Gannmani Anasuya & Ors Vs. Parvatini Amarendra Chowdhary & Ors  Insc 613
(17 May 2007)
S.B. Sinha & Markandey Katju
S.B. SINHA , J :
1. This appeal is directed against a judgment and decree dated 29.10.1999
passed by a Division Bench of the High Court of Judicature at Andhra Pradesh at
Hyderabad whereby and whereunder an appeal preferred by Appellants herein, who
were Defendant Nos. 2, 3 and 5 to 7 in the suit, from a judgment and decree
dated 23.04.1993 in O.S. No. 55 of 1985 passed by the Subordinate Judge,
Ramchandrapuram, was dismissed.
2. Plaintiffs (Respondent Nos. 1 and 2 herein) filed a suit purported to be
one for partition claiming 2/3rd share in the property described in Schedule
'A' appended to the plaint, claiming 4/9th share in the property described in
Schedule 'B' appended thereto, as also for a decree directing the Defendants 1
to 3 to render fair and proper accounts in respect of the poultry business
which was being run in the Schedule 'B' property from the year 1968 onwards as
also for future profits thereupon.
3. Plaintiffs are sons of Defendant No.1 (Respondent No.3 herein). One
Narasimha Murthy was the father of Defendant No.1. Appellants herein admittedly
are related to the respondents. Appellant No. 1 is niece of late Narasimha
Murthy. Her parents died when she was very young and unmarried. She was brought
up by the said Narasimha Murthy and married to Appellant No.2 herein. Appellant
Nos. 1 and 2 allegedly were close to the said Narasimha Murthy. At the time of
marriage, Appellant No. 2 was a student of Veterinary Science at Madras. After
securing B.V. Sc. Degree, he got an appointment in the veterinary department
and later on became a B.D.O., and subsequently a Project Officer in the Urban
Community Development of the Hyderabad Municipal Corporation. They allegedly
approached Defendant No. 1 and late Narasimha Murthy to invest money in poultry
business at Hyderabad; pursuant whereto investments were made.
Allegedly, an arrangement was entered into by and between the parties that
profits of the said business can be shared by late Narasimha Murthy, on the one
hand, and Defendant No. 1 and Defendant No.2, on the other, equally after
giving due credit to the expenditure and interest to investments made @ 15%
p.a. 7 acres and 14 guntas of land was purchased with the moneys advanced by
late Narasimha Murthy and Defendant No.1 at Attapur near Hyderabad in the name
of late Narasimha Murthy and the Defendant No.2.
Poultry business was, thus, started.
4. Narasimha Murthy died in the year 1971. With the profits from the said
business going up, a tube manufacturing plant was also installed.
According to the plaintiffs on the death of the said Narasimha Murthy, they
inherited 2/3rd undivided interest of the said poultry and tubes manufacturing
business and Appellant No.2 had the remaining 1/3rd share. The joint family and
Respondent No.3 herein had no interest in the said business concern.
5. Allegedly, a notice dated 27.08.1985 was served asking the appellants
herein to render accounts in respect of the said businesses, but no reply
thereto was given. A suit was thereafter filed on 12.09.1985. The father of the
Plaintiffs-Respondents Nos.1 and 2, namely, Respondent No.3 herein in his
written statement for all intent and purport supported the case of the
plaintiffs alleging that there had been no settlement of accounts in respect of
the said businesses and after the death of Narasimha Murthy, he was entitled to
the share to which his father was entitled to from the said business. It was alleged
that further amounts were also advanced after the death of his father by way of
advance as well as interest accrued on principal amounts advanced. It was
further alleged that the infrastructures and the buildings referred to in
Schedule 'B' appended to the plaint including the residential house bearing D.
No. 7/26 were constructed with the profit earned from the business. It was,
therefore, contended that they were entitled to 2/3rd share in the business
besides the amounts advanced together with interest at the rate of 15% p.a. and
also to a half share in the properties described in Schedule 'B' appended to
the plaint together with income thereof.
6. With his written statement, Defendant No.1 filed a document as an
annexure thereof showing that a sum of Rs.1,55,535.00 had been advanced during
the period 23.08.1968 to 29.05.1971.
7. In her written statement, Defendant No. 3 (Appellant No. 2 herein)
accepted that during the life time of late Narasimha Murthy, Defendant No.
1 partitioned the joint family properties under a registered deed of
partition of the year 1961. But according to him, only landed properties were
partitioned keeping the family house and vacant sites at Pulagurtha joint.
The allegation to the effect that Appellants herein approached the Defendant
No.1 and late Narasimha Murthy for investment of money in the poultry business
or that they invested any amount on the premise that the profits arising out of
the said business can be shared by late Narasimha Murthy and Defendant No. 1
and the Defendant No.2 equally after giving due credit to the expenditure and
interest to investments made at 15% p.a. was denied.
