IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.SASIDHARAN NAMBIAR TUESDAY, THE 8TH JULY 2008 / 17TH ASHADHA 1930 WP(C).No. 6500 of 2008(W) ------------------------------------- OS.412/1994 of SUB COURT,THALASSERY .................... PETITIONER: ------------------ UPPIMMERAKATH PUTHIYAPURAYIL JAMSHEELA ABDUNAVAS, AGED 22 YEARS, D/O.MUHAMMED KUNHI RESIDING AT JAMSHEELA, CHUNGAM, PAPPINISSERI AROLI, KANNUR DT. BY ADV. SRI.A.MOHAMED MUSTAQUE SRI.M.K.SUMOD SRI.KAUSER EDAPPAGATH RESPONDENTS: ---------------------- 1. S.P.SHEFEEQUE, S/O.N.MOHAMOOD EMPLOYED IN ABROAD, SAFIA MANZIL VALAPATTANAM, KANNUR TALUK, KANNUR DT. 2. P.M.ABDUL SHUKKUR, S/O.P.MAMMU BUSINESS, PUTHIYA MADATHUMMAL HOUSE VALAPATTANAM, KANNUR DT. 3. T.T.P. RAZIYA, W/O. P.KOYA NO OCCUPATION, UDUMBUMTHALA HOUSE THIRUVANGAD, THALASSERY. BY ADV. SRI.K.P.HAREENDRAN - R3 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 08/07/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C).6500/2008-W APPENDIX PETITIONER'S EXHIBITS: EXT.P1: COPY OF THE JUDGMENT IN W.P.(C).NO.28417/06 DATED 10/10/2007 OF THIS HON'BLE COURT. EXT.P2: COPY OF THE COUNTER STATEMENT FILED BY THE PETITIONER. EXT.P3: COPY OF THE FINAL DECREEE APPLICATION ALONG WITH ORDER NO. IA NO.1233/00 IN OS NO.412/94 DATED 22/01/2008. RESPONDENT'S EXHIBITS: NIL // TRUE COPY // Rs/ M. SASIDHARAN NAMBIAR, J. ------------------------------------------ W.P(C). NO. 6500 OF 2008 ------------------------------------------ Dated this the 8th day of July, 2008 JUDGMENT When the assets of a partnership firm is to be sold on dissolution of the partnership firm, whether the sale is to be effected only among the partners of the firm or can it be by public auction is the question to be considered in this writ petition. O.S. 412 of 1994 was filed by one of the partners of the firm for dissolution of the firm. A preliminary decree was passed on 21.12.1996 directing that partnership firm be dissolved with effect from the date of auction of the plaint schedule property being the sole asset of the partnership firm. As per the order of the court plaintiff is entitled to get Rs.15,000/- being his share capital invested and defendants 1 to 9 are also entitled to get Rs.15,000/- each being their amount invested and 10th defendant is entitled to Rs.30,000/- invested by him. The plaint schedule property be sold and the sale proceeds be shared among the partners according to their contributions. A final decree application was filed thereafter. In the final WPC6500 of 2008 2 decree application, petitioner filed an application to get herself impleaded as an assignee of the other partners. It was originally dismissed by the learned Munsiff. It was challenged before this court in WP(C) 28417 of 2006. Under Ext.P1 judgment this court impleaded petitioner and directed the Sub Judge to dispose final decree application. In the final decree application an order was passed on 22.1.2008 directing sale of the property only in between the partners. The said order is challenged in this petition filed under Article 227 of Constitution of India. 2. Learned counsel appearing for petitioner and respondents were heard. 3. Learned counsel appearing for petitioner argued that preliminary decree provides for sale of immovable property which is the sole asset of the partnership firm and division of the assets of the firm to the partners and being a transferee of the partners, petitioner is entitled to get the shares of her assignors and if the property is to be sold only among the sharers the property will not fetch the actual price and therefore property should either be sold in public or petitioner should also be permitted to purchase the property. Learned counsel WPC6500 of 2008 3 appearing for third respondent, contesting respondent, argued that as provided under Section 29 of the Partnership Act petitioner being a transferee from the partner is only entitled to receive the share in the assets of the firm and when court has found that the property is to be sold among partners she is only entitled to get a share in the said sale proceeds and the order of learned Sub Judge is not illegal or irregular warranting interference. 4. The Partnership Act does not contain similar provisions like Section 2 and 3 of the Partition Act. Partition Act enables the holder of a share or sharers of one moeity and above to file a petition to sell the property if the property is not devisable. In such a case, Section 3 enables any other sharer to apply to the court to purchase the share of the party who files an application to sell the property. If no other sharer files an application, court is bound to make a valuation of the property and offer to sell the property to that sharer. If more than one sharer files an application seeking leave to purchase the share of the other party, court is bound to offer sale of the property to that sharer who offers the highest price. When the Partnership WPC6500 of 2008 4 Act does not contain a similar provision, court was not justified in restricting the sale in between the partners alone. 5. Section 29 enables an assignee of a partner, who will step into the shoes of the partner, to claim the share of assets at the time of dissolution of the firm and also the share of profits of the firm to which the transferring partner is entitled to. If the partner is entitled to “the share of the assets of the firm to which the transferring partner is entitled”, she is definitely entitled to get the share in the actual value of the assets of the firm. If the property is to be sold only among the partners and that too when the shares of all other sharers except that of the petitioner in the final decree and third respondent and another, is purchased by the petitioner and the property is to be compulsorily given to any of the other three sharers, it is definite that the property will not fetch the actual value. If that be so, it is clear, the real value of the assets of the firm cannot be fetched. In such circumstances learned Sub Judge should have directed sale of the property in public auction so that the property would fetch maximum value which would be beneficial to all the partners. The order passed by the learned Sub Judge dated 22.1.2008 is WPC6500 of 2008 5 quashed. Learned Sub Judge is directed to sell the property by public auction without restricting the sale among the partners. Writ petition is disposed of as above. M. SASIDHARAN NAMBIAR, JUDGE Okb/-