HABIB Versus HAJI MUHAMMAD

This suit was filed on the 25th of January 1960 and is directed to the dissolution of partnership firm namely Messrs Abdul Latif Jusab, accounts and for the appointment of Receiver. Subsequently an amended plaint was filed on 23rd February 1963, as Haji Abdus Shikoor, who was plaintiff No. 1 in the original suit, died and his legal representatives had to be brought on record.

2. Briefly stated the facts alleged in the plaint were that plaintiffs 1, 2, 3 and 4 on the one hand and the defen dants 1, 2, 3 and 4 (the last‑mentioned defendant being pro forma defendant) on the other carried on business of Karyana, in general merchants and commission agents in co‑partnership along with deceased Haji Abdus Shakoor at Jodia Bazar, Karachi, under the name of Messrs Abdul Latif Jusab upon terms and conditions contained in partnership deed dated 30th July 1956; that this partnership was dissolved in the month of July 1959, when pro forma‑defendant No. 4 and plaintiff No. 1 retired ; that on 6th July 1969, plaintiffs 2, 3 and 4 and the defendants 1, 2 and 3 executed another partnership deed along with late Haji Abdus Shakoor with a view to carrying on the same business in the same name namely Messrs Abdul Latif Jusab; that the branch office of this partnership was opened at , Chittagong and the books of account of the firm contained at Karachi Office showed Rs. 11,000 as credit in the name of the said branch office; that simultaneously with the execution of the deed of partnership dated 7th July 1959, the deceased, plaintiffs 2, 3 and 4 defendants 1, 2 and 3 executed an agreement whereby it was agreed to pay the debts of the old firm amounting to Rs. 2,41,628‑3‑3 and further to pay the additional debts of Rs. 1,81,069‑2‑6 which did not figure in the books of account; that according to the terms of partnership deed dated 6th July 1959, plaintiff No. 2 and defendant No. 1 were to jointly manage the affairs of the firm and operate its Bank accounts; that this partnership did not do any business except that it utilized import licenses received by it from the Government and the profits thus earned utilized towards the payment of debts and income‑tax liability; that on 2nd January 1960 intimation was received from the bankers of the firm that import licenses for the year 1960 had been received and that plaintiff No. 2 had defendant No. 1 to sign and return the relevant forms; that accordingly plaintiff No. 2 signed the said forms but defendant No. 1 refused to do so and consequently late Haji Abdus Shakoor and plaintiffs 2, 3 and 4 opened a separate bank account in the name of the partnership as they apprehended that otherwise the import licenses would lapse and the firm would be a loser; that defendant No. 1 informed the bankers not to act on the signatures of the plaintiffs alone and as a result late Haji Abdus Shakoor and plaintiffs 2, 3 and 4 sent a legal notice to defendant No. 1 asking him to cooperate so that the import licenses of the firm could be utilized but in his reply defendant No. 1 laid down certain conditions upon which alone he agreed to cooperate; that according to the present balance‑sheet of the firm it was indebted to the extent of Rs. 2,68,545‑10‑3 out of which a sum of Rs. 59,365‑14‑0 had been paid since the inception of the firm; that the firm was additionally indebted in the sum of Rs. 1,81,069‑2‑6 as per Annexure `B' attached with the plaint; that income‑tax dues of the old firm, for 1951‑52 and 1952‑53, amounting to Rs. 31,000 were being paid in instalments of Rs. 1,500 per month: that income‑tax for the subsequent years, which when assessed, would have to be paid by the partnership firm; that late Haji Abdus Shakoor had a personal investment in the firm amounting to Rs. 34,000 apart from Rs. 75,000 which was credited to his daughthers and near relatives; that defendants 1 to 3 are indebted to the firm in the sum of over Rs. 1,43,000 as appearing in the balance‑sheet; that defendant No. 1 in collaboration with his son, nephew and defendants 2 and 3 have adopted an obstructive attitude to the prejudice of the interest of the plaintiffs; that in the events which have happened it has become impossible to continue the partnership business, the object of defendants 1 to 3 being to avoid receipt of import licences by the firm so as to put undue pressure on the plaintiffs and that in these circumstances when the plaintiffs asked the defendants to agree to the dissolution of the partnership firm they refused.

3. The record of the case shows that from amongst the four defendants only defendants 1 and 2 filed a joint written statement, but no written statement appears to have been filed on behalf of defendants 3 and 4, although they subsequently filed objections against the report of the Commissioner. For the sake of brevity the contents of the written statement of defendants 1 and 2 need not be reproduced as their defence is fully reflected in the objec tion which they filed against the report of the Commissioner and to which reference would be made in detail.

On 25‑1‑1960, plaintiff No. 1 was appointed as Receiver of the Partnership business but on 18‑2‑1960, he was removed and instead Nazir of this Court was appointed receiver. On 12‑4‑1960 the Nazir was removed from that position and instead Shareef, plaintiff No. 2, was appointed as Receiver. On 24‑5‑1961 a preliminary decree was passed in this case with the consent of parties and Mr. S. A. Moulvi Advocate was appointed as Commissioner to go through the accounts of the firm and to submit a report upon its dissolution. The order further directed that Shareef, plaintiff No. 2, was to discharge his duties as Receiver under the superintendence of the Official Assignee of this Court.

By an order dated 12‑3‑1962, Mr. Moulvi was directed that in the first instance he should determine the indebtedness of the firm and to make a report. In obedience to this order Mr. Moulvi submitted his report on 23‑12‑1962 and confirmed that all debts (i.e. mentioned in the account books and those not so mentioned) were proved except that out of 22 debts relating to creditors, from outside the account books, the names of only creditors could be ascertained while the names of the rest of 13 creditors could not be ascertained although their debts were also proved. This report of M. Moulvi came for consideration before late Mr. Justice Khamisani on 1‑5‑1964 who directed the Commissioner to submit another report showing the total assets and liabilities of the partnership firm. It was further observed in that order that since the report of Mr. Moulvi was submitted nearly after three long years it was of no assistance and conse quently the question of its acceptance "at this stage, in my view, does not arise". In obedience to his order Mr. S. A. Moulvi again went into the accounts of the firm and submitted his final report. Objections were filed against this report and when the matter came up in Court on 4‑10‑1966, it was ordered that the case should go back to Mr. Moulvi with directions that he should file a further report after taking into consideration the objection of the parties and the question of the entire liabilities of the firm. In consequence of this order the matter was once again referred to Mr. Moulvi who enquired into it, in line with the directions contained in the order of remand, and thereafter he submitted his final supplementary report on 15‑2‑1966. Against this report two sets of objections were filed by the parties one by the plaintiffs on 25‑3‑1968 and another by defendants 1, 2 and 3 on 12‑3‑1968. Defendant No. 4 however chose not to file any objections. The learned counsel for the parties stated at the Bar that the only report of the Commissioner, which required consideration, was the final supplementary report dated 15‑2‑1968 and that the consideration of his previous reports would be wholly unnecessary.

4. I would first deal with the objections of the plaintiffs which were formulated by Mr. A. A. Fazeel, their learned counsel as under :‑

(1) That the learned Commissioner was wrong to hold that some of the debts shown in Exhs. 57 and 58 were not genuine ;

(2) That he was wrong to have taken into consideration the accounts of the Partnership firm of 1956 ;

(3) That he erred by holding that some of the debts mentioned in these, documents were time‑barred;

(4) That he was wrong that the income‑tax liability was the responsibility of individual partners and trot that of the firm; and

(5) That he was wrong in holding that the goodwill of the partnership firm, which was sold to the plaintiffs, including the liabilities of the firm as well.

5. In his address upon objection No. 1, Mr. Fazeel, the learned counsel pointed out that neither the Court nor the Commissioner had doubted the genuineness of‑Exhs. 57 and 58, and consequently Mr. Moulvi was wrong to hold that some of the debts mentioned in th6m were not genuine. In his preliminary report the learned Commissioner had come to the conclusion that all debts mentioned in Exh. 57.were genuine, but in record to the debts mentioned in Exh. 58, he was of the view that only nine debts were genuine and the rest fictitious. In coming to this conclusion the learned Commissioner took into consideration two documents Exhs. 57 and 49, which were respectively produced before him by the plaintiffs and defendants. These two documents, which according to parties, represented the true state of affairs, placed the learned Commissioner in difficulty to decide as to which one of the document .was really genuine: However, relying upon clause 2 of Exh. 45, the learned Commissioner came to the conclusion that while the firm was indebted in the sum of Rs. 1,81,059‑2‑6, yet it was difficult to say as to who were the actual creditors except for the nine persons whose names were common to Exh. 58 produced by the plaintiffs and Exh. 49 produced by the defendants. In regard to the rest of the creditors shown in Exh. 58, the learned Commissioner considered each case on merits and disallowed it for plausible reasons.

After having scrutinized the preliminary report of the learned Commissioner I find myself in agreement with his conclusion.. It is an admitted position that the debts mentioned in Exh. 58 are from outside the account books. Therefore, while rejecting the claims of the bulk of creditors shown in this document, the learned Commissioner appeared to be right in holding that no cogent reason had been advanced to show as to why these amounts were given on credit to the suit firm and in many cases left outstanding for long period. The further circumstance which appeared to have weighed with the learned Commissioner was that according to P. W. 4 Hashim, Exh. 58 was prepared soon after the promulgation of Martial Law when the account books, relating to the business done from outside the regular account books of the firm, were burnt but he does not seem to have been convinced of this stand of the plaintiffs as upon the evidence on record he was of the view that both Exh. 57 and Exh. 58 must have been executed in June or July 1959, as Exh. 45 itself was executed on 6‑7‑1959. He therefore, disbelieved the statement of P. W. 4 Hashim that Exh. 58 was executed soon after the promulgation of Martial Law in 1958. The learned Commissioner further took note of the fact that only carbon copies of Exhs. 57 and 58 were produced by the plaintiffs but they failed to account for their originals. Upon this evidence it is difficult to say that the learned Commissioner was wrong in rejecting the bulk of the claims contained in Exh. 58, particularly when none of the creditors appeared before him.

6. In support of his second objection Mr. Fazeel, the learned counsel pointed out that in terms of the preliminary decree the jurisdiction of the Commissioner was confined to Exhs. 1 and 45 and he could not take into consideration the accounts of the firm of 1956. The objection is without force. According to the report of the learned Commissioner the defen dants had alleged fraud and misappropriation in the accounts of the firm of 1956, even when he was seized of the matter earlier, but he could no consider these objections at that stage as the matter was sub judice in view of the pendency of Suit No. 82 of 1960. However, he considered these objections in his final supplementary report and for that purpose sought jurisdiction from the order of the Court dated 4‑10‑1966, in which it was observed that :‑

It is right that the suit having been dismissed, the issues which were involved in it are no longer sub judice. Therefore, the Commissioner need not feel deterred from examining those accounts owing to the matter being sub judice.

The learned Commissioner was further of the view t4at the accounts of 1956 firm were directly relevant as after its dis solution all its accounts were carried over in the account books of the suit firm which in substance amounted to the continuation of the business of the earlier firm. In support the learned Commissioner relied upon a reported case in A I R 1927 Lab. 249.

After examining the contention of the learned counsel for the plaintiffs, I am rather inclined to agree with the view of the learned Commissioner. Admittedly the suit firm was con stituted by 7 out of the 9 partners of the earlier firm of 1956 and all its accounts had been carried over in the books of account of the firm of 1959. It is also an admitted position that the suit firm continued the same business as that of` the firm of 1956, and the agreement of liabilities (Exh. 45) related to the debts of that firm which were agreed to be paid by the partners of the suit firm. In this view, the objections of defendants 1 to 3 that misappropriation and fraud hid been committed in regard to the accounts of the firm of 1956 were directly relevant to the determination of the accounts of the suit firm. In any case the order of the Court dated 4‑10‑1966 clarified the position beyond any doubt and consequently the Commissioner was right to take into consideration the accounts of the firm of 1956.

Mr. Fazeel, the learned counsel however reiterated his objection and in support relied upon the preliminary decree, paras. 4 and 9 of the preliminary report of the Commissioner, Exh. 45 and two judgments, one reported in P L D 1958 Lab. 451 and another in A I R 1937 Sind 103. The operative part of preliminary decree reads:‑

During the hearing of this application ..counsel have agreed that a preliminary decree should be passed, that Mr. S. A. Moulvi Advocate, who is present in Court, appointed as Commissioner to go through the accounts and submit a report regarding the dissolution of the partnership. It is ordered accordingly.

