JUDGMENT R.L. Anand, J. - By this judgment I dispose of two Civil Revisions i.e. C.R. No. 2768 of 1994 titled Naresh Kumar v. Sarwan Kumar and others and C.R. No. 3208 of 1994 titled Sarwan Kumar and others v. Naresh Kumar as in my opinion, both the revisions can be disposed of by one common judgment. It is true that both the impugned orders have arisen separately from two separate suits but the decision of one has a direct bearing on the other, therefore, I am taking up both these Civil Revisions together. 2. First of all, I would like to say that Civil Revision No. 3208 of 1994 Sarwan Kumar etc. v. Naresh Kumar has arisen from the judgment dated 13.8.1994, passed by the Court of Additional District Judge, Bhatinda who affirmed the order dated 23.7.1994 passed by the Court of Sub Judge 1st Class, Phul, who, allowed the application of Shri Naresh Kumar plaintiff under Order 40 read with Section 151 C.P.C. and appointed a receiver who was directed to take over the possession of the business and record of the firm. 3. Civil Revision No. 2768 of 1994 titled Naresh Kumar v. Sarwan Kumar and others has been directed against the judgment dated 5.3.1994 passed by the Court of Additional District Judge, Bathinda, who affirmed the order dated 19.2.1994 passed by the Court of the Senior Sub Judge, Bathinda who granted the stay application under Order 39 Rules 1 and 2 C.P.C. of Shri Sarwan Kumar and Shri Naresh Kumar was restrained from interfering in the running and working of the gas agency run by Shri Sarwan Kumar and his employees. 4. The first suit was instituted by Shri Sarwan Kumar that was a suit for permanent injunction vide which he made a prayer that defendants S/Shri Naresh Kumar, Ram Singh and Kirpal Singh be restrained from operating the gas agency known as M/s Sukhda Gas Service (Distributorship of Indian Oil Corporation Ltd.) situated at Rampura Phul and defendants be also restrained from interfering in the running/working of the gas agency which is run by the plaintiff and his employees near bus stand Ram Pura Phul and in the godown which is also located at Bathinda-Barnala Road. Shri Sarwan Kumar in his suit alleged that he was alloted the distribution of Liquid Petroleum Gas at Ram Pura Phul being proprietor of M/s Sukhda Gas service.
Shri Sarwan Kumar in his suit alleged that he was alloted the distribution of Liquid Petroleum Gas at Ram Pura Phul being proprietor of M/s Sukhda Gas service. The licence was granted to him in the year 1984 by Indian Oil Corporation. He was running the gas agency since the date of his allotment. However, he appointed defendant No. 1 Shri Naresh Kumar as General Attorney vide General Power of Attorney dated 30.11.1992. In this manner, respondent No. 1 started working as a Manager. Respondent No. 1 employed respondents No. 2 and 3 as his clerks. Thereafter, the plaintiff got cancelled the power of attorney dated 30.11.1992 on 8.9.93. A publication was made in the Daily Jagbani dated 9.11.1993. The plaintiff is running the gas agency peacefully whereas defendant No. 1 has no right or title in the said agency or in the show room or in the godown. Defendant is intentionally interfering in the working of the gas agency and allied establishment. Therefore, the defendants be restrained from interfering in the possession of the plaintiff. Alongwith the plaint the plaintiff has also filed an application under Order 39 Rules 1 and 2 C.P.C. praying that till the disposal of the suit the defendants be restrained from interfering in his possession. 5. Notice of the application was given to the respondent who filed the reply and denied the allegations. According to the defendants, the plaintiff has concealed the material facts from the Court and he is estopped from filing the suit. In fact, the plaintiff has entered into partnership agreement dated 28.11.1992 and by virtue of that agreement, the defendant has invested the total amount for the working of the agency and defendant was specifically authorised to do all acts which the plaintiff could do under the said agreement. The defendant also filed a suit at Ram Pura Phul against the present plaintiff in which defendant was restrained from interfering in the working of the gas agency. In these circumstances, the present suit of Shri Sarwan Kumar is not legally maintainable. On merits, the defendans took the stand that the gas agency was allotted under the name of M/s Sukhda Gas Service by Indian Oil Corporation. As a matter of fact, respondent No. 1 is running the business in the premises which is owned and possessed by him.
