Kerala High Court

C.M. Asha vs Nishanth on 20 June, 2025

Author: Sathish Ninan

Bench: Sathish Ninan

                                                           2025:KER:44043


               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                PRESENT

               THE HONOURABLE MR. JUSTICE SATHISH NINAN

                                   &

              THE HONOURABLE MR.JUSTICE P. KRISHNA KUMAR

        FRIDAY, THE 20TH DAY OF JUNE 2025 / 30TH JYAISHTA, 1947

                          RFA NO. 127 OF 2020

        AGAINST THE JUDGMENT DATED 20.12.2019 IN OS NO.70 OF 2015 OF

                          SUB COURT, KANNUR

                                 -----

APPELLANT/PLAINTIFF:

            NISHANTH,
            S/O. RAJAN, AGED 55 YEARS, 'ANJANAM', NEAR WATER TANK,
            ONDEN PARAMBA, KAKKAD, KANNUR-670 005.


            BY ADVS.
            SRI.ABDUL RAOOF PALLIPATH
            SHRI.E.MOHAMMED SHAFI




RESPONDENTS/DEFENDANTS:

    1       C.M.ASHA, [ADDRESS REPLACED]*1
            D/O. LATE P.C.RAGHAVAN, AGED 71 YEARS, M.A. ROAD,
            KANNUR-670001.

    2       C.M.SUDHA, [ADDRESS REPLACED]*1
            D/O. LATE P.C.RAGHAVAN, AGED 67 YEARS, P.C.RAGHAVAN &
            SONS, M.A.ROAD, KANNUR-670 001.

    3       C.M.BEENA, [ADDRESS REPLACED]*1
            D/O. LATE P.C.RAGHAVAN, AGED 65 YEARS, P.C.RAGHAVAN &
            SONS, M.A ROAD, KANNUR-670 001.
                                                                    2025:KER:44043


RFA NO. 127 OF 2020                -2-


    4       SUMANTH, [ADDRESS REPLACED]*1
            S/O. SUDHAS, AGED 48 YEARS, S/O. LATE P.C.RAGHAVAN,
            P.C.RAGHAVAN & SONS, M.A ROAD, KANNUR-670 001.

*1[THE CAUSE TITLE OF THE APPEAL IS AMENDED BY REPLACING THE
ADDRESS OF THE RESPONDENTS WITH THE BELOW MENTIONED ADDRESS AS PER
ORDER DATED 02/12/2021 IN IA 2/2021]

    1       C.M. ASHA, D/O LATE P.C. RAGHAVAN, AGED 72 YERS, M.A.
            ROAD, KANNUR-670001.

            (NOW RESIDING : 'SHEETHAL', NEAR CHRISTIAN COLLEGE,
            WAYANAD, KANNUR-673001)

    2       C.M.SUDHA, D/O LATE P.C. RAGHAVAN, AGED 68 YEARS, P.C.
            RAGHAVAN & SONS, M.A. ROAD, KANNUR-670001.

    3       DR. BEENA C.M., D/O LATE P.C. RAGHAVAN, AGED 66 YEARS,
            P.C. RAGHAVAN & SONS, M.A. ROAD, KANNUR-67001.

            (NOW RESIDING AT : PONNARATH HOUSE, NEAR THIRUMALA
            TEMPLE, PERUNNA, CHANGASSERY, KOTTAYAM-686102.)

    4       SUMANTH, S/O SUDHAS, AGED 49 YEARS, S/O LATE P.C.
            RAGHAVAN, P.C. RAGHAVAN & SONS, M.A. ROAD,
            KANNUR-670001.

            (NOW RESIDING : 'SHEETHAL', NEAR CHRISTIAN COLLEGE,
            WAYANAD ROAD, CALICUT-673005.)

            BY ADVS.
            SHRI.SHYAM PADMAN (SR.)
            SHRI.C.M.ANDREWS
            SMT.BOBY M.SEKHAR
            SMT.LAYA MARY JOSEPH
            SHRI.HARISH ABRAHAM
            SMT.ASHWATHI SHYAM
            SHRI.MUHAMMED SUHAIL THANGAL.A



     THIS   REGULAR   FIRST   APPEAL   HAVING   COME   UP   FOR   HEARING    ON
20.06.2025, ALONG WITH RFA.26/2022, THE COURT ON THE SAME DAY
DELIVERED THE FOLLOWING:
                                                            2025:KER:44043




               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                               PRESENT

               THE HONOURABLE MR. JUSTICE SATHISH NINAN

                                   &

              THE HONOURABLE MR.JUSTICE P. KRISHNA KUMAR

        FRIDAY, THE 20TH DAY OF JUNE 2025 / 30TH JYAISHTA, 1947

                          RFA NO. 26 OF 2022

        AGAINST THE JUDGMENT DATED 20.12.2019 IN OS NO.70 OF 2015 OF

                          SUB COURT, KANNUR

                                 -----

APPELLANTS/DEFENDANTS:

    1       C.M. ASHA,
            D/O.LATE P.C.RAGHAVAN, AGED 65 YEARS, BUSINESS,
            P.C.RAHAVAN AND SONS, M.A.ROAD, KANNUR - 670 001.

