LexV. ANANTHA RAJU & ANR versus T.M. NARASIMHAN & ORS.
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A B C D E F G H 860 SUPREME COURT REPORTS [2021] 11 S.C.R. [2021] 11 S.C.R. 860 860 V. ANANTHA RAJU & ANR v. T.M. NARASIMHAN & ORS. (Civil Appeal No. 6469 of 2021) OCTOBER 26, 2021 [L. NAGESWARA RAO, SANJIV KHANNA AND B. R. GAVAI, JJ.] Partnership – Share in the profit and loss – A partnership firm was constituted in the year 1986 – In 1992 the partnership firm was re- constituted and the plaintiff no.1/appellant No.1 was inducted as a partner with 50% share in profit and loss, along with original partners, i.e., defendant Nos. 1 to 5 – It was however provided in the 1992 Deed, that if plaintiff no.1 fails to bring in an amount of Rs.50,00,000/- as his capital contribution on or before 31.3.1993, his share in the firm would be only to the extent of 10% – The firm was again reconstituted in 1995, whereby the plaintiff no.2, son of the plaintiff no.1 was inducted as partner – As per 1995 Deed, the share of the plaintiff Nos. 1 and 2 was to be 25% each – Differences arose between the parties in 2004 and a resolution was passed for expulsion of the plaintiffs from the firm – A suit was filed by the plaintiffs for rendition of accounts and for releasing their 50% share in the profits of the firm – Trial Court held that the plaintiffs together are entitled to 10% share in the profits and losses of the partnership firm till their expulsion – Aggrieved, plaintiffs filed an appeal before the High Court, which was dismissed – Before the Supreme Court, the plaintiffs/appellants contended that the trial Court and the High Court erred in holding that they will have only 10% share in the profits and losses of the partnership firm – Whereas, the respondents/defendants contended that 1995 Deed inadvertently mentioned that the plaintiffs will have 25% share each – Held: Once the plaintiffs had specifically contended that the terms of the Deed were amended by the 1995 Deed, and the defendants admitted about the execution of the said document, then the burden to prove mistake in the deed shifted upon the defendants – In 1992 Deed, the share of plaintiff no.1 was specified as 50%, however, it was specifically mentioned that if he fails to bring in an amount of Rs. 50,00,000/- as his capital A B C D E F G H 861 contribution to the firm on or before 31.3.1993, his share would be 10% – In the 1995 Deed, there was no mention regarding such contingency – In view of Section 91 of the Evidence Act, the evidentiary value of the 1995 Deed would stand on a much higher pedestal, as against the oral testimony of the parties – This court is unable to accept the contention of the defendants that the share in the profits and losses of the partnership firm as mentioned in the 1995 deed is inadvertent or a mistake in fact – If it was a mistake or inadvertence, nothing precluded the respondents/defendants from rectifying the same between 1995 and 2004 – The trial court as well as the High Court have erred in holding that the plaintiffs together were entitled to only 10% share – Insofar as the expulsion of the plaintiffs is concerned, the trial court has given sound reasons for upholding the expulsion – No reason to interfere with the same. Evidence Act, 1872 – ss. 91 and 92 – Discussed and explained. Partly allowing the appeal, the Court HELD: 1. This Court has held in Roop Kumar v. Mohan Thedani that the integration of the act consists in embodying it in a single utterance or memorial — commonly, a written one. This process of integration may be required by law, or it may be adopted voluntarily by the actor or actors and in the latter case, either wholly or partially. It has been held that the question that is required to be considered is whether the particular document was intended by the parties to cover certain subjects of transaction between them to deprive of legal effect of all other utterances. It has been further held that the practical consequence of integration is that its scattered parts, in their former and inchoate shape, have no longer any jural effect and they are replaced by a single embodiment of the act. It has been held that when a jural act is embodied in a single memorial, all other utterances of the parties on the topic are legally immaterial for the purpose of determining what are the terms of their act. It has been held that when persons express their agreements in writing, it is for the express purpose of getting rid of any indefiniteness and to put their ideas in such shape that there can be no misunderstanding, which so often
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