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PINNAMANENI MADHAVA RAO V/S KOLLI BASAVAYYA, decided on Monday, July 16, 1973.
[ In the High Court of Andhra Pradesh, C.R.P. No. 2306 of 1972. ] 16/07/1973
Judge(s) : A.V. KRISHNA RAO
Advocate(s) : V. Sivaramasastry. M. Jagannatha Rao.
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    A.V. Krishna Rao J.1. This is a revision petition under Section 115 Civil Procedure Code filed by the 1st Defendant who was the petitioner in I.A. No. 645/1971 in O.S.No. 36/1959 on the file of the Court of the Subordinate Judge. Machilipatnam seeking to revise the order of dismissal of the petition by the Court. The prayer in the said petition was that the suit should be dismissed as having abated due to the death of the 3rd defendant one of the partners. The application was made when the Court posted the suit for the passing of a final decree.2. The relevant facts giving rise to the present controversy may be stated. O.S. No. 36/1959 was filed by the plaintiff therein impleading defendants 1 to 25. The suit was for dissolution of partnership and settlement of accounts of a partnership in a rice mill styled as Sri Rajeswari Rice Mill Contractors Company. The suit was dismissed by the trial Court. The plaintiff referred an appeal A.S. No. 75/1961 on the file of the Court of the Additional District Judge Krishna. The appeal was allowed on 4-3-1964 sad a preliminary decree was passed. It defined the shares of the plaintiff and the various other defendants. The preliminary decree also declared that the partnership stood dissolved on 20-12-1958 by efflux of time and ordered a settlement of accounts of the partnership from 20-12-1956 to 20-12-1958. A commissioner was appointed to settle the accounts. Against that decision passing a preliminary decree by the first appellate Court. Second appeal No. 661 of 1964 was filed in the High Court dismissed the appeal on 9-11-1968 thereby confirming the decree passed by the first appellate court. The Commissioner who was appointed to look into the accounts recorded the evidence and filed his report on 11-2-66. The second appeal to the High Court was preferred by three defendants. The 3rd defendant was the third appellant in the second appeal. During the pendency of the second appeal the 3rd defendant died on 13-6-1965. The 3rd defendant left behind him his wife sons and daughters. They were not brought on record in place of the deceased third appellant in the second appeal. This fact was not brought to the notice of the Court before the hearing and disposal of the appeal. After the filing of the report by the Commissioner on 11-2-1966 the suit was posted for the passing of a final decree on 27-8-1971 when 1st defendant filed I.A.No. 645/1971 urging that as the 3rd defendant died on 13-6-65 and as no legal representatives were brought on record is the second appeal the suit itself had abated and that therefore no final decree could be passed and that the report of the Commissioner arrived at without the legal representatives of the 3rd defendant being on record also was bad. The plaintiff was made the sole respondent to the petition. The lower court dismissed application on the ground that when once the preliminary decree was passed in the suit defining the shares of the various parties who were partners in the business and a direction regarding the settlement of accounts was given the death of the 3rd defendant during the pendency of the appeal did not cause the suit to abate. In support of his view he relied upon the decision of the Madras High Court in Perumal Pillay v. Perumal Chetty (1928) I.L.R. 51 Madras 710 (F.B.).3. In this revision petition preferred by the 1st defendant the order of the court below is sought to be attacked on the ground that on the death of the third appellant in appeal the appeal itself as a whole had abated and the decree of the High Court confirming the preliminary decree was a nullity and that as the appeal was a continuation of the suit it must be held that the suit itself inclusive of the preliminary decree had no legal existence as the suit itself must be deemed to have abated. While the respondent's counsel appearing for the plaintiff in the main contended that even if the appeal had abated as a whole by reason of the death of the third appellant (3rd defendant in the suit) what abated was only the appeal and it did not further have the consequence of nullifying the preliminary decree passed by the appellate court. The preliminary decree which was competently passed in the presence of all the necessary parties continued and the final decree could be passed by the Court below at any time. Having record to the arguments before me though they cover a wide ground the two questions that fall for determination in this revision are.-(1) What is the effect of the death of the 3rd defendant who was the third appellant in the second appeal without his legal representatives being brought on record in an appeal arising out of a suit for dissolution of partnership and rendition of accounts ?