' The plaintiff and the four defendants are brothers Inter se and have been carrying on business in the name of N. Hassan Ali & Co , dealing mainly in the manufacture of Ice and aerated water. The profits and losses of this concern have been shared by the parties equally. Although all the brothers were in joint management, for the purposes of practical convenience, the departments concerned seem to have been separated and the plaintiff has been in charge of what has been known as the Sundries department. Defendants No, 3 and 4 while not the sleeping partners have also, it would seem, been less actively concerned with the management of the business and each of them has been in charge jointly with one of the other two defendants of some other department.
It does not seem that until 19t9 there were any differences between the parties but in that year some differences arose which affected also the harmonious conduct of the business and as a result the plaintiff initiated proceedings which ended in an arbitration by Mr. S. A. Moulvi, advocate.
The plaintiff alleged embezzlement on the part of the defendants as also mismanagement of the business.
2. While proceedings before the arbitrator were in progress defendant No, 4 on 15-3-1973 served a notice asking for dissolution of the firm and followed this up by a suit on the 21st of June, 1973 for dissolution of the partnership and accounts. This suit was No, 261/73 and various applications were filed by the parties in that suit including the application by the present plaintiff who was of course one of the defendants, for appointment of a receiver. All these applications were heard together by my learned brother Patel, J., and the orders which he passed included one for the appointment of the Nazir as a receiver. In the meantime the arbitrator gave an award which has since been filed in Court but has not yet been made a rule of the Court and all that need be said about this award is that arbitrator found that substantial sums of money were to be paid by defendants Nos. 1 and 2 both to the plaintiff and to defendants Nos. 3 and 4 and that he held that the allegation against the present plaintiff that he has embezzled money of the firm was not established. On the 27th of May, 1974 defendant No, 4, that is to say, the plaintiff in Suit No, 262/73 withdrew that suit without asking for permission to file a fresh suit and the suit was, therefore, dismissed as withdrawn, but the Court held that the present plaintiff could if he so chose file his own suit. On the 2nd of June, 1974, the plaintiff served a notice stating inter alia that the firm stood dissolved by reason of the earlier notice given by defendant No, 4 but that in any case without prejudice thereto he was giving a fresh notice for dissolution and he then filed the present suit and the application which is now before me is his application for the appointment of a receiver.
3. Mr. Imdad All Agha appearing for defendants 3 and 4 contested the application upon the sole ground that the deed of partnership between the parties dated the 31st October, 1964, according to him, did no A in fact bear the signature of defendant No, 3 and that, therefore, there, was no partnership between the parties and the suit was not maintainable Defendant No, 3 has filed no affidavit and this allegation appears in the a davit of defendant No,
4. In proof of the assertion that it does not bear defendant No, 3's signature it is alleged that defendant No, 3 was at that time in London and this allegation, it was said, his passport would bear out. Unfortunately, however it is said that the passport is lying locked and that the key is with defendant No, 3 himself who is away at Multan and has therefore not been able to file his affidavit. Now the deed does in fact bear what is the purported signature of defendant No, 3 and this allegation therefore really means that according to defendant No, 3 his signature has been forged and indeed it was later expressly alleged by Mr. Agha that it was forged by the plaintiff. It is somewhat curious that this Deed should have been executed in 1964, since when admittedly the partners have been carrying on business as such, that they have paid income-tax upon the basis of being partners, that no such objection was raised in the earlier suit and that generally the parties have throughout these years carried cn their business as partners and that the absence of defendant No, 3's signature or rather its forgery should have been discovered by counsel while preparing this case. Even assuming, what I find extremely difficult to believe that the deed did not bear his signature the partnership could exist even without a written deed and, although ivIr Agha had first attempted to argue that there could be no partnership without a written deed, he had finally to concede that this was not so. I cannot possibly hold even for the purpose of this application for a receiver that there is no partnership between the parties.
4. Mr. Agha then went on to argue that the form of the suit should then have been different and should have been based upon the true facts which according to him would be that there was a partnership though not written in a formal agreement. It is difficult to believe that there was no normal and written agreement for until a partnership deed is registered with the income-tax authorities will those authorities tax the income on the basis of a partnership but, assuming that this was in fact so the form of the suit would be no different. It would still be a suit for dissolution and accounts and I, therefore, think that there is no substance in Mr. Agha's objections.