It would be seen that the mandate given to the Commissioner was to go into the accounts of the suit firm and to report on its dissolution. The question is as to what accounts the Commissioner wag required to go into and for this purpose para. 4 of the plaint is relevant. It reads:‑

"That simultaneously with the execution of the sale deed of partnership dated 6‑7‑1959, the plaintiffs and the defendants executed an agreement on the same day, i.e. 6th July 1959, wherein the plaintiffs and the defendants, inter alla, agreed to pay the debts of the old firm amounting to Rs. 2,41,628‑3‑3 and further agreed to pay debts amounting to Rs. 1,81,069‑2‑6 not appearing in the books of accounts. A copy of the said agreement dated 6‑7‑1959 is herewith filed and marked. 'B'."

Agreement Annexure 'B', to which reference is made in this para. is Exh. 45 on record. According to the plaintiffs' own showing the suit firm had agreed to pay the debts of the firm of 1956 and for that purpose agreement Exh. 45 was executed. It would, therefore, follow that if the accounts of the former firm were challenged on the ground of misappropriation and fraud they had to be reopened for the well known principle that fraud vitiates even the most solemn transactions. Seen in this context it is difficult to resist the conclusion that while going into the accounts of the suit firm the learned Commissioner was also required to take into consideration the accounts of the former firm as shown in Exh.

45. This conclusion finds support from the subsequent order of the Court dated 4‑10‑1966 in which it was observed that:‑

"It appears that the main contest amongst the parties is as to what are the liabilities of the firm. In this respect there are allegations and counter‑allegations which lead to a controversy involving several lacs of rupees. According to the plaintiffs, the liabilities alleged by them to exist are to be met out of the assets of the firm, but according to defendants Nos. 1 to 3 those liabilities are either not genuine or are not valid and outstanding. One of the reasons for their invalidity is said to be that they have become barred by time ; another is that some of them have been paid off .Counsel for the parties, therefore, agree that a reference be made back to the Commis sioner with the directions that he should take into consideration the objections filed by the parties and after tracing out the relevant material an(, applying his mind submit his report so that it may be possible with the help of that report to make a final order."

In their objections defendants 1 to 3 had challenged the genuineness of agreement Exh. 45 and that of Exhs. 57 and 58 which were prepared on the strength of that document. Their precise objection was that most of the debts mentioned in these documents were either not genuine or were time‑barred. The above order of the Court, which was passed by the consent of parties, clearly directed the learned Commissioner to go into these objections and to submit a report so that it may be possible to pass a final order. In this view, surely it was not open to the plaintiffs to contend that while going into the accounts of 1956 firm the Commissioner had exceeded his jurisdiction.

7. Paras. 4 and 9 of the preliminary report also do not help the plaintiffs. It is no doubt true that according to these paras. the learned Commissioner found the suit firm indebted in the various sums mentioned in Exhs. 57 and 58, but he also reported that the identity of most of the creditors could not be established. Furthermore, while submitting his preliminary report the learned Commissioner declined to consider the objections of defendants 1 to 3 that most of the debts mentioned in Exhs. 57 and 58 were either fictitious or time‑barred. The reason for this refusal was that these objections were sub judice in Court in view of the pendency of Suit No. 82 of 1960. However, this bar was removed from his way by the consent order of the Court dated 4‑10‑1966 in which it was observed that:‑

"It is right that the suit having been dismissed, the issues which were involved in it are no longer sub judice ; therefore, the Commissioner need not feel deterred from examining those accounts owing to the matter being sub judice."

8. The two judgments cited by the learned counsel also do not help the plaintiffs. Unlike the present case, the preliminary decrees passed in those cases were not the result of any consent of the parties, and consequently they are distinguishable. It is an established principle of law, that a consent decree is just an agreement between the parties notwithstanding the fact that it 1B has been recorded by and bears the seal of the Court. Therefore, the consent preliminary decree passed in a case, like all other agreements, could be amended by the consent of parties without any objection. The consent order dated 4‑10‑1966 passed by the Court was directed just to achieve this very object, and consequently it would be futile to contend that the learned Commissioner by having taken into consideration the accounts of the firm of 1956, had exceeded his jurisdiction.

9. The third objection, which in principle appears to be the same as the first two objections, practically stands disposed of for the reasons already given. I am clear in my mind that in terms of the preliminary decree and the subsequent order dated 4‑10‑1966, the Commissioner was required to report on the entire liabilities of the firm which would obviously include an enquiry as to which debts, if any, were time‑barred. After all it is a well‑known principle of law that even a genuine debt, if barred by limitation, cannot be recovered through an action in Court. However the question, whether the learned Commissioner rightly found some of the debts as time‑barred, has still to be considered and with that aspect I shall deal presently.

10. The debts of the suit firm are shown to be of two types, one from inside and the other from outside the account books. From inside the account books the learned Commissioner rejected the claims of 7 creditors, namely A. Sattar Muhammad, Deen and Webber, A. Latif Jamal, Sharif Tayab Hamid, Iqbal Sullaiman & Co. Aijaz Medical Stores and Fazle Karim on the ground that they were barred by time.

Mr. Fazeel, the learned counsel for the plaintiffs argued that the learned Commissioner was wrong to hold that these debts were time‑barred as, according to him, they had been acknowledged within the means of section 19 of the Limitation tact by the suit firm. The learned counsel also relied upon section 20 of the Limitation Act and contended that some of the debts were in fact deposits and they could not have become barred by time until a demand was made by the creditors for their return. In order to appreciate the contention of the learned counsel let us examine each one of these items separately.

11. A. Sattar Muhammad.‑He was shown to be the creditor of the firm in the sum of Rs. 120.00. He did not file any claim before the Commissioner nor did he make any demand in writing for the return of that amount. The amount in question was shown to be due from 1950‑51, and the learned Commissioner was of the view that it was a debt and not a deposit. He, therefore, held that this claim was time‑barred.

Upon these facts it is difficult to disagree with the conclusion of the learned Commissioner.

12. Deen & Webber.‑The firm was shown to be indebted to this party in the 'sum of Rs. 33,000.00. They filed a claim before the Commissioner on 9‑3‑1965, and in support Mirza Ehsanul Haq C. W. 13 was examined who produced statement of accounts Exh.

27. According to the witness, this amount was given to the firm as friendly loan without interest. The statement of accounts Exh. 27 showed that an amount of Rs. 15,000.00 was paid to the firm on 29‑5‑1957, Rs. 4,000.00 on 11‑6‑1958 and Rs: 14,000.00 on 13‑9‑1957. All these amount were paid by cheques and Exh. 27 does not show that any sum was received back from tire firm.

Upon the evidence produced before the Commissioner, he came to the conclusion that the claim, having been acknowledged within the meaning of section 19 of the Limitation Act, was alive. He was, however, of the view that the liability to pay it was that of the 'plaintiffs, who had acknowledged it, and defendant No. 4 who, as legal heir, stepped into the shoes of plaintiff No. 1. The learned Commissioner exonerated defendants 1 to 3 holding that after Exh. 45 was executed on 6‑7‑1959, they were not a party to any acknowledgment.

13. Mr. Fazeel, the learned counsel, however, argued that the debt was to be paid by the suit firm and in support he relied upon Exhs. 45, 57, 134, the preliminary report of the Commissioner, the plaintiffs' objections thereto, balance‑sheets, the Income‑tax returns and the entries in the account books of the firm. He also sought support from judgments reported in A I R 1952 Mad. 136, A I R '1958 Pb. 341, A I R 1957 Travan. 159, A I R 1933 All. 364, A I R 1939 Lah. 397, A I R 1929 Lah. 266, I L R 1932 All. 51 and A I R 1962 Cal. 115.

14. As pointed out earlier, Exh. 45 is the agreement which was executed by the parties on 6‑7‑1959. In this agreement the partners of the suit firm acknowledged and agreed to pay the debts of the firm of 1956. The agreement speaks of a list of creditors (Exh. 57), but it was not annexed to the agreement nor its original produced before the Commissioner. Its carbon copy was produced in evidence but was seriously challenged by defendants 1. to 3. The Commissioner, therefore, took into consideration extraneous evidence to resolve the fate of this document and for that purpose he referred to the evidence of Jan Muhammad Dawood Advocate (P. W. 5), through whose efforts Exh. 45 was executed, and the copy of balance‑sheet Exh.

88. When shown, Mr. Jan Muhammad Dawood could not identify this document although he had seen the original when Exh. 45 was executed. The Commissioner, however, relied on balance‑sheet Exh. 88 (produced by defendant No. 1 and accepted by the plaintiffs) and came to the conclusion that the credits of 31 persons shown in that document were genuine as they were common to Exhs. 57 and 88.

15. There is no dispute that Exh. 45 was executed by 7 partners of the firm of 1959 in which they acknowledged the debts of the firm of 1956. The name of Messrs Deen & Webber appears in this document and consequently the debt of this party would be deemed to have been acknowledged and would be alive on 6‑7‑1959. It would, therefore, follow that from this date a fresh period of limitation of three years started running in favour of this claim 1t since it was filed after the expiry of this period on 10‑3‑1965, it would be deemed to have become time‑barred.

16. The preliminary report of the Commissioner, balance- sheet of the firm, entries in the account books and Exh. 134 also do not help the plaintiffs. While submitting his preliminary report the Commissioner was acting under the directions of the Court and not as agent of either party. Therefore, his finding that the claim of this party was genuine would not be an acknow ledgment within the meaning of section 19 of the Limitation Act so as to extend the time of limitation beyond 6‑7‑1962.

Exhibit 134 is the deed of retirement between 7 partners of 1959 firm and one partner of the firm of 1956. This document does not acknowledge any liabilities and is, therefore, not relevant.

17. Reliance upon the plaintiffs' objections and entries in the account books of the suit firm appears to be misconceived. It is no doubt true that this debt figured in the account books up to 1964‑65 and was also acknowledged by the plaintiffs in their objections, but the question is whether it was the liability of the suit firm?

It is an admitted position that this, and many other debts mentioned in Exh. 57, were challenged by the defendants as fictitious and fraudulent. It is also an admitted position that in view of the acute controversy between the parties, on this point, the Court had made a reference to the Commis sioner by order dated 12‑3‑1962. It is, therefore,, difficult to appreciate as to how the plaintiffs could possibly invoke their own admission that the debt in question was the liability of the suit firm. Furthermore the objections, in which these admissions were made, was the personal act of the plaintiffs and not as agents of the defendants. Therefore, the learned Commissioner was plainly right to hold that the said admissions did not amount to an acknowledgment on behalf of the firm, within the meaning of section 19 of the Limitation Act, and the claim of this party, which was filed on 10‑3‑1965, was barred by limitation.

18. I also agree with the learned Commissioner that the entries in the account books were made as a matter of routine and not with the intention of making any acknowledgment within the meaning of section 19 of the Limitation Act. In any case these entries have not been signed either by the firm or its, agent and therefore, in line with the principles contained in' I L R 10 Born. 71, the claim of this party, which was filed on 10‑3‑1965, would be barred by limitation.

19. Reliance upon the balance‑sheets of the firm also appears to be misconceived. After 6‑7‑1959 (when Exh. 45 was executed) Exh. 48 is the first balance‑sheet and is dated 7‑9‑1961. It is signed by plaintiff Muhammad Sharif as Receiver in which the debt of Messrs Deen & Webber is acknowledged. The question that arises is whether as Receiver Sharif had the power to acknowledge this debt and further whether its mention in the balance‑sheet (Exh. 48) would amount to an acknowledgment under section 19 of the Limitation Act.

20. It is not denied that Sharif was appointed as Receiver by the Court on 12‑4‑1960 with all powers under C. P. C. subject to certain conditions which are not relevant for the present discussion. Therefore as a matter of general principle and in line with the observations contained in A I R 1960 Born. 424, 1959 Mad. 816, 1937 Mad. 764 and 38 1 C 893, Sharif would be deemed to have possessed all powers under the C. P. C., including the powers to acknowledge debts. But the difficulty still remains as, apart from being a Receiver, he was also a partner of the suit firm and the defendants had charged him with fraud in relation to this and many other debts mentioned in Exh.

57. The defendants had levelled these allegations against him in their letter dated 18‑1‑1960 (which was before the filing of the suit) and the matter was referred to the Commissioner for enquiry by. Court on 12‑3‑1962. In this view, the admission of this debt by Sharif cannot be accepted as bona fide and the same must be disregarded.

21. In regard to the second question it is not denied that Sharif had signed the balance‑sheet (Exh. 48) as Receiver and under the directions of the Court. Therefore his position was that of an officer of the Court and not as partner of the suit firm so as to bind the defendants: Furthermore according to section 19 (2) (e) of the Partnership Act, 1932, Sharif had no "implied authority" to admit, in the present proceedings, any liability against the firm nor did he bring any evidence on record to show that the defendants had either acquiesced in or approved his said action. The fact that long before he acknow ledged this debt, he was accused of fraud, is a circumstance which cannot be ignored and it must follow that the said acknowledgment could not operate to the prejudice of the suit firm or at any rate against the interest of defendants 1 to 3. Clearly, therefore, Exh. 48 cannot be said to have acknowledged this debt within the meaning of section 19 of the Limitation Act so as to bind the suit firm.

