P A J SEETHARAMA RAJU Vs. LALA GOPIKRISHNA GOKULDOSS AGENCY DEPARTMENT

JUDGEMENT

(1.) THIS is an appeal against the judgment of Ganapatia Pillai J. in a suit (C. S. No. 41 of 1957) under Section 77 of the Indian Registration Act directing registration of two documents together with a certificate of balance attached thereto, the documents being marked as Ex. P. 4 and P. 1. The appellants, Seetharama Raju, rajeswari and Bapiraju constitute a firm of partners carrying on business under the name and style of Srinivasa Mining Co. , at Chipurapalli in Srikakulam Dt. (Andhra Pradesh ). They were the defendants to the suit. The firm owns certain manganese mines in Srikakulam Dt. The respondent (plaintiff in the suit) had agreed to finance the venture undertaken by the firm and the question in this appeal relates to the registrability of that financing agreement Ex. P. 4 dated 306-1958 entered into between the parties.

(2.) BEFORE referring to the provisions of that agreement, it is necessary to state certain other facts. The first appellant Seetharamaraju was originally a partner in a firm known as Ramakishna mining Co. By a document dated 19-11-1955 the respondent had agreed to advance certain sums of money for the purpose of that partnership, and in pursuance thereof he had advanced about Rs. 3,80,000. Ramakrishna Mining Co. , was subsequently dissolved and as a result of an arrangement between the partners Seetharama Raju became solely entitled to the mines and he also became responsible to pay the monies due to the respondent. On 16-5-1956 Rajeswari and Bapiraju who were originally the only partners of srinivasa mining Co. entered into a similar financing arrangement with the respondent for their own firm. That document is Ex. P. 1 The respondent advanced a sum of Rs. 79,099-10-0 to the partnership firm under the agreement. Subsequently the two partners of Srinivasa Mining Co. admitted Seetharama Raju the first appellant as the third partner. It was stipulated between them that the assets and the liabilities of Ramakrishna Mining Co. , as well as Srinivasa Mining co. , should be pooled together and treated as belonging to the new firm. On 30-6-1956 a revised agreement superseding the earlier financing agreements was entered into between the appellants and the respondent. That is the suit document, namely, Ex. P. 4. Under the new agreement the appellants offered the two sets of mines as security for the amounts due to the financier; schedules A and B thereto respectively set out mines originally owned by the Ramakrishna mining Co. and the Srinivasa Mining Co. The relevant covenants embodied in Ex. P. 4 states : "this agreement is to be read along with the agreement dated 16-51956 entered into between the financing agents and Srinivasa Mining co. and as supplement thereto. The mining owners agree that they will be liable also to repay the sum of Rs. 3,80,000 due from P. A. J. Seetharama Raju traceable to the liability of Ramakrishna Mining Co. to the financing agents and this liability shall be in addition to the sum of rs. 79,099-10-0 already due to the financing agents from Srinivasa ining Co. as per certificate of balance issued dated 27-6-1956. . . The mining owners hereby offer the entire assets of the mines owner inclusive of all the mines and the ore raised therefrom and goodwill in respect of all the mines described in schedules A and B as security for the amounts due to the financing agents. . . . . . " another clause in the agreement reiterated that the conditions embodied in Ex. P. 1 if not contrary to those in Ex. P. 4 would also govern the latter.

(3.) THE agreement proper, that is the portion excluding the schedules, covers four pages of typed matter and they have been signed on behalf of the respondent and also by the three partners of the appellant firm. Schedules A and B which cover the fifth page have been signed only by Seetharama Raju.