    2       C.M.SUDHA,
            D/O.LATE P.C.RAGHAVAN, AGED 62 YEARS, BUSINESS,
            P.C.RAGHAVAN AND SONS, M.A.ROAD, KANNUR - 670 001.

    3       C.M.BEENA,
            D/O.LATE P.C.RAGHAVAN, AGED 60 YEARS, BUSINESS,
            P.C.RAGHAVAN AND SONS, M.A.ROAD, KANNUR - 670 001.

    4       SUMATH,
            S/O.SUDHAS, AGED 43 YEARS, BUSINESS, P.C.RAGHAVAN AND
            SONS, M.A.ROAD, KANNUR - 670 001.


            BY ADVS.
            SHRI.SHYAM PADMAN (SR.)
            SHRI.C.M.ANDREWS
            SMT.BOBY M.SEKHAR
            SMT.LAYA MARY JOSEPH
            SHRI.HARISH ABRAHAM
            SMT.ASHWATHI SHYAM
            SHRI.MUHAMMED SUHAIL THANGAL.A
                                                                     2025:KER:44043




RFA NO. 26 OF 2022                     -2-


RESPONDENT/PLAINTIFF:

            NISHANTH,
            S/O.RAJAN, AGED 47 YEARS, BUSINESS, 'ANJANAM',
            NEAR WATER TANK, ORDEN PARAMBA, KAKKAD,
            KANNUR - 670 005.


            BY ADVS.
            SRI.ABDUL RAOOF PALLIPATH
            SHRI.E.MOHAMMED SHAFI



     THIS   REGULAR   FIRST   APPEAL    HAVING   COME   UP   FOR   HEARING    ON
20.06.2025, ALONG WITH RFA.127/2020, THE COURT ON THE SAME DAY
DELIVERED THE FOLLOWING:
                                                           2025:KER:44043
                         SATHISH NINAN &
                     P. KRISHNA KUMAR, JJ.
              = = = = = = = = = = = = = = = = = =
             R.F.A. Nos.127 of 2020 & 26 of 2022
              = = = = = = = = = = = = = = = = = =
             Dated this the 20th day of June, 2025

                         J U D G M E N T

Sathish Ninan, J.

The preliminary decree in a suit for partition is

under challenge both by the plaintiff and the

defendants, in the respective appeals.

2. The property sought to be partitioned has an

extent of 3 cents with a building thereon and the

hardware business being conducted therein under the name

and style "PC Raghavan and Sons". Defendants 1 to 3 are

the daughters of late P.C. Raghavan. The plaintiff is

the son of the first defendant. The 4 th defendant is the

son of the second defendant.

3. According to the plaintiff, the plaint schedule

property belonged to late P.C. Raghavan. He was

conducting a hardware business therein. Later he

converted it into a partnership business by including R.F.A. Nos.127 of 2020 & 26 of 2022

2025:KER:44043

defendants 1 to 3. Raghavan died in the year 1987. He

had executed Ext.A1 Will, bequeathing the plaint

schedule property. Under the bequest, the plaintiff is

entitled to 15% shares. Alleging that the defendants

refused partition, the suit was filed.

4. Defendants admitted that late Raghavan was the

original title holder of the property and the business.

They also admitted that Raghavan constituted a firm for

doing his business. The execution of Ext.A1 Will by

Raghavan was also admitted. It was contended that the

plaintiff is not a partner of the firm and is not

entitled for partition and profits.

5. The trial court held that the plaintiff is not a

partner of the firm and that the plaintiff is not

entitled to seek for partition of the business. It

proceeded to hold that the plaint schedule property,

excluding the business, is liable to be partitioned.

6. We have heard Sri.E.Mohammed Shafi, learned

counsel for the appellants and Sri.Sham Padman, the R.F.A. Nos.127 of 2020 & 26 of 2022

2025:KER:44043

learned senior counsel for the respondents.

7. The points that arise for consideration in this

appeal are :-

(i) Is the plaint schedule property a partnership asset?

(ii) Is the plaintiff a partner in the partnership firm - M/s P.C.Raghavan and sons?

(iii) What is the right of the plaintiff over the plaint schedule property and the business being conducted thereon?

(iv) Does the decree and judgment of the trial court warrant any interference?