22. The judgments relied upon also do not help the plaintiffs. 1952 Mad and 1958 Pb. dealt with the cases of companies and not the partnership firms. Since 1958 Ph. has followed the principles enunciated in 1952 Mad. it would be sufficient to discuss only the latter judgment.

23. The admitted facts in this case were that the balance- sheet of the company, in which certain debts were acknow ledged, was placed before the shareholders in the Annual General Meeting and it was approved. Thereafter it was signed by the authorised accountant of the firm and when one of the creditors filed a suit against the company and relied upon the admission made in his favour in the balance- sheet a question arose whether it amounted to an acknowledgment within the meaning of section 19 of the Limitation Act so as to save the suit from being barred by time. Upon these facts it was held that the admission amounted to such an acknowledgment and the suit was within time.

The judgment has no application to the facts of the present case. Unlike the case before us, in which plaintiff Sharif had made admissions in the balance‑sheets without the express or implied authority of, the defendants, in that case the balance sheet was approved by the shareholders of the company in the Annual General Meeting and thereafter authenticated by the authorised accountants of the company. Upon these facts it is difficult to appreciate as to how advantage could be taken of this judgment.

23. A I R 1957 Travan., A I R 1933 All., A I R 1939 Lab., A I R 192,9 Lah., I L R 32 All. and A I R 1962 Cal. are equally distinguishable. The Travancore case dealt with Second Appeal filed against the concurrent judgments of the Courts below that the decree was barred by time. It was a registered decree and enforceable within six years. The first Execution Application was filed on 9‑8‑1951, but it was rejected on the same day followed by another Execution Application dated 25‑9‑1951. Against this application the judgment‑debtor filed objections and contended that the decree was barred by time while the decree‑holder relied upon certain acknowledgments to save limitation. The precise contention of the decree‑holder was that the debt had been acknowledged in Exhs. E. & G. Exh. E was the copy of Memorandum of Appeal, in a Civil Misc. Appeal, preferred for getting the suit restored after setting aside the ex parte decree while Exh. G was the copy of petition filed in the said appeal for staying the execution proceedings. In these documents the judgment‑debtor had alleged that the hypothecation bond upon which, the sui: was filed and decreed was not supported by consideration and hence the decree was wrong. Upon these facts the High Court came to the conclusion that the debt of the appellant had been acknowledged within the meaning of section 19 of the Limitation Act, and consequently the decree was alive. The judgment is wholly irrelevant as it had nothing to do with the admissions made by a partner against the suit firm. Even otherwise the judgment is distinguishable, as unlike the present case, in which plaintiff Sharif had made admissions without the express or implied authority of the defendants, the judgment -debtor in that case had acknowledged his liability towards the decree‑holder.

24. A I R 1933 All. is also not a case of partnership and is in any case distinguishable. The main question which fell for consideration in that case was whether the application of the judgment‑debtor, accompanied by a letter of the decree‑holder that execution proceedings would not be launched within certain period, amounted to an acknowledgment within the meaning of section 19 of the Limitation Act? The Court answered the question in the affirmative holding that the application of the judgment‑debtor, when read along with the letter of the decree‑holder, amounted to an acknowledgment, and consequently the decree was saved from the bar of limitation. It is difficult to appreciate as to how this judgment is relevant.

25. A I R 1939 Lah. is also distinguishable. In that case the acknowledgment of debt was made by a partner of a going concern who, as a fact, was found to have acted on behalf of the firm and acknowledged many other debts from time to time. In the present case the so‑called admissions of plaintiff Sharif were made not when the suit firm was a going concern but when it was in the process of dissolution. Admittedly Sharif had no express authority of the defendants to make any such admission nor did he possess the "implied authority" to do so in view of the prohibition contained in section 19 (2) (e) of the Partnership Act, 1932.

26. The facts in A I R 1929 Lab. were that a partner, who was entrusted with the winding up proceedings of the firm, acknowledged certain debts and the question arose whether it amounted to an acknowledgment within the meaning of section 19 of the Limitation Act. While declining to consider this question, as it had not been raised before the Courts below, the High Court observed that had this question been raised at the proper time it would have had force. Apart from the fact that these observations were necessarily in the nature of obitor dicta, the High Court did not agree with the contention of the appellant that the partner, who had made these admissions, was solely concerned with the winding up proceedings, and consequently he would be deemed to possess the implied authority to acknowledge debts. The judgment is clearly distinguishable.

27. The next case is I L R 1932 All. In that case the managing partner of the firm had acknowledged certain debts at a time when the firm was a going concern. Upon one such acknowledgment, a creditor filed a suit in Court and the question which arose for consideration was whether the managing partner had the authority to make these acknowledgments and further whether they satisfied the requirements of section 19 of the Limitation Act? Upon the evidence on record, the Court came to the conclusion that the managing partner had the authority to borrow money for the business of the firm, and consequently he would be deemed also to possess the power to acknowledge debts. The Court further came to the conclusion that the acknowledgment in question having been made bona fide, when the firm was a going concern, satisfied the requirements of section 19 of the Limitation Act and the suit of the plaintiff was saved from the bar of limitation.

The case appears to be wholly irrelevant as plaintiff Sharif, although a co‑managing partner of the firm, had no authority to borrow money nor did he acknowledge the various debts, mentioned in Exh. 57, at the time when the firm was a going concern. Furthermore he was prohibited from making any such admissions in view of section 19 (2) (e) of the Partnership Act, 1932, and therefore he could not have validly admitted any debts against the suit firm.

28. The last case is A I R 1962 Cal. in which the effect of acknowledgment of debt in the balance‑sheet of a limited company came for consideration. The facts in that case were that the managing agent of the company, who was authorised to borrow sums on behalf of the company, acknowledged certain debts in the balance‑sheet which was approved by the share holders in the General Body Meeting. On the basis of one such acknowledgment, a creditor of the company filed a suit in Court and the question arose whether the acknowledgment of debt in the balance‑sheet was an acknowledgment within the meaning of section 19 of the Limitation Act? The High Court, after considering a number of judgments from the various High Courts of the Indian Sub‑continent, answered the question in the affirmative holding that since the acknowledgment was authorised to borrow sums on behalf of the company he would also be deemed to have possessed the power to acknowledge debts. The High Court was further of the view that the balance- sheet in question was approved by the share‑holders of the company in the General Body Meeting, and consequently these acknowledgments satisfied the requirement of section 19 of the Limitation Act so as to save the suit of the plaintiff from the bar of limitation.

The relevancy of this judgment to the present case is not understandable. Apart from the fact that we are dealing with the case of a partnership firm and not that of a company, plaintiff Sharif had neither the express nor the implied authority of the defendants to acknowledge any debts so as to bind the firm, and consequently the balance‑sheets, upon which reliance was placed, are of no assistance to the plaintiffs.

29. Before parting with this discussion it may be mentioned that the learned counsel for the defendants had relied upon section 19(2)(e) of the Partnership Act, 1932 before the Commissioner and contended that the suit firm was not bound by the acknowledgments in Exh. 57, as they were made by plaintiff Sharif without their authority. The learned Commis sioner .did not agree with that contention as he was of the view that the section applied only to suits filed against the firm by third parties, and not when the suit was between the partners. As against this, I have accepted the contention of the learned counsel for the defendants, but for different reasons. According to the partnership deed dated 6‑7‑1959, plaintiff Sharif was a co‑managing partner of the firm, but in terms of clause 9, he could not admit or acknowledge any debt against the firm without the consent of the other managing partner. Admittedly, while acknowledging the various debts in Exh.

57. Sharif did not obtain the concurrence of the other co‑managing partner and therefore he could not be deemed to have possessed the implied authority to‑ acknowledge these debts in view of the specific bar contained in that clause. Furthermore, the allegations of fraud having been levelled against him, even before the filing of the suit, was another circumstance to negative the contention that he possessed the implied authority to acknowledge any debts against the firm and particularly those which had been challenged by the defendants as fictitious.

30. The next place of evidence, upon which reliance is placed, are receipts Exhs. X/1 to X/3, 5,. 11 to 13, 15 and 25. All these receipts are on the printed forms, filled in Gujrati language, and were signed on 4‑7‑1959 by plaintiff Sharif in his capacity as partner. In the body of the receipt is shown the receipt of cash amounts from specific creditors, but the nature of the transaction is left in doubt unless the words "remains payable" which appear on their back, are taken into consideration. These words which according to the plaintiffs were simply meant to acknowledge the debts shown in the body of the receipts, were signed by Sharif on 28‑6‑1962 in his capacity as Receiver.

Defendants 1 to 3 had strongly objected to their admissibility before the Commissioner on the ground that they were stamped and being the only evidence to show that the transactions were in the nature of loans come within the mischief of Article 1 of the Stamp Act. They had also challenged, the genuineness of the receipts on the same grounds upon which Exhs. 57 and 58 were challenged. Since the question was hotly contested before the Commissioner, he recorded the evidence of Abdul Ghaffar C. W. 1, and thereafter having heard the learned counsel for the parties upheld the contention of the defendants. The opinion of the learned Commissioner on this point is recorded in the deposition sheet of witness Abdul Ghaffar which is on record of the suit file. The learned Commissioner also translated into English one receipt which is annexed to the deposition of this witness.

Mr. Fazeel objected to this finding of the Commissioner, contending that the words "remains payable" could mean no more than acknowledging existing debts and therefore the Commissioner was wrong that the receipts were inadmissible under Article 1 of the Stamp Act. In substance the contention of the learned counsel was that if the endorsements on the back of the receipts are held to be acknowledgment of the existing debts then it was not required to be stamped and therefore would not come within the mischief of Article 1 of the Stamp Act.

Before considering the contention on merit, it may be pointed out that in his supplementary final report the learned Commissioner doubted the genuineness of these receipts although he gave no specific finding in that regard. Since the question was hotly debated in Court, I would first like to consider the evidence on record to ensure if the receipts in question were really genuine. By doing so the process of duplication would be avoided as once conclusion is reached that the receipts are not genuine the need to consider the legal contention of the learned counsel as to their admissibility or otherwise would not arise.

In support of their contention that the receipts were fictitious, the defendants examined before the Commissioner one Ahmed Siddiq, the owner of printing press. He confirmed to have sold the plaintiff. Sharif a Hundi book against cash memo. Exh.

40. The date on Exh. 40 shows that it was issued after five years of the filing of the suit. As against this, plaintiff Sharif in his evidence before the Commissioner pleaded ignorance as to where the receipts in question were printed. Furthermore Sharif did not mention these receipts when he was examined by the Commissioner in the earlier proceedings nor are they mentioned in Exh.

45. Similarly in their reply to the plaintiffs' notice (which was before the filing of the suit) the defendants had asked the names of various creditors, but no names were supplied to them. The receipts in question were not even mentioned to Mr. Jan Muhammad Dawood Advocate; through whose efforts Exh. 45 and many other agreements were executed. Similarly Sulaiman Billo, a witness of the plaintiffs, stated before the Commissioner that he had been given one such receipt by Sharif after the present suit was filed, but Sharif in his evidence insisted that it had been given to him on 4‑7‑1959. To the same effect was the evidence of another Sharif, a creditor of the firm, who had stated that plaintiff Sharif had given him the receipt after he filed his claim before the Commissioner on 315‑1965, but according to Sharif plaintiff he had given that receipt on 4‑7‑1959.

31. In view of this evidence, can it really be said that the receipts in question are genuine? I have the least doubt in my mind to answer the question in the negative. If these receipts were really executed on 4‑7‑1959, it would be difficult to believe that plaintiff. Sharif would have failed to mention them at any stage prior to the filing of the suit and particularly when the defendants in their reply dated 18‑1‑1960 had pointedly asked for the names of the creditors. Similarly the non‑mention of receipts before the Commissioner, in the earlier statement also speaks volumes against the bona fide of the plaintiffs. Furthermore the evidence of Ahmad Siddiq, the press owner, Sullaiman Billo, the plaintiffs' witness, and another Sharif, a creditor of the firm, clearly belies the stand taken by plaintiff Sharif that the receipts in question were executed on 4‑7‑1959 and given to various creditors in acknowledgment of their debts.