On merits, the defendans took the stand that the gas agency was allotted under the name of M/s Sukhda Gas Service by Indian Oil Corporation. As a matter of fact, respondent No. 1 is running the business in the premises which is owned and possessed by him. The learned trial Court allowed the application under Order 39 Rules 1 and 2 C.P.C. of Shri Sarwan Kumar and defendants Naresh Kumar and others were restrained from interfering in the possession of the plaintiff. 6. Not satisfied with the order of the trial Court Naresh Kumar filed the first appeal under Order 43 C.P.C. and the said appeal was also dismissed by the Court of Additional District Judge for the reasons given in paras No. 6 and 10 of the order dated 5.3.1994 which are reproduced as under :- "6. The suit was presented in the Court of Senior Sub Judge, Bathinda and vide order 8.2.1994 defendants were restrained (ex parte) from operating the agency M/s Sukhda Gas Service, Rampua and interfering in the running of the said agency by the plaintiff and his employees at the show room, illegally and forcibly or in any other manner, till 24.2.1994. 7. Vide order under appeal the ad interim injuction granted on 8.2.1994 was confirmed against defendant No. 1 till the decision of the suit. 8. There is a copy of letter dated May 28, 1984 from Indian Oil Corporation Ltd. to Sharwan Kumar M/s Sukhda Gas Service, near bus-stand, Rampura Phul and the perusal of letter shows that vide this letter said Sharwan Kumar of M/s Sukhda Gas Service was appointd as Distributor on the terms and conditions contained in the Distributorship agreement. Much stress was laid on behalf of the appellant on the copy of agreement dated 28.11.1992 and that copy is on the file. This copy of agreement is to the effect that Sharwan Kumar is prop. of Sukhda Gas Service Rampura Phul, and Naresh Kumar had invested the total amount and Sharwan Kumar agreed to give 80% net profits to Naresh Kumar and authorised to do all acts which the proprietor could do regarding the said agency. 9. For deciding an ad interim injunction application the following three principles are to be taken into consideration :- 1. The prima facie case; and 2. The balance of convenience; And 3.
9. For deciding an ad interim injunction application the following three principles are to be taken into consideration :- 1. The prima facie case; and 2. The balance of convenience; And 3. That the plaintiff would suffer an irreparable loss in case the application for ad interim injuction is not accepted. 10. From the said letter dated 28.5.1984 it is clear that Sharwan Kumar was allotted the distributorship of LPG in the name of M/s Sukhda Gas Service near Bus-stand Rampura Phul. The said agreement prima facie shows that total amount was invested by Naresh Kumar and he was to get net profit of 80% and Sharwan Kumar as 20% but at the same time it is only the distributor who is appointed by the concerned corporation and in this case the Indian Oil Corporation and as such the plaintiff being the duly appointed distributor of LPG Gas Agency is certainly entitled to operate the same and he has succeeded in establishing his case being prima facie and as such balance of convenience also lies in his favour and in case he is restrained from operating the agency then he would suffer irreparable injury." 7. Not satisfied with the orders of both the Courts below, Shri Naresh Kumar has filed the Civil Revision No. 2768 of 1994. 8. Civil Revision No. 3208 of 1994 has been directed by Shri Sarwan Kumar against the order dated 13.8.1994 passed by the Court of Additional District Judge, Bathinda who affirmed the order of the trial Court which appointed receiver under Order 40 Rule 1 C.P.C. and the case set up of Shri Naresh Kumar in the trial Court was that the defendant Shri Sarwan Kumar was the employee of his father. Indian Oil Corporation Ltd. gave the distributorship of liquified petroleum gas in the name of Sarwan Kumar since he belongs to Scheduled Caste and the distributorship was to be given only out of the reserved quota or to the ex-defence person. In fact that LPG distributorship was being run by Naresh Kumar plaintiff and the entire investment for running this agency was invested by the plaintiff and an agreement was also executed between the parties by virtue of which defendant Sarwan Kumar was to get 20% of the net profits and the remaining 80% of the net profit was to be kept by the plaintiff.
The show room, godown and finances were arranged by the plaintiff with his own money and the plaintiff was running the gas agency. The above agreement was reduced into writing on 28.11.1992 and by virtue of this agreement the plaintiff was supposed to invest the total amount and Sharwan Kumar agreed to give 80% share of the net profit to Naresh Kumar. The plaintiff was also authorised to do all acts on behalf of M/s Sukhda Gas Service and accordingly the business was being run in partnership. It is also alleged by the plaintiff that Sarwan Kumar had also appointed Naresh Kumar plaintiff as Manager and General Attorney and authorised him to operate bank accounts on behalf of M/s Sukhda Gas service, sign and execute various documents, agreements and contracts for sale and purchase of vehicles, fire fighting equipment, air conditioner, office furniture and other office appliances. The plaintiff was further authorised by the defendant to enter into agreement with Indian Oil Corporation, to enter into agreement, payments and generally to do all things necessary for running distributorship of LPG supply. In view of all this, it is specifically pleaded by the plaintiff that he had invested the entire capital in setting up and running the LPG distributorship. He had major and direct interest in the Gas Agency. He was described as Manager only to override the rules of the Indian Oil Corporation. It is further pointed out that business was being run by the parties in partnership with each other smoothly up till September, 1993 and thereafter Sarwan Kumar defendant in connivance with certain persons cancelled the power of attorney executed by him in favour of Naresh Kumar and has started negotiating with certain persons for running business of LPG distributorship. When the defendant tried to hand over partnership business to some third persons then the plaintiff filed a civil suit against him for permanent injunction and obtained injunction order against one Walaiti Ram and as well as against the present defendant. It is further pleaded that Sarwan Kumar also filed a suit in the Court of Senior Sub Judge, Bathinda and obtained injunction order against Naresh Kumar and others with a malafide intention to take over whole of the business of LPG distributorship. In that case the learned Senior Sub Judge, Bathinda restrained Naresh Kumar and others from operating Sukhda Gas Service Rampura.
