Sarla Bala Sinha vs Sarat Chandra Sinha & Ors
2015 Latest Caselaw 3317 Del

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*      IN THE HIGH COURT OF DELHI AT NEW DELHI

+      CS(OS) 2409/2014 & IA Nos. 15113/2014, 15115/2014, 20455/2014,
       21521/2014, 21824/2014, 2003/2015, 4008/2015, 4217-4218/2015,
       4291/2015, 7366/2015

       SARLA BALA SINHA                                ..... Plaintiff
                    Through: Mr. Avneesh Garg, Advocate with
                             Mr. Ishan Khanna, Advocate.

                         versus

       SARAT CHANDRA SINHA & ORS                 ..... Defendants
                   Through: Mr. Vipul Gupta, Advocate for
                            defendant No.1 with defendant in
                            person.
                            Mr. Dipak K. Nag, Advocate with
                            Ms. Apurva Upmanyu, Advocate for
                            defendants No.2, 4 and 5.


%                                     Date of Decision: 24th April, 2015

CORAM:
HON'BLE MR. JUSTICE MANMOHAN

                         JUDGMENT

MANMOHAN, J: (Oral)

I.A. No. 21520/2014

1. Present application has been filed by defendant No.1 for rejection of the plaint under Order VII Rule 11 CPC.

2. Mr. Vipul Gupta, learned counsel for defendant No.1 submits that the present plaint is barred by limitation. He states that plaintiff has sought a

direction to pay 50% share of profits since 14 th April, 2006 and a declaration that the partnership deed depriving her of 50% share is null and void. He points out that the present suit had been filed in 2014. According to him, the present suit is beyond the period of limitation of three years as prescribed in Article 58 of the Limitation Act.

3. Mr. Gupta further submits that the present suit is not properly valued for the purposes of Court-fees. He states that the following reliefs have not even been tentatively valued:

i. Sums dues to the plaintiff from accounts and FDR held by Mr.Anandmoy Sinha and/or in joint name with plaintiff (Para 28 & prayer cl. 'g').

ii. Refund all amounts out of share of plaintiff (para 28, line 10 & prayer cl. 'g').

iii. Defendant No.1 to furnish all details and accounts of all transactions in respect of sale of property at Mahavir Vihar and sale proceeds of flats at Khasra No.79/11, Mahavir Enclave, Palam (para 28 and prayer cl. 'd'& 'g').

4. Mr. Gupta, lastly submits that the present suit is also barred under Section 69(1) of the Indian Partnership Act, 1932. He states that the suit filed by the plaintiff claiming herself to be a partner in an alleged ongoing partnership firm-defendant No.3 is not maintainable as the firm is not registered.

5. On the other hand, Mr. Avneesh Garg, learned counsel for plaintiff points out that in accordance with Clause 17 of the Partnership Deed dated 01st April, 1992, the share of the deceased partner Mr. Anandmoy Sinha had

to go to his legal representatives. He submits that Sections 106 and 110 of the Limitation Act, 1963 apply to the present case as the plaintiff is seeking her right in the joint family properties including the partnership firm. He submits that partners of a partnership firm are co-owners of a property of the partnership firm.

6. Without prejudice to the aforesaid, Mr. Garg states that from the date of the death of the husband of plaintiff, defendant No.1 had been illegally continuing the partnership firm and consequently, the present suit is maintainable as it is a case of continuous cause of action.

7. Mr. Garg contends that defendant No.1 has not precisely specified as to what is the deficiency in Court-fees. He states that the following sufficient Court-fees has been paid by the plaintiff:-

       Relief No.           Relief Sought                Court Fees Paid
         a)         Declaration                            Rs.20/-
         b)         Declaration                            Rs.20/-
         c) & (d)   Rendition of Accounts                Rs.2832/-
         (e)        Plaintiff's share in profits         Rs.26,744/-
                    (Tentative and subject to
                    Prayer (c))
       (f) & (g)    Injunction                       Rs.20/- each
                    Total Court Fee Payable              Rs.29,656/-
                    Court Fee Paid                       Rs.30,000/-
                    Excess Court Fees Paid                Rs.344/-

8. Mr. Garg states that no objection has been raised either in the written statement or in the application that the present suit is barred under Section 69(1) of the Indian Partnership Act, 1932.

