Karnataka High Court

M/S Mangal Deep vs Shri Muralidhar on 8 February, 2022

Bench: Sachin Shankar Magadum

                                                         R
              IN THE HIGH COURT OF KARNATAKA
                      DHARWAD BENCH

           DATED THIS THE 8TH DAY OF FEBRUARY 2022

                           BEFORE

      THE HON'BLE MR. JUSTICE SACHIN SHANKAR MAGADUM

     REGULAR SECOND APPEAL NO.100003 OF 2014 (DEC & INJ)
                            C/W
           REGULAR SECOND APPEAL NO.2105 OF 2013

IN REGULAR SECOND APPEAL NO.100003 OF 2014
BETWEEN

1.      M/S. MANGAL DEEP
        A REGISTERED PARTNERSHIP FIRM
        STALL NO. 7 HDMC COMPLEX,
        SUBHASH ROAD, DHARWAD-580001.
        REPRESENTED BY ITS PARTNER
        BHAWARLAL RUPAJI CHAVAN

2.      BASILAL PRABHURAMJI SHARMA
        AGE: 63 YEARS
        OCC: PARTNER OF M/S. MANGAL DEEP
        STALL NO. 7, HDMC, COMPLEX
        SUBHASH ROAD,
        DHARWAD -580001

3.      BHAVARLAL S/O. ROOPAJI CHOUHAN
        AGE: 61 YEARS,
        OCC: PARTNER OF M/S. MANGAL DEEP
        STALL NO. 7, HDMC, COMPLEX
        SUBHASH ROAD,
        DHARWAD-580001
                                               ...APPELLANTS
(BY SRI. V. M. SHEELAVANT, ADV., FOR SRI. M L VANTI, ADV., )
                              2




AND
1.    MURALIDHAR S/O. NARAYANAPPA HEBSUR
      AGE: MAJOR,
      OCC: ALLEGED TO BE RETIRED
      PARTNER OF M/S. MANGAL DEEP
      REGISTERED PARTNERSHIP FIRM
      STALL NO. 7 HDMC COMPLEX,
      SUBHASH ROAD,
      DHARWAD -580001.

2.    PRATAP S/O. ROOPJI CHOUHAN
      AGE: 55 YEARS,
      OCC: PARTNER OF M/S. MANGAL DEEP
      STALL NO. 7, HDMC COMPLEX,
      SUBHASH ROAD,
      DHARWAD -580001.

3.    AMBALAL S/O. DHULAJI CHOUHAN
      AGE: 58 YEARS,
      OCC: BUSINESS PARTNER OF
      M/S. MANGAL DEEP,
      STALL NO. 7, HDMC COMPLEX,
      SUBHASH ROAD, DHARWAD-580001.

4.    M/S. N. I. HEBSUR & SONS, HUBLI
      AN ALLEGED REGISTERED PARTNERSHIP FIRM,
      BY ONE OF ITS PARTNER,
      SRI. I. N. HEBSUR,
      AGE: MAJOR, OCC: BUSINESS,
      R/O. DESHPANDENAGAR, HUBLI,
      DIST:DHARWAD-580001

                                           ...RESPONDENTS
(BY SRI. C. N. HARLAPUR, ADV., FOR C/R1;
SRI. S. S. BAWAKHAN, ADV., FOR R1)

      THIS RSA IS FILED UNDER SECTION 100 R/W ORDER XLI
RULE 1 OF CPC, PRAYING TO SET ASIDE THE JUDGMENT AND
DECREE DATED 18.12.2013 PASSED IN R.A.NO.86/2011 BY THE
                               3




PRINCIPAL SENIOR CIVIL JUDGE AND CJM, DHARWAD, AND THE
JUDGMENT    AND   DECREE     DATED   23.07.2011    PASSED    IN
O.S.NO.193/1998   BY   THE   PRINCIPAL   CIVIL     JUDGE    AND
PRINCIPAL J.M.F.C., DHARWAD IN THE INTEREST OF JUSTICE
AND EQUITY.