In that case the learned Senior Sub Judge, Bathinda restrained Naresh Kumar and others from operating Sukhda Gas Service Rampura. On account of temporary injunction issued by the learned Senior Sub Judge, Bathinda on 8.2.1994 Sarwan Kumar took the control of whole of the business, assets and account books of Sukhda Gas Service. It is further pleaded that defendant had filed a Civil Writ Petition No. 3252 of 1994 challenging the order dated 5.3.1994 of Indian Oil Corporation Ltd. by virtue of which Company cancelled the LPG supply and the Honble High Court stayed operation of the abovesaid order. Thereafter, the plaintiff moved an application under Order 1 Rule 10 C.P.C. before the Honble High Court for being impleaded as respondent in the above said writ petition on 30.3.1994 but on 24.5.1994 Sarwan Kumar withdrew the writ petition. It is further alleged by the plaintiff that defendant is liable to render accounts of the firm to the plaintiff and to pay to the plaintiff his due share out of the assets and profits of the firms. Along with the suit he also filed an application for the appointment of receiver for taking over the possession of management of the business of the partnership firm and other account books etc. of the firm. 9. The notice of the application under Order 40 Rule 1. C.P.C. was given to the defendant who filed the reply and denied the allegations. According to the defendant the plaintiff was not appointed as a Manager of the Sukhda Gas Service but lateron under pressure present power of attorney was got executed in his favour and this power of attorney was cancelled on 8.9.93. Defendant denied the execution of the agreement dated 28.11.1992 with the plaintiff and according to the defendant his signatures were obtained by the plaintiff on blank paper in order to commit a fraud. As per the defendant he had taken the godown and show room on rent at the rate of Rs. 500/- per month. The belonging of the show room has been taken into possession by the plaintiff illegally for which a separate case is pending. With this prayer, the defendant prayed for the dismissal of the application under Order 40 Rule 1 C.P.C. 10.
500/- per month. The belonging of the show room has been taken into possession by the plaintiff illegally for which a separate case is pending. With this prayer, the defendant prayed for the dismissal of the application under Order 40 Rule 1 C.P.C. 10. The parties addressed arguments before the trial Court and for the reasons given in paras No. 4 and 5 of the order dated 23.7.1994, the learned Sub Judge 1st Class, Phul allowed the application under Order 40 Rule 1 C.P.C. The reasons are as follow :- "4. In reply it is submitted that the respondent has given written statement and reply in the Court. It is denied that Sarwan Kumar was employee of the father of plaintiff. It is admitted that Sarwan Kumar was given distributorship of LPG gas by the Indian Oil Corporation. It is submitted that Naresh Kumar was appointed only Manager by defendant Sarwan Kumar to manage the Sukhda Gas Service, but lateron he got himself appointed power of attorney by pressure. It is alleged that said power of attorney was cancelled by the defendant on 8.9.1993. The defendant has totally denied the execution of agreement with plaintiff on 28.11.1992. It is alleged that the plaintiff had got the signatures of Sarwan Kumar on blank papers to defraud Sarwan Kumar. It is alleged that if plaintiff had got signed some printed and some unprinted and stamped papers from Sarwan Kumar, then Sarwan Kumar is not bound by the same. It is alleged that Indian Oil Corporation Ltd. in his letter LPG 307 dated 12.12.1983 categorically forbade distributors from making others as partners in business. It is also alleged that the suit for dissolution does not lie as the alleged firm is not registered. It is alleged that the owner of the showroom is the father of the plaintiff Goverdhan Dass and Sarwan Kumar had taken the showroom on rent of Rs. 500/- per month. It is alleged that the belonging of this show-room has been taken into possession by the plaintiff illegally and the case is pending before the Ld. Senior Sub Judge, Bathinda. An injunction order is granted by the learned Senior Sub Judge, the appeal against that order is pending in the Court of District Judge, Bathinda. It is admitted that upon writ the order of Indian Oil Corporation Ltd. was stayed.
Senior Sub Judge, Bathinda. An injunction order is granted by the learned Senior Sub Judge, the appeal against that order is pending in the Court of District Judge, Bathinda. It is admitted that upon writ the order of Indian Oil Corporation Ltd. was stayed. The defendant Sarwan Kumar has thus opposed the appointment of receiver on the ground that he has not executed the agreement dated 28.11.1993, that the partnership was unregistered and no suit has till the partnership is registered under Section 69 of Indian Partnership Act and that he was given sole distributorship by the Indian Oil Company and the power of attorney given in favour of Naresh Kumar has been cancelled by the defendant. 5. As regards the execution of agreement dated 28.11.1992 is concerned the defendant Sarwan Kumar has taken contradictory stand in this court against the stand taken by him in the previous litigation. The men may tell lie but the circumstances cannot. It is quite clear that in an annexure P4 given in the writ petition filed by the defendant Sarwan Kumar in the Honble Punjab and Haryana High Court he had admitted the execution of agreement. The Ld. counsel for the defendant has argued that admission does not bind the defendant, but I am not convinced with this arguments because in the Court of Ld. Senior Sub Judge, the agreement was also said to be executed by the defendant Sarwan Kumar although the Ld. Senior Sub Judge declare that to be unlawful yet he has given out that his observations will not effect the merit of the case. Moreover, the agreement may be unlawful as between the rights of the Indian Oil Corporation Ltd. and Sarwan Kumar but it is not unlawful so as to determine the rights of the parties to the agreement inter se. As the agreement of distributorship of gas agency is a sole agreement as between Indian Oil Corporation and Sarwan Kumar, so also the agreement for investment of money and for distributorship of shares amongst the parties inter se is also solus agreement and in case of dissolution of the firm so created the person who has acquired advantage out of that is liable to give accounts to the other party.
