1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION SECOND APPEAL NO. 678 OF 2004 Shri Om Prakash Bhagwant Sanmukh ) Age 47 Occupation : Trading ) R/o. 4076, Shaniwar Peth, Miraj, ) Disrict Sangli. ).. Appellant Orig.deft. No.1) Vs. 1. Shri Vithal Bhagwan Sanmukh ) Since deceased through his legal ) heirs and representatives : ) 1a. Smt. Sushant Vithal sanmukh ) Age 54 yrs, Occ: Household. ) 1b. Shri Chetan Vithal Sanmukh ) age 30 yrs, Occ: Businiess. ) 1c. Kum Kirti Vithal Sanmukh ) Age 26 yrs, Occ: Household. ) 2. Sou. Rukmini Anand Sanmukh ) Age 55, Occu: Trading & Household. )..Respondents Mr.Ashutosh Gole, i/b. Mr. R.S.Apte, Advocate, for the appellant. CORAM: J.H.BHATIA,J. DATE: 6th August, 2009. JUDGMENT 2 1. Heard the learned Counsel for the appellant, who is the original defendant. 2. The facts in brief are that the respondent no.1/original plaintiff filed Special Civil Suit No.266 of 1990 for declaration and injunction and alternatively for dissolution of the partnership firm. According to the plaintiff, the plaintiff and defendant No.1 are the real brothers and defendant No.2 is the wife of their brother Anand. Initially, plaintiff, defendant No.1 and Anand had entered into a partnership in the name and style of M/s. Lucky Wine Mart on 4.6.1973. The partnership firm was for dealing in business of wine. The partnership was reconstituted on 30.6.1976 whereby the defendant No.2 was admitted as a partner instead of her husband and plaintiff and defendant NO.2 had 1/3rd share each in the loss and profit of the partnership. The licence for running liquor shop was obtained by the firm in the name of defendant No.1 alone and defendant No.1 was to manage all the affairs of the partnership firm and to run the business. According to the plaintiff, the defendant Nos. 1 and 2 were trying to oust the plaintiff from the partnership firm and to delete his name from the partnership. The defendants also obstructed the plaintiff from participation in the partnership business. Therefore, while filing the suit, he sought a declaration that Licence No.FLII No.4/89-90 and FLCL/TOD No. 3 3/89-90 are the properties of the partnership firm and he sought injunction restraining the defendants from changing name of the partnership or the wine shop. In the alternative, he sought dissolution of partnership firm and accounts. Defendant No.2 filed written statement and substantially admitted the contentions of the plaintiff, but she denied that she had entered into any conspircy to oust the plaintiff from the business. 3. Defendant No.1 contested the suit by filing written statement and denied that there was any partnership firm and that the business of wine run in the name of Lucky Wine Mart is that of the partnership firm. According to him, he alone is licensee and recently he has changed the name of his wine shop to Sheetal Wine Mart. According to him, the plaintiff, defendant No.1 and the husband of the defendant No.2 were running 3 different shops in the name and style of “Lucy Wine Mart”, “Lucy Agencies” and “Lucky Traders” respectively and independently. He submitted that there is no partnership in respect of any of these 3 shops and in the alternative, he submitted that the partnership was only formal but he alone was running the business and only for the purpose of convenience, partnership was entered into. According to to him, the partnership agreement was against the provisions of Section Sec. 23 of the Contract Act and Sec. 4 of the Indian Partnership Act. Such contract is 4 against the public policy and therefore, the plaintiff is not entitled to any relief. 4. The trial Court dismissed the suit holding that the plaintiff had failed to prove that he was joint owner or he had any interest in the business of the liquor shop. The plaintiff preferred Regular Civil Appeal No.84 of 2001 before the District Court, Sangli. The appellate Court came to conclusion that the plaintiff and defendant Nos. 1 and 2 had formed the partnership firm for the purpose of running the business of liquor in the name of M/s. Lucky Wine Mart. under the licence issued in the name of the defendant no.1. The appellate Court held that the plaintiff was not entitled to declaration that he is one of the owners of the licence nor he is entitled to injunction. However, the appellate Court found that the plaintiff/appellant is entitled to a decree for dissolution of the partnership firm and accordingly, he passed a decree. The said judgment and decree are challenged in the present appeal by the original defendant No.1. 5. On perusal of the Judgment of the first appellate court, it appears that the plaintiff examined himself and proved certain documents. Defendant No.1 did not enter into the witness box. The partnership firm of the plaintiff, defendant No.1 and defendant No.2 was registered and it was for the purpose of carrying out business in the name of M/s. Lucky Wine Mart. The necessary 5 certificate of registration has been issued by the Registrar of Firms vide Exhibit 110. It may be noted that liquor licence was issued by the Excise Authorities in the name of the defendant no.1 alone. In view of the rules framed by the Government under the Prohibition Act in respect of issuance of licence, a licence issued in the name of an individual cannot be transferred to any other person. Relevant part of Rule 40 reads as follows : “No person shall be recognized as partner of the holder of a vendor’s licence for the purpose of his licence, unless the partnership has been declared to the Collector before the licence is granted and the names of the partners have been entered jointly in the licence or if the partnership is entered into after the granting of licence, unless the Collector agrees on application made to him to alter the licence and (to add the name or names of the partner or partners in the licence. ....” 6. On perusal of this rule, Sec. 34(2) which stipulates conditions on which the licence is issued, it becomes clear that the licensee has to maintain certain stocks, accounts and has to pay all rent, costs, charges and expenses, licence fees, etc. If there is any violation or breach of the rules, the licensee is 6 responsible for the same. For that purpose, Rule 40 provides that no person except the licencee shall be recognized as the licencee or as partner in the business. However, there is no absolute bar on partnership firm holding licence. Rule 40 as quoted above, indicates that if the partnership firm was declared to the Collector before issuance of the licence and the names of the partners have been entered jointly in the licencee, all of them can be recognized as the partners. Similarly, Rule 40 also provides that if after issuance of licence a partnership is entered into unless the Collector agrees to alter the licence and to add the name or names of partners in the licence the partner will not be recognized. It is material to note that in the present case, the appellate Court has also clearly held that the plaintiff would not get a declaration that he is one of the licencees of liquor shop business nor he can seek a declaration that his name cannot be deleted from the partnership firm holding the licence. In fact, the appellate Court has clearly held that liquor shop licence stands in the name of the defendant No.1 alone. The transfer of that licence is possible only if the Collector under the Rules permits the same and not otherwise. Even though under the rules, framed under the Bombay Prohibition Act, the plaintiff, as a partner of the firm, is not recognized as such, the plaintiff could certainly insist for dissolution of partnership and accounts on the basis of the terms of the partnership deed. The liquor business can be run only after obtaining necessary 7 licnece under the Bombay Prohibition Act. That clearly indicates that the business of liquor is not totally prohibited or banned. It can be run subject to certain conditions and the licence which may be issued by the Government. Therefore, the contract of partnership to run such business is neither in violation of any provisions of the Partnership Act nor it violates sec. 23 of the Contract Act. 7. After hearing the learned Counsel for the appellant and perusal of the Judgment of the appellate Court, I do not find any illegality or perversity in the said judgment. The decree passed by the first appellate Court is strictly as per law and he has not given any relief which would violate the conditions of licence issued in favour of the defendant no.1 alone by the Authority under the Bombay Prohibition Act. Therefore, I find no substantial question of law involved in the present Appeal. 8. Therefore, the Appeal stands dismissed. 9. As the Appeal itself is dismissed, C.A. No.776 of 2004 for stay does not survive and stands dismissed accordingly. (J.H.BHATIA,J.)