintiff can 
ignore it. (665-E] 
None of the defendants was ever residing in Chandigarh or did any 
business whatsoever in Chandigarh. (666-D] 
2. Mere bald allegation that he was having a branch office of the firm 
at Chandigarh will not confer jurisdiction unless it is shown that a part 
of the cause of action arose within the territorial jurisdiction of that Court. 
(666-C] 
A 
B 
c 
D 
CIVIL APPELLATE JURISDICTION : Special Leave Petition E 
(Civil) No. 10301 of 1993. 
From the Judgment and Order dated 8.7.93 of the Punjab & Haryana 
High Court in C.R. No.1483/93. 
K.K. Venugopal, S.K. Gambhir and Vivek Gambhir for the 
petitioner. 
Shanti Bhushan, Ashok H. Desai, M.L. Bachawat, S.K. Jain, A.P. 
Dhamija, S. Atreya and A.K. Srivastava for the respondents. 
The Judgment of the Court was delivered by 
AHMADI, J. The petitioner is the original plaintiff. He filed a suit in 
the Court of the learned Senior Judge, Chandigarh, for dissolution of the 
firm carrying on business in the name and style of Mis. Rajaram & Brothers 
F 
G 
of which he claimed to be a partner alongwith his father, brothers and one 
K.K. Jindal. Each partner had 20% share in the profits and losses of the H 
662 
SUPREME COURT REPORTS (1993] SUPP. 1 S.C.R. 
A firm apd the partnership was one at will. The head office of the firm was 
situate at Bombay where it was registered with the Registrar of Firms. Its 
factory was situate at Mandsaur where the father Rajaram Gupta lived with 
his sons and attended to the partnership business. The plaintiff also was 
residing at Mandsaur till 1974 when he shifted to Chandigarh. After he 
B shifted to Chandigarh he visited Mandsaur of and on in connection with 
the business of the firm. His case is that after he shifted to Chandigarh he 
used to call for and receive statements of accounts of the business carried
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