As regards the registration of the firm is concerned it is quite clear in Section 69 of Indian Partnership Act, that section does not apply to the suit for dissolution of an unregistered firm and for rendition of accounts. The cancellation of power of attorney does not make any difference regarding distribution of the assets of the partnership firm to be divided between the plaintiff and defendant Sarvan Kumar. The Ld. counsel for the defendants has further argued that receiver should not be appointed where one of the partners is in possession. He has relied upon Murti Durga Maai Ji v. Har Narian, 1992 PLJ 420. But I am not convinced with the arguments of Ld. counsel for the defendants because the circumstances show a prima facie case in favour of the plaintiff for appointment of receiver. Plaintiff has been deprived of the possession and management of the business of distributorship of LPG Gas by quoting wrong facts before the Courts and even with the help of unlawful means, because had there been no investment by plaintiff, the Sukhda Gas Service would not have worked. In similar circumstances the Honble Punjab and Haryana High Court in Pritam Singh v. Sarup Singh, 1978 PLR 316 and in Nihal Chand v. Jai Narain and others, AIR 1969 Punjab and Haryana 523 justified the appointment of a receiver. It was held that where a partner was excluded from management of partnership affairs and there is denial of status, receiver should be appointed. Hence, the appointment of receiver is justified by circumstances of the case as well as from the authorities of our Honble High Court. The parties are asked who should be appointed as receiver from taking possession of the business of distributorship of LPG gas. The plaintiff suggested the name of one Parshotam Lal son of Hans Raj rqsesident of Rampura Phul to which the defendant has not opposed. Hence I appoint Parshotam, Lal son of Hans Raj resident of Rampura Phul to take over management of distributorship of LPG supply by Sukhda Gas Service and to take over possession of business and record the unlawful to the possession. His remuneration of Rs. 1500/- per month will be paid out of the assets from the date of taking over of management etc.
His remuneration of Rs. 1500/- per month will be paid out of the assets from the date of taking over of management etc. He will submit complete report regarding the profits and loss of the Sukhda Gas Service Rampura Phul to the Court every month. Both the plaintiff and defendant Sarwan Kumar are directed to assist the receiver in his day to day work. The receiver will also render full account of investment of Sukhda Gas Service in two months. My observations in this order will not affect the merits of the main case. The application is disposed of accordingly". 11. Not satisfied with the decision of the trial court Shri Sarwan Kumar filed an appeal before the Court of Additional District Judge, Bathinda who dismissed the appeal for the reasons given in paras No. 6 to 8 of the order dated 13.8.1994, which are reproduced as under: "In this case the agreement dated 28.11.1992 is the main dub on which the entire care of the parties revolves and before I proceed further in the present appeal it is necessary to reproduce the contents of the agreement in question :- "Agreement. I Sarwan Kumar son of Shri Nand Ram resident of Rampura Phul, District Bathinda. I am the proprietor of Sukhda Gas Service Rampura Phul, District Bathinda. Sh. Naresh Kumar son of Sh. Goverdhan Dass also worked with me. He had invested the total amount so, I agree to give him the share of 80% in the net profit and I will get 20% share from the Net Profits. He is authorised to do all acts which I can regarding the Sukhda Gas Service. This agreement has been executed by me for record, with free will. Dated: 28.11.1992. Witness, Executant, witness witness. Sd/- Sd/- Sd/- Rajinder Kumar, Advocate Sarwan Kumar son of Sh. Nand Singh Sindhu Zabar Jang Rampura Phool Rampura Phool r/o Bathinda, Teh. Phul Distt. Bathinda Sd/- Naresh Kumar son of Sh. Goverdhan Dass r/o Rampura Phul, Bathinda". 7. The other imported document in the instant case is general power of attorney and it is necessary to reproduce paras 1 and 5 of this power of attorney which was executed by defendant Sarwan Kumar in favour of plaintiff on 30.11.1992. This document has also been attested by Sh. Rajinder Kumar Goyal, Advocate, Rampura Phul.