9. Without prejudice to the aforesaid, he submits that Section 69(1) creates a bar only to such suits which are brought by a partner of the firm. He points out that in the present case the plaintiff has yet to be given a status of a partner of the defendant No.3-firm.

10. In rejoinder, Mr. Gupta, learned counsel for defendant No.1 submits that Section 106 of the Limitation Act, 1963 cannot be invoked as defendant No.1 is not an executor of the Will. He states that defendant No.1 would have been executor only if Mr. Bankim Chandra Sinha had pre-deceased Mr. Anand Moy Sinha--which eventuality did not occur. Mr. Gupta contends that since Mr. Anand Moy Sinha died in April, 2006 and Mr. Bankim Chandra Sinha died on 18th May, 2012 and no relief had been sought during the lifetime of Mr. Bankim Chandra Sinha, present suit is not maintainable.

11. Having heard learned counsel for the parties, this Court is of the view that an application for rejection of the plaint under Order VII Rule 11 CPC can be allowed only if all the allegations in the plaint taken in their entirety at their face value to be correct, appear to be barred by any law.

12. For deciding the present application as to whether a suit is barred by limitation or not, only the averments made in the plaint are relevant. At this stage, the Court would not be entitled to consider the defence of the defendants. In Balasaria Construction (P) Ltd. vs. Hanuman Seva Trust and Others, (2006) 5 SCC 658, the Supreme Court held as under:-

"8. After hearing counsel for the parties, going through the plaint, application under Order 7 Rule 11(d) CPC and the judgments of the trial court and the High Court, we are of the opinion that the present suit could not be dismissed as barred by limitation without proper pleadings, framing of an issue of

limitation and taking of evidence. Question of limitation is a mixed question of law and fact. Ex facie in the present case on the reading of the plaint it cannot be held that the suit is barred by time. The findings recorded by the High Court touching upon the merits of the dispute are set aside but the conclusion arrived at by the High Court is affirmed. We agree with the view taken by the trial court that a plaint cannot be rejected under Order 7 Rule 11(d) of the Code of Civil Procedure."

13. Upon a perusal of the plaint, this Court is of the view that the present suit has been filed by the plaintiff for recovery of immovable properties and shares/profits in a partnership firm which she claims had been bequeathed in her favour by her late husband by way of a registered Will dated 02 nd December, 2012.

14. This Court is of the opinion that in view of the averments in the plaint, present suit would be covered by Article 106 and not by Article 58 of the Schedule attached to the Limitation Act, 1963. Article 106 of the Schedule to the Limitation Act, 1963 reads as under:-

 Sl.          Description of suit       Period of       Time from which period
 No.                                    limitation           begins to run

106. For a legacy or for a share of a Twelve years When the legacy or share residue bequeathed by a becomes payable or testator or for a distributive deliverable.

share of the property of an intestate against an executor or an administrator or some other person legally charged with the duty of distributing the estate.

15. Consequently, this Court is of the view on the basis of the averments in the plaint, the limitation for the present suit would be twelve years and even if the cause of action is presumed to have arisen on 14th April, 2006 as alleged by the defendant No.1, then also the suit would be within limitation.

16. As far as the allegation of shortfall in Court-fees is concerned, this Court finds that the plaintiff has valued the relief of declaration, permanent and mandatory injunction, rendition of accounts as well as recovery of profits separately.

17. As far as the reliefs stated to have been not valued, this Court finds that they are not reliefs, but in fact, averments in paragraph 28 of the plaint.

18. Moreover, as the accounts and sale proceeds are not within the knowledge of the plaintiff, she cannot be asked to pay the Court-fees with regard to the amounts that have to be paid by the defendant No.1 either under prayers (g) or (d) of the prayer clause.

19. In any event, learned counsel for plaintiff has undertaken before this Court that plaintiff shall pay any shortfall in Court-fees within a period of four weeks of the suit being decreed. The said undertaking is accepted by this Court and plaintiff is held bound by the same. It is further diected that in the event, the shortfall in Court-fees is not paid, the decree, if any, passed in favour of the plaintiff shall not be executed.