IN REGULAR SECOND APPEAL NO.2105 OF 2013
BETWEEN

1.    M/S. MANGAL DEEP
      A REGISTERED PARTNERSHIP FIRM
      STALL NO. 7 HDMC COMPLEX,
      SUBHASH ROAD, DHARWAD-580001.
      REPRESENTED BY ITS PARTNER
      BHANSILAL S/O. PRABHURAMJI SHARMA

2.    BASILAL PRABHURAMJI SHARMA
      AGE: 63 YEARS
      OCC: PARTNER OF M/S. MANGAL DEEP,
      STALL NO. 7, HDMC, COMPLEX
      SUBHASH ROAD,
      DHARWAD -580001

3.    BHAVARLAL S/O. ROOPAJI CHOUHAN
      AGE: 61 YEARS,
      OCC: PARTNER OF M/S. MANGAL DEEP
      STALL NO. 7, HDMC, COMPLEX
      SUBHASH ROAD,
      DHARWAD-580001
                                                  ...APPELLANTS
(BY SRI. V. M. SHEELAVANT, ADV.,)

AND
1.    MURALIDHAR S/O. NARAYANAPPA HEBSUR
      AGE: MAJOR,
      OCC: PARTNER OF M/S. MANGAL DEEP
      REGISTERED PARTNERSHIP FIRM
                                4




     STALL NO. 7 HDMC COMPLEX,
     SUBHASH ROAD,
     DHARWAD -580001.

2.   AMBALAL S/O. DHULAJI CHOUHAN
     AGE: 58 YEARS,
     OCC: BUSINESS PARTNER OF
     M/S. MANGAL DEEP
     STALL NO. 7, HDMC COMPLEX,
     SUBHASH ROAD,
     DHARWAD-580001.

3.   PRATAP S/O. ROOPJI CHOUHAN
     AGE: 55 YEARS,
     OCC: PARTNER OF M/S. MANGAL DEEP
     STALL NO. 7, HDMC COMPLEX,
     SUBHASH ROAD,
     DHARWAD -580001.
                                              ...RESPONDENTS
(BY SRI. C. N. HARLAPUR, ADV., AND
SRI. S. S. BAWAKHAN, ADV., FOR R1;
R2 AND R3 - NOTICE SERVED)

     THIS RSA IS FILED UNDER SECTION 100 R/W ORDER XLI
RULE 1 OF CPC, PRAYING TO SET ASIDE THE JUDGMENT AND
DECREE DATED 18.12.2013 PASSED IN R.A.NO.88/2011 BY THE
PRINCIPAL SENIOR CIVIL JUDGE AND CJM, DHARWAD, AND THE
JUDGMENT     AND   DECREE     DATED   23.07.2011   PASSED    IN
O.S.NO.197/1999    BY   THE   PRINCIPAL   CIVIL    JUDGE    AND
PRINCIPAL J.M.F.C., DHARWAD IN THE INTEREST OF JUSTICE
AND EQUITY.

     THESE REGULAR SECOND APPEALS COMING ON FOR
FINAL HEARING, THIS DAY, THE COURT DELIVERED THE
FOLLOWING:
                                5




                          JUDGMENT

These two captioned regular second appeals are

filed questioning the judgment and decree arising out of

O.S.No.193/1998 and O.S.No.197/1999. The appellants

in RSA No.2105/2013 are assailing the judgment and

decree passed in O.S.No.197/1999 and also the judgment

rendered in R.A.No.88/2011. O.S.No.197/1999 was filed

seeking the relief of mandatory injunction. RSA

No.100003/2014 is filed by the plaintiffs in O.S.No.193/

1998 questioning the judgment and decree passed in

O.S.No.193/1998 and also the judgment and decree

rendered by the First Appellate Court in R.A.No.86/2011.

The appellants in RSA No.100003/2014 filed suit in

O.S.No.193/1998 for declaration and injunction against

the respondents herein.

2. Both the appeals were heard together on

admission and this Court has admitted these appeals on

02.02.2022 by formulating following substantial question

of law.

"Whether the judgment and decree of the First Appellate Court is in gross violation of provisions of Order XLI Rule 30 and 31 and also Section 107 of CPC?"