7. The other imported document in the instant case is general power of attorney and it is necessary to reproduce paras 1 and 5 of this power of attorney which was executed by defendant Sarwan Kumar in favour of plaintiff on 30.11.1992. This document has also been attested by Sh. Rajinder Kumar Goyal, Advocate, Rampura Phul. Para No. 1 To draw cheques and operate upon the current account in the name of our establishment with any bank or banks. Para No. 5. To represent our establishment before any person or authority including Indian Corporation and file any document or statement before them" It is crystal clear from the pleadings of the parties particularly from the reply filed by the defendant that he admits his signatures on the agreement in question but he has pointed out that the same were obtained from him under pressure and in fact he never executed the agreement by virtue of which he agreed to give a share of 80% in the net profit to the plaintiff and through this agreement he also declared that Naresh Kumar had invested the total amount that is why major portion of the profit is being given to him. The general power of attorney in favour of Naresh Kumar was got registered on 30.11.1992 in the office of Sub Registrar, Rampura Phul. It is true that in the present proceedings Sarwan Kumar defendant has developed the case complete denial regarding the execution of the abovesaid agreement but it appears that truth is not coming through the reply filed by the defendant to the application for the appointment of receiver since I find from the record that as per his suitability he has shifted his stand with regard to the agreement in question.
It is admitted case of the parties that a writ petition was filed by Sarwan Kumar defendant before the Honble High Court and along with writ petition certain annexures were attached and one letter dated 20.10.1993 written by the defendant to Chief Area Manager, Indian Area Office, Chandigarh was also attached and para No. 5 of this letter clearly spells out that defendant admitted the execution of the agreement dated 28.11.1992 and he also disclosed the reasons for joined hands with the plaintiff and in view of all this para No. 5 of this letter is reproduced as under :- "That due to financial constraints I executed as agreement on 28.11.1992 with the said attorney. That I will give him 80% share of net profit against his total investment on truck showroom and godown etc. Lateron he turned himself from attorney to proprietor instead of 80% he had become 100% share of profit. When the execution of the agreement has been admitted by the defendant on 20.10.1993 then it does not lie in his mouth to put forward before this Court that in fact he never executed any agreement on 28.11.1992 and rather his signatures were obtained on blank papers. It appears that he has taken this stand in the instant suit in order to oppose the application of the appointment of receiver. It is further admitted in para No. 4 of this letter by the defendant that he had given General Power of Attorney to Naresh Kumar to operate the business of the Gas Agency. It is also admitted in this letter that father of the defendant was a labourer on the food grain shop of Naresh Kumar-plaintiff and it is also mentioned in this letter that defendant belongs to a poor scheduled in this caste family. All this shows that defendant is in the habit of changing his stand and that is why now he is denying the execution of the agreement.
All this shows that defendant is in the habit of changing his stand and that is why now he is denying the execution of the agreement. The facts and circumstances do spell out and as is admitted by defendant himself in letter dated 20.10.1993 that his father was labourer on the good grains shop of plaintiff Naresh Kumar and it appears that the present defendant was an employee of the plaintiff and keeping in view that the distributorship could be obtained only by a person belonging to scheduled caste tribe and accordingly the same was secured in the name of Sarwan Kumar defendant and major part of the investment appear to have been made by the plaintiff, because it is admitted in para No. 3 of the abovesaid letter that defendant belongs to poor scheduled caste family and the agreement in question in also outcome of these circumstances. Otherwise in case the entire investment was made by the defendant even if it be presumed that Naresh Kumar was acting as Manager of Sarwan Kumar defendant then in that case Sarwan Kumar would not have agreed to give 80% share of the net profit and further it is again admitted by Sarwan Kumar that he has hired the show room belonging to the father of Naresh Kumar plaintiff at the rate of Rs. 500/- per month. The facts and circumstances mentioned above beat the drum of partnership between the parties. In the present proceedings I am only to determine whether the receiver is required to be appointed in such like circumstances. 8. Faced with this situation, the learned counsel for the appellant vehemently argued that agreement in question is against the public policy and as well as against the rules of Indian Oil Corporation and accordingly it hits under section 23 of the Contract Act and the same is liable to be ignored at this stage. I have considered the contention of the learned counsel, but it does not cut ice with me since in view of the fact that in para No. 5 of the letter dated 20.10.1993, it is categorically admitted by Sarwan Kumar that he entered into an agreement dated 28.11.1992 and as well as General Power of Attorney in favour of the plaintiff and both these documents as already stated above do spell out that partnership was being run by the present parties.
Moreover, the defendant by filing a suit in the Court of Senior Sub Judge, Bathinda obtained an injunction order against the present plaintiff by virtue of which he was restrained for operating the Gas Agency as well as in the work of the agency in question in any manner and, therefore, the present plaintiff has no option but to file the application for the appointment of receiver. Order 40 Rule 1 Civil Procedure Code provides that where it appears to the Court to be just and convenient, it may appoint a Receiver for any property. No inflexible rules can be laid down in which a Receiver can be appointed. The circumstances and facts of each case have to be gone into for appointment of a Receiver. I am of this opinion that the underlying principle under order 40 Rule 1 Civil Procedure Code relating to the appointment of a Receiver is that the subject matter of the suit should be allowed to remain intact in order to see that at the end of the final adjudication, the parties might be entitled to the benefit thereof, and in the instant case it is yet to be determined by the lower Court whether the agreement in question which was arrived at between the parties is against the law or in other words whether the same is liable to be upheld. The rights of the parties cannot be thrown out while deciding such application. It was laid down in AIR 1960 Pb. and Hy. 523 by the Honble High Court as under :- "that a Receiver may be appointed where there is a reasonable apprehension to the property assets or income and are in Manager of being injured, misused or desiccated. The property should be preserved from loss or wastage so that the final relief may be effective. The appointment of a Receiver in such circumstances does not result in harassment to a party but protects the rights of the injured party by keeping the property intact.
