Appeal (L) No. 376 of 2013 in Notice of Motion No. 166 of 2013 in Suit No. 75 of 2013 with Notice of Motion No. 1800 of 2013. Case: Gopal Bhagwandas Ahuja Vs Jagdish Bhagwandas Ahuja & Ors.. High Court of Bombay (India)
| Case Number | Appeal (L) No. 376 of 2013 in Notice of Motion No. 166 of 2013 in Suit No. 75 of 2013 with Notice of Motion No. 1800 of 2013 |
| Counsel | For Appellant: Mr. Shailesh Shah, Senior Advocate, Ms. Mamta Sadh, Mr. S.K. Srivastav, Mr. Gunjan Shah and Ms. Kavita Srivastav i/b. S.K. Srivastav & Co. and For Respondents: Mr. Aspi Chinoy, Dr. V.V. Tulzapurkar , Mr. D.D. Madon, Senior Advocates, Mr. Zal T. andhyarujina, Mr. Ravi Gandhi, Mr. Punit S. Damodar, Mr. Mahek Kamdar i/b. Kanga & Co.... |
| Judges | D. Y. Chandrachud and M. S. Sonak, JJ. |
| Issue | Property Law |
| Judgement Date | October 08, 2013 |
| Court | High Court of Bombay (India) |
Judgment:
D. Y. Chandrachud, J.
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The Appeal arises from the judgment of a learned Single Judge dated 27 August 2013 dismissing a Motion for interim relief in a suit for partition. The Appellant is the original Plaintiff. For convenience of reference parties are referred to by their description in the suit. The Plaintiff and Defendants 1 to 8 are siblings, all of them being the children of Bhagwandas Ahuja who died on 14 April 1996. Between 1948 and 1969 Bhagwandas Ahuja carried on business of a kirana commission agency as a partner in a firm by the name of Mulchand & Co. The partnership firm had suffered larges losses and stopped its business activities in 1969. Bhagwandas was heavily indebted. On 5 February 1970 the first deed of partnership was entered into, with effect from 1969, under which the First Defendant commenced doing business in partnership under the name of Kanayalal Rameshkumar. The First Defendant was the eldest son of Bhagwandas, who had ceased to carry on any business. His other sons, Defendants 2 to 4 who were then minors were admitted to the benefit of the partnership. On 5 October 1973 Bhagwandas and his two partners in Mulchand & Co. filed a petition for insolvency in this court. Bhagwandas was declared as an insolvent on 5 October 1973. During the course of his examination in 1973 Bhagwandas stated that he had a liability of Rs. 25.80 lacs to 17 creditors; that he had not carried on any business since 1969 and that he had not invested any money with any firm or relatives. The First and Second Defendants were stated to be brokers in the kirana business. In 1976 Defendants 1 to 4 purchased a flat in Jolly Maker Apartments, Cuffe Parade, which was sold in 1982 to acquire four separate flats at andheri.
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In 1982, the First Defendant formed a partnership by the name of Rameshkumar Gopaldas together with the Plaintiff and the Second, Third and Fourth Defendants. In 1985 the Second, Third and Fourth Defendants exited from the firm of Rameshkumar Gopaldas and commenced their own businesses. Thereafter the business of the partnership was continued by the Plaintiff and the First Defendant. The Second, Third and Fourth Defendants cease to have any interest in the business, profits and funds of the partnership. The profits of the business have since been distributed between the Plaintiff and the First Defendant.
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In 1985, the First Defendant commenced a construction business in partnership with persons who were not members of the family, by the name of United Development Agency. In 1988 the First Defendant entered into a partnership with persons who were not members of the family in the name and style of CAMS Constructions for carrying on the business of construction. In 1989, the First Defendant entered into a partnership in the name and style of CAMS Developers for carrying on business as construction contractors with persons who were not members of the family. In 1989 the Plaintiff and the First Defendant formed a partnership with other partners including persons who were not members of the family in the firm name and style of CAMS India Corporation which carried on the business of construction contractors. In 1989 the Plaintiff who had joined the First Defendant as a partner in the business of CAMS India Corporation mortgaged his residential flat at Versova as security for obtaining a loan from the State Bank of India. In 1991 the Plaintiff and the First Defendant started carrying on the business in partnership by the firm name and style of Ahuja Constructions. Between 1991 and 2003, the Plaintiff and his wife were partners and shareholders in several partnership firms and companies set up by the First Defendant to undertake business initially as construction contractors and subsequently as developers.
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In 2001 the partnership firms and businesses of the First Defendant are stated to have accumulated losses of Rs. 35 crores. Between 2000 and 2003 the First Defendant proceeded to convert the partnership firms into private limited companies under Part IX of the Companies Act 1956. The erstwhile partners were allotted shares in the new companies in proportion to their capital ratio in the firms. When the companies raised capital by increasing their shareholding the Plaintiff did not subscribe to the additional shares. According to the First Defendant, in view of the accumulated losses of the partnership firm and businesses the Plaintiff wanted to exit from the business.
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On 4 November 2003 the First Defendant and the Twelfth Defendant entered into a partnership, which came to be called Shree Ahuja Properties, for carrying on the business of undertaking slum rehabilitation projects. On 25 August 2004 the partnership firm was reconstituted to bring in private limited companies as partners of which the Plaintiff was a Director. On 6 August 2007 the partnership firm of Shree Ahuja Properties was converted into a Private Limited Company by the name of Shree Ahuja Properties and Realtors Private Limited, the Sixteenth Defendant. In 2008-2009, Defendant No. 16 allotted 49% of the equity to Citi Properties for a consideration of Rs. 198 crores and obtained a loan of Rs. 225 crores from ICICI Bank.
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On 28 January 2008 the Advocates representing the Plaintiff and his spouse addressed a letter to Defendant No. 17 seeking inspection of various documents and registers of the company. On 1 June 2010 a letter was addressed by the Plaintiff asserting a claim of equal shares in the companies and partnerships
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The suit for partition was instituted before this Court on the Original Side. The case of the Plaintiff is that he together with Defendants 1 to 8 (and Defendants 9, 10 and 11 who are the children of a deceased sister) constituted...
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