5. Mr. A. M. I. Nomani appearing for defendants No, 1 and 2 had two substantial objections to make.
In the first place he argued that the present was not a partnership at "will" and he relied upon clause (2) of the deed which reads thus :- "(2) Any partner desirous of determining the partnership shall give three months previous notice in writing to the other partners of his intention to do so and on expiration of such period the partnership shall terminate accordingly as to the partner giving such notice."
' Relying upon the language of this clause he argued that in the first place a notice did not automatically result in a dissolution bit took effect only after three months and this also did not result in a termination of that partnership but only in a severance of the connection of the partner giving such notice from the firm. It will be noticed that the last few words of the clause are "shall terminate accordingly as to the partner giving such notice". In other words it was said that the termination is only quo such partner while the firm itself continued.
6. On the other hand clause (1) of the deed runs thus "(1) The partnership shall be deemed to have commenced as from 1st September, 1964 and subject to the conditions hereinafter contained shall be a partnership at will."
Now here in an ambiguous language the partnership is described as being at "will". The question therefore is whether clause (2) controls clause (1) so as to make it a partnership other than one at on merely the method by which the dissolution shall take place. I must confess that the language of clause (2) leaves something to be desired so far as the clarity is concerned. The interpretation of learned counsel for the plaint Mr. Wajihuddin was that the two clauses are entirely independent and that clause (2) provides only for a situation where a partner not desirous of winding up a business but only of withdrawing from the partnership could give notice to that effete. This might be so. It is, however, to be noticed that clause (2) itself starts with the words "any partner desirous of terminating the partnership" and would therefore seen to me that clause (2) provides only for the method by which the partnership which Is one at "will" may be dissolved. The question is not free from difficulty and I am after all dealing with only an application for receivership and I, therefore, do not think it right to attempt to decide more than is necessary for that purpose. In either view of the matter the position would be that the plaintiff at least would be entitled to withdraw and would be entitled to accounts. The purpose of appointing a receiver always is to safeguard the interests of the parties pending the final decision of the g Court and it seers to me that since all the parties share equally in the profit and losses it is to their joint interest that the assets be in the meantime maintained and the profits earned so as to leave more for the parties at the end. In any view of the matter, therefore the objection based upon the language on clause (2) does not in my opinion militate against the appointment of a receiver.
7. The second objection advanced by Mr. Naumani was that the plaintiff himself is guilty of embezzlement and has not come with elean hands and for this purpose he relied upon a report of the Nazir in regard to the months of March and April, 1974 which shows sales in the Sundry Department of only Rs, 210.50 and 797.75 There is nothing in the report which establishes any kind of embezzlement but it was argued that this department which was in the charge of the plaintiff shows this very meagre amou at of sales and thus proves mismanagement and/or embezzlement by the plaintiff inasmuch as, it was alleged that earlier very much more business passed through this department. This is explained by the plaintiff on the ground that this department was dealing mainly in the licenses of the business which were really utilized for the other departments and that these have been, by the defendants, diverted now to the departments concerned. If this be so of course then there is no fault to be found in these sales for the licenses are still being utilized for the concern and the reduction in the figures of the Sundry department is immaterial. On the other hand it would give some support at least to the plaintiff's allegation that he has been willfully deprived of a real share in the management. The other allegations as to embezzlement have been negative by the arbitrator and although his award has not yet become the rule of the Court and I cannot at present stage of the case come to any final conclusion on these matters. I think I must regard the arbitrator's finding as prima fade correct. I am quite unable to agree, therefore, that the plaintiff is disentitled from maintaining this application on the ground of misconduct.
8. Upon the merits of the question whether a receiver should be appointed or not it does seem to me, first, as I have already indicated that the main consideration must be the protection of the interests of all the parties. Besides the question whether a receiver should be appointed was gone into at great length and thoroughly by my learned brother Patel J, in the former suit and I am in entire agreement with that order. The situation in all material respects, is the same, the present also bein a suit for dissolution of partnership and accounts between the same parties in regard to the same firm. I have, therefore, come to the conclu sion that it is just and convenient to appoint a receiver.
9. During the course of the hearing of this application I asked the parties to inform me whether, in the event of my Ting to this conclusion they could agree upon the name of a perm wh ) n they could all trust as a receiver but they failed to give me such a na are and I, therefore, appoint the Nazir as a Receiver.