32. Another circumstance which militates against the case of the plaintiffs is the finding of the Commissioner (with which the Court has agreed) that some of the debts mentioned in Exhs. 57 and 58 were not genuine. It is not denied that the receipts in question were issued in acknowledgment of the debts mentioned in these documents, and consequently they cannot be said to be free of doubt. Besides, the defendants had charged the plaintiffs with fraud, in regard to the debts mentioned in Exhs. 57 and 58, and that circumstances cannot be ignored. If the receipts were really genuine, the plaintiffs would be expected to disclose that at the earliest possible opportunity and particularly when the defendants charged them with fraud and. had even asked them to disclose the names of the creditors before the filing of the suit. For all these reasons I am satisfied in my mind that the receipts in question were not genuine and were manufactured at a later stage with a view to prejudicing the interest of defendants 1 to 3. In the result, the legal contention of the learned counsel for the plaintiffs need not be considered as under the circumstances it would be only of academic interest.

33. The next piece of evidence relied upon are the income- tax returns. Along with these returns the balance‑sheets of the firm were annexed in which debts mentioned in Exhs. 57 and 58 were acknowledged. The income‑tax returns have been signed by defendants 1 and 3, and the argument is that since the balance‑sheets were annexed to them defendants 1 and 3 must be deemed to have acknowledged these debts and the same would be recoverable from the suit firm. It is an admitted position that none of the balance‑sheets were signed by these defendants as they had all along objected that the debts mentioned in Exhs. 57 and 58 being fictitious were not payable. It is no doubt true that they signed the income‑tax returns, but this they had done under protest and in pursuance of the directions of the Income‑tax Authorities. In this respect, Mr. Lakhani, the learned counsel for the defendants produced a bunch of correspondence between Sharif and the Income‑tax Department and its copies supplied to Mr. Fazeel in Court. Although these documents were produced for the first time, Mr. Fazeel did not object to them and therefore they were taken on record.

Notwithstanding this position, however, Mr. Fazeel cited a number of authorities to show that under the circumstances the suit firm was liable for the debts and the contrary conclusion of the learned Commissioner was incorrect., There is no quarrel with the authorities cited by the learned counsel, but they are clearly distinguishable. After all the surrounding circumstances under which defendants 1 and 3 signed the income‑tax returns in this case, cannot be ignored. As already pointed out the defendants even before the present suit was filed, had charged the plaintiffs with fraud in relation to some of the debts mentioned in Exhs. 57 and 58 and maintained that position that they had refused to sign the balance‑sheet in which these debts were mentioned. Therefore, it is difficult to hold that just because they signed the income‑tax returns, and that too under protest and in obedience to the directions of Income -tax Authorities, they would be deemed to have acknowledged these debts within the meaning of section 19 of the Limitation Act.

Reference may be made to another circumstance which supports this conclusion. It is an admitted position that Sharif had acknowledged these doubts in his capacity as Receiver and normally his authority could not be questioned as the h Court had invested him with all powers under the C. P. C. However since he was a co‑managing partner of the suit firm and defendants 1 to 3 had levelled serious allegations of fraud against him, he could not have properly acknowledged the, various debts without the express or implied authority of the defendants or at least of the other co‑managing partner. Furthermore a conclusion having already been reached that some of the debts mentioned in Exhs. 57 and 58 were not genuine the very authenticity of these documents would become doubtful. In the result the various balance‑sheets and the income‑tax returns, which were prepared on the strength of these documents, would be equally doubtful and could not possibly sustain the contention of the plaintiff. I, therefore, agree with the conclusion of the learned Commissioner that the claim of Messrs Deen & Webber, in so far as the suit firm was. concerned, was time‑barred notwithstanding , its acknowledgment by plaintiff Sharif.

34. Mr. Fazeel, the learned counsel next contended that learned Commissioner was wrong to hold that the debt of this party was alive against the plaintiffs and defendant No. 4, in view of the acknowledgment of plaintiff Sharif, and the same was recoverable from them and not from the assets of the suit firm. The contention is without force for the reasons already stated, plaintiff Sharif had no authority to acknowledge this debt on behalf of the suit firm, and consequently defen dants 1 to 3, who had all along alleged fraud against him and the plaintiffs regarding some of the debts mentioned in Exhs. 57 and 58, were not bound, by that acknowledgment Furthermore the acknowledgment in question would be of no avail against defendants 1 to 3 in view of subsection (2) of section 21 of the Limitation Act, which reads :‑

Nothing in the said sections renders one of several joint contractors; partners . . . chargeable by reason only of a written acknowledgment signed or of a payment made by, or by the agent of, any other or others of them.

This conclusion finds support by Full Bench judgment of Madras High Court (I L R 1941 Mad. 427) in which the effect of section 21 of the Limitation Act was considered, and it was held that in order to bind the firm evidence must be brought on record to show that the acknowledging partner had the authority of his co‑partners or at any rate there were sufficient indications to show that the same could be properly inferred. K In the result, I agree with the conclusion of the learned Commissioner that the debt of this party is alive against the plaintiffs an defendant No. 4, who, as legal heirs, stepped into the shoes of plaintiff No. 1, as they alone had acknowledged the said debt after the execution of Exh. 45 to the exclusion of defendants 1 to 3.

35. Abdul Latif H. Jamal.‑This party claimed Rs. 4,000.00 from the suit firm on the ground that he had kept it with the firm as "Immanat". He filed his claim (Exh. X/29) on 6‑5‑1965 before the Commissioner and also supported his claim by appearing as his own witness. According to the learned Com missioner he had stated in para. 4 of his claim that he had sufficient documentary evidence to prove his claim, but none was produced during the enquiry. The case that he set out was that he had initially deposited Rs. 10,000.00 or Rs. 12,000.00 with the suit firm by way of "Immanat" although he had his own business of jewellery at Mangalore. However according to the ledger of 1947‑48 (Exh. 4) this amount was shown to have been given to the suit firm on interest for unspecified period. Exh. 5 is the entry from the said ledger and the learned Com missioner was of the view that nothing was brought on record to show that the amount was given on deposit. The learned Commissioner was further of the view that Abdul Latif Jamal being himself a jeweller could not be expected to deposit this amount with the suit firm as he would be having his own bank account. He also took into consideration entry Exh. 5 according to which this amount was paid to the suit firm on interest.

Upon this evidence the learned Commissioner came to the conclusion that the claim was time‑barred, and I agree with his conclusion. After having analysed the evidence I am also of the view that the amount in question was simply a loan and not a deposit, and consequently the claim, which arose with effect from 4‑5‑1948, on which date the amount was given to the suit firm, could be governed by Article 57 of the Limitation Act. This conclusion would not be affected in the least even if it was to be noted that the amount in question had been carried over from year to year in the account books of the firm and due interest on that amount credited in the name of this party, for the simple reason that for three intervening years 1956 to 1959) no interest was credited against this amount although the practice was resumed in 1959‑60. It is no doubt true that in support of his claim this party relied upon his own books as to save his claim under section 20 of the Limitation Act, but the learned Commissioner rightly rejected this piece of evidence in view of I L R 1941 Mad. 441. The learned Commissioner was right in his conclusion that the claim had become barred by time in 1959 or at best in 1963 and its subsequent acknowledgment could not revive it.

36. Sharif Tayab Hamid.‑This party claimed about Rs. 2,250.00. He filed his claim Exh. 24 and also examined himself before the Commissioner. According to him the amount in question had been given to the firm in November 1954 or early 1955. In examination‑in‑chief he stated that in support of his claim he had maintained a note‑book but at the instance of the suit firm he returned the same when he filed his claim on 25‑3‑1965. However, he admitted in cross‑examination that when he filed his claim a Hundi was given to him by the firm for his dues which, according to him, was not traceable. However, its photostat copy was shown to him by the defendants which he admitted to be correct and it was exhibited as X/25. This Hundi, like all other receipts executed by plaintiff Sharif, bears the date 4‑7‑1959, which has already been disbelieved. In this view, the learned Commissioner appears to be right in disregarding the Hundi in question upon which the claimant relied.

The factual position in regard to this claim is that the amount was given to the suit firm on interest without any fixed period. In order to save his claim from the bar of limitation he was obliged to bring on record some evidence to show that the amount was given on deposit, but according to the learned Commissioner no such evidence was brought on record. In fact, according to entry Exh. 9, the amount in question was clearly a loan and the learned Commissioner was plainly right to hold that the time against it would run from 31‑1‑1955, and the same would, therefore, be barred by limitation on 31‑1‑1958. It is true that this amount was acknowledged after 31‑1‑1958, but that would be of no avail as admittedly the acknowledgment was given at a time when the original period of limitation had already expired.

37. Aijaz Medical Stores.‑The case of this party was that it had given a commercial loan to the suit firm on 10‑12‑1958 (Exh. 27) and the same was acknowledged on 6‑7‑1959 vide Exh.

45. However, no claim was filed before the Commissioner although one Habib appeared as witness in support of that claim. The party had also given a notice (Exh. 59) for the return of its dues, but witness Habib did not produce any documentary evidence to sustain his claim. In his oral statement he stated that the amount in question was advanced in September 1958 by a cheque, but in the books of account of the suit firm it was credited as cash. After 6‑7‑1959, the amount in question has not been acknowledged by the suit firm, and consequently it would be barred by limitation on 6‑7‑1962.

38. Iqbal Sullaiman & Co.‑This party claimed Rs. 1,500.00 from the firm but did not file any claim before the Commissioner. However, one Haji Eassa C. W. 14, a clerk of this creditor appeared before the Commissioner and produced a voucher for that amount but did not file it on record. The amount in question has been shown in the cash book and ledger of the suit firm as commercial loan and was acknowledged vide agreement Exh.

45. It is an admitted position that there is no acknowledgment of this debt on behalf of the suit firm, and consequently it had become barred by limitation on 6‑5‑1967 when Haji Eassa C. W. 14 appeared before the Commissioner in support of that claim. In this view, it is difficult to disagree with the conclusion of the learned Commissioner.

39. Fazle Karim.‑Upon the evidence produced before the learned Commissioner he came to the conclusion that the claim of this party amounting to Rs. 90,000.00 was alive only against the plaintiffs and defendant No. 4, who had acknowledged this amount, and not against defendants 1 to 3. The learned Com missioner observed that since this party was an Indian national the amount in question would be paid only to the person legally entitled to receive it.

The account of this party started in the ledger of 1957‑58 in which Rs. 90,000.00 has been shown to its credit. The amount in question has been acknowledged by the suit firm in Exh. 45, and the claim for its recovery was filed before the Commissioner on 10th March 1965 under the signatures of Messrs Saeed A. Shaikh & Company Advocates. One Haji Mirza Ahsanul Haq C. W. 13, a brother of this party, appeared as witness in support of the claim and also filed his power‑of -attorney. The record shows that after 6‑7‑1959, the claim of this party has not been acknowledged by the suit firm, but only by the plaintiffs and defendant No. 4. In this view and for the reasons already given while discussing the claim of Messrs Deen & Webber, I have not been able to disagree with the conclusion of the learned Commissioner that the amount in question is recoverable only from the plaintiffs and defendant No. 4, and not from the suit firm. I also agree with the learned Commissioner that the amount in question would be paid only to the person legally entitled to receive it as the party himself is an Indian national.

40. I would now deal with debts from outside the account books (Exh. 58) out of which the Commissioner rejected fifteen claims either as fictitious or time‑barred. In regard to the claims of M. Abdullah Moula Bukhsh the Commissioner, however, came to the conclusion that it was the responsibility of the plaintiffs and defendant No. 4, who had acknowledged it, to the exclusion of defendants Nos. 1 to 3. Mr. Fazeel, the learned counsel assailed the finding of the learned Commissioner and in support relied upon Exh. 45, the receipts issued by plaintiff Sharif, Exh. 58, the evidence of accountant Hashim, of Jan Muhammad Dawood Advocate, of Ibrahim an attesting witness of Exh. 45, balance‑sheets Exhs. 88 and 89 and the preliminary report of the learned Commissioner. In order to appreciate his contention it would be proper to deal with each item of debt separately.

41. Ibrahim Brothers Limited and Ladiq Seth.‑The learned Commissioner reported that the claims of both parties were barred by limitation. He also disallowed the claims on the ground that no one appeared before him to support these claims in spite of the fact that notices were served on both parties.

The learned Commissioner also took into consideration his preliminary report in which he had reported the claim of Ibrahim Brothers Limited to be genuine but at that time he refused to go into the objections of defendants 1 to 3 that the claim was fictitious. Since, in view of the subsequent order of the Court, he was required to consider each claim on merit no objection could be taken to his finding as none appeared before him in spite of the service of proper notice. Therefore, there is hardly any scope to disagree with the findings of the learned Commissioner.

42. Sikandar Muhammaddin Miraa.‑In his preliminary report the learned Commissioner doubted the genuineness of the claim of this party. However, a claim was filed on its behalf on 10‑3‑1965 by Messrs Saeed A. Shaikh & Company Advocates and it was alleged that further details of the claim and its proof would be furnished later.