3. The appellants in these appeals feeling

aggrieved by the common judgment and decree passed

by the First Appellate Court in R.A.No.88/2011 and

R.A.No.86/2011 are before this Court. The First Appellate

Court while deciding the appeals has not at all applied its

mind and therefore, this Court having examined the

judgment and decree passed by the First Appellate Court

has formulated the top noted substantial question of law.

The short point that would arise for consideration in the

present appeals is as to whether the First Appellate Court

has independently assessed the ocular and documentary

evidence let in by the parties. My answer to it is no. The

same can be gathered from the manner in which the First

Appellate Court has decided the appeal. It would be

useful for this Court to cull out the relevant portion of the

judgment rendered by the First Appellate Court which

starts at paragraph 20 and closes at paragraph 27:

"20. Before discussing the oral evidence of the respective parties, it is necessary to see the documentary evidence. Ex.D-24 to Ex.D28 are the main documents to the cause for the present lis. Ex.D- 24 is the deed of partnership of M/s. Mangaldeep, Dharwad made on 13.05.1982 and partners are shown at Sl.No. 1 to 5 i.e., party to the suit O.S.No.510/97 wherein they admitted the R-1 as party No.5 of their firm and shifted the place of business to shop No.7 and urged about their share of profit and loss and it is one of the covenant mentioned at Sl.No.17 of the said agreement which reads thus:

"It is hereby further agreed that in case of dissolution of the partnership or changes of its premises, the partners No.1 to 4 shall not have any right whatsoever in the premises and furnitures and fittings of the firm. Partner No.5 viz; Shri M. N. Hebsur alone shall have absolute right in the said premises, furnitures and fittings

and other partners shall not be entitled to any amount payable in this behalf as compensation, cost or any other things. However, said partner No.5, Shri. M. N. Hebsur shall not have any right in respect of good will of the firm's business or its name"

21. Ex.D-27 and 28 which are clarification and one letter of partners of M/s Mangaldeep that it is clear that one Hebsur is having only right over stall No.7 and Ex.D-25 is the letter addressed to M. N. Hebsur from one Asst. Engineer (Electrical) HDMC., wherein permission was accorded to the M. N. Hebsur for additional power to the stall No.7 and Ex.D.26 is the Memorandum of understanding between the partners of the firm on 1st day March 1982 wherein it is one of the conditions mentioned that:

"5th party as long as continue in the partnership of M/s Mangaldeep, the firm can continue its business in the premises of stall No.7. If the party No.5 retires from the partnership firm and parties 1 to 4 will have to shift their business elsewhere, immediately."

Such being the understanding between the parties of the firm, appellants' firm namely M/s Mangaldeep have no right to continue in the stall No.7 when M.N.Hebsur is claiming that he is retired from the said firm.

22. Further it is agreed between them that if M.N.Hebsur is not interested to continue in the business of M/s Mangaldeep firm, the other partner No.1 to 4 of the said firm shall have to shift their business from stall No.7 to elsewhere immediately. Under these circumstances, the partners of the M/s Mangaldeep firm whoever may be have no right to say against either M. N. Hebsur or M/s N. I. Hebsur & sons.

23. No doubt, number of litigations have been pending between the parties in the court of law. But party must understand an agreement between them otherwise there is no end for lis.

24. I have very well remember the arguments canvassed by the learned senior counsel for both parties. The counsel for the appellants has argued vehemently and noticed about legal points regarding maintainability of the suit O.S.No.17\97/99 and relied upon number of decisions reported below:

Suit by a partner or a firm Order 30 of C.P.C.

1. AIR 1970 RAJ page:86

2. AIR 1969 Guj page: 178

3. AIR 1961 SC page : 325

4. AIR 1978 Delhi Page: 255

5. AIR 1995, Part VI page: 84

6. ILR 1922, Part I, KAR page: 955

7. 2008 Part IV KCCR page: 2234

8. 2012 Part I KCCR SN 6.