The property should be preserved from loss or wastage so that the final relief may be effective. The appointment of a Receiver in such circumstances does not result in harassment to a party but protects the rights of the injured party by keeping the property intact. Where a partner excludes another from the management of the partnership affairs, a case is made out for appointment of a Receiver and this doctrine is acted on even where the defendant contends that the plaintiff is not a partner or that he had no interest in the partnership assets the learned Judge further held that the considerations which determine the grant or refusal of prayer to appoint a Receiver rest on well known principles but no court has been able to lay down unvarying and inflexible rules applying to all circumstances and eventualities. The facts of the actual case are of primary consideration which determine the exercise of discretionary power". Applying the proposition of law laid down by the Honble High Court to the instant case I find that it covers the case of the parties from all four corners. In the instant case also the plaintiff has been excluded from management of Gas Agency since the defendant has obtained temporary injunction against him and moreover at the cost of repetition the execution of the agreement has also been admitted by the defendant in his letter written to the Chief Area Manager which has already been discussed above at length and as such I am of this opinion that it would be just and convenient to appoint a Receiver to safeguard the interest of both the parties and accordingly no interference is called for in the impugned order of the lower Court and in the final analysis this appeal is dismissed with no order as to costs. However, before I part with this order of mine, I am also to observe that keeping in view the facts and circumstances of this case the trial Court is directed to dispose of the suit preferably within six months from the date of passing of this order by fixing the dates in such a manner so that the same may be disposed of within the abovesaid period. The parties through their counsel are directed to appear before the trial Court on 28.9.1994. Ahlmad is directed to send the file of the lower Court forthwith". 12.
The parties through their counsel are directed to appear before the trial Court on 28.9.1994. Ahlmad is directed to send the file of the lower Court forthwith". 12. Still, not satisfied with the decision of the Courts below, the present revision has been filed by Shri Sarwan Kumar. 13. I have heard Shri J.K. Sibal, Sr. Advocate, appearing on behalf of Shri Sarwan Kumar and Shri Vinay Mittal, Sr. Advocate, appearing on behalf of Shri Naresh Kumar and with their assistance have gone through the record of this case. 14. I have stated above at the first instance that the success of one revision would amount to dismissal of the other revision. 15. The learned counsel Shri J.K. Sibal, has vehemently challenged the order dated 13.8.1994, passed by the Court of Additional District Judge, Bathinda and submitted that the deed of agreement of partnership dated 28.11.1992, executed between the parties is against the public policy. This was his alternative contention. Firstly his contention was that the agreement dated 28.11.1992 was never executed by his client Shri Sarwan Kumar and thus, there is no prima facie case in favour of Shri Naresh Kumar. Defending the order under Order 39 Rules 1 and 2 C.P.C., the learned counsel Shri J.K. Sibal, submitted that both the Courts have rightly come to the conclusion that Shri Sarwan Kumar is in possession of the property and, therefore, he has the right to protect the possession. Mr. Sibal submitted that it is proved on the record that in the year 1984 Indian Oil Corporation gave the agency to Shri Sarwan Kumar as a Scheduled caste candidate. Shri Naresh Kumar was only appointed Manager. The authority has been cancelled. Possession always remained with Shri Sarwan Kumar, therefore, the defendant Shri Naresh Kumar has been rightly injuncted upon not to interfere in the possession of the plaintiff. 16. On the contrary, the learned counsel appearing on behalf of Shri Naresh Kumar submitted that it is proved on the record that deed of agreement of partnership was executed between the parties dated 28.11.1992 vide which it was agreed upon that 80% share of the profits will be taken by Shri Naresh Kumar and 20% will go to Shri Sarwan Kumar because Shri Naresh Kumar was to invest the entire amount. The business premises was also being run in the premises of Shri Naresh Kumar.
The business premises was also being run in the premises of Shri Naresh Kumar. He was the owner of these premises. Shri Sarwan Kumar has concealed material fact in his application under Order 39 Rules 1 and 2 C.P.C. and, therefore, his application deserves to be dismissed on that ground. 17. After considering the rival contention of the parties, I am of the opinion that Civil Revision No. 2768 of 1994 filed by Shri Naresh Kumar deserves to be allowed and accepted while Civil Revision No. 3208 of 1994 filed by Shri Sarwan Kumar against Shri Naresh Kumar deserves to be dismissed. 18. It is the basic law of the land that relief of temporary injunction is a discretionary relief and a person who seeks equity must do the equity. If the plaintiff in a suit for permanent injunction has concealed the material facts, this material concealment itself is a ground for rejection of the application under Order 39 Rules 1 and 2 C.P.C. Case set up by Shri Sarwan Kumar in his suit was that he executed a power of attorney dated 30.11.1992 vide which Shri Naresh Kumar was appointed as Manager. This power of attorney was cancelled 8.9.1993 and that he even issued a publication in the Daily Jag Bani dated 9.11.1993. The plaintiff, nowhere, makes a mention of the agreement dated 28.11.1992, whereas in the other suit filed by Shri Naresh Kumar, he categorically alleges that he entered into a partnership with Shri Sarwan Kumar on 28.11.1992. So much so he was appointed as a Manager. He has also given a reason why the deed of partnership was executed and why he was appointed as the sole manager because he had to invest the entire amount. So much so, the premises of the agency were also owned by him. Partnership is nothing but an agreement between two partners vide which they agree to share the profits of partnership firm. If it is established on the record that in fact Shri Naresh Kumar became a partner by virtue of the agreement dated 28.11.1992 then the suit for injunction against a partner is not legally maintainable because each partner is agent of the partnership firm. He has an equal interest like others.