When the claim of this party came for consideration the learned Commissioner issued two notices, one personally to the party and another to his Advocates, but the latter notice was returned with endorsement that the papers had been taken away from them and further that they could not contact their clients. As the whereabouts of this party were‑ not known the learned Commissioner did not issue any further notice and enquired into the claim on whatever documents were available on record.

The only documentary evidence relied upon as a receipt dated 4‑7‑1959 in which plaintiff Sharif had acknowledged this debt. The debt in question was supposed to be due from before 7‑10‑1958, but according to the evidence of the plaintiffs the note book; from which this receipt was prepared, was destroyed after the Martial Law of 1958. The learned Com missioner disbelieved the genuineness of this receipt, and I have already concurred with his conclusion. The rest of the evidence on record, to which reference has been made in the contention of the learned counsel for the plaintiffs, was also disbelieved by the learned Commissioner, and I have agreed with him for the reasons given in detail while considering the claim of Messrs Deen & Webber. Since the same evidence has been relied upon in support of the claim of this party, it is obviously of no avail, and consequently 1 have no reason to disagree with the finding of the learned Commissioner that the claim in question was not genuine. .

43. Noor Bhoi A. Karim.‑This party claimed Rs. 10,000.00 from the suit firm, but the learned Commissioner had expressed its satisfaction about it in his preliminary report. However, receipt Exh. 2, which was executed by plaintiff Sharif on 4‑7‑1958, was relied upon before the Commissioner, but he disregarded it, being fictitious. I have also considered the effect of these receipts while considering the claim of Messrs Deen & Webber and have come to the same conclusion. Therefore, there is no scope to disagree with the conclusion of the learned Com missioner that the claim of this party was not genuine.

44. Rahmatullah,‑This party claimed Rs. 1,538‑9‑0, and in his preliminary report the Commissioner accepted it as genuine. However, while considering the objections defendants 1 to 3, the Commissioner disallowed this amount as barred by limitation. It seems that an attempt was made to show as if the amount in question had been given on deposit, but the learned Commissioner came to the contrary conclusion holding that the odd amount of Rs. 38‑9‑0, over and above the round figure of Rs. 1,500, would suggest that it had' been given as commercial loan. In regard to the question as to when the amount was advanced to the suit firm, the party stated that it was given in 1956 or 1957, but he could not mention the exact date. The learned Commis sioner was, therefore, of the view that if the amount in question had become time‑barred before 6‑7‑1959, then its acknowledgment in Exh. 45 would not help this party. Since the claimant did not produce any evidence to show, as to when he had advanced the amount in question to the suit ‑firm, the Commissioner came to the conclusion that it had been time barred by time on 6‑7‑1959 and notwithstanding its acknowledgment in Exh. , 45 it could not be recovered. Upon the evidence on record it cannot be said that the conclusion of the learned Commissioner on this point was not reasonable, and consequently I find no reason to disagree with his finding that the claim was not recoverable.

45. Moosa Haji Noor Muhammad.‑In his claim, which he filed before the Commissioner on 5‑3‑1965, he is alleged to have deposited Rs. 25,000.00 with the suit firm. The learned Com missioner had expressed his dissatisfaction about this claim in his preliminary report, but during the subsequent proceedings the party appeared as C. W. 4 and supported his claim. The only document produced for that purpose was receipt Exh. 5 which was executed by plaintiff Sharif on 6‑7‑1959. Since I have already come to the conclusion that all such receipts were ficti tious obviously the learned Commissioner was right in disregard ing it. The further ground, upon which the learned Commissioner rejected this claim, was that according to the, party he maintained two sets of books of account, one relating to his firm and another to his personal affairs. Since he claimed to have advanced this amount in his personal capacity; the Commissioner was of the view that the party was obliged to have produced his personal books of account which he failed to do, and consequently he raised adverse' presumption against him holding that had these books been produced they would not have supported his claim. The learned Commissioner also noted that the party did not disclose as to why this amount was advanced and further whether it was a loan or a simple advance on interest. He also disregarded the photostat copy of his declaration under Martial Law Regula tion No. 43 as, according to him, it did not show his undeclared income. Upon this evidence and the fact that the party was a money‑lender the learned Commissioner maintained his earlier view that his claim was not genuine.

I have not been able to disagree with this conclusion of the learned Commissioner which, under the circumstances, appears to be not only plausible but plainly reasonable.

46. Bai Hanifa.‑She claimed Rs. 9,000.00 against the suit firm and the learned Commissioner expressed his dissatisfaction about its genuineness in his preliminary report. When the claim was being considered on merit, she produced receipt Exh. 12, which is alleged to have been given to her some months after the present suit was filed. The learned Commissioner disbelieved this document as it had been given to the claimant long after her claim was disputed by defendants 1 to 3 as fictitious.

Upon this evidence and the fact that the party was closely related to deceased‑plaintiff A. Shakoor, I have no option but to agree with the conclusion of the learned Commissioner that the claim in question was not genuine, particularly, when no other document except receipt Exh. 12, was produced before him.

47. Habib A. Shakoor.‑He claimed Rs. 24,000.00 against the suit firm which, according to him; he had advanced to the firm of 1956 of ,which he was a partner. In support of his claim he relied upon receipt Exh. 3, which was executed by plaintiff Sharif on 4‑7‑1959 and of course on Exh. 58 in which his name was mentioned. Apart from the fact that these two documents, which have been disbelieved by me while discussing the case of Messrs Deen & Webber, cannot possibly support his claim, the party failed to show any reason as to why the amount in question was not shown in the books of account of the partnership firm of 1956, when it was a loan given to it for the discharge of certain immediate liabilities. It is interesting to note that he failed to examine any of his creditors although some of them (such as one Rehmatullah) were still unpaid and they were in possession of his receipts which he had executed in their favour. Furthermore, one such receipt, which was returned to him by creditor Joosab after he paid him back, was not preserved by him although his claim respecting that amount was still outstanding against the suit firm.

After anxiously analyzing the evidence on record and the relevant circumstances, I have not been able to disagree with the conclusion of the learned Commissioner that the claim of this party was not genuine.

48. Abdul Gajjar Sullaiman.‑In his preliminary report the learned Commissioner reported the claim of this party to be not genuine. However, while considering the objections of defen dants 1 to 3, Mr. Sullaiman, the father of this party, filed claim (Exh. X/10) on 6‑3‑1965 and also examined himself as witness C. W.

5. He produced receipt Exh. X/13 in support of that claim which was executed by plaintiff Sharif on 4‑7‑1959.

In cross‑examination Sullaiman pleaded ignorance as to how and under what circumstances the amount in question was loaned to the firm of 1956, nor did Abdul Ghaffar himself appeared as witness to explain that position. In this view, the learned Commissioner maintained his earlier finding that the claim of Abdul Ghaffar was not genuine.

I have anxiously applied my mind to the evidence on record but have failed to persuade myself to disagree with the finding of the learned Commissioner. The fact that Abdul Ghaffar himself chose not to appear before the Commissioner and his father Sullaiman pleaded ignorance about the circumstances in which this loan was given to the firm of 1956, it is difficult to disagree with the conclusion of the learned Commissioner. Furthermore, the only document upon which reliance was placed in support of the claim was the receipt executed by plaintiff Sharif on 4‑7‑1959. While considering the claim of Messrs Deen & Webber, I had discussed the effect of all such receipts and came to the conclusion that they were fictitious, and consequently the receipt upon which reliance was placed could not possibly sustain this claim.

49. Hajlani Zulekha Bawa.‑She claimed Rs. 10,000.00 against the suit firm. She did not appear before the Commissioner personally but was represented by her son Abdul Ghaffar. who was examined as witness C. W.

6. According to him, the amount in question was loaned to the suit firm in 1957, against a receipt which had been misplaced and was not traceable. According to the witness, the amount was given to Oomer Dawood, an employee of the firm, but he failed to explain whether it was a loan or a deposit. In cross‑examination he stated that his mother had brought Rs. 20,000.00 in cash to Pakistan in November 1957, out of which she advanced Rs. 10,000.00 to the suit firm. Hs. failed to explain, however, as to whether the amount was advanced so as to earn profits or for any other consideration.

Apart from the oral word of Abdul Ghaffar no documentary evidence was brought on record. The learned Commissioner was of the view that, under the circumstances, it would be improper to allow this claim upon the oral word of Abdul Ghaffar in fact, he had come to the same conclusion in his preliminary report from which he found no reason to depart upon the evidence produced before him.

I entirely agree with the conclusion of the learned Commis sioner that this amount could not be allowed. Admittedly, the claim was made only upon the oral word of Abdul Ghaffar, the son of the claimant, and, under the circumstances, it could not have been properly allowed. Furthermore, the reasons given by the witness as to how the amount was given on loan to the suit firm are so unconvincing that it could hardly inspire confidence. Consequently, I entirely agree with the learned Commissioner that the claim of this party was not genuine.

50. Muhammad Anwar.‑He claimed Rs. 20,000.00 against the suit firm. In his claim Exh. 14 he alleged to have advanced this amount to the firm as deposit and in support examined himself as witness C. W.

7. He also produced receipt Exh. 15, which plaintiff Sharif had executed on 4‑7‑1959.

In his evidence he stated that he had given this amount to the firm in 1958 on deposit while he was proceeding to perform Hajj. According to him, he had received about Rs. 400.00 back from the firm and the balance was still due to him. In regard to receipt Exh. 15, his case was that it was given to him at his request in the presence of Haji Muhammad, defendant No. 1 and plaintiff Habib.

In cross‑examination he stated that the amount in question belonged to his wife and daughters and that before proceeding for Hajj he wanted to keep it with some one as deposit. He admitted to be a merchant of Lyallpur and stated that he brought this amount in cash to Karachi and deposited it with the suit firm without obtaining any receipt. He further admitted, however, that the brother of his wife was a merchant at Karachi but gave no reason as to why he did not deposit that amount with him. He also failed to show as to what amount he actually received back from the firm on his return from Hajj.

The learned Commissioner disbelieved the evidence of Muhammad Anwar and rejected his claim. The only document produced in support of his claim was the receipt executed by plaintiff Sharif which, for reasons already stated, cannot possibly support the claim of this party. Furthermore it is highly unnatural to believe that the witness would have brought the huge amount of Rs. 20,000.00 all the way from Lyallpur to deposit it with the suit firm and that too without obtaining any receipt and without disclosing any reason for prompting him ‑ to do so. Similarly he failed to show any reason as to why in preference to his brother‑in‑jaw, who was admittedly a merchant of Karachi, he deposited the amount with the suit firm. In view of the evidence on record and all the circumstances, it cannot be said that the learned Commissioner was wrong in rejecting the claim of this party which was grounded simply on the oral testimony of a doubtful character.

51. Yousuf Anwar.‑In his preliminary report the learned Commissioner found the debt of this party genuine as, according to him, it was covered by the acknowledgments contained in Exh. 45 and in two other documents dated 25‑1‑1960 and 17‑4‑1962. However, while considering the objections of defendants I to 3, the party neither appeared before the Commis sioner nor filed his claim. According to the learned Commis sioner he had issued notice to this party on 20‑2‑1967, but it was returned unserved as, according to the prows‑server, the business firm of this party had been closed since quite some time and his whereabouts were not known. The learned Commissioner was, in any case, of the view that the claim of this party had become barred by time the latest on 17‑4‑1965 and was not recoverable.

I find myself in agreement with this conclusion as, under the circumstances, the learned Commissioner had no option but to hold that the claim was not recoverable.

52. Abdul Ghaffar Ahmad.‑In his preliminary report the learned Commissioner expressed his dissatisfaction about this claim, and he found no reason to depart from that conclusion in his supplementary final report. The party filed his claim on 29‑3‑1965, and also appeared as his own witness C. W.

1. The only document, which he produced in support of his claim, was receipt Exh. X,/1, which was executed by plaintiff Sharif on 4‑7‑1959, but the learned Commissioner disregarded it. On my part I have already discussed the effect of all such receipts in the preceding part of this judgment, and I have come to the same conclusion. In this view, there is no scope for disagree ment with the finding of the Commissioner that the claim of this party was not genuine.

53 Abdul Aziz Ali Muhammad. The claim of this party was disallowed by the Commissioner both in his preliminary report and supplementary final report. In support of the claim, Mr. Rehmatullah, the present proprietor of the firm, appeared and was examined as witness C. W.

9. According to this witness, the claimant and the suit firm had mutual dealings in giving and taking loans from each other from time to, time and all these transactions were recorded in their respective account books. According to him, the claim in question related to the year 1955-56, but sur risingly it was not entered in the books of account of the firm nor in his own books of account. In this view of the evidence on record I am satisfied that the learned Commissioner rightly rejected the claim of this party. Furthermore, Rehmatullah could not positively state as to when exactly the amount was advanced in 1955‑56, and consequently the Commissioner came to the conclusion that if it was advanced prior to 6‑7‑196, when Exh. 45 was executed, it would be barred by limitation. Under the circumstances, I have no option but to agree with this finding as well and hold that the claim of this party was not recoverable.

