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PETITIONER: BHAGWANT P. SULAKHE

       Vs.

RESPONDENT: DIGAMBAK GOPAL SULAKH AND OBS.

DATE OF JUDGMENT30/09/1985

BENCH: SEN, AMARENDRA NATH (J) BENCH: SEN, AMARENDRA NATH (J) BHAGWATI, P.N. (CJ) MADON, D.P.

CITATION:  1986 AIR   79            1985 SCR  Supl. (3) 169  1986 SCC  (1) 366        1985 SCALE  (2)819

ACT:      Joint family  property, character  of - When lt changes ether by  an unilateral  act it is open to any member of the joint family  to convert  any joint family property into his personal property  - Partnership  firm formed  out of  joint family funds  and managing  agency agreement entered into by such a  partnership firm  with another  company - Commission received by  the co-sharers  of the point family in terms of the managing  agency agreement and the remuneration received by them as the managing director treated as the joint family property for all purposes - Whether one of the co-sharers by a simple  letter claim  the commission remuneration received by him  as his  personal property  till the  joint family is disrupted -  Position of  managing director and the managing agent, explained.

HEADNOTE:      One Pandarinath Martand Sulakhe died leaving behind him his  sons   Vishwanath,  Gopal,   Govind  and  Bhagwant  and considerable properties.  Vishwanath died  in  1910  leaving behind his  son Dattatraya,  Govind, one of the brothers who constituted a  pint family  after the  death of their father Pandarinath Sulakhe, separated from the joint family in 1914 taking his  share of  the family  properties.  However,  the other  two   brothers  along  with  the  son  of  Vishwanath continued to  remain pint  and lived as members of the joint family till  8.12.1941  on  which  date  Bhagwant  intimated Dattatraya  son   of  Vishwanath   his  intention  to  cause severance of the point family status.      Prior to it, in the year 1922, a Public Limited Company named Lokmanya  Mills Ltd.  was intended  to be  floated and with that  in view  Dattatraya and  Bhagwant entered  into a partnership under the name and style of M/s. Sulakhe and Co. with four  outsiders, as per the Partnership Agreement dated 3rd January,  1923. me said Partnership firm Sulakhe and Co. entered into  a Managing  Agency agreement  on 5.2.1923 with the said  Lokmanya Mills Company Ltd. The said agreement was to expire  after 35  years.  The  mill  actually  went  into production in  the year  1938. on  the basis of the managing agency agreement between the company 170

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and the firm Sulakhe & Co., Dattatraya acted as the managing agent upto  1935 and thereafter Bhagwant became the managing agent.  After  Bhagwant’s  appointment  as  managing  agent, Dattatraya was appointed as the Director of the company.      At the  time when  the company was incorporated and its articles were  adopted and also at the time when the company entered into  the managing agency agreement with Sulakhe and Co. and  when the  deed  of  partnership  of  the  firm  was executed Bhagwant  and Dattatraya being members of the joint family, all  the 325 shares which was initially purchased in the company  - 200  in the name of Dattatraya and 125 in the name of  Bhagwant -  plus the  83 further shares - 79 in the name of  Bhagwant and 4 in the name of Gopal - were paid for by  the   joint  family  out  of  the  joint  family  funds. Therefore, the  entire  amount  of  remuneration  which  was received by  Dattatraya and  Bhagwant not only on account of their  shares   of  commission  under  the  managing  agency agreement on  the basis  of the partnership deed but also on account of  the Director’s  fees paid  to them  and also  on account of  the salary  paid to  Dattatraya who acted as the managing agent  of the  company till  1935, was  treated  as joint family  property. Even after Bhagwant took over as the managing agent  in 1935,  the position  continued to  be the same and the remuneration received by him formed part of the joint family  income till  the dispute  raised by him by his letter  dated  15th  July,  1941.  All  monies  received  by Bhagwant and  Dattatraya from  the  company  were  not  only treated as  joint family  property, but also were so entered in the books of account of joint family and were so shown in the income tax returns.      However by  his letter  dated 15th  July, 1941 Bhagwant informed Dattatraya that the remuneration received by him as the managing  agent of  the company  on  the  basis  of  the managing agency  agreement, fees  received  by  him  as  the director of  the company  and his income from his profession as a  lawyer were  his personal income and should be treated as such. He made it clear that he will not in future put any of these  incomes into the hotch pot of the joint family. By another  letter   dated  8.12.1941  Bhagwant  intimated  his intention to  cause severance  of the  joint family  status. Since Dattatraya  did not  accept the  claim of Bhagwant for treating the  said amount as the personal property. Bhagwant filed a  suit No.  166/43 in the original side of the Bombay High Court laying claim to the said amounts. In the meantime Gopal and  Dattatraya filed  two suits  in the  Civil  Court against the  Company and Bhagwant for the payment of the sum of money credited to the 171 joint family  in the  books of  the parties  and as a result thereof A  most of  the joint  family properties  came to be divided  amongst   the  parties  in  accordance  with  their respective shares,  except the dispute raised in the suit in the original side of the High Court.      During the  pendency of  the  said  suit  the  managing agency agreement  had come  to  an  end  by  virtue  of  the provisions contained  in section 87 (A) (2) of the Companies Act, in  as much  as though  the Board  of Directors  of the company had  passed a  resolution on 28.6.56 for the renewal of the  managing agency  agreement, no  action was  taken by SuLakhe &  Co. to  get the  Managing Agency  Agreement for a further term  after 1957  extended. On  the other  hand, the company amended its articles of association and proceeded to appoint Bhagwant  as its  managing Director  and neither his appointment nor the validity of the amendment of articles of association was  objected to  by either Sulakhe & Co. or any

