Spur Tank Road Filling Station v. F.Jayakumar & Ors.

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 17..07..2009Coram:THE HONOURABLE MR.JUSTICE G.RAJASURIAS.A.No.888 of 20071. Spur Tank Road Filling Station rep.by its Partner F.Devendran2. F.Devendran... Appellants/Defendants 1 & 2 vs.1. F.Jayakumar2. The General Manager Indian Oil Corporation Indian Oil Bhavan No.139, Nungambakkam High Road Chennai 600 034.3. The Chief Divisional Manager Indian Oil Corporation No.139, Nungambakkam High Road Chennai-34... Respondents/Plaintiff and Defendants 3 & 4.This second appeal is filed under Section 100 of C.P.C. againstthe judgement and decree dated 15.02.2007, passed by the learnedAdditional District Judge, Fast Track Court No.II, Chennai-1 inA.S.No.158 of 2004 reversing the judgement and decree dated31.03.2000 passed by the learned XI Assistant Judge, City CivilCourt, Chennai in O.S.No.9251 of 1987.For Appellants : Mr.A.Natarajan,Sr.counsel for Mr.M.VivekanandanFor Respondents : Mr.T.S.Baskaran for R1 Mr.Anantha Natarajan for R2 and R3 https://hcservices.ecourts.gov.in/hcservices/ JUDGMENTThis second appeal is focussed by the defendants 1 and 2,animadverting upon the judgement and decree dated 15.02.2007, passedby the learned Additional District Judge, Fast Track Court No.II,Chennai-1 in A.S.No.158 of 2004 reversing the judgement and decreedated 31.03.2000 passed by the learned XI Assistant Judge, City CivilCourt, Chennai in O.S.No.9251 of 1987. For convenience sake, theparties are referred to here under according to their litigativestatus before the trial Court.2. Niggard and bereft of details, a summation and summarisationof the relevant facts, as found exemplified from the plaint is setout thus:(i) The plaintiff and his brother defendant No.2 Devendranseparately applied to Indian Oil Corporation (D3 and D4) to obtainlicence to run a petrol bunk; whereupon, Devendran was selected forthe grant of dealership to run the petrol bunk as he happened to be agraduate. (ii) Even though the dealership was in the name of Devendran,nevertheless the plaintiff only invested the funds to run the petrolbunk. Accordingly, the plaintiff invested a sum of Rs.20,000/- andstarted the petrol bunk on 25.12.1979 under the name and style SpurTank Road Filling Station. D2 did not contribute any amount towardsthe said business. (iii) The plaintiff only furnished bank guarantee to the IndianOil Corporation in connection with the dealership. In addition toopening a Bank account with Indian Overseas Bank, Egmore Branch on28.06.1980 in the name of the said petrol bunk, the plaintiffdeposited money in that account so as to enable the bank to stand asguarantor. The plaintiff was fully running the said petrol bunk. Hewas going on investing money in the said business and in order tosafe guard his position, he wanted some arrangements to be made withhis brother Devendran and suggested for forming a partnership betweenthem and get it recorded with the Indian Oil Corporation.(iv) On 06.07.1981, the first defendant sent a letter to theIndian Oil Corporation informing that he was taking the plaintiff asa partner in the petrol bunk business and a reminder dated 09.07.1982was also sent. Whereupon, Indian Oil Corporation, insisted forsending their request in stamp paper as per the instruction of oneChandrasekaran, the then sales Officer of Indian Oil Corporation. (v) The plaintiff and his brother Devendran sent theirwillingness in writing in a stamp paper; whereupon Indian Oil https://hcservices.ecourts.gov.in/hcservices/ Corporation sent a proforma of partnership to the plaintiff and D2and they were asked to fill up the same and submit it to the IndianOil Corporation. The said partnership proforma form was filled by theplaintiff and it was handed over to one C.V.Devarajan, Sales Officerof the Indian Oil Corporation in person by the plaintiff and D2. Infact, the plaintiff and his brother Devendran signed the saidpartnership deed in the presence of the said officer in his officepremises. The said officer verified the signatures of the plaintiffand the first defendant and he also put his signature in it. OneDr.Santhosem Ex.M.P attested the said partnership deed. (vi) The plaintiff got married on 06.09.1983; whereuponmisunderstanding arose between the plaintiff and his brotherDevendran. Owing to such misunderstanding D2 Devendran startedlooking after the petrol bunk. The father of the plaintiff also wassiding with D2 and trying to defeat the interest of the plaintiff,who attempted to obtain a copy of the said partnership deed availablewith Bharat Petroleum in vain. D2 is enjoying the properties of thepartnership business without sharing it with the plaintiff. Hencethe suit to dissolve this partnership.3. Per contra, denying and refuting, challenging and impugningthe allegations/averments in the plaint, the defendants 1 and 2 filedthe