If it is established on the record that in fact Shri Naresh Kumar became a partner by virtue of the agreement dated 28.11.1992 then the suit for injunction against a partner is not legally maintainable because each partner is agent of the partnership firm. He has an equal interest like others. Though a partner is not a co-sharer but certainly he has a right, title or interest in the property and he has the right to enjoy the fruits of the partnership firm. The agreement dated 28.11.1992 runs as follows:- "I Sarwan Kumar son of Shri Nand Ram resident of Rampura Phul, District Bathinda. I am the proprietor of Sukhda Gas Service Rampura Phul, District Bathinda. Sh. Naresh Kumar son of Sh. Goverdhan Dass also worked with me. He had invested the total amount so, I agree to give him the share of 80% in the net profits and I will get 20% share from the NET Profits. He is authorised to do all acts which I can regarding the Sukhda Gas service. This agreement has been executed by me for record, with free will" This agreement is also attested by two witnesses. There is no explanation about this agreement by Shri Sarwan Kumar. The moment, through this agreement, it is established that there was partnership firm, prima facie it does not lie proper in the mouth of Shri Sarwan Kumar to claim injunction. 19. Faced with this difficulty, learned counsel appearing on behalf of Shri Sarwan Kumar submitted that the agreement which has been relied upon by Shri Naresh Kumar is against the public policy and, therefore, this type of agreement cannot be relied upon or acted upon. In support of his contention, the learned counsel Shri J.K. Sibal, has relied upon AIR 1964 Andhra Pradesh 145, Basavayya v. N. Kottayya and AIR 1986 SC 1571, Central Land Water Transport Corporation Ltd. and another v. Central Inland Water Transport Corporation Ltd. and submitted that this agreement is against the public policy and no suit of Shri Naresh Kumar is maintainable. 20.
20. On the contrary, Shri Vinay Mittal, the learned counsel appearing on behalf of Shri Naresh Kumar submitted that if Shri Sarwan Kumar has committed any violation against the terms of the agency of Indian Oil Corporation, it is for the Corporation to take the action against Shri Sarwan Kumar but so far as the partnership between Naresh Kumar and Sarwan Kumar is concerned, it is valid under the law. Moment, the relations between the parties are that of partners and they were running the business, then in the eventuality, it is always open to Shri Naresh Kumar to file a suit for rendition of accounts and he could not be injuncted upon to enter into the partnership premises. He, thus, defended the order under Order 40 Rule 1 C.P.C. and opposed the order under Order 39 Rules 1 and 2 C.P.C. 21. After considering the rival contentions of the parties, I am of the opinion that the contention raised by Sh. J.K. Sibal, is without any force. The Judgment of Andhra Pradesh High Court quoted above is distinguishable on facts. In the cited case, there was a dealer of cloth and a licence was granted to him under Madras Cloth (Dealers) Control Order, 1944. The said dealer entered into partnership with another person and such partnership was opposing the public policy and, therefore, it was illegal. The suit was brought by the dealer for the dissolution of the partnership and settlement of accounts. In these circumstances, the Andhra Pradesh High Court held that the suit of dealer for dissolution of partnership and settlement of accounts against the so called partner is not legally maintainable. Here the facts are to the contrary. Here the suit was filed by the third party against Shri Sarwan Kumar who at one point of time was the sole proprietor of the agency and there is no bar on the part of the proprietor to convert his concern into a partnership one.
Here the facts are to the contrary. Here the suit was filed by the third party against Shri Sarwan Kumar who at one point of time was the sole proprietor of the agency and there is no bar on the part of the proprietor to convert his concern into a partnership one. Assuming for the sake of argument, it is inferred that Shri Sarwan Kumar was not in a position to execute any partnership deed with Shri Naresh Kumar or that he did so against the terms of the gas agency, in that situation, it is the Indian Oil Corporation which can take action against Shri Sarwan Kumar but to say that the deed of agreement of partnership executed between Sarwan Kumar and Shri Naresh Kumar is illegal is too much. Nothing has been brought on the record to show that at any point of time the Indian Oil Corporation while granting the licence to Shri Sarwan Kumar declared that in the event of entering into any partnership by him with a third person, such an agreement would be illegal. 22. The judgment of the Honble Supreme Court AIR 1986 page 1571 (supra) simply lays down that the Indian Contract Act does not define the expression "public policy" or opposed to "public policy" as envisaged in section 23 of the Contract Act. The learned counsel Shri Sibal submitted that the object of giving the agency to Shri Sarwan Kumar was to uplift the financial position of the scheduled castes persons in the society and with that object this agency was granted to him. He further submitted that if Shri Sarwan Kumar had entered into any partnership, i.e. against the spirit of the provision of Section 23, therefore, no receiver can be appointed. 23. I do not understood how the agreement between Sarwan Kumar and Naresh Kumar is against the public policy.
