Case: G. Narayana Raju Vs. G. Chamaraju &amp; Others

1. The plaintiff G. Narayana Raju filed O. S. 34 of 1951-52 in the Court of District Judge, Mysore for partition and separate possession of suit properties mentioned in the various schedules of the plaint. The first defendant is the brother of the plaintiff. The second defendant is the widow of Muniswami Raju the eldest brothel of the plaintiff. The third defendant is the legal representative of the plaintiffs mother. She is now the appellant having been brought on record as the representative of the deceased plaintiff. The case of the original plaintiff was that he, the first defendant and Muniswamy Raju (husband of the second defendant) were the sons of one Gopala Raju and were all members of the joint family. Gopalaraju died in May 1931 and after his death the plaintiff and his brothers continued to be members of the joint family. The joint status of the family was severed by the issue of a registered notice by the first defendant to the plaintiff in July 1951. An ancestral house in Nazarbad belonging to the family was acquired by the City Improvement Trust Board in or about the year 1909. Out of the compensation paid for that house and supplemented by the earnings of the members of the joint family, the house item No. 1 of Schedule A to the plaint was purchased by Gopalaraju in or about the year 1910. Subsequently item No 2 of Schedule A was also purchased by Gopalaraju from the income of item No. 1 supplemented by the earnings of the members of the family. All the other items of properties mentioned in Schedule A and other Schedules attached to the plaint were acquired out of the income from items 1 and 2 of Schedule A. It was further alleged that the business known as "Ambika Stores" was also the joint family business and all the properties mentioned in the Schedules except items 1 and 2 of Schedule A were acquired out of the income of the members of the family including the income from the business of Ambika Stores. The plaintiff accordingly claimed that he and the first defendant would each be entitled to get 5/14th share and the second and third defendants would each be entitled to get 2/14th share. In the alternative the plaintiff pleaded that if for any reason the Court held that the properties stand in the name of Muniswami Raju and were not acquired with the aid of the joint family nucleus, he and the second defendant were entitled to equal shares as co-owners of the joint family business. The suit was mainly contested by the second defendant who asserted that the properties mentioned in all the Schedules of the plaint were self-acquisitions of Muniswami Raju and constituted his separate properties. It was alleged that Muniswami Raju was the only earning member of the family at the time of the acquisition of items 1 and 2 of Schedule A properties and the plaintiff and the first defendant were employed in petty jobs Wesley Press. Muniswami Raju later on employed the plaintiff in his shop as a salaried servant and the latter had no proprietary right in the business of Ambika Stores. After consideration of the oral and documentary evidence the District Judge held that the plaintiff, first defendant and Muniswami Raju were not divided and that the only property which was divisible was item No. 1 of Schedule A and there was not sufficient ancestral nucleus for acquisition of the other properties and that all were the self-acquisitions of Muniswami Raju, that Muniswami Raju never blended his properties with that of the joint family, that the plaintiff was only an employee under Muniswami Raju and therefore he was not entitled to the alternative relief claimed by him. Accordingly, the District Judge granted a preliminary decree holding that the plaintiff was entitled to 2/7th share in item No. 1 of Schedule A. The plaintiff took the matter in appeal to the Mysore High Court. By its judgment dated March 25 1960 the High Court affirmed the decree of the trial Court with the modification that besides item No. 1 of Schedule A item No. 2 also should be held to be joint family property and the plaintiff was entitled to partition of his share in this item also. The High Court cancelled the direction of the District Judge that the plaintiff should account for the moneys and properties of Muniswami Raju in his hands before he is given possession of his share.

Court's reasoning:
It is well established that there is no presumption under Hindu Law that business standing in the name of any member of the joint family is a joint business even if that member is the manager of the joint family. Unless it could be shown that the business in the hands of the coparcener grew up with the assistance of the joint family property or joint family funds or that the earnings of the business were blended with the joint family estate, the business remains free and separate.The question therefore whether the business was begun or carried on with the assistance of joint family property or joint family funds or as a family business is a question of fact4. It was, however, contented on behalf of the appellant that the finding of the lower courts is vitiated in law because of the circumstance that they have not taken into account three important documents Ex. D, Ex. E and Ex. DDD. We are unable to accept this argument as correct. It is manifest on a perusal of the judgment of the High Court that all the documents have been examined regarding the issue whether the business of Ambika Stores was a joint family business of Muniswami Raju7. It was finally contended on behalf of the appellant that, in any event, the appellant became a co-owner of the business along with Muniswami Raju by reason of contribution of his own labour towards the development of the business. In our opinion, there is no substance in this argument. It is evident that the appellant gave up his job in Wesley Press and joined Ambika Stores about 9 or 10 months after it was started by Muniswami Raju. The appellant does not state in his evidence that he was a co-owner when he joined Ambika Stores. On the other hand, in Ex. 68 which is an application dated March 20, 1928 by the appellant to the City Co-operative Bank, the appellant has described himself as a clerk in Ambika Stores and Muniswami Raju has been described as his proprietor. There is no satisfactory evidence on behalf of the appellant to show as to when and under which circumstances his status of a clerk changed to that of a co-owner. In another application, Ex. 1 which is of the year 1929 the appellant has described Muniswami Raju as the proprietor of Ambika Stores and he has described himself as doing out-door commercial business with Ambika Stores. Again, in Ex. C which is a loan application made in 1932 by both the brothers, Muniswami Raju has been described as the proprietor of Ambika Stores while the appellant has been described as a General Merchant of Mysore. Reference was made on behalf of the appellant to recitals in Ex. DDD a mortgage deed dated June 20, 1934 in which Muniswami Raju and the appellant have been described as proprietors of Ambika Stores. We have already dealt with this document and for the reasons already mentioned we hold that the description of the executants was only given for the purpose of borrowing from the Bank and it had not the legal effect of making the appellant a co-owner of the partnership business. There is no evidence of any assertion by the appellant during Muniswami Rajus lifetime of his being a co-owner of the partnership business, nor is there any evidence of recognition by Muniswami Raju of any such right of the appellant. On the other hand, there is sufficient evidence to show that whatever the appellant d id in connection with the business was only done with the authority conferred by Muniswami Raju. In our opinion the High Court has rightly rejected the claim of the appellant that he was a co-owner of the partnership business.