(2) Where a preliminary decree was validly passed does the fact of abatement in whole of an appeal against the preliminary decree put at end to the preliminary decree and the suit in which was passed ? The answers to these two questions depend upon the provisions of Or. 22 Rule 3 read with Rule 11 of the Code of Civil Procedure. Or. 22 Rule 3 Civil Procedure Code reads as follows :(1) Where one of two or more plaintiffs dies and the right to sue does not survive to the surviving plaintiff or plaintiffs alone or a sole plaintiff or sole surviving dies and the right to sue survives the Court on an application made in that behalf shall cause the legal representative of the deceased to be made a party and shall proceed with the suit (2) Where within the time limited by law no application is made under sub-rule (1) the suit shall abate so far as the deceased plaintiff is concerned and on the application of the defendant the Court may award to him the costs which he may have incurred in defending the suit to be recovered from the estate of the deceased plaintiff.4. Rule 3 governs cases where during the pendency of a suit the sole plaintiff or one of the several plaintiffs dies while Rule 4 governs cases of the death of the sole defendant or one of several defendants Rule 11 of Or. 22 makes the provisions of Or. 22 applicable in so far as may to appeals by stating that the word 'plaintiff' shall be held to include an appellant that the word 'defendant' a respondent and the word 'suit' an appeal. The relevant rules applicable in the present case is Or. 22 Rule 3 read with Rule 11 C.P.C. In the present case out of the three appellants one died. Does the right to prosecute the appeal survive to the other two appellants? If it does not an application will lie to the appellate court to cause the legal representatives of the deceased appellant to be made a party within the time limited by law. If no such application is made the appeal shall abate so far as the deceased appellant is concerned as per sub rule (2) of Rule 3. In the instance case as no application to implead the legal representatives of the 3rd defendant-third appellant was filed the second appeal had abated so far as the deceased third-appellant is concerned. Then the question is did the appeal abate as whole? Whether an appeal abates partially i.e. with reference to the deceased appellant only or whether the appeal had abated as a whole depends upon the nature of the particular suit which gave rise to the appeal.5. The suit in the present case is by one of the partners for a dissolution of the partnership and rendition of accounts such a suit brings about a severance in the jural relationship of the parents and determination of their mutual rights as partners. The position of the partners in a suit of this type is that each of the partners is really in turn a plaintiff and defendant and the Court has to adjudicate upon the rights and liabilities of each of the partners relatively to the other partners. In such a suit a court may pass a decree in favour of the plaintiff against the defendant or defendants or in favour of any defendant or defendants against the plaintiff. In order to institute a suit of this type for dissolution of partnership and rendition of accounts all the partners or their legal representatives must be made parties. They are necessary parties for the disposal of the subject matter of the suit. The taking of accounts in such a suit cannot be done as between some only of the partners. Has the second appeal abated in the instant case as a whole having regard to the nature of the suit? On facts such as the present the position is no longer in doubt having regard to the latest pronouncement of the Supreme Court in R.P. Gupta v. Murli Prasad A.I.R. 1972 S.C. 1181. The second appeal must be held to have abated as a whole.6. The relevant facts in the Supreme Court case are that in 1954 one Parasnath Prasad had filed a suit for dissolution of partnership and rendition of accounts. A preliminary decree was passed by the trial court in 1959 in which the respective shares of the various partners and their heirs were declared and an account was ordered. There was an appeal to the High Court to which all the partners were parties. The High Court set aside the decree of the trial court and the suit was dismissed. Some of the partners filed two separate appeal to the Supreme Court from the Judgment of the High Court. One Jagdish Narain who was the respondent in both the appeals died on 8-12-1969 when the appeals were pending in the Supreme Court. His heirs have not been brought of record and it was contended before their Lordships that the two appeals before the Supreme Court in which the deceased partner was impleaded as a respondent had abated as a whole and that they were otherwise incompetent. In dealing with the question the majority of the Bench constituting Vaidialingam and Palekar JJ. and observed thus (Page 1181 Paragraph 16).Under Rule 43 r/w Rule 11 of Order XXII C.P.C. the appeal abates as against the deceased respondent where within the time limited by law no application is made to bring his heirs or legal representatives on record. As pointed out by this Court in the State of Punjab v. Nathu Ram (1962) 2 SCR 636 (A.I.R. 1962 S.C. 99) it is not correct to say that the appeal abates against the other respondents. Under certain circumstances the appeal may not be proceeded with and is liable to be dismissed. But there is so not because of the procedural defect but because as Mulla has pointed out it is part of the substantive law (See Mulla C.P.C. Vol 1 Thirteenth Edition p. 620 under note Non-joinder of parties). No exhaustive statement can be made as to the circumstances under which an appeal in such case cannot proceed. But the courts as pointed out in the above decision have applied one or the other of three tests. The courts will not proceed with an appeal (a) when the success of the appeal may lead to the court's coming to a decision which may be in conflict with the decision between the appellant and the deceased respondent and therefore it would lead to the court's passing a decree which will be contradictory to the decree which had become final with respect to the same subject matter between the appellant and