TaxTMI 
TaxTMI 
2024 (5) TMI 1697
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..... 47 of 2002 preferred by respondent No. 1- plaintiff. 3. The status and rank of the parties to the lis is as below: - Party Name Position before this Court Position in O.S. No. 67 of 1999 S. Raghuraj Reddy Respondent No. 1 Plaintiff M/s Shivraj Reddy & Brothers Appellant No. 6 Defendant No. 1 Late S. Shivraj Reddy Through his LRs (Appellant No. 1-5) Defendant No. 2 Dhanraj Reddy Respondent No. 2 Defendant No. 3 B. Narayan Reddy Respondent No. 3 Defendant No. 4 4. Respondent No. 1-plaintiff, along with defendant Nos. 2, 3, 4 and deceased M. Balraj Reddy [Died in 1984] had constituted a partnership firm-defendant No. 1 namely "M/s Shivraj Reddy & Brothers" (hereinafter being referred to as 'firm') on 15th August, 1978 with its primary business being the construction of buildings on a contract basis with respect to the works of the Government and Municipalities. 5. Respondent No. 1-plaintiff instituted O.S. No. 67 of 1997 [Initially filed as O.S. No. 3 of 1996 but later renumbered as (O.S. No. 67 of 1997)] seeking relief of dissolution of the firm and rendition of accounts. The learned II Additional Chief Judge, City Civi....
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....ed- (a) if constituted for a fixed term, by the expiry of the term; (b) if constituted to carry out one or more adventures or undertakings, by the completion thereof; (c) by the death of a partner; and (d) by the adjudication of a partner as an insolvent." 9. Learned counsel submitted that as per Section 42(c) of the Act, the death of a partner leads to automatic dissolution of the firm. He submitted that Shri M. Balraj Reddy i.e. Partner No. 3 in the firm admittedly expired in the year 1984 and consequent to his death, the firm stood dissolved automatically. 10. He further urged that it is settled law that it is the duty of the Court to dismiss any suit instituted after the prescribed period of limitation, although limitation has not been set up as a defence and thus, the learned Division Bench erred in allowing LPA No. 47 of 2002 and interfering with the judgment dated 19th October, 2001 passed by the learned Single Judge on the basis that the plea of limitation was never raised during the pleadings and thus, the learned Single Judge ought not to have dealt with the issue of limitation. 11. On these grounds, learned counsel for the app....
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....) 3 SCR 495 : AIR 1964 SC 1336] held (AIR para 9): "Section 3 of the Limitation Act enjoins a court to dismiss any suit instituted, appeal preferred and application made, after the period of limitation prescribed therefor by Schedule I irrespective of the fact whether the opponent had set up the plea of limitation or not. It is the duty of the court not to proceed with the application if it is made beyond the period of limitation prescribed. The Court had no choice and if in construing the necessary provision of the Limitation Act or in determining which provision of the Limitation Act applies, the subordinate court comes to an erroneous decision, it is open to the court in revision to interfere with that conclusion as that conclusion led the court to assume or not to assume the jurisdiction to proceed with the determination of that matter." (emphasis supplied) 16. Thus, it is a settled law that even if the plea of limitation is not set up as a defence, the Court has to dismiss the suit if it is barred by limitation. 17. The fact that the firm-defendant No.1 namely "M/s Shivraj Reddy & Brothers", was a partnership at will, is not in dispute. It is also not d....
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....rm. Even if it is assumed for the sake of argument that the partners were carrying on the business activities after the death of Shri M. Balraj Reddy, there cannot be any doubt that the firm stood dissolved automatically in the year 1984 as mandated under Section 42(c) of the Act unless and until there was a contract between the remaining partners of the firm to the contrary. There is of course, no such averment by the respondents. The business activities even if carried on by the remaining partners of the firm after the death of Shri M. Balraj Reddy, would be deemed to be carried in their individual capacity in the circumstances noted above. 20. The period of limitation for filing a suit for rendition of account is three years from the date of dissolution. In the present case, the firm dissolved in year 1984 by virtue of death of Shri M. Balraj Reddy and thus, the suit could only have been instituted within a period of three years from that event. Indisputably, the suit came to be filed in the year 1996 and was clearly time-barred, therefore, learned Single Judge was justified in accepting the C.C.C. Appeal No. 35 of 1999 and rejecting the suit as being hopelessly barred by lim....
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....Respondent No. 1- plaintiff was left at liberty to file separate applications for the appointment of Advocate Commissioner for taking the accounts in respect of the firm and for other appropriate reliefs. Being aggrieved, the defendant No. 1 and the firm defendant No. 9 preferred C.C.C. Appeal No. 40 of 1999 which came to be rejected vide judgment and decree dated 19th October, 2001, however, a declaration was passed that respondent No. 1- plaintiff can seek rendition of accounts for a period of three years prior to the date of filing of the suit and not beyond that. 30. Being aggrieved, defendant No. 1 and firm-defendant No. 9 filed LPA No. 37 of 2002 challenging the said judgment and respondent No. 1-plaintiff filed LPA No. 48 of 2002 challenging the observation that respondent No. 1- plaintiff cannot seek rendition of accounts beyond a period of three years prior to filing of the suit. 31. Learned Division Bench of the High Court of the Andhra Pradesh vide judgment dated 27th March 2014, dismissed the LPA No. 37 of 2002 preferred by defendant No. 1 and the firm-defendant No. 9 and allowed the LPA No. 48 of 2002 preferred by respondent No. 1-plaintiff, which are assailed in....