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of the  co-sharers forming part of the partnership firm. The trial Judge  accepted the claims of Bhagwant and decreed the suit in his favour and made Gopal and Dattatraya accountable in respect  of the  joint family business. The High Court in appeal held that the income received by Bhagwant as managing agent and  managing Director  of the  company could  not  be considered to  be the  personal  property  of  Bhagwant  and reversed the decision of the trial Judge in this respect and also on  various other claims to cash etc. Hence the appeals by certificate  under Article 133 (1) (a) as it stood before the Constitution (Thirtieth) Amendment Act, 1972.      Allowing the appeals in part and passing a final decree in terms clarified, the Court. ^      HELD :  1.1 The  character of any joint family property does not  change with  the severance  of the  status of  the joint family and a joint family property continues to retain its joint  family-character so  long  as  the  joint  family property is  in existence and is not partitioned amongst the co-sharers. By  an unilateral  act it  is not  open  to  any member of  the joint  family to  convert  any  joint  family property into his personal property. [194 B-C]      1.2 The agreement of partnership clearly indicates that Bhagwant and  Dattatraya became  members of  the  firm  M/s. SuLakhe &  Co- which  Was appointed as the managing agent of the company,  on the basis of the managing agency agreement, representing the  joint family  and for  the benefit  of the joint family. Their 172 interest in  the partnership  firm and managing agency was a part of  joint family  assets and whatever income was earned by them  on the  basis  of  the  managing  agency  agreement belongs to  the joint  family and  formed part  of the joint family property. The same position must necessarily continue in the  eye of  law so long as the partnership agreement and the managing agency agreement continued. [192 G-H; 193 A-D]      1.3 By seeking to bring about a severance in the status of the  joint family,  one of  the co-sharers cannot deprive the joint  family of this property and the income derived on the basis  of the  managing agency  agreement  continues  to remain the property of  the  joint family  so long as the joint family asset is not partitioned and  otherwise continues to remain in existence. In the  facts and  circumstances of  the  case,  the  entire income arising  out of  the managing  agency  agreement  and accruing to  the two members of the family, namely, Bhagwant and Dattatraya who might have rendered the services had been earned  for   and  on   behalf  of   the   family   and   as representatives  of   the  point   family.  Dattatraya   had continued as  the managing  agent for  a number of years and there had  been no  question of  apportionment of any income derived  by  him  as  his  remunerations  for  the  services rendered by  him  as  managing  agent.  Therefore,  Bhagwant cannot  lay   any  claim  for  retaining  any  part  of  the remuneration received  by  him  from  the  company  for  the services rendered by him. [193 D-E; 194 A]      2.1 In  Raj Kumar  Singh Hukum  Chandji’s case,  [1971] S.C.R.  748,   the  Supreme  Court  held  that  the  broader principle that  emerges is whether the remuneration received by the  coparcener in  substance though  not in form was but one of the modes of return made to the family because of the investment of the family funds in the business or whether it was a  compensation made  for the  services rendered  by the individual coparcener.  If it is the former, it is an income of the  Hindu undivided  family but if it is the latter then

