The report contains a study of three cases from either High Court or Supreme Court. The cases have been observed on the following aspects: Parties of the case (Name you have to mention) and the name of the court Case is related to which Act (i.e. for e.g. Contract Act, Consumer Protection Act, etc.) Actual Issue related to the case Facts of the case Judgement given by honourable court.

1. Study of cases from High Court and Supreme Court

2. Case 1
Birdichand Sukhraj Marwadi Vs. Harakchand Jagraj Marwadi
I. Parties of the case
Petitioner:
Birdichand Sukhraj Marwadi
Vs.
Respondent:
Harakchand Jagraj Marwadi
Date of Judgment- 15/12/1939
II. Court and Region
High Court of Nagpur
III. Act
Indian Partnership Act 1932, Contract Act 1872
IV. Issue related to the Case
Whether an isolated adventure for the purchase and sale of cotton entered into by
two persons who agree to share the profits or the losses makes them partners
within the meaning of the Partnership Act.
V. Facts of the Case
The plaintiff purchased cartloads of cotton from a third party and the defendant
held half the share in the profit or the loss arising out of the said transaction. Since
the price began to fall, the defendant told the plaintiff’s to sell it. The plaintiff did
so and in order to recover the extra loss caused due to selling off the defendant’s
share of the cotton, the plaintiff sued the defendant for his half share in the loss.
The defendant argued that the said transaction, even if accepted as constituting

3. partnership, can’t be the basis for the plaintiff’s claim as the firm was not
registered. Section 69 (1) applicable here.
VI. Judgement given for the case.
Trial Court: The transaction was a partnership transaction and as per s.69 the suit
could not lie.
High Court
i. (Law) The court stated that there is no doubt that an “isolated adventure” could
constitute a partnership. However, a basic requirement that must be fulfilled with
regards to this is that the adventure should constitute a business and this business
should be on the joint account. Partnership rests on agreement and so long as the
agreement contemplates an outgoing and an incoming on the joint account in
respect of a business, the partnership is complete and all subsequent rights and
liabilities are governed by laws which relate to partnership. There is a difference
between cases of purchase of property for a joint user from those in which it is
purchased for a joint endeavour.
ii. Since, there could be neither profit nor loss until the cotton was resold the
transaction was not merely to purchase cotton for the purpose of sharing it
between them but to resell it. The transaction was on their joint account. Both the
parties were to share the profit or bear the loss half and half. That meant that
neither could sell his half of the cotton as an independent transaction in which he
alone was interested without the consent of the other. Whatever was done had to
be done on the joint account. Therefore it was a clear case of partnership and the
suit could not lie because of Section 69(1), Partnership Act.

4. Case 2
Deputy Commissioner of Sales-Tax Vs. Messrs k. Kelukutty
I. Parties of the case
Petitioner:
Deputy Commissioner of Sales-Tax, (law) Board of Revenue
Vs.
Respondent:
Messrs k. Kelukutty
Date of Judgment- 03/05/1985
II. Court and Region
Kerala High Court and Kerala Supreme Court
III. Act
Indian Partnership Act 1932
IV. Issue related to the Case
i. Whether when the partners constituting a partnership firm carrying on one business
constitute thereafter another partnership firm carrying on a separate and distinct
business are there two distinct partnership firms in whose hand the turnover of the two
businesses falls to be respectively assessed or is there in law only a single partnership
firm liable to assessment on the turnover of both businesses?
ii. Which law is more apt in the present situation to be applied; partnership law or Tax
law?
V. Facts of the Case
The respondent is a partnership firm dealing in timber. When the firm’s Sales Tax
Officer was assessing the firm’s turnover, he discovered that the partners of the firm
owned a saw mill, and the partners in that saw mill were the same as in the
respondent firm. It was also discovered that the respondent had not included the