54. S. M. Jamil & Company.‑In support of the claim of this party Mr. Wahabdin appeared and was examined as witness C. W.

8. According to him, he was the sole proprietor of the creditor firm of which be maintained accounts., However, the amount in question was not shown in his books of accounts nor was it shown in his declaration of hidden wealth which he filed under the Martial Law Regulations of 1958. He failed to produce any document in support of his claim and the learned Commissioner, being dissatisfied about his oral evidence, held that the amount was not recoverable.

In the face of this evidence and all the surrounding circum stances, it is difficult to appreciate as to bow the claim of this party could be properly allowed by the Commissioner. Therefore, I have no option but to agree with his conclusion that the amount was not recoverable.

55. M. Abdullah Moula Bukhsh.‑This party claimed Rs. 12,000.00 from the suit firm and the learned Commissioner, in his preliminary report, found it genuine. However, while considering the objections of defendants 1 to 3, the party filed no claim, but one of its partners namely Abdus Sattar had been examined by the Commissioner during the preliminary enquiry and had produced accounts Exh. 106 to Exh.

109. According to Exh. 109, the party is alleged to have advanced Rs. 13,179‑6‑0 to the suit firm on 13‑2‑1957, but it was settled for Rs. 12,000. This amount was acknowledged by the firm in Exh 45, but therefore it was not acknowledged by the firm although it was acknowledged by the plaintiff's on 25‑1‑1960 and again on 17‑4‑1962. Since the amount in question was claimed on behalf of the creditor by Abdus Sattar in August 1962, the learned Commissioner came to the conclusion that the claim was alive against the plaintiffs and defendant No. 4, who alone had acknowledged it.

Upon the evidence on record, I have not been able to find any reason to disagree with the conclusion of the learned Commissioner. For the reasons already given while considering the claim of Messrs Deen & Webber, which are directly relevant to the present claim, I am also of the view that the claim of this party was alive but only against the plaintiffs and defendant No. 4, who alone, had acknowledged it to the exclusion of defendants 1 to 3.

For all these reasons, I adopt the conclusions of the learned Commissioner, including his findings on the debts from inside and outside the account books as contained in para. 10 of his supplementary preliminary report which, for the sake of brevity, need not be reproduced in the body of this judgment.

56. The next contention of the learned counsel for the plain tiffs was that the liability of income‑tax was that of the three firms of 1951, 1956 and 1959 and not of the individual partners as held by the Commissioner. In support of his contention the learned counsel relied upon sections 43 (a) and 44 of the Income‑tax Act and section 48 of the Partnership Act. He further relied upon the affidavit of plaintiff Sharif dated 23‑1‑1960, the counter affidavit of defendant No. 1 dated 30‑1‑1960, a letter from the counsel of the defendants dated 14‑3‑1960 written to the Nazir of the Court, another affidavit of Sharif dated 11‑4‑1960, counter -affidavit of the defendants dated 12‑4‑1960, para. 11 of the plaint and para. 9 of the written statement.

The learned, Commissioner, before whom this point was strenuously argued, did not agree with the learned counsel for the plaintiffs for a number of reasons. He referred to the practice of plaintiff Sharif, who had paid the income‑tax of the firm of 1950, but had debited the amount to the individual accounts of the three partners of that firm. Relying upon this practice the learned Commissioner interpreted the deed of partnership of the firm of 1959 to the same effect and held that the liability to pay income‑tax was that of the individual partners. The learned Commissioner also took into consideration the practice of paying income‑tax of the firm of 1947 which consisted of three partners, namely Sullaiman, Abdul Latif and Yousuf. He observed that income‑tax of that firm, for the first accounting year 1947‑48, was paid in the year 1952‑53, prior to which the firm had been reconstituted in 1950 in which Sullaiman was not. a partner. However, the income‑tax dues and Muhajir tax, which fell to the share of Sullaiman, were paid by the firm but debited to the account of Sullaiman. He further observed that the same practice was continued for the subsequent years in the ledgers Exh. 18 and Exh. 20, and cash books Exh. 19 and Exh.

21. The Commissioner also found that these amounts were never transferred to the firm but were carried forward in the account books of the firm from year to year till 4‑7‑1959, when the whole of that amount, on the debit side, was transferred to the capital account of his son Oosman in Exh. 26 and credit journal Exh.

121. By way of another instance the learned Commissioner noted that similar taxes on behalf of the other two partners of the firm of 1947 were paid and debited to their individual accounts in ledgers Exhs. 14, 18 and 20.

In regard to the firm of 1956, the learned Commissioner, referred to para. 3 of the partnership deed of the firm of 1959, whereby the liabilities of the former firm were taken over and not those of ‑ individual partners. The firm, being a registered firm, every partner was liable and assessed to income‑tax individually under section 23(5) of the Income‑tax Act, while for the purposes of super tax the firm itself was assessed, as a group.

57. After having analysed the evidence on record I am in agreement with the finding of the learned Commissioner, section 43(a) and section 44 of the Income‑tax Act, upon which reliance was placed by the learned counsel for the plaintiffs, appeared rather to support that finding instead of the contention of the plaintiffs. According to section 43(a) (and section 44 does not appear to be relevant), the liability to pay income‑tax is the personal responsibility of the individual partner, and not that of the firm.

58. Reliance upon the various documents such as partnership deeds etc., is misconceived. These documents, when read together, simply show the anxiety of the defendants that the income‑tax must first be paid before the assets of the firm are distributed, and not that they were admitting that the firm was liable to pair income‑tai. In any case, the defendants by their admission alone could not make the suit firm liable to pay income -tax when section 43(a) of the Income‑tax Act makes the individual partners personally responsible to discharge that liability.

In regard to the liability for the purposes of super tax the firm itself has been assessed as a group which, according to the learned Commissioner reflected the correct legal position. However, the learned counsel for the defendants has taken strong exception to this finding and I would deal with his arguments at an appropriate stage in the later part of this judgment.

59. The Commissioner at pages 32, 33 and 34 of his supplementary final report has catalogued in figures the amounts payable on account of super tax and income‑tax. Since neither party has objected to these figures, I would finally adopt them without the necessity of reproducing them in judgment.

60. The learned counsel for the plaintiffs next argued that the Commissioner was wrong to hold that the firm, after the sale of its goodwill to the plaintiffs, was not liable to capital gains tax. This point does not appear to have been raised during the course of the arguments, but was mentioned in the notes of the learned counsel which were supplied to the Court at a later stage.

In support of this argument before the Commissioner reliance was placed upon the Finance Act of 1963 and some Indian decisions, but the learned Commissioner distinguished these cases holding that after 1956, they were not relevant.

The admitted facts are that the capital gains tax was imposed in British India in 1947 by the insertion of section 12(b) in the Income‑tax Act. This levy was effective for period 1‑4‑1946 to 31‑3‑1947, but in Pakistan it was extended up to 31‑3‑1950 by virtue of three amendments after which the recovery of this levy was stopped. In India this levey was reimposed in 1956, but in Pakistan it was introduced after 7‑6‑1963 by Act XVI of 1963 with the proviso which reads :‑

Provided that any transfer of capital assets by reason of compulsory acquisition : . . . or on the dissolution of firm or . . . . shall not, for the purposes of this section, be treated as sale, exchange or transfer of capital assets.

61. This being the state of law in Pakistan, the learned Commissioner appeared to be right in holding that the firm, after its goodwill was sold to the plaintiffs, was not liable to pay capital gains tax. The learned Commissioner also appeared to be right in distinguishing the various cases cited before him as they mostly referred to limited companies, and not partnership firms which have been specifically exempted in view of the above proviso: These authorities are, in any case, distinguishable as they are based on Indian Law which, at the relevant time, was substantially different than the law in Pakistan.

Before parting with this discussion, it may be pointed out that the conclusion, in regard to the levy of capital gains tax; is necessarily tentative in nature as no effective finding could be given on that point in the absence, of Income‑tax Department who are not a party to these proceedings. Therefore, if a demand is ever made by the Department for the payment of capital gains tax and the plaintiffs fail to secure exemption under the proviso to section 12(b) of the Income‑tax Act, they would then be entitled to claim contribution from defendants 1 to 3, who would be at liberty to contest that demand. In such a situation, the plaintiffs would perhaps file a suit against the defendants in which this question would be finally determined.

62. Mr. Fazeel, the learned counsel for the plaintiff next argued that the learned Commissioner had wrongly saddled defendant Habib, the L. R. of plaintiff No. 1, with the liability of Rs. 73,500.00 and Habib and Sharif in the sum of Rs. 2,28,000.00 in equal shares. The contention is based on two premises, namely:‑

(1) That these liabilities were found in regard to the firm of 1956, and the Commissioner had no jurisdiction to reopen these accounts, and

(2) That by this process the profits of Habib and Sharif were considerably reduced and the defendants given more amounts than what they had claimed in their objections.

It is an admitted position that defendant Haji Muhammad had claimed Rs. 1,39,914.00, but the Commissioner awarded him Rs. 1,59,809.25. It is also an admitted position that in their objections the defendants claimed that the plaintiffs were liable in the sum of Rs. 2,77,029.50, but the Commissioner found this liability in the sum of Rs. 5,55,618.00. It is also not denied that in his final report the Commissioner had allowed plaintiff Sharif Rs. 14,926.00 and Ghaffar Rs. 77,517.00, but in the final supple mentary report they were respectively made to pay Rs. 1,21,759.94 and Rs. 64,000.00.

The first contention of the learned counsel that the Com missioner had no jurisdiction to reopen the accounts of the firm of 1956 has been extensively dealt with in the earlier part of this judgment and was found to have no force. Therefore, this contention need not be reconsidered.

The other contention of the learned counsel that the Commissioner had wrongly enhanced the liability of the plaintiffs in his supplementary final report and allowed larger amounts to the defendants as against their own claim is misconceived. As already pointed out, the conclusions of the Commissioner in his final report were based in disregard of the objections of defendants 1 to 3, which he declined to consider in view of the pendency of Suit No. 82 of 1960. Therefore, when the matter was remanded to him with directions to dispose of these objections he reopened the accounts of 1956 firm on the ground of fraud, alleged by defendants 1 to 3, and came to the impugned conclusion. By this process his earlier conclusions were natur ally affected and in the result the liability of the plaintiffs considerably enhanced to the larger benefit of defendants 1 to 3.

This conclusion was reached' as a result of considering the objections of defendants 1 to 3 that the plaintiffs had misapprop riated several amounts. The first objection of the defendants was that Rs. 1,72,000.00 had been misappropriated by the plaintiffs by making false entries of the sale of cotton seed in ledgers Exh. 124 in the names of Sultan Muhammad, Ibrahim Sullaiman and Muhammad Ilyas. These entries were made on 24th and 26th July 1957, and appeared last in the books in the cotton seed account. The amount of Rs. 1,72,200.00 has been shown credited in cash book Exh. 23 on 27‑7‑1957, and on the same date Rs. 1,47,000.00 has been shown debited to Chittagong shop as paid against eight Hundies drawn by it. The balance of Rs. 25,200:00 has been debited to eight out of nine partners of the firm. By this process the amount of Rs. 1,72,200.00 has been balanced. The question, therefore, is as to whether the balance of Rs. 1,47,000.00 was misappropriated?

63. In the cash book of Chittagong account, a sum of Rs. 1,47,000.00 is shown credited on 28‑7‑1957 in favour of Karachi shop and debited in the names of eight Hundi‑holders. The learned Commissioner found that their entry was not made in due course of business as the Hundies were not drawn on 25‑7‑1957, but one day after they were actually paid at Karachi. These Hundies are Exhs. 97 to 104 and signed by Sullaiman on behalf of the firm.

The learned Commissioner, after examining considerable documentary evidence on record; found these Hundies to be bogus and held that the amount of Rs. 1,47,000.00 was mis appropriated by Habib and Sullaiman, who alone were found responsible by him to the exclusion of other partners. I have minutely examined the evidence, upon which the learned Com missioner relied including his reasons for coming to the impugned conclusion, but I have not been able to disagree with him that the Hundies in question were bogus and the amount of Rs. 1,47,000.00 was misappropriated by Habib and Sullaiman, who alone are responsible to pay it back to the suit firm in equal shares.

It is interesting to note that even the identity of the persons in whose names these Hundies were drawn was not established nor any one of them produced before the learned Commissioner. Even the drawer of these Hundies, namely Sullaiman failed to examine himself before the Commissioner, and consequently the learned Commissioner was plainly right in his conclusion that the Huhdies were bogus and the amount had been misappro priated.

