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TMI Blog2007 (5) TMI 630X X X X Extracts X X X X X X X X Extracts X X X X ..... mine the shares held by the parties thereto. Ordinarily, the extent of an involvement made shall be the criteria for determining the share of the co-entrepreneurs. In absence of terms and conditions of the joint venture having not been reduced to writing, conduct of the parties how they dealt with affairs of the business would be relevant. If the contents of Ex. B-8 were accepted, it was not for the High Court to consider the consequences flowing therefrom, and, thus, but the fact whether the figure(s) contained therein could be verified from the books of account might not be very relevant. Whether, it would be in consonance with the pleadings of Appellants was again of not much significance if it can be used for demolishing the case of Plaintiffs and Defendant No.1 If the figures contained in Ex. B-8 were accepted, it was for Defendant No. 1 to explain the same and not for Appellants. The High Court, in our opinion, thus, committed a manifest error in not taking into consideration the contents of Ex. B-8 in its proper perspective. It was for the High Court to frame appropriate points for its determination in the light of the submissions made on behalf of Appellants in terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts. Appellant No. 1 is niece of late Narasimha Murthy. Her parents died when she was very young and unmarried. She was brought up by the said Narasimha Murthy and married to Appellant No.2 herein. Appellant Nos. 1 and 2 allegedly were close to the said Narasimha Murthy. At the time of marriage, Appellant No. 2 was a student of Veterinary Science at Madras. After securing B.V. Sc. Degree, he got an appointment in the veterinary department and later on became a B.D.O., and subsequently a Project Officer in the Urban Community Development of the Hyderabad Municipal Corporation. They allegedly approached Defendant No. 1 and late Narasimha Murthy to invest money in poultry business at Hyderabad; pursuant where to investments were made. Allegedly, an arrangement was entered into by and between the parties that profits of the said business can be shared by late Narasimha Murthy, on the one hand, and Defendant No. 1 and Defendant No.2, on the other, equally after giving due credit to the expenditure and interest to investments made @ 15% p.a. 7 acres and 14 guntas of land was purchased with the moneys advanced by late Narasimha Murthy and Defendant No.1 at Attapur near Hyderabad in the na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gation to the effect that Appellants herein approached the Defendant No.1 and late Narasimha Murthy for investment of money in the poultry business or that they invested any amount on the premise that the profits arising out of the said business can be shared by late Narasimha Murthy and Defendant No. 1 and the Defendant No.2 equally after giving due credit to the expenditure and interest to investments made at 15% p.a. was denied. The other allegations made in the plaint were also disputed. A plea that the suit was barred by limitation was also taken. 8. There is no document to show that any partnership came into being by and between the parties and/or their predecessors in interest. 9. It is, however, not in dispute that after the suit was filed, an Advocate Commissioner was appointed for making an inventory of the poultry farm. It was stated that late Narasimha Murthy merely advanced a sum of ₹ 5,000/- and as a good gesture of goodwill, his name was included as one of the vendees along with Defendant No. 2 in the purchase of the property by reason of the said deed of sale dated 02.12.1970. According to Appellants, Narasimha Murthy had never shown any interest in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the learned Trial Judge as also the High Court committed a serious error insofar as they failed to take into consideration the effect of Ex.B-8, which categorically goes to show that the accounts had been settled by and between the parties on 30.05.1979. The learned counsel urged that it may be true that no averment was made in the written statement in regard to the said document, but in view of the fact that Defendant No. 1 (Respondent No. 3 herein) having admitted the execution thereof, the same should have been taken into consideration for the purpose of determining the issue of limitation, if not for other purposes. 15. The learned counsel would submit that the High Court has also not bestowed any consideration in respect of the execution of deed of partnership dated 06.03.1978 entered into by and between the appellants with her daughter wherein Defendant No.1 (Respondent No.3) is a witness. 16. In any event, the learned counsel argued, there is nothing on record to show as to how the High Court came to a conclusion that the plaintiffs and Defendant No.1 had 2/3rd share in the business venture. The learned counsel submitted that the fact that Defendant No.1 (Respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r as issue No. 1 is concerned, we are satisfied that the business was a joint venture and not the sole proprietary concern of the Appellant No. 1, as urged by Mr. Subba Rao. 20. We may furthermore notice that a concession was made before the High Court that so far as the immovable property is concerned, having regard to the provisions contained in Section 45 of the Transfer of Property Act, 1894, Narasimha Murthy had = share therein. It is, thus, not necessary for us to go into the said question as correctness or otherwise of the said concession is not in question before us. 21. However, it is difficult for us to accept the reasonings of the High Court in regard to Ex. B-8. Plaintiffs (Respondent Nos. 1 and 2) were claiming the property as members of the Hindu undivided family. Admittedly, the interest of the Hindu undivided family was being looked after by Narasimha Murthy and after his death by Defendant No.1 (Respondent No.3). Correspondences were exchanged by and between Appellant Nos. 1 and 2 only with Narasimha Murthy and Defendant No. 1 (Respondent No.3). Yet again admittedly, Defendant No. 1 (Respondent No.3) was the manager of the Hindu undivided family. His dealing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not been proved. What was the subject-matter of the partnership had also not been considered by the High Court. A share in a joint venture, in absence of any document in writing, must be determined having regard to the conduct of the parties. The High Court proceeded on the basis that the plaintiffs and defendant No.1 had = share in the property in terms of Section 45 of the Transfer of Property Act. If the said immovable property formed assets of the joint venture, the same would be an india to determine the shares held by the parties thereto. Ordinarily, the extent of an involvement made shall be the criteria for determining the share of the co-entrepreneurs. In absence of terms and conditions of the joint venture having not been reduced to writing, conduct of the parties how they dealt with affairs of the business would be relevant. 26. The High Court does not say that the concession made by the learned counsel appearing on behalf of Appellants was incorrect. In a situation of this nature, particularly when the limitation issue required determination, Ex. B-8, in our opinion, should have received serious consideration at the hands of the courts below. 27. In terms of Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f examined on commission as he does not want to face the Court since his case is false. As regards the share of the 4th defendant who is the daughter of late Narasimha Murthy is concerned, the respondents are not entitled to her share as relinquishment of her share in the property is not evidenced by any document except Ex.B9 which is not a registered document. Therefore, the respondents cannot claim the share of the 4th respondent. Since neither late Narasimha Murthy nor respondent No. 1 obstructed the 1st appellant from carrying on the business in the half share of Ac.7.14 guntas of land, the appellants are not liable to account for profits earned by them by their own labour. If really the case of the respondents is that the poultry business carried on by the appellants is not the exclusive business of the 1st appellant, at the time of Ex. B8 they would have demanded for accounting of the profits. As regards the building constructed in the site, it is constructed with the money belonging to the 1st appellant and therefore, the respondents are not entitled for a share in the said building. At the most the value of the site on which the building is constructed may be awarded to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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