1983 PLP 1111 (CLC)

The order challenged in this revision petition is the appellate order of Mr. Abdus Saeed Sabir, Additional District Judge, Lahore dated 27th of November, 1972 by which he set aside the order of the learned civil Court dismissing the plaintiffs‑respondents' application under Order XL, rule 1, C. P. C. for appointment of a receiver and directing the learned trial Court to appoint a receiver to take over the whole of the property of the firm till the main case is disposed of.

2. On the 12th of November, 1970 a suit for dissolution of partner ship and rendition of accounts was filed by the respondent against the petitioner alleging that he had entered into a partnership with the petitioner on 7th October, 1963 by which it was agreed upon that the parties would carry on the business of sale of bangles in the name and style of "Naseem Bangles Store". The capital would be invested by the petitioner while the business would be carried on in the respondent's shop. The petitioner and the respondent were entitled to share the profits in the ratio of 3/4 : 1/4. It was further alleged that the respondent was entitled to get a sum of Rs. 125 per month as advance profits and if at the time of final yearly accounting, the profits exceeded this amount, the petitioner was bound to pay the balance, but if the profits fell short of the above amount, the respondent was not liable to make any refund, since the losses were to by borne by the petitioner. The partnership was alleged to be at will and liable to dissolution on a month's notice from either side. It was further averred that apart from paying a sum of Rs. 125 per month to the plaintiff‑respondent, the defendant‑petitioner had neither rendered proper accounts nor paid his share of the profits, in accordance with the terms of the partnership. The partnership had, therefore, to be dissolved by a registered notice acknowledgment due which the petitioner refused to receive. It was further alleged that the defendant petitioner was committing acts which were causing damage to the building of the shop which was contributed by the plaintiff towards the partnership. 1t is abundantly clear from the plaint that the suit of the plaintiff was based upon a memorandum of partnership executed by the parties, the original of which was handed over to the plaintiff. Copy of the partner ship deed and the registered notice were filed alongwith the plaint.

3. An application under Order XL, rule I, C. P. C. for appointment of receiver was submitted by the plaintiff‑respondent on 16th November, 1970 alleging that the assets as well as the account books of the partnership were in possession of the respondent and in case he learnt of the suit, he might modify or destroy even the existing accounts and misappropriate the assets. Earlier to this an application dated 19th October, 1971 was sub mitted by the respondent for grant of temporary injunction for restraining the defendant‑petitioner from handing over possession of the shop to any other person or from misappropriating the assets till the decision in the trim Court. The trial Court allowed the application for temporary injunction, issued injunction prayed for, but dismissed the application for appointment of a receiver. Since the defendant‑petitioner had denied the execution of the partnership deed and had claimed that the sum of Rs. 125 was being paid every month as rent, the Court in its order passed on an application for temporary injunction, held that the respondent had a good prima facie case. While dealing with the application under Order XL, rule I, C. P. C., he did not give as such finding but dismissed the application on the ground that the sum of Rs. 125 as minimum profits was being paid.

4. In appeal the learned Additional District Judge first considered the question of prima facie case and found this in favour of the respondent. Taking into consideration the concession made that once the partner ship is dissolved, the appointment of a receiver is a must and finding that the allegation about the destruction of the account books amounted to apprehension of waste, the learned Additional District Judge, set aside the order of the trial Court and directed the appointment of a receiver.

5. The learned counsel for the petitioner contended as follows :‑ (I) The respondent had not come to the Court with clean hands since the factum of issuance of injunction was concealed by him before the Appellate Court. (2) There is an issue about the existence of partnership. Before the determination of that issue the Appellate Court was in error in directing appointment of a receiver. Reliance was placed upon Syed Abdul .Momin Razvi and others v. Hussain M. Malik and others P L D 1955 Sind 21. (3) Mere apprehension of loss of Account Books did not justify the taking of a harsh step of appointment of a receiver particularly when there was no specific allegation about their destruction. There is no such allegation in the application under Order XL, rule 1. (4) That although it was alleged in the plaint that the petitioner was damaging the property but no such allegation was made in the application under Order XL, rule I, C. P. C.