The other allegations made in the plaint were also disputed. A plea that the
suit was barred by limitation was also taken.
8. There is no document to show that any partnership came into being by and
between the parties and/or their predecessors in interest.
9. It is, however, not in dispute that after the suit was filed, an Advocate
Commissioner was appointed for making an inventory of the poultry farm.
It was stated that late Narasimha Murthy merely advanced a sum of Rs.
5,000/- and as a good gesture of goodwill, his name was included as one of
the vendees along with Defendant No. 2 in the purchase of the property by
reason of the said deed of sale dated 02.12.1970. According to Appellants,
Narasimha Murthy had never shown any interest in the said property as a result
whereof the business became exclusively theirs and the same was accepted by
late Narasimha Murthy. Even if the said allegations are correct, Narasimha
Murthy would only have = share in the land covered by the said sale deed.
10. M/s Anasuya Poultry Farm or M/s Anasuya Plastics were the business
concerns started by the Defendant No.2 (Appellant No. 1 herein) with her own
money and late Narasimha Murthy or Respondent No.3 had no interest therein. It
was furthermore contended that for carrying out the poultry business, a shed
had been constructed by Defendant No.2 by obtaining loans from the State Bank
of India and neither Narasimha Murthy nor the Defendant No.1 even objected
thereto. The business, therefore, was a proprietary concern of the Appellant
No.1 herein. Although separate written statements were filed by the Defendant
No.4 and Defendant Nos. 5 to 7, it may not be necessary to consider the same.
Defendant No. 4 in her written statement relinquished her share.
11. A large number of issues were framed by the learned Trial Judge. The
learned Trial Judge by reason of his judgment dated 23.04.1993 passed a
preliminary decree directing partition of the properties described in Schedule
'A' appended to the plaint into three equal shares by metes and bounds and
allotted two shares to the plaintiffs and furthermore directed partition of the
properties described in Schedule 'B' appended to the plaint into nine equal
shares by metes and bounds and allotted four shares to the plaintiffs.
Appellant Nos. 1 and 2 herein as also Respondent No. 3 herein were also
directed to render fair and proper accounts in respect of poultry business from
12. Appellants herein (Defendant Nos. 2, 3, 5 to 7) preferred an appeal
thereagainst before the High Court, which has been dismissed by reason of the
13. The High Court having regard to the contentions raised by parties
formulated the following questions for its consideration :
1. Whether the poultry business carried on by the appellants is a joint
2. Whether there was a settlement of account under Ex. B8?
3. Whether the respondents are entitled to the share of defendant No. 47?;
and 4. Whether the suit is barred by limitation."
14. Mr. A. Subba Rao, the learned counsel appearing on behalf of the
appellants, would submit that the learned Trial Judge as also the High Court
committed a serious error insofar as they failed to take into consideration the
effect of Ex.B-8, which categorically goes to show that the accounts had been
settled by and between the parties on 30.05.1979. The learned counsel urged
that it may be true that no averment was made in the written statement in
regard to the said document, but in view of the fact that Defendant No. 1
(Respondent No. 3 herein) having admitted the execution thereof, the same
should have been taken into consideration for the purpose of determining the
issue of limitation, if not for other purposes.
15. The learned counsel would submit that the High Court has also not
bestowed any consideration in respect of the execution of deed of partnership
dated 06.03.1978 entered into by and between the appellants with her daughter
wherein Defendant No.1 (Respondent No.3) is a witness.
16. In any event, the learned counsel argued, there is nothing on record to
show as to how the High Court came to a conclusion that the plaintiffs and
Defendant No.1 had 2/3rd share in the business venture. The learned counsel
submitted that the fact that Defendant No.1 (Respondent No.3) was himself an
Engineering Graduate, there was absolutely no reason as to why he had not asked
for an account annually and having regard to the fact that the partnership was
allegedly entered into in the year 1978, the suit was ex facie barred by
17. Mr. T.L.V. Viswanatha Iyer, the learned counsel appearing on behalf of
the plaintiffs (Respondent Nos. 1 and 2), on the other hand, submitted that although
the question in regard to the extent of share had been raised before the
learned Trial Judge, the same was not done before the High Court and, thus, the
same should not be permitted to be raised before us. According to the learned
counsSel as the appellants herein were not in a position to make any investment
and a total sum of Rs.1,55,535/- was advanced by Defendant No.1, towards the
joint venture, a suit for rendition of accounts was maintainable. The judgment
of the trial court, according to the learned counsel, was unassailable, in
regard to the question of limitation. The learned counsel would contend that
Ex.B-8 upon which reliance has been placed, does not contain any signature of
any party nor any amount has been paid pursuant thereto in full and final
settlement of the accounts wherefor the same was drawn up. It was pointed out
that Defendant No. 1 was only a manager of the Hindu undivided family and the
business concerns were being run the appellants herein. In view of the fact
that profits were being reinvested into the partnership business, it is idle to
contend that the accounts were settled particularly when the business was found
to be a running one by the learned Trial Judge. Even the notice issued by the
plaintiffs, it was pointed out, had not been replied by the defendants. The
learned counsel would contend that Article 5 of the Limitation Act,
1963 would not be applicable in a case of this nature as the same refers to
a dissolution of partnership and as in this case, the provisions of the Indian Partnership Act,
1932 are not attracted, only Article 113 thereof would apply.