the deceased respondent; (b) when the appellant could not have brought the action for the necessary relief against those respondents alone who are still before the court and (c) when the decree against the surviving respondents if the appeal succeeds be ineffective that is to say it could not be successfully executed. These three tests as pointed out by this court in Sri Chand v. Jagdish Parshad Kishan Chand (1966) 3 SCR 451 : (AIR 1966 SC 1427) are not cumulative tests. Even if one of them is satisfied the court may dismiss the appeal.7. It was further observed thus (at page 1185 in paragraph 18):In this connection attention is invited to the following passage in Nathu Ram's case at page 640:The abatement of an appeal means not only that the decree between the appellant and the deceased respondent has become final but also as a necessary corollary that the appellate Court cannot in any way modify that decree directly or indirectly. The reason is plain. It is that in the absence of the legal representatives of the deceased respondents the appellate court cannot determine anything between the appellant and the legal representatives which may affect the rights of the legal representatives under the decree. It is immaterial that the modification which the court wilt do is one to which exception can or cannot be taken. (Underlining mine).These observations have been made with reference to the appellant and the deceased respondent but they are equally applicable where a decree is passed between a respondent and a deceased respondent in a partnership suit. Murali Prasad the respondent has obtained a decree from the High Court to the effect that deceased Jagdish Narain can claim no share against him and if the appellants were to succeed in these appeals it will inevitably lead to the conclusion that deceased Jagdish Narain would have a share against Murali Prasad and the appellate court would not be in a position to modify the High Court decree directly or indirectly since that decree has become final as between Murali Prasad and the deceased Jagdish Narain.8. Then dealing further with the question their Lordships approved the decision in Ramdayal v. Junnenjoy Coondoo (1887) I.L.R. 14 Cal 791 that a suit for partnership accounts after a necessary party defendant was omitted was liable to be dismissed. They referred to the decision in Amir Chand v. Ravji Bhai A.I.R. 1930 Mad 714 wherein it was held that a suit for accounts could not be maintained between some only of the partners of the firm and that every partner must be made a party. That the same consideration applied to an appeal arising out of a suit for dissolution of partnership and accounts was stated by a reference to Raj Chander Sen v. Gangadas seal (1904) 31. Ind. App. 71 (P.C.). In the Privy Council case it was observed by their Lordships that in the absence of the legal representatives of one of the partners the Court had no option and that the appeals were idle. The Supreme Court also referred to the decision in Kunj Behari Lal v. Ajoubla Prasad A.I.R. 1947 Oudh 28 to the following effect:Wherein an appeal arising out of a suit for accounts and partition of partnership property which cannot be determined in the absence of all the parties interested some of the respondents die and their legal representatives are not brought on the record within limitation and the right to sue does not survive against those respondents alone whose names are already on the record the appeal fails in to.9. They then went on to observe that in view of the clear position of law in this respect the failure to bring on record the heirs or legal representatives of deceased Jagadish Narain one of the sharers in the subject-matters of the suit must inevitably lead to the dismissal of the appeals. Though the case before the Supreme Court was one where the matter was governed by rule 4 (3) read with Rule 11 of Or. 22 the decidendi of the case is equally applicable to the present case where the matter is governed by Or. 22 Rule 3 read with Rule II Civil Procedure Code. The Supreme Court held that the appeals could not be proceeded with and should be dismissed.10. In view of the clear and categorical enunciation of the law relating to partnership suits and the applicability of the relevant provisions of Or. 22 no useful purpose would be served by referring to the decisions of various High Courts cited before me laying down the same proposition. So it has to be held in the instant case that the second appeal before the High Court had abated as a whole.11. At the time second appeal was heard by this court it must be held to have been not properly constituted and it ceased to be maintainable. The ultimate judgment though it is one of dismissal confirming the preliminary decree passed by the appellate Court is of no legal effect what soever. The position would have been the same even if in the second appeal was allowed by setting aside the preliminary decree or there was a modification or variation of the preliminary decree. The legal representatives of the 3rd defendant were necessary parties to the appeal and there was no appeal in the eye of law as the Court would be dealind with the rights of a dead person viz. the 3rd defendant who was a necessary party to the appeal and whose legal representatives were not brought on record. The judgment in second appeal is of no legal effect whatsoever. It is immaterial whether the appeal was dismissed or allowed. This view that the second appeal was not properly constituted and was not maintainable at the time it came to be heard is supported by a judgment of a Division Bench of this Court in L.P.A.No. 140 of 1970 dated 9-11-1971 