Falshaw, J. - (1.) On a difference of opinion between Khosla and Kapur JJ.. in three connected appeals (Regular First Appeals Nos. 13, 14 and 15 of 1953) the following points have been referred to me for decision under Section 98, Civil P. C. 1. Is the restriction imposed by Clause 3 of the partnership agreement enforceable in law? 2. Is the plaintiff entitled to the relief of injunction as claimed by him? - 3. Is the plaintiff entitled to the relief in respect of accounts? 4. Is the suit within limitation?
(2.) Although the facts of the case have been set out at some length in the judgments of the two learned Judges who have disagreed, I find it necessary to give at least my own brief version of them. The British India Corporation Ltd. is the owner of a number of enterprises including the Kanpur Cotton Mills Co., and by an agreement in the form of a letter dated 20-3-1937, P. 2, the Corporation appointed the firm Messrs. L. N, Gadodia and Co., of which Laxmi Narain Gadodia, the plaintiff, is the proprietor, as selling agents for the sale of ell yarn and cloth produced by the Kanpur Cotton Mills up to 31-12-1937. A few days later, 29-3-1937, Laxmi Narain Gadodia entered into a partnership agreement with Deva Sharma one of the defendants in the suit, the sole business of the partnership being the said selling agency and the partnership agreement was to continue in force as long as the selling agency business continued. According to the terms of this agreement L. N. Gadodia was to receive -/12/-in the rupee out of the profits of the agency and Deva Sharma the remaining -/4/-. Clause 3 of the partnership agreement, which is one of the most contentious points in the case, reads: "3. That on the termination of the selling agency business neither of the parties to this agreement shall take up the said selling agency from the mills," It is not in dispute that L. N. Gadodia was to be the financing partner and that Deva Sharma was the man who was mainly to be responsible for the running of the business and the fact that Deva Sharma was 'persona grata' with the Corporation is clear from the inclusion in para 17 of the Corporations' letter, P. 2, of the sentence. "The services of D. Sharma will not be dispensed with by your Company without the prior sanction of the Kanpur Cotton Mills."
(3.) The selling agency was renewed in favour of the -partnership by the agreement, P. 3, dated 1-3-1938 for a period of one year from 1-1-1938, but Clause 18 in the agreement provided "that on the expiry of the agreement by the efflux of time unless any new agreement is then entered into by the parties hereto, this agreement shall be regarded as a continuing agreement and shall be subject to the conditions detailed herein". The position of Deva Sharma in the partnership running the selling agency was again assured by Clause 17, which was to the effect that his services should not be dispensed with by the agents without the prior sanction of the Company.;