He further submitted that if Shri Sarwan Kumar had entered into any partnership, i.e. against the spirit of the provision of Section 23, therefore, no receiver can be appointed. 23. I do not understood how the agreement between Sarwan Kumar and Naresh Kumar is against the public policy. If Sarwan Kumar has been totally ruled out from the partnership firm there would have been some weight in the argument of Shri Sibal but in the present case entire investment has been made by Shri Naresh Kumar who has given his own premises to run the business and if for his huge investment he has taken 80% of profits by giving 20% profits to Shri Sarwan Kumar who had not invested any amount, there is no illegality or impropriety in such an agreement nor such an agreement can be held to be against the public policy. 24. Learned counsel Shri Sibal then relied upon a judgment of Honble Supreme Court reported as AIR 1959 S.C. 781, Gherulal Parakh v. Mahadeo Das Maiya and others. This judgment only talks of what is a public policy. I have already held above that the agreement between the parties is not against the public policy. It nowhere directly or indirectly interferes the spirit of the public policy. Rather it promotes the objects of Indian Partnership Act. 25. The counsel Shri Sibal then submitted that it was not a fit case where the provision of Order 40 Rule 1 C.P.C. right to have been applied by the Courts below. In support of his contention the counsel Shri Sibal relied upon 1992 PLJ, 420 Murti Durga Maai Ji and others v. Har Narain and others and 1995(3) All Instant Judgments 764, Virendar Kumar Sachdev v. Pawan Kumar and others. 26. I have gone through these citations. 1992 PLJ 420 (supra) lays down that Court can appoint a Receiver where it finds it just and convenient to do so but before ordering the appointment of Receiver it is obligatory upon the plaintiff to show a good prima facie case to justify the appointment of Receiver.
26. I have gone through these citations. 1992 PLJ 420 (supra) lays down that Court can appoint a Receiver where it finds it just and convenient to do so but before ordering the appointment of Receiver it is obligatory upon the plaintiff to show a good prima facie case to justify the appointment of Receiver. It was observed that where the plaintiff is unable to make out a strong prima facie case with regard to its exclusive possession, it is not proper in such a case to appoint a Receiver but here is the case where the plaintiff Shri Naresh Kumar has shown in his suit that he is entitled to the appointment of Receiver. The defendant Shri Sarwan Kumar has denied the very existence of the partnership. He cannot be allowed to do such an act which is detriment to the interest of plaintiff Shri Naresh Kumar who prima facie had invested the amount in the running of the gas agency. His rights prima facie are required to be secured. 27. Similarly, the judgment of 1995(3) All Instant Judgments 764 (supra) lays down that the provisions under Order 40 Rule 1 are in the shape of an extraordinary remedy. This is a harsh measure and has to be taken as a last resort. In the cited case the agreement itself provides for damages. Also it was not clear whether the agreement was a partnership or not. In these circumstances, the High Court was inclined not to appoint a Receiver but in the present case the reading of the agreement clearly shows that prima facie the partners have entered into an agreement. The defendant Shri Sarwan Kumar became interested in denying the very existence of the partnership deed. It has given a legitimate apprehension in the mind of Shri Naresh Kumar to file a suit for rendition of accounts. 28. Resultantly, I am of the considered opinion that both the Courts below were not right when the application under Order 39 Rules 1 and 2 C.P.C. of Shri Sarwan Kumar was allowed. Both the Courts have committed material illegality causing serious prejudice to the interest of Shri Naresh Kumar. In this view of the matter, Civil Revision No. 3208 of 1994 titled Sarwan Kumar v. Naresh Kumar stands dismissed while Civil Revision No. 2768 of 1994 titled Naresh Kumar v. Sarwan Kumar stands allowed.
Both the Courts have committed material illegality causing serious prejudice to the interest of Shri Naresh Kumar. In this view of the matter, Civil Revision No. 3208 of 1994 titled Sarwan Kumar v. Naresh Kumar stands dismissed while Civil Revision No. 2768 of 1994 titled Naresh Kumar v. Sarwan Kumar stands allowed. The impugned orders are hereby set aside. 29. Before, I part with this judgment, I may also make a mention that the Court of Additional District Judge vide judgment dated 13.8.1994 have already given the suitable directions to the trial Court to dispose of the suit preferably within a period of six months from the date of the passing of that order by fixing dates in such a manner so that the suit may be disposed of within the abovesaid period. Unfortunately, the suit could not be disposed of by virtue of the Civil Revisions filed by the respective parties in the High Court which are hanging fire since 1994. The directions are given to the trial Court to dispose of both the suits, which have already been consolidated as told to me at the bar, by the learned counsel for the parties, within six months from the receipt of the copy of this order. There shall be no order as to costs in both the revisions. The parties through their counsel are directed to appear before the trial Court on 21st May, 2001. Order accordingly.