9. 2012 Part II SCC page: 196

Partnership at Will:

1. 1966 SC page: 1300

2. AIR 1970 MAD page: 5

3. AIR 2002 AP page: 389

Sec. 23,31,32 and 72 of the Indian Partnership Act,

1. AIR 1959 AP 116

Assets of the firm:

1. AIR 1993 BOM page: 30

Partnership at Will

1. AIR 1991 CAL, page: 195 Section 20 of CPC

1. AIR 2006 SC page: 1828

Arbitration Clause:

2008 part I RAJ - Civil Journal Dinesh Jangi Vs. Laxmikant Jangid.

Retirement of a partner:

AIR 1959 AP page: 116

Not partnership agreement:

AIR 1973 CAL page: 193

1. AIR 1952 AP Page : 837

2. AIR 1957 CAL page: 336

3. AIR 1957 CAL page: 620

4. KCCR 2005 Part 4 page: 2334

Suit for possession:

1. AIR 2003 SC page: 2508

2. KCCR 2002 Part 2 page: 226

3. KCCR 2002 Part 2, page: 1364

4. AIR 2002 KAR page: 3 to 6

5. AIR 2000 Gouhatti pg: 173

6. ILR 2006 KAR page: 4251

7. KCCR 2011 part 3 page: 2123.

Assignee of firm:

1. AIR 1993 BOM page: 30

Mere suit for mandatory injunction not maintainable:

1. AIR 1978 page: 133

2. AIR 1988 Orissa Page : 117

3. AIR 1900 SC page: 867

4. AIR 1981 J & K page: 78

5. KCCR 2002 Part 4 page: 3514

6. AIR 2012 Part 2 page: 524

7. AIR 2012 SC pg: 1727

Dissolution of title:

1. KCCR 2011 Part 2 page: 1277

25. But, on the other hand, the learned counsel for the respondent/ who is plaintiff in O.S.No.197/1999 also vehemently argued and prayed for confirming the judgment passed by the trial court as it does not suffer any angle.

26. I have gone through the decisions relied upon by the appellants. But, they do not help the appellants in view the agreement entered into between them, as they estopped from taking such contention. On the other hand, I carefully perused the pleadings of the parties, evidence and judgment passed by the trial Court. On perusal of the same, it is made clear that the judgment passed by the trial court is in accordance with law, facts, pleadings and there is no error committed by the trial court while passing the judgment. Accordingly, I have no hesitation to answer Points 1 and 2 in the negative.

27. Point No.3: in view of my findings on Point No.1 and 2, I proceed to pass the following:

4. If the findings recorded by the First Appellate

Court at these relevant paragraphs are examined, then

this Court is of the view that the power which is invested

with the Appellate Court in independently assessing the

entire material on record is not forthcoming from the

judgment under challenge. Section 107(2) of CPC does

invest the Appellate Court with some powers that are

conferred on Court on original jurisdiction. It is a trite law

that it is a bounden duty of the Appellate Court to see

whether the evidence taken as a whole can reasonably

justify the conclusion which the Trial Court arrived at or

whether there is an element of improbability arising

through a number of circumstances which in the opinion

of the Court outweighs such finding. Though the First

Appellate Court has concurred with the findings of the

Trial Court, it is still incumbent on the part of the First

Appellate Court to formulate proper issues that would

arise for consideration in the light of the grounds urged in

regular appeal. The legislature has entrusted a very

important duty to the First Appellate Court and it is for

Appellate Court to decide finally all questions on facts on

which the disposal of the suit might depend. The First

Appellate Court has to make an honest endeavor to make

a proper apprising of the merits of the case put up by the

parties. But on plain reading of above culled out

paragraphs of the judgment of the First Appellate Court,

it can be easily inferred that the First Appellate Court has

not taken trouble to give a re-look into the matter. The

First appellate Court being a final fact finding authority

has to exhaustively deal with every contention, which

would be vital and would have a bearing on the

conclusions that are arrived at by the Trial Court. There

must be sufficient discussion to show that it has applied

its own mind to the evidence. The First Appellate Court

has to pronounce the judgment only after applying

judicial mind to the appreciation of evidence and

thereafter has to manifestly convey the judicial thinking

by which it either confirms or reverse with the judgment

of the Trial Court. It is a trite law that the appeal is a

continuation of suit and therefore, the First Appellate

Court is under a bounden duty to revisit over the

disputed questions of fact and thereafter come to a

conclusion. In the process if the First Appellate Court

comes to a conclusion that it cannot accept the reasons

assigned by the Trial Court, then it can divert with the

reasons which are recorded by the Trial Court and while

reversing the decree of the Trial Court, it has to attend all

relevant questions, which would arise for consideration in

the context of issues framed therein and ocular and

documentary evidence which would be let in by the

parties.

