Partnership with coparcener as working partner upheld where skill and labour alone formed valid separate contribution.

A valid partnership may exist between the karta of a Hindu undivided family and a coparcener who joins as a working partner by contributing only skill and labour. Partnership law permits persons to agree to share profits of a business carried on by all or any of them acting for all, and there is no legal bar merely because one participant is a coparcener. Skill and labour were treated as a real and valuable contribution, and as the separate asset of the individual coparcener rather than property of the family. The arrangement was not shown to be fictitious or otherwise invalid, so the partnership was upheld as genuine and legally effective.

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Issues: Whether a valid partnership can exist between the karta of a Hindu undivided family and a coparcener who joins as a working partner by contributing only skill and labour, without bringing in separate capital or severing from the family.

Analysis: The partnership law permits persons to agree to share profits of a business carried on by all or any of them acting for all, and there is no legal bar merely because one of the parties is a coparcener of the family represented by the karta. Earlier authority recognised that a coparcener may enter into a partnership with the karta in respect of his separate property, and the reasoning of later decisions did not displace that principle. The Court treated skill and labour as a real and valuable contribution capable of being the basis of consideration for partnership, and held that such contribution is not the property of the Hindu undivided family but the separate asset of the individual coparcener. The Court also noted that the partnership was not shown to be fictitious or invalid on any other ground.

Conclusion: A coparcener may validly become a working partner with the karta of a Hindu undivided family by contributing skill and labour alone, and the partnership in question was valid.

Ratio Decidendi: A valid partnership may be formed between the karta of a Hindu undivided family and an undivided coparcener where the coparcener contributes his own skill and labour as separate property and the arrangement is otherwise genuine.

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