hence this appeal by the first defendant whose interest is identical with that of defendants 2 to 7.
as the term of the previous lease and of the licence to manufacture and sell salt which was the partnership business was to expire at the end of december 1942 one of the companytesting defendants served a numberice upon one of the plaintiffs to the effect that as.
in accordance with the rules of the salt department the requisite licence for the manufacture of salt was granted to the first defendant and the father of the defendants 2 to 7 in whose name the lease also stood.
4 of 1889 which will hereinafter be referred to as the act .
the answer further attributed fraud and evil intention to the other party.
in or about the year 1939 differences arose between the parties but the business companytinued to be carried on by the defendants 1 to in august 1941 in accordance with the changed policy of the government which substituted the practice of settling salt leases by renewal of the lease in favour of those lease holders whose companyduct had been satisfactory in the opinion of the department for the old practice of settling salt leases to highest bidders the companylector enquired from the old lease holders whose record had been satisfactory from the point of view of the salt department whether they would take renewal for a period of 25 years.
but an alternative case also was sought to be made out that even if the partnership did number companytinue after december 1942 as a result of.
p 15 a .
appeal from the judgment and decree dated december 10 1948 of the madras high companyrt in regular first appeal number 609 of 1946 arising out of the judgment and decree dated march 30 1946 of the companyrt of the subordinate judge of chicacole in original suit number 1 of 1943.
the acts of the defendants the benefit of the fresh lease for 25 years should be treated as an asset of the dissolved partnership business and should be taken into account in the process of dissolution of the partnership.
thus the exchange of the numberices aforesaid was a prelude to the institution of the suit on january 5 1943 that is to say even before the fresh lease had been executed by the government in favour of the companytesting defendants 1 to 7.
as regards the benefit of the renewed lease for 25 years the trial companyrt negatived the plaintiffs claim that the dissolved partnership carried any firm or trade name which companyld be said to have any tangible goodwill and that the defendants could number be restrained from carrying on the business in their own names as they had been doing in the past.
the terms of the new lease will have to be discussed later in the companyrse of this judg ment.
civil appellate jurisdiction civil appeal number 91 of 1954.
30000 for paying the premium for the lease and for other incidental expenses in running the factory in proportion to the shares just indicated.
accordingly they made their application in july 1942 and a fresh lease for 25 years was granted to them on april 15 1943 for the period january 1943 to december 1967 in pursuance of the companylectors order passed in numberember 1942 ex.
they companytributed a sum of rs.
the father of defendants 2 to 7 who had a five anna share in the business died in august 1935 and the defendants 2 to 7 were admitted as partners in place of their father.
the other defendants aforesaid their companyduct having been satisfactory were amongst those lessees who had been 2invited to make applications for the renewal of their leases.
the land and the factory where salt used to be manufactured by the parties are government property.
v. viswanatha sastri and r. ganapathy iyer for the appellant.
but on the alternative plea of the plaintiffs the companyrt after an elaborate discussion of english and indian law on the subject held that the plaintiffs were entitled to treat the new lease as an asset of the dissolved partnership.
m. rajagopala sastri and s. k. sastri for respondents number.
the reference in this judgment to i appellant will thus include the interest of the other number appealing defendants also.
it appears that the first plaintiff the father of plaintiffs 2 to 4 plaintiff 5 the first defendant and the deceased father of defendants 2 to 7 had made bids for the lease of the land and the factory and the highest bid of the defendants aforesaid was accepted and in pursuance thereof a lease for 17 years from january 1926 to december 1942 was granted by the government in favour of the first defendant and the father of defendants 2 to 7.
1 2 3 5 7 13 and 24 27.
the relevant facts of this case upon which the appeal depends may shortly be stated as follows the companytesting parties used to carry on the business of salt manufacture in accordance with the rules laid down by the government under the madras salt act mad.
the terms of the partnership will have to be discussed in detail hereinafter.
by a deed of partnership dated march 18 1926 the first plaintiff with a two anna share the father of plaintiffs 2 to 4 having a similar share and plaintiff 5 with anumberher two anna share on the one hand and the first defendant having a five anna share and the father of defendants 2 to 7 with the remaining five anna share entered into a partnership for running the salt factory.
the suit was instituted on the footing that the original partnership companytinued even after december 1942 inasmuch as the fresh lease had been obtained in pursuance of a unanimous resolution of all the partners to obtain the new lease for the partnership business.
the appellant as also.
the partnership was expiring at the end of the month the partners should settle their accounts and make arrangements for the disposal of the unsold stock of 82102 maunds of salt.
the reply to the numberice was given on december 28 1942 through an advocate alleging inter alia that the application for the renewal of the lease for a period of 25 years had been made on behalf and with the companysent of all the partners and that thus the partnership business was agreed to be companytinued even after the expiry of the term of the previous partnership.
the judgment of the companyrt was delivered by sinha j. the only question for determination in this appeal by the first defendant on a certificate granted by the high court of madras is whether the renewal of a lease for running a salt factory granted by the government in favour of the appellant and others defendants 1 to 7 companyld be treated as an asset of the dissolved partnership between the contesting parties.
on appeal by the plaintiffs and some defendants on the side of the plaintiffs the high companyrt of madras determined this controversy in favour of those appellants.
the trial companyrt decided this question in favour of the companytesting defendants.
october 6.
