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TMI Blog1935 (12) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... that its terms were that the plaintiff firm should take the property upon lease for fifty-one years beginning from the date of the agreement at an annual rent of Rupees 308-12-0, and that a formal lease was to be executed; but there is a finding that the date for the execution of the lease was left indefinite and that it depended upon defendant 1 himself having a title to convey, upon the Thakore (who is admittedly the owner of the land) letting it first to Naran, and Naran then letting it to defendant 1. A number of defences were raised but were overruled, and the execution of a registered lease was ordered. In this second appeal by defendant 1 four points are urged; (1) that the plaintiff firm consists in fact of more than twenty members ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Now it is incontrovertible that the members of the firm of the Bavla Vishnu Cotton Ginning Factory must be treated as members of the company of which the firm is a member. If an authority for this is needed, it is to be found in Pannaji Devi chand v. Senaji Kapurchand (50 Mad. 175). That case had an off shoot under a similar name in the Bombay Presidency, and has been reported in 36 Bom. L.R. 786 as Pannaji v. Senaji, and eventually the Madras case went in appeal to the Privy Council, and the appellate judgment (which merely accepts the reasoning of the High Court of Madras and dismisses the appeal) has been reported in Senaji v. Pannaji (32 Bom. L.R. 1607). The case is relied upon by the learned counsel for defendant 1 as dealing with a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exactly what part the sub-partners took in the business. But as they have been described as sub-partners, it is reasonable to take it that they were in fact what is usually meant by a sub-partner. A sub-partner is described in Lindley on Partnership, Edn. 10, at p. 66: he is a stranger who agrees with one of the partners of the firm to share the profits derived by that partner from the firm, and it is said by the learned author that this arrangement does not make the stranger a partner in the original firm but constitutes what is called a sub-partnership which in no way affects the other members of the principal firm. A case is cited in which a certain person agreed with one of the partners in a business that he should be interested in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urposes of section 4, Companies Act. I hold that in this respect there is no objection to the suit. It is then contended that the agreement in fact created an immediate demise of the property and operated as an actual transfer and therefore required writing and registration under section 107, T.P. Act, and in the absence of writing and registration, cannot now be enforced. I agree that since the plaintiff firm actually took possession of the property upon the very day of the agreement and paid rent, it is difficult to say that the agreement did not amount to a lease within the definition of section 105, T.P. Act, and to that extent is void. But the agreement was also an agreement for a lease and I do not know why, in so far as it is an agr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... depended upon the date when defendant 1 obtained his title to lease the land, and that would not be until the Thakore had first leased it to Naran and Naran leased it to defendant 1. Nor do I see any objection to enforcing the agreement on the score of limitation. It could not be enforced until the defendant got his title, and it appears from the judgment of the learned Assistant Judge in appeal that the deed which the Thakore and Naran had to execute in favour of defendant 1 before defendant 1 could get his title was not executed until the year 1927. This suit has been brought in the year 1928 and is clearly in time. The last point however is serious for the plaintiff. Defendant 1 is a partner of the plaintiff firm and he is being sued by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the firm in the taking of the partnership accounts was entitled to credit of the sum in dispute. This question does not seem to have been considered at all by the learned Assistant Judge before whom the present appeal was brought, and it may be that the matter was not raised in this Court; but it was raised in the trial Court, and the equitable principle referred to in Rustomji v. Seth Purshotamdas, (25 Bona. L.R. 306) was considered but I think misunderstood. I do not think that the learned Judges who decided Rustomji v. Seth Purshotamdas, (25 Bom. L.R. 606) would have extended the equitable principle to cover a case as the present, which cannot be adequately dealt with merely by a declaration of a right to a credit on the partnership ..... X X X X Extracts X X X X X X X X Extracts X X X X
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