The question may arise as to why Habib should have been made responsible to equally share the burden of Rs. 1,47,000.00 with Sullaiman who was the author of these Hundies? The answer is that Habib was found to have been incharge of the cotton seed business of the firm at Karachi and that by itself was enough to connect him with the misappropriation of this amount along with Sullaiman. Obviously, therefore, he was equally responsible to share this burden as the Hundies in question were drawn in relation to the cotton seed business and which as a fact have been found as bogus.

The next contention of the learned counsel that by this process the defendants have been given more amounts than what they had claimed in their objections is also misconceived. It is no doubt true that in their objections they had claimed much lesser amount than what was awarded to them by the Commissioner, but this by itself was no ground to disentitle them to a larger benefit when upon the scrutiny of the accounts of 1956 firm it was found that the plaintiffs had misappropriated large amounts. Furthermore, when they filed their objections the defendants were not aware of the true state of accounts of the firm of 1956, and consequently they were not in a: position specifically to state as to what amounts were actually misappropriated. It was only after the accounts of the firm of 1956 were reopened on the ground of fraud that these facts came to light and therefore there was no conceivable impediment in the way of the Commissioner to hold that larger amounts, other than what the defendants had claimed, had been misappropriated.

The Commissioner next found that an amount of Rs.2,28,000.00 had been misappropriated by plaintiffs Habib and Sharif, who were required to pay it back to the suit firm in equal shares. The report of the Commissioner shows that on account of short delivery of 19,000 bags of cotton seed by M. Abdullah Moula Bukhsh, this amount was debited to that party in the books of account (vide Exh. 24, page 48 and journal Exh. 126, page 1). On 2‑8‑1958, the amount in question was again credited in the name of this party and correspondingly debited to profit and loss account in the ledger Exh. 24 at pages 48 and 191. The Commissioner, however, found that this credit was wrongly given to the party as no consideration was received by the suit firm, and consequently it could not have been shown as loss in the account books. When confronted with these entries, plaintiff Sharif stated that he did not remember if any effort was made to get the delivery of these 1900 bags nor did he remember as to how this amount was transferred as debit to profit and loss account. As against this, one Abdus Sattar from the firm of M. Abdullah Moula Bukhsh was examined by the plaintiffs, but he denied that 1900 bags had been short delivered. In this view of the evidence on record the learned Commissioner found that Rs. 2,28,000.00 had been misappro priated.

64. I have gone through the relevant evidence and the reasons of the learned Commissioner and agree with this conclu sion. The only argument advanced on behalf of the plaintiffs was that the accounts of the firm of 1956 could not have been reopened and that in any case one of the defendants (D. W. 1.) was present at the time of the settlement of dues with the firm of M. Abdullah Moula Bukhsh, and consequently he was equally liable to proportionately pay back the amount to the suit firm. As already pointed out, the accounts of 1956 firm were properly reopened and therefore the contention of the learned counsel for the plaintiffs is misconceived. In regard to the allegation that one of the defendants (D. W. 1) was present at the time of the settlement of accounts with M. Moula Bukhsh the learned Commissioner observed that he was not questioned by the plaintiffs whether the amount of Rs. 2,28,000.00 was the subject -matter of settlement between the parties. Therefore, there is hardly any scope to disagree with the learned Commissioner in this conclusion which, under the circumstances, appears to be proper.

65. The learned Commissioner fixed the responsibility for this amount on Habib and Sharif in equal shares as they alone were responsible for conducting cotton seed business with the firm of M. Abdullah Moula Bukhsh. In this view he rightly fixed the responsibility for this amount on Habib and Sharif to the exclusion of other partners who had nothing, to do with these transactions.

The learned Commissioner next found that an amount Rs. 15,000.00 was misappropriated and fixed the responsibility on plaintiff Sullaiman. The amount in question was shown in the Karachi ledger (Exh. 24), in the account of D. W. Ismail Chotani. The learned Commissioner found that in this account were shown payments made to the family of Chotani for monthly household expenses and the amounts were accordingly debited. The total amount on the debit side of this account was shown Rs. 18,238‑4‑6, whereas on the credit side the first amount appeared Rs. 3,238‑4‑3, which was transferred to Chittagong and credited in the accounts at Karachi on 1‑8‑1958. Similarly the amount of Rs. 15,000.00 was transferred to Chittagong on 2‑8‑1958 and accounts at Karachi were accordingly squared. Although this entry was also a transfer entry, it was not entered in credit journal Exh. 126, but credited in Karachi cash book Exh. 24 on page 89.

As against this, the amount of Rs. 15 000.00 was shown credited in the Chittagong ledger (Exh. 152) to the account of Karachi shop and also in cash book Exh.

163. The learned Commissioner found that this was obviously incorrect as the amount should have been debited in the Chittagong books to the account of Abdullah Chotani. On the contrary the amount was split‑up and debited to three names, namely that of Ismail Ghani, Sattar Dawood and Oomar Dawood in Exh. 163 at page 141. These amounts were also shown in ledger Exh. 152 in the name of these persons. Ismail Chotani in his evidence before the Commissioner stated that he never withdrew any amount more than his salary and therefore he was not a creditor of the firm. He also stated that whatever amounts he withdrew at Chittagong were transferred to Karachi in his presence but not vice versa. Upon this evidence the learned Commissioner found that Ismail Chotani was not a creditor of the firm in the sum of Rs. 15,000.00 and that the amount had been misappropriated at Chittagong. However, he fixed the responsibility on Sullaiman who was incharge of the business at Chittagonge and chose not to appear before the Commissioner to explain the circumstances:

After scrutinizing the evidence on record and the reasons of the learned Commissioner, I have not been able to persuade myself to disagree with his conclusion on this point, particularly when Sullaiman chose not to appear in the witness‑box to explain as to how the amount of Rs. 15,000.00 was shown in the name of Chotani. The finding of the learned Commissioner, based as it was on proper evidence, appears to be plausible, and I have no option but to agree with his conclusion. It would, therefore, follow that notwithstanding his earlier conclusions in the final report about the state of accounts between the parties the learned Commissioner, after having properly reopened the accounts of 1956 firm, correctly came to the impugned conclusion.

66. The learned counsel next argued that Habib and Sullaiman who had stepped into the shoes of late Haji Shakoor as L. Rs., could not be saddled with any liability in regard to the accounts of 1956 firm and in support relied upon the deed of retirement (Exh. 134) which, according to him, absolved them from all such liabilities. The contention is without force. It is an admitted position that Habib and Sullaiman were partners in the firm of 1956 and had been found to have personally committed fraud in relation to the accounts of that firm and misappropriated large amounts. To that extent they would stand liable to repay all the amounts which they had misappropriated on account of their personal fraud notwithstanding the fact that vide the deed of dissolution (Exh. 134) they were absolved from all liabilities. Therefore, it is factually erroneous to contend that as L. Rs. Of deceased Haji Shakoor they could not have been saddled with any liability in regard to the accounts of the firm of 1956.

67. The learned counsel lastly contended that the Commissioner was wrong to hold that the goodwill of the partnership firm, which was sold to the plaintiffs, included the liabilities of the firm as well and in support relied upon the auction proceedings dated 4‑1‑1964 and the consent order passed by the Court on 20‑1‑1964. The liability relates to the payment of income‑tax for 1963‑64, and the question is whether the learned Commissioner rightly found it to be the liability of the plaintiffs? For this purpose the relevant order is that of the Letters Patent Bench dated 23‑9‑1963 in which the goodwill of the firm was held to mean and include only the name and style of the firm, the licences which had been obtained by the use of that name after 21‑3‑1963, on which date the auction was held and all other advantages and benefits which may accrue from its use in the future. To the same effect is the order of a learned Single Judge dated 9‑12‑1963, by which the Commissioner was ordered to sell by auction the goodwill of the firm between the parties. In pursuance of this order, the Commissioner held the auction proceedings on 4‑1‑1964 and after taking the bids of the parties submitted his report to the Court. The bid of Rs. 5,21,500.00 of Ghaffar, the attorney of Mst. Zubaida, plaintiff Rs. 9 being the highest was accepted by the consent of parties and the auction proceedings confirmed by Court on 20‑1‑1964. The report of the learned Commissioner shows that on this account Rs. 7,577.C0 was paid in advance by the Receiver and the same was debited to the account of the plaintiffs in equal shares.

I am rather inclined to agree with the view of the learned Commissioner. The order of the Letters Patent Bench has defined the goodwill of the firm to mean and include only the name and style of the firm, the licences which have been obtained by the use of that name after the 21st of March 1963 and all other advantages and benefits which may accrue from its use in the future. The crucial date is 21st of March 1963, as it is after this date that the goodwill of the firm became the property of the plaintiffs and as a result of its use and the licences which they obtained they made profits. Since the profits were made after the 21st of March 1963 i.e. during the accounting year 1963‑64, the liability to pay income‑tax on the profits earned during that period would be that of the plaintiffs unless they could seek exemption under any order of the Court or any agreement between the parties to the contrary. I am clear in my mind that the order of the Letters Patent Bench, which is the foundation for the sale of the goodwill of the firm to the plaintiffs, does not exempt the plaintiffs from this liability nor is there any contrary agreement between the parties. Furtherance the incidence of doing business and earning profits would carry with it the liability to pay income‑tax as welt and the responsibility for that purpose would be of the person who, during the relevant period, was engaged in trade. I, therefore, see no objection to the finding of the learned Commissioner that it was the responsibility of the plaintiffs to pay income‑tax for the year 1963‑64, in which they had earned profits by using the goodwill of the firm and its licences.

The learned counsel raised the same objection in regard to the finding of the Commissioner that expenses by way of salaries of the staff, rent of the various premises, fees of the Official Assignee and other miscellaneous expenses were payable by the plaintiffs, out of the profits of the firm, when they were the owners of its goodwill. This point has been sufficiently dealt with in the preceding para. and found without force. For the same reasons the contention cannot be accepted, and it must be held that the conclusion of the learned Commissioner was right.

This disposes of all the objections of the plaintiffs.

68. I would now take up the objections of defendants 1 to 3. Their first objection is that the Commissioner was wrong to hold that plaintiff Sharif as Receiver had the power to acknowledge debts on behalf of the suit firm. I find no force in this objection. This point has already been considered in the earlier part of the judgment and on principle I have agreed with the learned Commissioner that plaintiff Sharif, having been appointed as Receiver with all powers under the C. P. C., could properly acknowledge debts against the suit firm although most of the acknowledgments made by him were found as fictitious and fraudulent. In this view, there is no need to reconsider this objection as it has already been dealt with in detail.

69. The next objection of the defendants is that the Commis sioner wrongly allowed fifteen claims from inside the account books and four claims from outside the account books. I would deal with these debts separately.

70. Debts from outside the account books

Haji Muhammad Ali Muhammad.‑By going through the report of the learned Commissioner, the objection of the defendants was found to be incorrect. The Commissioner did not allow this amount as alleged but had only directed the Receiver to keep Rs. 40,000.00 apart so that if the suit of this party, which was filed against the firm, was decreed the amount should be available to discharge that liability. Under the circumstances, I find nothing wrong with this direction of the learned Commissioner. In case the suit of this party, which perhaps might have been disposed of, by now, has been decreed the amount would be paid in the discharge of that liability, but if it was dismissed then the amount would form part of the assets of the firm to be distributed amongst the parties according to their respective shares.

71. Ismail Ghani.‑This party claimed Rs. 544.00 from the suit firm and the learned Commissioner in his preliminary report found it to be deposit. The Commissioner had issued a notice to the party (marked A/44 and its acknowledgment is A/48). A letter received from this party is also on record as A/49, and upon these facts the learned Commissioner came to the conclusion that this amount was payable.

I have gone through the preliminary report of the learned Commissioner and found myself in agreement with his conclusion. The fact that the amount in question was deposit and not a loan it was rightly held to be payable by the suit firm.

72. Sullaiman Dawood.‑This party claimed Rs. 210.00 from the suit firm and according to the preliminary report of the Commissioner it was a deposit. The report further shows that the amount was collected from beginnings and kept with the suit firm in confidence. In this view, the Commissioner was right that the amount was payable. However, according to the supple mentary final report the party is reported to have died and no one has come forward to claim this amount. Accordingly it would form part of the assets of the suit firm to be distributed amongst the partners according to their respective shares.

73. Sardar Muhammad.‑The claim of this party is Rs. 1,232‑12‑0, and was found to be loan by the Commissioner. The report of the learned Commissioner shows that in spite of the notice served on the party, he did not appear as according to Muhammad Anwar C. W. 7, he had lost the balance of his mind. This amount was acknowledged in Exh. 45, in the plaint and again on 17‑4‑1962 in the deposition of P. W.