written statement, the gist and kernel of them would run thus:The plaintiff had nothing to do with the petrol bunk business.D2 in his individual capacity is owning it as his sole proprietaryfirm. No money was contributed by the plaintiff for such business.No such partnership agreement was signed by the plaintiff and D2 andit was not sent to Indian Oil Corporation. As such, the prayer forseeking dissolution of the alleged partnership is not tenable.Accordingly, he prayed for the dismissal of the suit.4. D3 and D4 filed the written statement, remonstrating andrefuting the allegations/averments made as against D3 and D4 in theplaint as under:(a) The Indian Oil Corporation(I.O.C) granted dealership only infavour of D2 for running the petrol bunk and as per the terms andconditions of allotment of dealership, any variation in suchdealership could be undertaken only with the consent of the IndianOil Corporation.(b) I.O.C. is not aware of the alleged investment made by theplaintiff and it is for the plaintiff to prove this version. Thesecond defendant for the first time wrote a letter dated 05.02.1982to I.O.C. seeking approval for the reorganisation of the dealershipby the admission of the plaintiff as a partner and enclosed a draftof the proposed partnership deed. https://hcservices.ecourts.gov.in/hcservices/ (c) However, D2 subsequently, informed, vide his letter dated07.02.1984, the Indian Oil Corporation that he had given up the ideaof forming the partnership and he wanted to continue the dealershiponly in his name and consequently, run the petrol bunk as a soleproprietary firm. Accordingly, D3 and D4 prayed for the dismissal of the suit.5. D1 and D2 also filed the additional written statement, thewarp and woof of it would run thus:As per Section 68 and 69 of the Indian Partnership Act, the suitis not maintainable. The suit filed for dissolution of such allegedunregistered partnership is not tenable.6. The trial Court framed the relevant issues as under.7. During trial, the plaintiff examined himself as P.W.1and Exs.A1 to A30 were marked. On behalf of the defendants, thesecond defendant examined himself as D.W1 along with D.W.2 and andExs.B1 and B2 were marked.8. Ultimately, the trial court dismissed the suit. Beingaggrieved by and dissatisfied with the judgement of the lower court,the appeal in A.S.No.158 of 2004 was filed before the learnedAdditional District Judge, Fast Track Court No.II, Chennai, whichCourt set aside the judgement of the trial court and decreed the suit.9. Animadverting upon such decreeing of the suit by theAppellate Court, the defendants 1 and 2, have filed this secondappeal on various grounds, the gist and kernel of them would run thus:The first Appellate Court misunderstanding as though there was apartnership, ordered for dissolution and granted the incidentalrelief.Section 69(3) (a) of the Indian Partnership Act wasmisunderstood by the first Appellate Court; the lower court failedto note that the partnership proforma agreement was never approved bythe Indian Oil Corporation.10. My learned Predecessor admitted the second appeal andformulated the following substantial questions of law for decidingthe second appeal."a. Whether the judgement of the lower appellate Courtin reversing the judgement of the trial Court bymisconstruing the provisions of Section 69(3)(a) of theIndian Partnership Act, 1932(9 of 1932) as suit filed bythe third party for dissolution of partnership firm is https://hcservices.ecourts.gov.in/hcservices/ maintainable in law.b. Whether the first respondent is entitled to therelief of dissolution of partnership firm in the absence ofpartnership agreement.c. Whether the first respondent is entitled to file asuit to dissolve a partnership firm which is a proprietorconcern as evidenced by Ex.B1 and was never recognised as apartnership firm by the 3rd and 4th respondents.d. Whether the lower appellate Court is right whiledrawing adverse inference against 3rd and 4th respondent andgranting the relief so as to infringe the rights of theappellants."11. After hearing both sides for sometime, I felt that one othersubstantial question of law under Section 100 of C.P.C. Should beframed as under:-Whether the judgement of the first appellate Courtstands vitiated on the sole ground that verbatim the Judgeof the first appellate Court adopted the written argumentssubmitted by the appellant before it, without applying hismind and discretion as the last Court of fact?12. Both sides took note of this substantial question of law andadvanced their arguments in this connection.13. The learned Senior counsel for the appellants/defendants 1 &2 would advance his argument to the effect that the first appellateCourt, without adhering to Order 41 Rule 31 of C.P.C dealt with thematter and as such, the matter has to be remitted back to the firstappellate to consider afresh the first