5. turnover of the saw mill in their own turnover. The sales officer took the view that
since both firms had identical partners they were effectively one firm and was to be
treated as such and therefore the turnover of the sale of sawdust had to be included in
the earlier assessment made on the respondent firm. The Appellate Assistant
Commissioner, Sales Tax upheld the assessment order.
VI. Judgement given for the case.
Kerala High Court:
The two firms were separate firms in the eyes of law.
Kerala Supreme Court:
i. When an assessing officer agrees to assess the turnover of a firm, he must make sure
that the venture is a firm. This can be done by applying the necessary partnership
law modifying it according to the tax law applicable. The Kerala General Sales-Tax
Act contains no provision regarding this only partnership law should be
applied.[w.r.t issue ii]
ii. It is the partnership agreement that forms a partnership relationship, thus making it a
partnership’s basis. Partnership agreement may define different partnership relations
and thereby define different firms. The partners may be different and yet the
nature of the business may be the same, the business may be different and yet
the partners may be same. An agreement between the partners to carry on a
business and share its profits may be followed by a separate agreement between the
same partners to carry on another business and share the profits therein. The
intention may be to constitute two separate partnerships and therefore two distinct
firms. Each partnership is a distinct relationship. It will all depend on the intention
of the partners. [w.r.t Issue i]
They did not conclude as to the question whether there was one firm or two because
of lack of relevant evidence and asked Kerala General Sales-Tax authorities to find it.
They referred the case to the Appellate Assistant Commissioner, sales Tax for taking
up the appeal and resolved it in the light of their findings.

6. Case 3
Deputy Commissioner of Sales-Tax Vs. Messrs k. Kelukutty
I. Parties of the case
Petitioner:
Khushal Khemgar Shah & Ors.
Vs.
Respondent:
Khorshed Banu Dadiba Boatwalla & Anr.
Date of Judgment- 15/01/1960
II. Court and Region
High Court and Supreme Court
III. Act
Indian Partnership Act 1932
IV. Issue related to the Case
Whether the good-will of a firm is an asset or not?
V. Facts of the Case
D, who was one of eight partners in a firm, died on February 20, 1957. By virtue of a
provision in the partnership deed, the business of the firm was continued by the
surviving partners. The respondents, being the widow and son of D commenced an
action for an account of the partnership between D and the surviving partners,
claiming for the payment of the amount determined to be due to D at the time of his
death.
VI. Judgement given for the case
High Court (single judge): Ordered a decree for the account till Feb 20, 1957.

7. Division Bench: On appeal modified the decree holding that the respondents were
entitled only to interest at 6 % p.a. on the amount of D’s share in the assets of the
partnership, including good-will.
Supreme Court:
Contention (Appellants): Respondents as legal representatives of D were not entitled
to a share in the value of the good- will of the firm because good-will may be taken
into account only when there is a dissolution and not otherwise and furthermore,
because D had agreed that his interest in the good-will would cease after his death
and the business shall be continued by the surviving, partners.
A.N. Grover, J.C. Shah and K.S.Hegde, JJ. (Dismissed the appeal)
i. The good-will of a firm is an asset of the firm. In case of partnership business
continued by the surviving partners after the death of a partner, the Court can award
to the legal representatives of the deceased partner a share in the goodwill in the
absence of an express stipulation to the contrary.
ii. In interpreting the deed of partnership, the Court will insist upon some indication that
the right to a share in the assets is, by virtue of the agreement that the surviving
partners are entitled to carry on the business on the death of the partner, to be
extinguished. In the absence of a provision, the normal rule that the share of a partner
in the assets devolves upon his legal representatives will apply to the good-will as
well as to other assets.
iii. There is no indication in s. 55 of the Partnership Act that goodwill may be taken into
account only when there is a general dissolution of the firm and not when the
representatives of a partner claim his share in the firm, which by express stipulations
is to continue notwithstanding the death of a partner. Nor do ss. 39, 42 and 46 of the
Act support such a contention.

8. Bibliography
Birdichand And Ors. vs State Of Rajasthan (Rajasthan High Court May 9, 1957).
Wanchoo. (n.d.). Birdichand And Ors. vs State Of Rajasthan. Retrieved from Indian Kanoon:
https://indiankanoon.org/doc/1123952/?type=print
Singhvi, G. (n.d.). V.N.Shrikhande vs Anita Sena Fernandes. Retrieved from Indian Kanoon:
https://indiankanoon.org/doc/1421311/
C, S. (n.d.). Khushal Khemgar Shah & Ors vs Khorshed Banu Dadiba Boatwalla. Retrieved
from Indian Kanoon: https://indiankanoon.org/doc/1581571/
Stone, C. J. (n.d.). Birdichand Sukhraj Marwadi Vs. Harakchand Jagraj Marwadi. Retrieved
from Casemine:
https://www.casemine.com/judgement/in/5ac5e2f64a932619d903cde9