to which I was a party. (Kothapally Ayyavarappa and others v. Uppalapathi Singa Raju and others). In that case the plaintiffs had filed a representative suit against some defendants alleging inter alia that the suit property was endowed property and that the defendants 1 to 3 were trustees of the property endowed for the purpose of maintaining a tank. It was prayed that the trustees should be removed and a scheme should be prepared regarding the suit tank and for recovery of the property endowed from the trustees. The defendants had contended that the lands in question were granted as personal inam to them. They denied that they were trustees in respect of the lands. As a result of the findings on various issues the suit went against the plaintiffs. The plaintiff carried the matter in appeal to this Court. While the appeal was pending the 2nd defendant who was the 1st respondent in the appeal died. There was an order of court earlier that the appeal as against the 2nd defendant stood dismissed as his legal representatives were not brought on record. The appeal came to be heard by a learned single judge of this court who had disagreed with the conclusions come to by the trial court and allowed the appeal and remanded the same for the framing of a Scheme. In the Letters Patent Appeal preferred by the defendants 'Gopala Rao Ekbote J. (as he then was) and myself relying upon the decision in State of Punjab v. Nathu Ram A.I.R. 1962 S.C. 89 held that the appeal heard by the single judge was improperly constituted We accepted the contention of the learned counsel for the appellants that the appeal before learned single judge was not maintainable. In that view of the matter we refused to go into the merits of the appeal observing that we could not go into the merits of the appeal. We set aside the judgment of the single Judge as not maintainable in the absence of the legal representatives of the 2nd defendant and that it was not maintainable even as against the others.12. In the instance case before us it follows that the second appeal itself was not maintainable before the learned single Judge as having been improperly constituted and the appellate Judgment has no existence in the eye of law.13. My view therefore on the first question is that by reason of the death of the 3rd defendant third appellant in the second appeal without his legal representatives being brought on record the second appeal in the High Court has abated as a whole. The appeal when it came to be heard was an improperly constituted appeal and the same was not maintainable and the judgment passed therein is of no consequence whatever.14. That leads me to the second question viz. what is the position with reference to the preliminary decree passed by reason of the decree of the first appellate court decree of the view expressed by me regarding the first question put an end to the preliminary decree and the suit wherein it was passed.15. On the day when the first appellate court had passed the preliminary decree all the necessary parties were present. It was a perfectly valid and binding decree in the suit. Having regard to the language of Or. 22 Rule 11 C.P.C. what had abated was only the second appeal and it had abated as a whole.16. Whatever doubt there was as to the true effect of a preliminary decree passed in a suit for partition suits on mortgages or in suits for dissolution and rendition of accounts of a partnership the nature and consequence of the passing of a preliminary decree is no longer is doubt by reason of the judgment of the Privy Council in Lakhmi Narayan v. Balmakund I.L.R. 4 Pat. 61 = A.I.R. 1924 P.C. 198. In the case before the Privy Council a preliminary decree by consent was passed by the High Court on appeal in a suit for partition. Thereafter the suit was remitted to the Court of the Subordinate Judge to see that the necessary steps for effecting the partition pursuant to the directions contained in the preliminary decree made by the High Court. Before the Subordinate Judge when the matter was posted no steps were taken by the plaintiff. Some of the defendants who were represented also took no steps. For want of further prosecution the Subordinate Judge had dismissed the suit. That was set aside by the High Court. It was observed by the Privy Council as follows:After a decree has once been made in a suit the suit cannot be dismissed unless the decree is reversed on appeal. The parties have on the making of the decree acquired rights or incurred liabilities which are fixed unless or until the decree is varied or set aside. After a decree any party can apply to have it enforced.17. The principle of the above Privy Council case was invoked by a Full Bench of the Madras High Court in Perumal Pillay v. Perumal Chetty (1928) I.L.R. 51 Mad. 710 (F.B.). There a preliminary decree was passed in a mortgage suit on 18-11-1921. The plaintiff died on 25-2-1922 before a final decree was passed. There was no application made within three months of the plaintiff's death to bring the legal the representatives on record. It was contended that in those circumstances the suit must be deemed by the provisions of Or. 22 Rule 3 C.P.C. to have abated. The said contention was negatived by the Full Bench after referring to the decision of the Privy Council in Lakhmi Narayan v. Balmakund I.L.R. 4 Pat. 61 = A.I.R. 1924 P.C. 198. It was ruled by the Full Bench that Or. 22 Rules 3 and 4 did not apply to the state of circumstances in the case.18. It was faintly argued by the learned counsel for the petitioner that the case dealt with by the Full Bench was a mortgage suit and that in the instant case it is a partnership suit