20. Consequently, the plea of deficiency in Court-fees cannot be accepted at this stage.

21. This Court upon reading of the plaint is also of the view that the reliefs sought in the present suit fall within the exception envisaged in Section 69(3) of the Indian Partnership Act, 1932. The relevant portion of Section 69(3) is reproduced hereinbelow:-

"69. Effect of non-registration-

(3) The provisions of sub-sections (1), (2) and (2A) shall apply also to a claim of setoff or other proceedings to enforce a right arising from a contract but shall not affect,-

(a) the firms constituted for a duration upto six months or with a capital upto two thousand rupees; or;

(b) the powers of an official assigned, receiver or Court under the Presidency Towns Insolvency Act, 1909, or the Provincial Insolvency Act, 1920, to realise the property of an insolvent partner."

22. In the opinion of this Court, plaintiff by way of the present suit in essence seeks either accounts of a dissolved firm or to release the property of a dissolved firm.

23. In any event, this Court is in agreement with the argument of learned counsel for the plaintiff that the plaintiff has yet to be given the status of a partner of defendant No. 3-firm.

24. In view thereof, this Court is of the view that the present application is bereft of merits. It is accordingly dismissed.

CS(OS) 2409/2014 & IA Nos. 15113/2014, 15115/2014, 20455/2014, 21521/2014, 21824/2014, 2003/2015, 4008/2015, 4217-4218/2015, 4291/2015, 7366/2015

Defendant No.1 is personally present in Court. His statement under Order 10 CPC has been recorded separately.

Since the defendant No.1 now wants to engage a new counsel, present case is adjourned to 20th May, 2015. It is made clear that the application for appointment of a Receiver shall be taken for hearing on the next date of hearing.

                                                          MANMOHAN, J
APRIL 24, 2015
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+      CS(OS) 2409/2014               Sarla Bala Sinha
                                          Vs.
                                      Sarat Chandra Sinha & Ors

Statement of Mr. Sarat Chandra Sinha, resident of 563, Mantola, Paharganj, New Delhi, On S.A.

I was paying to my mother Rs.10,000 to Rs.15,000 per month. In fact, I used to pay whatever amount she used to demand in cash. The payments made to my mother are not reflected in the account books of defendant No.3 as I was getting salary and from my salary I was making payment to my mother.

Till 2010, I was not withdrawing any money from defendant No.3 as we were a joint family till that time.

Q. From 18th May, 2012, have you filed any income tax returns? A. Yes. I have filed my income tax returns in a sealed cover. Q. In the income tax returns, have you shown the payments paid to your mother?

A. I have not made any specific withdrawal from the sole proprietorship firm in favour of my mother.

Q. In view of Clause 17 of the Partnership Deed dated 01st April, 1992, how was the Partnership Deed constituted between you and late Mr. Bankim Chandra Sinha to the exclusion of the plaintiff?

A. After the death of my father, my mother refused to join the partnership firm. At that stage the partnership firm had huge liabilities and my mother did not want to become a partner. This would be apparent from the fact that the Partnership Deed dated 27th April, 2006 executed between me and my late brother Mr. Bankim Chandra Sinha was witnessed by my mother. Q. Did your father die intestate or did he leave behind a Will? A. I am not aware whether my father left behind any Will. I have come to

know about the Will for the first time only in the present proceedings. Q. What is your stand with regard to this Will?

A. Unless and until I see the original Will, I cannot comment on it.

(At this stage, defendant No.1 is shown a certified copy of the Will dated 02nd December, 2002 filed by the plaintiff.)

I cannot say whether the document shown to me is a genuine Will or not. Defendant No.3 as of today is a sole proprietorship firm. In fact, after the death of my youngest brother Mr. Bankim Chandra Sinha, defendant No.3 became a sole proprietorship firm.

Q. In view of Clause 18 of the Partnership Deed dated 27th April, 2006, with your brother how did you convert defendant No. 3 into a sole proprietorship firm?

A. I did not follow the mandate of Clause 18 of the Partnership Deed dated 27th April, 2006 as my mother verbally directed me to form a proprietorship firm. Defendant no. 2 was a witness to the same.

Q. Have you pleaded this defence in written statement?

A.     No.




RO&AC                                                       MANMOHAN, J



APRIL 24, 2015