18. Dr. K.P. Kaylash Nath Pillai, the learned counsel appearing on behalf of
Defendant No. 1 (Respondent No.3), would submit that the question as to whether
the business was a joint venture or not being a question of fact, this Court
should not exercise its discretionary jurisdiction under Article 136 of the
Constitution of India.
19. So far as issue No. 1 is concerned, we are satisfied that the business
was a joint venture and not the sole proprietary concern of the Appellant No.
1, as urged by Mr. Subba Rao.
20. We may furthermore notice that a concession was made before the High
Court that so far as the immovable property is concerned, having regard to the
provisions contained in Section 45 of the Transfer of Property Act, 1894,
Narasimha Murthy had = share therein. It is, thus, not necessary for us to go
into the said question as correctness or otherwise of the said concession is
not in question before us.
21. However, it is difficult for us to accept the reasonings of the High
Court in regard to Ex. B-8. Plaintiffs (Respondent Nos. 1 and 2) were claiming
the property as members of the Hindu undivided family.
Admittedly, the interest of the Hindu undivided family was being looked
after by Narasimha Murthy and after his death by Defendant No.1 (Respondent
No.3). Correspondences were exchanged by and between Appellant Nos. 1 and 2
only with Narasimha Murthy and Defendant No. 1 (Respondent No.3). Yet again
admittedly, Defendant No. 1 (Respondent No.3) was the manager of the Hindu
undivided family. His dealing with the appellant in regard to the affairs of
the business will have a direct bearing in the matter of determination of the
issues raised before us.
22. An admission made by a party can be used against him. When such
admission is made by a Karta of the Hindu undivided family, who is managing the
family property as well as family business affairs, the same would be a
relevant fact. When a claim was made by the plaintiffs for rendition of
accounts in the lis, issuance of a document purported to have been authored by
one of the parties, in our opinion, was required to be taken into
23. In terms of Section 58 of the Indian Evidence
Act, 1872, a thing admitted need not be proved. [See Shreedhar Govind
Yesahwant Govind Kamerkar & Anr. 2006 (14) SCALE 174]
24. It is also a trite law that when in cross-examination a witness accepts
the correctness of a document, the same would be relevant. A pleading in regard
to existence of a document may be necessary for advancing the case of a party,
but when a witness admits a document to be in his own handwriting without
anything more, the effect thereof may have to be considered having regard to
the provisions contained in Section 145 of the Indian Evidence
Act in terms whereof the only requirement would be that his attention is
drawn before a writing can be proved. These relevant facts have not been
considered by the High Court. The High Court merely proceeded on the basis that
Ex. B-8 did not contain anybody's signature. If the Defendant No. 1 accepted
the contents of the said document, which, according to him, were noted by him
from the books of accounts, authenticity thereof is not in question, and, thus,
even in absence of books of accounts, relevant pages whereof were found to have
been torn, the High Court ought to have taken the same into consideration as
well as the admission on the part of the Defendant No. 1 and the effect
thereof. Such an admission could be taken into consideration both for the
purpose of arriving at a finding in regard to the fact as to whether a full and
final settlement of accounts had been arrived at, which was a relevant fact as
also for determining the question of limitation.
25. There is no document in writing to prove partnership. Accounts had not
been demanded by the plaintiffs or the defendant no. 3 for a long time.
Even an oral partnership had not been proved. What was the subject-matter of
the partnership had also not been considered by the High Court. A share in a
joint venture, in absence of any document in writing, must be determined having
regard to the conduct of the parties. The High Court proceeded on the basis
that the plaintiffs and defendant No.1 had = share in the property in terms of
Section 45 of the Transfer of Property Act. If the said immovable property
formed assets of the joint venture, the same would be an indicia to determine
the shares held by the parties thereto. Ordinarily, the extent of an
involvement made shall be the criteria for determining the share of the
co-entrepreneurs. In absence of terms and conditions of the joint venture
having not been reduced to writing, conduct of the parties how they dealt with
affairs of the business would be relevant.
