TMI Blog1970 (5) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... ounts towards the plaintiff No. 1 but as no accounts were rendered by the defendant, a suit for dissolution of partnership and rendition of accounts was instituted. 3. We need not go into the pleas taken on the merits of the case by the defendant: but as an additional plea, it was asserted by him that a route permit could not be transferred in favour of anybody and in the partnership deed the route permit also was transferred, therefore the partnership deed was illegal and the suit of the plaintiffs was not as such maintainable. Issues were struck in this case on 4th August, 1969 and issue No. 2 ran in the following words: Whether under law, no person can transfer a route permit to Anr. person and since there is no mention of transfer of route permit in the partnership between the parties, the partnership-deed is against law and what is its effect upon the present suit? O.P.D. After bearing arguments, the learned trial Judge by his order under revision relying on a Madhya Pradesh ruling reported as AIR 1966 Madh Pra 13, held that this partnership was not hit by any provisions of the Motor Vehicles Act and decided the issue against the defendant. It is against this order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he permit and shall not without such permission operate to confer on any person to whom a Vehicle covered by the permit is transferred any right to use that vehicle in the maimer authorised by the permit. On a plain reading of these two sections, particularly Section 59 the transfer of a permit from one person to Anr. is prohibited unless it is permitted by the Transport Authority who granted the permit. In this case admittedly on the date on which the partnership was entered into, the route permit stood in the name of the petitioner only. He could not transfer the permit either wholly or partly in favour of anybody (in this case the plaintiffs) without the permission of the Transport Authority mentioned in the Section. In this case the permit holder i.e., the defendant-petitioner has in clear and unambiguous terms transferred the 2/3rd of this permit in favour of the plaintiffs which is forbidden by law. On a plain reading of these sections no legal discussion is necessary but as some authorities have been referred to by the learned Counsel for the parties, it will be worthwhile to mention them. 6. The learned Counsel for the petitioner has referred us to AIR 1963 Mad 413 wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... separate capital account of the partners and that the share of profit of each partner was not credited in his account in the ledger. The officer placed no reliance on the Bati Khata maintained by the partners. On facts it was held by the S.C. that there was no evidence of transgression of the provisions of the Bengal Excise Act, 1911 and there was nothing affecting the validity of the partnership. The argument advanced before the Supreme Court was that the partnership was illegal being against Section 42(1) of the Bengal Excise Act, which read as under: 42(1): Subject to such restrictions as the State Government; may prescribe the authority who granted any licence permit or pass under this Act may cancel or suspend it (a) it is transferred or sub-let by the holder thereof without the permission of the said authority. Their Lordships of the Supreme Court came to the finding that there was no evidence that the excise licences were transferred or sub-let. The three shops, it appears, were managed separately and their accounts were kept distinct. So in this case as each of the brOrs. held a licence and all the three joined in a partnership agreeing to share the profits earned b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1966 Madh Pra 13 the narration of the facts would make it clear that it has no application to the facts of this case. The portion of the judgment relating to the facts may be quoted: ...Prior to the formation of firm Motor Bus and Truck plying business of Barwani was being carried on by Shri Dayabhai as a proprietary concern. But due to lack of proper administration the business was running in losses and to improve efficiency in management he admitted Shri. Chhotabhai Poonambhai as a partner and agreed to carry on the business of bus plying and Cinemas in partnership and accordingly this partnership, firm has been constituted. According to the deed the capital contributed by the partners was to be credited to their respective accounts. It said nothing about the transfer to the partnership firm of any permits held by Dayabhai or by any assets including buses and trucks belonging to him.... Then in para (5a) of the Judgment, it is again reiterated that such an agreement was neither illegal nor opposed to any statutory provisions. Their Lordships of the Madhya Pradesh High Court held that: If follows from the above propositions that partnership business in transport, can b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtnership was only an agreement and as the parties were aware of the necessity of getting the route permit transferred they had put down this term in the so-called partnership; the suit of the plaintiffs was maintainable. But in our opinion this argument is without any substance because according to the terms of this document the plaintiffs became owners of the truck as well as its permit right from 1st January, 1969, to the extent of 2/3rd. At that time admittedly there was no permission obtained from the Transport Authorities to transfer this share, in the permit to the plaintiffs. Therefore, in our opinion this partnership is hit by Section 59 of the Motor Vehicles Act and is illegal. The same view has been taken in a case decided by this Court viz., Mislri Alla Ditta v. Puran Chand decided on 30th April, 1962. 12. The last argument of Mr. D.D. Thakur was that the transfer of the truck i.e. the material of the truck did not require any permission of the Transport Authority. To that extent the partnership deed would be valid and not hit by the provisions of Section 59 of the Motor Vehicles Act and to that extent the suit should be allowed to proceed. But in our opinion even th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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