8. The fact that the plaint schedule property with

the business, originally belonged to late Raghavan is

not in dispute. Ext.A1 is the Will dated 28.05.1986

executed by late Raghavan. The recitals in Ext.A1 Will

is unambiguous that he was doing business in the

property by constituting a partnership firm. The factum

of constitution of a firm by Raghavan along with

defendants 1 to 3 as partners, is also not in dispute.

The recitals in Ext.A1 Will is explicit that

Sri.Raghavan had brought in the plaint schedule property R.F.A. Nos.127 of 2020 & 26 of 2022

2025:KER:44043

as a partnership asset, in which, the business of the

firm was conducted. On the constitution of the firm,

Raghavan himself had only a share over the partnership

asset including the land and business.

9. It is the case of the plaintiff that, under

Ext.A1 Will he has become a partner entitled to 15%

shares over the property and the business. As per Ext.A1

Will, the shares held by him in the firm were bequeathed

to the legatees thereunder. Under Ext.A1 Will, the

plaintiff has been bequeathed 15% shares from out of the

shares held by him. It is from whatever share that

Raghavan had in the partnership, that 15% shares was

bequeathed to the plaintiff. The plaintiff was not

inducted as a partner after the death of

Sri.P.C.Raghavan. Partnership is created by agreement.

Unless all the partners agree, no person can be brought

into the firm as a partner. Partnership arises from

contract and not from status (S.5 Partnership Act). The

plaintiff is the representative of a deceased partner. R.F.A. Nos.127 of 2020 & 26 of 2022

2025:KER:44043

Section 37 of the Partnership Act provides the right of

the representative of a deceased partner. The Section

reads thus:-

"37. Right of outgoing partner in certain cases to share subsequent profits.-- Where any member of a firm has died or otherwise ceased to be a partner, and the surviving or continuing partners carry on the business of the firm with the property of the firm without any final settlement of accounts as between them and the outgoing partner or his estate, then, in the absence of a contract to the contrary, the outgoing partner or his estate is entitled at the option of himself or his representatives to such share of the profits made since he ceased to be a partner as may be attributable to the use of his share of the property of the firm or to interest at the rate of six percent per annum on the amount of his share in the property of the firm. (Proviso omitted as not relevant)"

Going by the Section, the right of the plaintiff is,

either to claim the share of profits attributable to his

share in the property of the firm or, to interest at the

rate of 6% per annum on the amount of his share in the

property of the firm. Therefore, the right of the

plaintiff is either to claim the share of profits made

since the death of Raghavan attributable to the use of

the plaintiff's share of the property of the firm which R.F.A. Nos.127 of 2020 & 26 of 2022

2025:KER:44043

he obtained under the Will, or to claim interest at the

rate of 6% per annum on the amount of his share in the

property of the firm.

10. During the subsistence of the partnership

though the assets vest in the partners, none of them can

deal with any specific property as his own. In Addanki

Narayanappa v. Bhaskara Krishnappa (AIR 1966 SC 1300) the Apex Court

held,

"...whatever may be the character of the property which is brought in by the partners when the partnership is formed or which may be acquired in the course of the business of the partnership it becomes the property of the firm and what a partner is entitled to is his share of profits, if any, accruing to the partnership from the realisation of this property, and upon dissolution of the partnership to a share in the money representing the value of the property. No doubt, since a firm has no legal existence, the partnership property will vest in all the partners and in that sense every partner has an interest in the property of the partnership. During the subsistence of the partnership, however, no partner can deal with any portion of the property as his own. Nor can he assign his interest in a specific item of the partnership property to anyone. His right is to obtain such profits, if any, as fall to his share from time to time and upon the dissolution of the firm to a share in the assets of the firm which remain after satisfying the liabilities set out in Cl. (a) and sub-Cls.

(i), (ii) and (iii) of Cl. (b) of S.48. It has been stated in Lindley on Partnership, 12th ed. At p. 375:

R.F.A. Nos.127 of 2020 & 26 of 2022

2025:KER:44043

"What is meant by the share of a partner is his proportion of the partnership assets after they have been all realised and converted into money, and all the partnership debts and liabilities have been paid and discharged. This it is, and this only which on the death of a partner passes to his representatives, or to a legatee of his share ........ and which on his bankruptcy passes to his trustee."

The right of the plaintiff is only in terms of Section

37. The prayer for partition is misconceived. The trial

court could not have passed a decree for partition of

the partnership property. The decree and judgment of the

trial court is thus liable to be interfered with.

11. We do notice that the plaint contains a relief

for share of profits. The trial court has denied the

claim holding that, the plaintiff not being a partner,

is not entitled to share of profits. Evidently this is

contrary to the rights provided to the representative of

a deceased partner under Section 37 of the Partnership

Act. The said finding is liable to be set aside and we