26. The High Court does not say that the concession made by the learned
counsel appearing on behalf of Appellants was incorrect. In a situation of this
nature, particularly when the limitation issue required determination, Ex.
B-8, in our opinion, should have received serious consideration at the hands
of the courts below.
27. In terms of Section 3 of the Limitation Act,
it is for the court to determine the question as to whether the suit is barred
by limitation or not irrespective of the fact that as to whether such a plea
has been raised by the parties. Such a jurisdictional fact need not, thus, be
pleaded. In any event, the said evidence was admissible for the purpose of
contradicting a witness, which being a relevant fact should have been
considered in its proper perspective. If the contents of Ex. B-8 were accepted,
it was not for the High Court to consider the consequences flowing therefrom,
and, thus, but the fact whether the figure(s) contained therein could be
verified from the books of account might not be very relevant. Whether, it
would be in consonance with the pleadings of Appellants was again of not much
significance if it can be used for demolishing the case of Plaintiffs and
Defendant No.1 If the figures contained in Ex. B-8 were accepted, it was for
Defendant No. 1 to explain the same and not for Appellants. The High Court, in
our opinion, thus, committed a manifest error in not taking into consideration
the contents of Ex. B-8 in its proper perspective.
28. At the cost of repetition, we may state that the effect of the said
document at least should have received serious consideration at the hands of
the High Court. We cannot accept the contention of Mr. Iyer that such a
question had not been raised. From the impugned judgment of the High Court, it
appears that the said such question had specifically been raised. The High
Court noticed the arguments of the learned Advocate in the following terms :
"Therefore, they have no objection for giving the half share in the
property in spire of 1st respondent expressing his intention to relinquish his
right in the half share of landed property admeasuring Ac. 7-14 guntas in
Atapur covered by Ex. B-15. After the settlement of accounts under Ex. B-8 the
appellants obtained loans from various banks for the purpose of reviving the
poultry business and also setting up of business in plastics. In all the loan
transactions, the 1st respondent signed the loan documents as a guarantor. If
really he is interested in the business, he would have been one of the
principal debtors and not a guarantor. That indicates that the respondents have
no interest in the poultry business carried on by the 1st appellant. Further
the 1st respondent got himself examined on commission as he does not want to
face the Court since his case is false.
As regards the share of the 4th defendant who is the daughter of late
Narasimha Murthy is concerned, the respondents are not entitled to her share as
relinquishment of her share in the property is not evidenced by any document
except Ex.B9 which is not a registered document. Therefore, the respondents
cannot claim the share of the 4th respondent. Since neither late Narasimha
Murthy nor respondent No. 1 obstructed the 1st appellant from carrying on the
business in the half share of Ac.7.14 guntas of land, the appellants are not
liable to account for profits earned by them by their own labour. If really the
case of the respondents is that the poultry business carried on by the
appellants is not the exclusive business of the 1st appellant, at the time of
Ex. B8 they would have demanded for accounting of the profits. As regards the
building constructed in the site, it is constructed with the money belonging to
the 1st appellant and therefore, the respondents are not entitled for a share
in the said building.
At the most the value of the site on which the building is constructed may
be awarded to the member of the joint family on which the corners constructs a
building. The suit for accounts is barred by limitation as the business was
closed in 1973. At the most the respondents are entitled for profits 3 years
prior to the filing of the suit"
29. It was for the High Court to frame appropriate points for its
determination in the light of the submissions made on behalf of Appellants in
terms of Order 41 Rule 31 of the Code of Civil Procedure. The High Court failed
to address itself on the said issue. Thus, apart from Issues Nos.
2 and 4, other points which for its consideration including the extent of
the share of Plaintiffs and Defendant No. 1 were required to be specifically
gone into particularly in view of the fact that such a contention had been
considered by the learned Trial Judge. Issue Nos. 2 and 4, in our opinion,
therefore, require fresh consideration at the hands of the High Court.
30. For the aforementioned purpose, it may also be necessary for the High
Court to consider the applicability of the relevant articles of the Limitation Act. We,
therefore, are of the opinion that the impugned judgment to the extent
aforementioned cannot be sustained. It is set aside accordingly in part and the
matter is remitted to the High Court for consideration of the matter afresh on
the said issues, inter alia, in the light of the observations made
hereinbefore. The High Court shall also formulate appropriate points for its
consideration in terms of Order 41 Rule 31 of the Code of Civil Procedure and
proceed to hear the appeal on merits on the relevant issues apart from Issue
Nos.2 and 4. This appeal is allowed to the aforementioned extent. In the
peculiar facts and circumstances of the case, there shall be no order as to