appeal.14. Whereas, the learned counsel for the firstrespondent/plaintiff would advance his argument that the firstappellate Court, after getting itself satisfied about the genuinenessof the case of the first respondent/plaintiff borrowed certainsentences from the written arguments submitted by the plaintiff andrendered the judgement, which cannot be found fault with.15. The learned Senior counsel for the secondappellants/defendants 1 and 2 herein invited the attention of thisCourt to paragraph Nos.16 to 23 of the impugned judgement of thefirst appellate Court, which contained the discussion portion, vis-a-vis the written arguments submitted by the first respondent/plaintiffbefore the first appellate Court. https://hcservices.ecourts.gov.in/hcservices/

16. I am fully satisfied that from line No.8 under paragraphNo.16 of the judgment onwards till the fag end of paragraph No.22,verbatim word by word the first appellate Judge copied andreproduced, lifted and adopted the written arguments submitted by theplaintiff before the first appellate Court. 17. In respect of issue No.1, which the learned Judge ought tohave termed it as point No.1, relating to the maintainability of thesuit, he expressed his opinion that the suit was maintainable andeven there the arguments or objections advanced on the side of the D1and D2 have not been considered.18. The oral evidence and the documentary evidence adduced byboth sides have not been discussed, as it ought to have been dealtwith by the last Court of fact.19. It is trite proposition of law that the first appellateCourt, which happened to be the last Court of fact, to analyse bothoral and documentary evidence afresh and arrive at an independentconclusion.20. In this case, the judgement of the first appellate Court, tosay the least, is far from satisfactory, as the learned DistrictJudge has totally ignored his responsibility to analyse the oralevidence and also the documentary evidence and arrived at theconclusion.21. At this juncture, the question arises as to whether thisCourt dealing with the second appeal could ignore the judgement ofthe first appellate Court and re-appreciate the evidence.22. At this juncture, I would like to recall and recollect thefollowing decisions of the Honourable Apex Court:(i) (2006) 5 Supreme Court Cases 545 – HERO VINOTH (MINOR) VS.SESHAMMAL,certain excerpts from its would run thus:-"17. After the amendment a second appeal can be filedonly if a substantial question of law is involved in thecase. The memorandum of appeal must precisely state thesubstantial question of law involved and the High Court isobliged to satisfy itself regarding the existence of such aquestion. If satisfied, the High Court has to formulatethe substantial question of law involved in the case. . . .. . . ."18. . . . . . It has to be kept in mind that theright of appeal is neither a natural nor an inherent rightattached to the litigation. Being a substantive statutory https://hcservices.ecourts.gov.in/hcservices/ right, it has to be regulated in accordance with law inforce at the relevant time. The conditions mentioned inthe section must be strictly fulfilled before a secondappeal can be maintained and no court has the power to addor to enlarge those grounds. The second appeal cannot bedecided on merely equitable grounds. The concurrentfindings of facts will not be disturbed by the High Courtin exercise of the powers under this section. Further, asubstantial question of law has to be distinguished from asubstantial question of fact. . . . . . 21. . . . . However, it is clear that the legislaturehas chosen not to qualify the scope of "substantialquestion of law" by sufficing the words "of generalimportance" as has been done in many other provisions suchas Section 109 of the Code or Article 133(1)(a) of theConstitution. The substantial question of law on which asecond appeal shall be heard need not necessarily be asubstantial question of law of general importance. InGuran Ditta v. Ram Ditta the phrase "substantial questionof law' as it was employed in the last clause of the thenexisting Section 100 CPC (since omitted by the AmendmentAct, 1973) came up for consideration and their Lordshipsheld that it did not mean a substantial question of generalimportance but a substantial question of law which wasinvolved in the case. In Sir Chunilal case theConstitution Bench expressed agreement with the followingview taken by a Full Bench of the Madras High Court inRimmalapudi Subba Rao v. Noony Veeraju(Sir Chunilal case,SCR p.557)"When a question of law is fairly arguable, wherethere is room for difference of opinion on it or where theCourt thought it necessary to deal with that question atsome length and discuss alternative views, then thequestion would be a substantial question of law. On theother hand if the question was practically covered by thedecision of the highest court or