1. Upon these facts the learned Commissioner found this claim to be within time as, according to him, the period against this claim would remain suspended under section 6 of the Limitation Act due to the mental illness of this party.

Upon the evidence on record I do ‑not see as to how I could disagree with this conclusion.

74. Debts from inside the account books.‑The learned Com missioner all owed fifteen claims under this head which come to Rs. 42,814.52. I have examined each and every item minutely including the evidence in support thereof and the reasons of the learned Commissioner but have not been able to disagree with his conclusion. However, let me examine each one of these items separately to see if there was any force in the objections of the defendants.

75. Raj Oil Mills.‑According to the report of the learned Commissioner, this party had filed a suit against the firm for the recovery of Rs. 4,000.00, and the same was pending, without anticipating the outcome or the result of the suit the learned Commissioner directed that a sum of Rs. 4,400.00 be kept apart so that if the suit was decreed there should be no difficulty in meeting that liability. I find nothing wrong with this conclusion. However, in case the suit of this party is dismissed or has already been dismissed, this amount would be added to the assets of the firm and would be available for distribution amongst the partners.

76. Habib Ayoob.‑The claim of this party was Rs. 539‑14 0 and the learned Commissioner found it to be deposit. The party appeared before the Commissioner in support of his claim and upon the scrutiny of the cash books of the suit firm his claim was found to be genuine. Furthermore, the amount was shown to have been a deposit and the learned Commissioner found it to be within time. In this view, I do not see any reason to disagree with this finding.

77. Baf Zainab Madar.‑She claimed Rs. 1,248.25 from the suit firm and one Jusaf Ghani C. W. 19 appeared before the Commissioner in support of that claim. Upon the scrutiny of the evidence and the cash books of the suit firm the learned Commis sioner found this amount to be deposit and within time. The learned counsel for the defendants failed to point out as to how this conclusion was wrong, and consequently there is no reason to disagree with the learned Commissioner.

78. Bai Fatima Ghani.‑In support of her claim her son Jusaf Ghani appeared before the Commissioner as she herself had died. In his evidence before the Commissioner he produced a note book (Exh. X/31) in which her claim was accounted for and endorsed by plaintiff Sharif as Receiver. Furthermore her claim was also supported by the account books of the firm and upon the evidence the learned Commissioner found it was a deposit and since no claim was made for its refund it was within time. He however reported that the amount in question would be paid according to the orders of the Court to the person who would be legally entitled to it.

I do not see as to how one could disagree with this conclusion based as it was on proper evidence. I, therefore, direct that the amount allowed by the Commissioner would be retained and paid to the person entitled to receive it after he has produced in Court satisfactory evidence.

79. A. Ghafar Habib.‑This party claimed the small amount of Rs. 636.62, and the learned Commissioner found it to be deposit. The claim was also supported by the account books of the firm and consequently the Commissioner allowed it. I agree with this conclusion and hold that the amount was payable.

80. Bai Hanifa Tayab.‑She is the sister of deceased‑plaintiff A. Shakoor and to support of her claim her brother Dawood appeared as C. W. 18 and produced a note book (Exh. X/30). Her claim was supported by the account books of the suit firm and the learned Commissioner found it to be deposit. He was, therefore, of the view that the claim was within time and payable.

The learned counsel has failed to show as to how this conclu sion was wrong and therefore I have no option but to agree with the learned Commissioner.

81. Bai Hawa Shakoor.‑The learned Commissioner allowed her claim for Rs. 646 44 holding that it was a deposit and not a loan and was therefore within time. In reaching this conclusion the learned Commissioner took into consideration the entries of the account books of the firm which supported this claim. I agree that this am‑)unt was rightly payable.

82. Abba Hussain.‑The party claimed Rs. 2,895.00 and one A. Aziz C. W. 23 appeared before the Commissioner and gave his evidence. The claim was supported by the entries in the account books of the suit firm and the learned Commissioner found that it was a deposit and not a loan. The learned Commissioner also found that since no demand was made for the refund of that amount it was within time and payable.

The learned counsel for the defendants failed to show as to how this finding was wrong and consequently I agree with it.

83. The rest of the claims of Hajiani Zulekha, Dawood Oosman, Bai Aisha, Haji A. Shakoor, Hajiani Haw Ghani, Hajiani Zubaida, Bai Hanifa and Ahmad Haji Jamal have been allowed by the learned Commissioner holding them to be deposits and payable as no claim was made for their return. In reaching this conclusion the learned Commissioner took into consideration the entries in the account books of the suit firm which appeared to support the claim of these parties.

The learned counsel for the defendants failed to show as to how the learned Commissioner was wrong in coming to this conclusion, and consequently there is no option but to agree with him.

84. The next objection of the defendants is that an amount of Rs. 40000 was to be debited only to the account of Sullaiman Ghani, but no arguments were addressed on this point. In fact, even the objection in question does not give any indica tion as to why it is desired that this amount should be debited only to the account of Sullaiman Ghani, and consequently this objection must be rejected.

85. The next objection of the defendants is that the Commissioner wrongly allowed Rs. 2,895.00 to Abba Hussain and Rs. 1,654.69 to Bai Hanifa Tayab as they were actually entitled to Rs. 949.00 and Rs. 1,254.69 respectively. Apart from the bare objection, the learned counsel did not address any arguments on this point and in spite of my endeavour to see the merit of this objection I could not find any guidance from the record. The learned Commissioner in his supplementary final report has allowed these parties the amounts to which objection has been taken, but in the absence of anything to the contrary on record, it is difficult to disagree with the learned Commissioner. The objection must, therefore, be rejected.

85. The next objection of the defendants is that plaintiff Sharif as Receiver had failed to recover the dues of the firm amounting to Rs. 25,272.30 from various parties in spite of oral and written requests made to him by the defendants for that purpose and consequently the said amount should have been debited to his account and added to the assets of the firm. The learned counsel for the defendants did not advance any arguments on this point and therefore there was no material before me to see the validity of this objection. However, I referred to para. 41 of the supplementary final report of the Commissioner in which this objection was dealt with and he appeared to be of the view that these debts were prima facie barred by time. In the absence of any material on record to the contrary. I have no option but to agree with that finding and hence reject this objection.

87. The last objection of the defendants was that the learned Commissioner in his supplementary final report (para. 34) had mistakenly mentioned the amount of Rs. 91,722.44 when actually the amount was only Rs. 91,172.44. This error, according to the learned counsel, was to be rectified. The objection is well founded. By looking at para. 20 of his final report, upon which the learned Commissioner relied for the purposes of this amount, it was noticed that it contained the figure of Rs. 91,172.44 and not Rs. 91,722.44. In this view, the amount mentioned in para. 34 of the supplementary final report of the Commissioner would be read as Rs. 91,172.44 and not the contrary figure which was wrongly mentioned.

88. The last objection of the defendants is in regard to the liability of super tax. The learned Commissioner was of the view that under section 23(5) of the Income‑tax Act super tax was to be paid by the firm and the income‑tax by individual partners. The learned Commissioner, however, did not give any reasons in support of his conclusion apart from referring to section 23(5) of the Income‑tax Act.

Section 23,5) of the Income‑tax Act prima facie does not support the conclusion of the learned Commissioner, but I would refrain to go into this question as it involves the interpretation of the various provisions of the Income‑tax Act which, to my mind, could not be done in the absence of Income‑tax Department. After all any finding of the Court upon the provisions of that Act would affect the power and jurisdiction of the Income‑tax Department including possib ly a large number of cases which might be pending before it for adjudication. In this view, even the learned Commissioner should have refrained from giving a positive finding on this point although he would have been justified to express his tentative conclusion so that the tax in question could have been paid to the Department from the assets of the firm. In such an event those partners, according to whom this tax was to be paid by the individual partners, would have been at liberty to seek their remedy through appropriate proceedings either in Court or before the Income‑tax Department. Accordingly I hold that the amount of Rs. 68,471.00 payable on account of super tax would be paid from the assets of the suit firm but the defendants would be at liberty to challenge that position through appropriate proceedings.

It would be recalled that in regard to the income‑tax liability of the individual partners, I have agreed with the conclusion of the learned Commissioner. Therefore, the question may arise as to how the said finding of the Commissioner could be approved when in regard to the liability for super tax and capital gains tax I have held that he could not give any positive finding in the absence of the Income‑tax Department. The answer is that in regard to the liability to pay income‑tax by each partner there was sufficient evidence on record such as the past practice when taxes were paid by the firm but later adjusted against the account of each partner. In this view and for the fact that taxes on that account were paid by the partners and received by the Income‑tax Department the possibility of any prejudice as to the power any jurisdiction of the Department stands excluded. However, in regard to the question of super tax and capital gains tax the position is different. Unlike the case of income‑tax there is no evidence on record to show as to how the partners paid or agreed to pay these taxes. Therefore, to decide this question one has to construe the various provisions of the Income‑tax Act, but this would be undesirable as the Income‑tax Department is not before the Court. It is conceivable that upon the same question a large number of cases might be pending before the Department and they are bound to be prejudiced by any finding of the Court.

With this discussion the objections of defendants 1 to 3 are disposed of.

89. There is yet another set of objections of the defendants dated 31‑3‑1967, which they filed against the report of plaintiff Sharif as Receiver. However, during the course of arguments and again on 29‑8‑1968, when the arguments in this case were concluded the learned counsel for the parties by consent stated that the judgment may not await the disposal of these objections and if necessary the defendants would file a separate suit for that purpose. In this view, the learned counsel for the defendants did not press these objections and hence they would be left out of consideration.

As already stated the arguments in this case were finally heard on 29‑8‑1968 and the judgment reserved. The main reason for which the judgment was reserved was that according to the learned counsel the tenancy rights in the partnership premises were first to be finally auctioned between the parties by the Official Assignee. Accordingly, the Official Assignee was directed to do so and submit his report within two weeks. It thus happened that the auction proceedings could not be finalised until 17‑12‑1968, when the Official Assignee submitted his report stating that the matter had been compromised by the parties. Along with his report the Official Assignee also filed the consent application of the parties according to which it was agreed that the shop premises at Chittagong and the godown premises at Bombay Bazar, Karachi be handed over jointly to Habib Haji Shakoor, plaintiff No. 1 and Haji Muhammad Haji Shakoor, defen dant No. 1. It was further agreed that these premises would be partitioned amongst the parties according to their respective shares out of Court. This application was accordingly granted and the report of the Commissioner approved on 17‑3‑1969, and the Court directed that in terms of the said application the premises be handed over to Habib Haji Shakoor and Haji Muhammad Haji Shakoor.

90. The Official Assignee also submitted accounts dated 25‑2‑1969 relating to his functions as Receiver. By consent of the parties these accounts were approved on 17‑3‑1969 and taken on record.

91. For all these reasons the suit firm is hereby dissolved as prayed and the preliminary decree dated 24‑5‑1961 made final in terms of the supplementary final report of the learned Commis sioner dated 15‑2‑1968, as modified in this judgment. In the result all the net assets of the suit firm, which would be available, would be distributed between the partners in proportion to their respective shares. The suit is accordingly decreed but consider ing that the plaintiffs are found to have committed fraud in relation to the affairs of the suit firm and further that the parties are closely inter‑related there shall be no order as to costs.

92. Before parting with this judgment I would like to record my appreciation for the laborious and conscientious work put in by Mr. S. A. Moulvi, the learned Commissioner, in this case which not only involved extensive accounting of a complicated nature but also difficult questions of law. But for his efforts, which considerably facilitated to understand this case, my task would have been more difficult in writing this judgment.

The record of the case shows that Mr. Moulvi had received only about Rs. 6,000.00 as fees (and this does not include about Rs. 3,0‑0.00 paid to him for his efforts in selling the goodwill of the partnership firm) which, under the circumstances, appears to be inadequate remuneration. Therefore, I sent for the learned counsel for the parties on 31st July 1969, but Mr. A. K. Lakhani also appeared before me as Mr. Fazeel, the learned counsel for the plaintiffs could not be contacted. When I explained to Mr. Lakhani that for the amount of work put in by him. Mr. Moulvi reasonably appeared to be entitled to a little more remuneration he replied that he had no objection. He, however, stated that in so far as the plaintiffs were concerned the decision rested with Mr. Fazeel whom he would contact and then inform the Court of his views. On 1‑8‑1969, Mr. Lakhani came to see me in my chamber, when I was not present, and left a written note saying that while the, defendants bad no objection to the proposal yet according to Mr. Fazeel the plaintiffs would not agree to any such suggestion. Considering that the amount of about Rs. 6,000.00 already paid to Mr. Moulvi under the circumstances appears to be wholly inadequate I direct that he would be paid the additional amount of Rs. 4,000.00 from the assets of the firm before distribution takes place between the parties.

A. E. Suit decreed.