5. It would be relevant for this Court to refer to the

principles laid down by the Kerala High Court in the case of

Kurian Chacko v. Varkey Ouseph1 while examining the

AIR 1969 Kerala 316

power of the Appellate Court hearing an appeal under

Section 96 has held as under:

"Civil P.C. (5 of 1908) S.96, S.107 - Duty of appellate Court to consider evidence independently.

An appellate court is the final Court of fact ordinarily and therefore a litigant is entitled to a full and fair and independent consideration of the evidence at the appellate stage. Anything less than this is unjust to him. No supplementing of appreciation is contemplated at the appellate stage. But, an independent appraisal of the evidence is the duty of the Court at that level. Failure to do that is an abdication of appellate power. It is the appellate Court's function not to find out whether there is perversity in the trial Court's judgment but whether it is wrong. There is very wide difference between a wrong conclusion and a perverse conclusion. A restricted revisional jurisdiction may be invoked under certain statutes only where there is perversity in the findings but the wider appellate jurisdiction conferred under Section 96 of the

Civil P. C., demands a little more effort on the part of the appellate Court in going into the evidence to come to its own conclusion and reversing the trial Court's decision if it is found to be wrong"

(Emphasis supplied)

6. The Full Bench of the Hon'ble Apex Court in the

case of Santosh Hazari v. Purushottam Tiwari

(deceased) by LRs2 has held that the judgment of the

First Appellate Court under Section 96 of CPC read with

Order XLI Rule 1 and 2 of CPC must display conscious

application of mind and record findings supported by

reasons on all issues and contentions.

7. The Full Bench of the Hon'ble Apex Court in the

case of Madhukar and others v. Sangram and others3

reiterating the principles laid down in the case of Santosh

Hazari (supra) has further held that if Court fails to fulfill

its obligations, the parties would not get the true benefit of

(2001) 3 Supreme Court Cases 179

(2001) 4 Supreme Court Cases 756

a first appeal, which is a valuable right on the basis of

which parties have the right to be heard on questions of law

as well as of fact.

8. If the judgment and decree under challenge is

examined in the light of the principles discussed supra, I

am of the view that the Appellate has passed a very cryptic

order and no cogent reasons are forthcoming while ordering

for remand.

9. If the judgment and decree under challenge is

examined in the light of the principles discussed supra, I

am of the view that the judgment is found wanting and

same is contrary to the procedure contemplated under

Section 107 read with Order XLI of CPC and also contrary

to the mandatory provisions of Order XLI Rules 30 and 31

of CPC. Therefore, on this short point, the judgment

rendered by the First Appellate Court is held to be

palpably erroneous and since no reasons are assigned,

the judgment and decree also suffers from perversity. In

that view of the matter, since there is no proper

appreciation of ocular and documentary evidence and the

fact that the same is not done by final fact finding

authority under Section 107 of CPC, this Court, left with

no other alternative than to remand the matter to the

First Appellate Court to formulate proper points that

would arise for consideration and thereafter proceed to

hear the parties and then pass a fresh judgment on

merits in accordance with law based on material on

record. Sine the suits are of the year 1997 and 1998, I

direct the First Appellate Court to decide the case on

merit in accordance with law within a period of three

months from the date of receipt records from the Trial

Court.

10. For the foregoing reasons, the substantial

question of law formulated by this Court is answered in

the affirmative and I proceed to pass the following:

ORDER

Both the appeals are allowed.

The matter stands remitted back to the First appellate Court and since the parties are represented by their respective counsel, they shall appear before the First Appellate Court on 21.03.2022 without expecting notice by the Court and the First Appellate Court shall dispose of the case within three months from that date.