seeking dissolution and claiming accounts. I do not think that can make any difference. The principle enunicated by the Privy Council in the case of a preliminary decree passed in a partition suit was applied by the Full Bench of the Madras High Court to the case of a preliminary decree passed in a mortgage suit and I do not see any difficulty in applying the dicta of the Privy Council to this case of a partnership suit where a preliminary decree was validly passed by a competent Court.19. In the instance case as already discussed and held by me there was never any valid second appellate decree. The preliminary decree passed by the first appellate court is a valid decree. The rights and liabilities of the partners were fixed by the preliminary decree. That decree had not been (and in this case it could not have been) varied or set aside. The position therefore after the preliminary decree is passed is that there is no question of abatement of the suit even if it had happened that the 3rd defendant died after the first appellate court passed the preliminary decree 20. What now therefore remains is the passing of a final decree. It would be open to any of the parties to the suit to move that further proceedings be taken for the passing of a final decree and initiate supplementary proceedings for that purpose. Such proceedings have been initiated in this case. The court below passing the final decree must have before it all the necessary parties to the proceedings which means that the legal representatives of the deceased 3rd defendant must be made parties. The trial court will direct necessary steps to be taken in this behalf before passing the final decree. The trial court will consider any objections that may be raised on behalf of the legal representatives of the deceased 3rd defendant to the Commissioner's report. Time for this purpose will be granted to them after they are brought on record. The learned counsel for the respondent had urged that there should be a de novo enquiry into the accounts by the Commissioner. I cannot accept this contention. There can be no prejudice to the interests of the legal representatives of the 3rd defendant if their objections to the Commissioner's report are heard and disposed of as directed by me.21. As a result of my above discussion. I am of the following opinion relevant to the present controversy which is as follows:(1) In a suit for dissolution of partnership and settlement of accounts once a preliminary decree is passed the death of one or more of the partners after the passing of the preliminary decree does not cause the suit to abate even though no legal representatives of the deceased partner or partners are brought on record. Rules 1 3 and 4 of Or. 22 C.P.C. have no application to such a case.(2) After the passing of a preliminary decree in such a suit if any partner who is either an appellant or a respondent dies and no legal representatives are brought on record the appeal abates as a whole. The appeal itself becomes not maintainable and the appellate court would not have the competence to processed with the appeal.(3) Thereafter if in ignorance of the fact of the death of any of the parties to the appeal the appellant court proceeds to hear the matter and passes a decree either of affirmance or variation or reversal the decree is of no consequence whatever.(4) The preliminary decree passed subsists notwithstanding the appeal and its abatement.(5) The trial court must proceeds to pass a final decree when approached to do so.(6) Such a final decree cannot be passed without impleading the legal representatives of the deceased partner.22. Before concluding I must however make a reference to the conduct of the 1st defendant who is the petitioner herein. He had filed the second appeal in the High Court along with the 3rd defendant. He was aware of the death of the 3rd defendant. Yet he had taken no step to implead the legal representatives of the 3rd defendant. The appeal was heard at his instance and the other appellants. In view of this conduct I should have been reluctant to interfere in this revision even if a contrary conclusion could be come to on merits as interference with the order of the Court below would perpetuate an injustice and put a premium on the conductor the 1st defendant resulting to the nullification of the suit itself. As stated by the Court below I.A. No. 645/71 was a very belated application filed by him when the Court posted the matter for the passing of the final decree.23. I find that the Orissa and Allahabad High Courts have amended Rule 12 of Or. 22. The said rule as it stands reads thus:Nothing in Rules 3 4 and 8 shall apply to proceeding in execution of a decree or order.24. The amendment introduced by the said two High Court add at the end of the rule the following words:-or to proceedings in the original court taken after the passing of the preliminary decree where a final decree also requires to be passed having regard to the nature of the suit.25. If such an amendment as is made by the High Courts of Orissa and Allahabad are also made by this Court to Or. 22 of the Code of Civil Procedure much argument perhaps could be avoided in Courts. In spite of the fact that the decisions rendered by the various High Courts after the decision of the Privy Council in Lachmi Narayan v. Balmkund I.L.R. 4 Patna 61 = A.I.R. 1924 P.C. 198 leaves the matter in on doubt whatever.26. For the reasons given above. I hold that the dismissal of the petition I.A.R. No 546/1971 by the Court below is correct and is not liable to be interfered with in revision petition therefore fails and is dismissed with costs.C.R.P. dismissed with costs.