6. In support of the plea that the payment of Rs. 125 per month was being made as rent, the learned counsel showed to me some. money order receipts. These receipts, however, do not prove this allegation. On the 29th of October, 1974 I directed the petitioner to bring receipts of the monthly payments which he had obtained from the respondent and also to produce all the Account Books. It transpired later that at that time the petitioner was not present but his son was in Court. No objection against this direction was raised. On the 30th of October, 1974 the learned counsel stated that the receipts or Account Registers could not be produced for the reason that it was not customary for the petitioner to obtain any written acknowledgment of the receipt of the monthly payments and no accounts in writing were ever maintained, when I put it to him that this position was not taken up yesterday, the learned counsel stated that he had consulted the son of the petitioner at that time and not the petitioner.

7. The learned counsel for the respondent on the other hand, had a number of documents purporting to have been executed by the petitioner in the form of receipts in which he had acknowledged his liabiht4 for arrears of these monthly dues as profits.

8. After hearing the learned counsel for the parties, I agree with the learned District Judge that prima facie. in this case the parties were partners. The partnership deed is in wrong. The execution of this deed was denied in the written statement as well as in the reply to the applica tion under Order XL, rule 1, C. P. C. and it was added that the deed purported to have been signed although the petitioner was illiterate and could not sign. It was further averred that the deed was not registered and as such was not admissible in evidence. Certain alternative objections have also been taken in the written statement on the assumption that the deed of partnership was executed by the petitioner. After going through the record I find that up to the date on which the plea of deed being unregis tered was taken, the petitioner or his counsel has not inspected the record. I, therefore, required from the learned counsel how did the petitioner know that the deed was unregistered. I pointed out that the case of the petitioner was that this deed was not executed at all and it was a forged document which was prepared for the purpose of bringing this suit. He was not able to give any convincing reply. What he could, at the most say was that the learned counsel for the petitioner might have privately inspected the record without any application; but I cannot attribute such conduct to a learned member of the Bar without evidence. As at present advised. I am convinced that the petitioner is a party to the said partnership deed. He could not have known otherwise that it was registered.

9. The learned trial Court had also held while considering the appli cation for temporary injunction that the plaintiff had good prima facie case. In my view, in the circumstances of the case it was not necessary to wait for the decision of the issue regarding the partnership.

10. It is not the case of the petitioner that the Court has no jurisdic tion to appoint a receiver before deciding such an issue. The authority relied upon by him also does not go to that extent. It was held in that case, relying upon a passage from Dindlay on Partnership that the Court usually declines to appoint a receiver unless the question whether the parties are partners, is decided. This authority also; therefore, recognises that the appointment of a receiver can be ordered even prior to the decision of the issue, but in that case there must ‑4be sufficient evidence to prove that the plaintiff has a prima facie case establishing the existence of relationship of partners between the parties. This has been shown in the present case and in these circumstances, I cannot hold that the learned Additional District Judge has either acted in excess of his jurisdiction or has acted illegally or with material irregularity in the exercise of his jurisdiction. The provisions of section 115, C. P. C. are, therefore, not attracted on his account.

11. Once it is held that prima facie the partnership deed was executed by the petitioner and the partnership being terminable on one month's notice on either side, such a notice was given, it can safely be assumed that the partnership stands dissolved. In these circumstances, there can be not doubt that a receiver ought to be appointed.

12. The arguments that mere apprehension of loss of Account Books was not enough for the appointment of a receiver, loses its force in view of the petitioner's position in this Court that he had never maintained any account. If he had not maintained accounts and had acted in violation of the agreement of partnership, it will be a fit case for appointment of a receiver, and if on the other hand he maintained the accounts and is unwilling to produce the same in Court, the allegation made in the application established. Moreover it was alleged in the plaint that the petition‑_ was causing damage to the property and an injunction had to be issued to that effect against the petitioner. For this reason too, this was a fit case for appointment of a receiver I find no merit in this petition and dismiss it with costs. B. M. A. Revision petition dismissed,