MUSHTAK ALI KAZI, J.-This is an application under section 561-A, Cr. P. C fee quashing the proceedings of a criminal case started oar a direct complaint against the petitioner ire the Court of City Magistrate, Sukkur.
2. The facts in brief are that respondents 1 and 2 along with one Abdul Ghani and late Abdul Rahman started partnership business of commission agency known as Messrs Karim Bux Abdul Ghani Commission Agents at Wallace Ganj, Sukkur, on lot of April, 1961 under a partnership deed.
Later on Abdul Rahman died and his share was transferred to his wife. Mst. Bashiran mother of petitioner No. 1, Abdul Aziz. Abdul Ghani also retired from the partnership due to old age and his son Abdul Ghafoor was substituted as partner in his place. A fresh deed of partnership warts, therefore, executed in the year 1969 and specific amounts were assigned as being capital investment of each of such partners. Petitioners Nos. t and 2 were avoiding to settle the accounts and in the opinion of the chartered accountant firm who had examined the account books, subsidiary books of account had also been kept by the working partners and the entries in such books were not being brought over to the main books. Dr. Abdul Aziz, son of Abdul Rahman filed a complaint for criminal offences under sec--petition 4r 6/420, P. P. C. Against the petitioners Abdul Hakim and Muhammad Ramzan partners and against one Munshi of the firm. The learned City Magistrate.
Sukkur after holding preliminary enquiry ordered issue of non-bailable warrants against all the three accused for offence under sec--tions 420 and 406, P. P. C. On 2-7-1975. Meanwhile Abdul Ghaffoor the .Other sleeping partner files! a suit for dissolution of partnership, rendition of account" etc impleading Abdul Hakim, Muhammad Ramzan and Mst. Bashiran and the rest of the partners as co-defendants in the Court of Senior Civil Judge. Sukkur on 29th July, 1975.
3. It has been argued by Mr. M. I. Memon on behalf of the petitioners that no offence under section 406 or 420. P, P. C. Has been made out on the face of the complaint which has been filed seven years after Mst. Bashiran was admitted to the benefits of the partnership and the proceedings which arc in the nature of the abuse of the process of Court may accordingly be quashed. It has on the other hand been pointed out by Mr. Muzaffar Hassan on behalf of the complainant respondent No. 2 Dr. Abdul Aziz son of Mst. Bashiran that uoles3 evidence is recorded it would be premature to come to any finding whether a criminal offence is made out or not. Mr. Agha Ghulam A.I on behalf of she State supports the case of the peti--tioners and is of opinion that the matter being of civil nature a remedy under the Partnership Act would be an appropriate remedy since no offence under section 406 or 420 appears to have been made out on the fats stated in the complaint.
4. Admittedly the assets of the partnership belonged to each of the partners as co-owner of the whole of the common stock jointly. It is not the allegation to the complaint that any of tire petitioners were entrusted with this property or bad dominion over it. An owner cannot be entrusted with such dominion over his own property. There was, therefore, obviously no contract of entrustment between the petitioners on the one hand and Mst. Bashiran on the other.
5. The leading case on the subject is Man Mohan Das and others v. Mohendra Bhowal AIR 1948 Cal.
292 decided by Harries, C. J. And Blank, J. Of the Calcutta High Court. It was observed by Harries, C.
J., who wrote the judgment, that a partner cannot be prosecuted under section 406 for withholding the share of the profits to which the other partner is alleged to be entitled as the partner or joint owner of the partnership assets and each is only entitled to such part of the profits as the account would show is due to him. A partner cannot even sue another partner for his share of the profits but if he desires to claim what he alleged is due to him from the other partners he must file a partnership suit for dissolution of partnership and accounts and payment to him of what has bean found due on taking such accounts.
6. Theoretically a partner could be hold guilty of act offence under section 406, P. P. C.It could be established that any such partner was actually entrusted with such property in a fiduciary capacity and he had dishonestly misappropriated it or canvorted It to his own use. But it is difficult to conceive such a situation. Ordinarily the money received on behalf of the partnership is not received in A fiduciary capacity and all that could be alleged in such cases is that the remaining partners have been, withholding the opposite-party's share of the profits. The proper method of obtaining redress in such a case is to sue for dissolution and account; and if on taking such account any sum is found due to the opposite patty he would obtain a decree for it. Until such proceedings have been taken. It is quite impossible to say whether the opposite-party is entitled to anything at all. The criminal Court cannot be expected to go into the question of taking of partnership accounts. The real purpose behind filing such com--plaints is obviously to threaten the opposite-party so that they should core to terms.
7. The above Calcutta decision was relied upon in the case of Jalkrishna v. The Crown AIR 1950 Nag.
99. It was held by Homeon,1, that a partner cannot be guilty of criminal breach of trust or misappropriation. In Fall Bench case of Queen v. Okhoy Coomar 12 B L R 307 it was observed that the words of section 405 were wide enough to include the case of a partner if it be proved that he was in fact entrusted with the partnership property or with the dominion over it and had dishonestly misappropriated it or converted it to his own use. This view was, however, examined by a Division Bench in Gobindranath v. Kirdharilal (1894)1 Ch. 343 and it was observed that it was difficult tea conceive how such a situation could arise; for, a partner who received money belonging to the partnership on account of himself and his co-partners does not do so in a fiduciary capacity as held in Piddocke v. Burt (1894)1 Ch. 343.
8. In this connection it would be appropriate to quote Lindley on Partnership (9th Edn.), 559, that "no criminal prosecution is sustainable by one partner against another for stealing, or embezzling or obtaining by false pretences, or misappropriating the property of the firm."
Partners are joint owners or co-owners of the partnership property, viz., of the common stock.
Section 253(1), Indian Contract Act. Each partner is co-owner of this common stock, that he receives or pays share only in profits and losses arising therefrom, and though his share in the partnership property is only the value of his original contribution increased or diminished by his share of profits or lose. It is difficult, therefore, to conceive tow he can be entrusted with or with dominion over his own property or how he can dishonesty misappropriate it or convert it to his own use".
9. The latest case on the subject is Charanjeelal Sharma v. Raja Ram Single AIR 1964 Raj. 267 wherein it is observed that "even if it be assumed that a partner has failed to render accounts and is concealing the partnership books, it would not bring the case within section 406 of the Indian Penal Code. The partners are joint owners of tae partnership assets and each is only entitled to such part of the profits as an aunt would show is due to him . . . . . . . a partner cannot he held liable for a charge under section 406 of the Indian Penal Code for not rendering accounts to any partner and for withholding the share of profits of the other partner as it is not the function of a criminal Court to go into the accounts of partnership and determine the specific amount due to one partner from the other for his share of profits. This can only be done by a civil Court in a suit for accounts. In such circumstances the case of the petitioner so far as the above allegations are concerned, would not come under section 406 of the Indian Penal Code. The proper remedy for the complainant is to file a suit for dissolution of the partnership and rendition of accounts. Against the petitioner. At this stage the amount to his share of profits cannot be predicted.
10. Thus the petitioners being the partners could not be prosecuted for misappropriation nor could they be held liable for cheating. The proper remedy would be a suit for dissolution and account and this remedy has bee sought by the other partner, namely. Abdul Ghafoor. The matter is already e before the civil Court where the rights of all the parting would be adjudicated. This petition is, therefore, accepted and the proceedings pending in the Court of City Magistrate, Sukkur against the petitioners are quashed.