if the general principlesto be applied in determining the question are well settledand the only question was of applying those principles tothe particular fact of the case it would not be asubstantial question of law."This Court laid down the following test as proper test, fordetermining whether a question of law raised in the case issubstantial:(Sir Chunilal case, SCR pp.557-58)"The proper test for determining whether a question oflaw raised in the case is substantial would, in our https://hcservices.ecourts.gov.in/hcservices/ opinion, be whether it is of general public importance orwhether it directly and substantially affects the rights ofthe parties and if so whether it is either an open questionin the sense that it is not finally settled by this Courtor by the Privy Council or by the Federal Court or is notfree from difficulty or call for discussion of alternativeviews. If the question is settled by the highest court orthe general principles to be applied in determining thequestion are well settled and there is a mere question ofapplying those principles or that the plea raised ispalpably absurd the question would not be a substantialquestion of law."23. To be "substantial" a question of law must bedebatable, not previously settled by law of the land or abinding precedent, and must have a material bearing on thedecision of the case, if answered either way, insofar asthe rights of the parties before it are concerned. To be aquestion of law "involving in the case" there must be firsta foundation for it laid in the pleadings and the questionshould emerge from the sustainable findings of fact arrivedat by court of facts and it must be necessary to decidethat question of law for a just and proper decision of thecase. An entirely new point raised for the first timebefore the High Court is not a question involved in thecase unless it goes to the root of the matter. It will,therefore, depend on the facts and circumstance of eachcase whether a question of law his a substantial one andinvolved in the case or not, the paramount overallconsideration being the need for striking a judiciousbalance between the indispensable obligation to do justiceat all stages and impelling necessity of avoidingprolongation in the life of any lis.(See Santosh Hazari v.Purushottam Tiwari).24. . . . (iii) The general rule is that High Court will notinterfere with the concurrent findings of the Courts below.But it is not an absolute rule. Some of the well-recognised exceptions are where (i) the Courts below haveignored material evidence or acted on no evidence; (ii) thecourts have drawn wrong inferences from proved facts byapplying the law erroneously; or (iii) the courts havewrongly cast the burden of proof. When we refer to"decision based on no evidence", it not only refers tocases where there is a total dearth of evidence, but alsorefers to any case, where the evidence, taken as a whole,is not reasonably capable of supporting the finding." https://hcservices.ecourts.gov.in/hcservices/ (ii) 2008(4) SCALE 300 – KASHMIR SINGH VS. HARNAMSINGH AND ANOTHER.(iii) 2009-1-L.W.1 – STATE BANK OF INDIA & OTHERS vs. S.N.GOYA:A plain reading of those precedents would reveal and demonstratethat under Section 100 of the Code of Civil Procedure, Second Appealcannot be entertained, unless there is substantial question of lawinvolved. 23. It is therefore clear that the second appellate Court cannotevaluate the evidence available on record like a first appellateCourt and this Court is only concerned with the substantial questionsof law. Hence, in such a case, absolutely there is no chance forthis Court to decide the second appeal in the wake of the grossmisconduct of the Judge of the first appellate Court in not renderingthe judgement in accordance with Order 41 Rule 31.24. I would like to make the point clear that while disposing ofthis case I have not in any way decided on merits the case of therespective parties. Wherefore, I would like to set aside thejudgement and decree of the first appellate Court and remit thematter back to the first appellate Court to consider the appealafresh in accordance with law.25. Since, this is a very old matter, the first appellate Courtis expected to dispose of the appeal purely on merits untrammelledand uninfluenced by any of the observations made by this Court,within a period of two months from the date of receipt of copy ofthis order and report compliance.Sd/Asst.Registrar/true copy/Sub Asst.RegistrarmskTo1. The Additional District Judge, Fast Track Court No.II, Chennai-1. https://hcservices.ecourts.gov.in/hcservices/

2. The XI Assistant Judge, City Civil Court, Chennai.Copy to The Section Officer, V.R.Section, High Court, Madras.1 cc To Mr.Anantha Natarajan, Advocate, SR.324631 cc To Mr.A.Madhu Mathi, Advocate, SR.324631 cc To Mr.Chitra Sampath, Advocate, SR.32332 S.A.No.888 of 2007bky(co)pmk.24.7.2009