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it is the income of the individual coparcener. If the income was essentially earned as a result of the funds invested the fact that  a coparcener  has rendered sore service would not change the  character of  the receipt.  But, if on the other hand, it  is essentially  a remuneration  for  the  services rendered by a coparcener, the circumstance that his services were availed  of because  of the reason that he was a member of the  family which  had invested funds in that business or that he  had obtained  the qualification  shares from out of the family  funds would  not make the receipt, the income of the Hindu  undivided family.  The legal principle enunciated therein for determining 173 the true  nature and  character of the remuneration received by any  A member  of the  joint family  equally  applies  in deciding  the  nature  and  character  of  the  remuneration received by  the Managing Director in the instant case. [195 C-D; 196 C-E; 197 A-B]      2.2 The  position of  the Managing Director is entirely different from  the position  of the  managing agent  on the basis  of   the  managing   agency  agreement   between  the partnership firm  of Sulakhe  & Co.  and the position of the Managing Director stands entirely on a different footing. At the time  when Bhagwant  was appointed the Managing Director of the  company on  19.10.1957, with  effect from 16.1.1957, there was  complete disruption of the joint family and there was no  joint family  in existence.  Further inspite  of the Board of  Director’s  resolution  dated  28.6.1956  for  the renewal of  the managing  agency agreement  as  required  by section 87  A (2)  of the Companies Act, no action was taken by the  firm of  sulakhe Co.  or  any  partner  thereof  for obtaining renewal  of the  managing agency  agreement for  a further term  after 1957. On the other hand when the company had amended its articles of association and had proceeded to appoint Bhagwant  as the  Managing Director,  there  was  no challenge to  them either  by any  partner of  the  firm  of Sulakhe & Co. which hat been appointed as the managing agent of the  company or by any member of the joint family. Is the managing agency  agreement had  ceased to  exist at the time Bhagwant was  appointed the Managing Director of the company and as  at that  time there  was no joint family of Bhagwant and the  other co-sharers  in existence,  Bhagwant cannot be said to  have been appointed as the Managing Director of the company either  because of  the managing agency agreement or because of his being a member of the joint family. The facts and  circumstances   make  it  clear  that  the  partnership agreement or  the managing agency agreement had no relevance to the  appointment of  Bhagwant as the Managing Director of the Company. In the said circumstances, (i) the remuneration received by  Bhagwant as  Managing Director  of the  company from the  company is   his  personal property  ant cannot be considered to  be the  income of  the joint family; (ii) the appointment of Bhagwant as Managing Director, at a time when there was  complete disruption  of the  joint family and the members of  the family  were fighting  in  Court  cannot  be considered to be by way of any return on the investment mate by the Joint family; aud (iii) Bhagwant was appointed as the Managing Director by the company for services to be rendered by him,  as the  company might  have been  impressed by  his performance as  the managing  agent for  a number  of years. Though undoubtedly  Bhagwant acted as the managing agent for ant on behalf of the joint family and for 174 benefit of the Joint family, yet what must have weighed with the company  is the  kind of services rendered by him to the

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company. The company was concerned with his services and not with the  question whether he was rendering the services for and on  behalf of  the family.  The remuneration  which  the company agreed to pay to Bhagwant for acting as the Managing Director was  for the services to be rendered by him. [194 ; 195 A-B; 196 G]      Raj kumar Singh Hukum Chandji v. Commissioner of Income Tax, Madhya Pradesh [1971] 1 S.C.B. 748 applied.      2.3 From  the materials  on record,  it is  clear  that there can also be no question of Bhagwant being a trustee or acting as the trustee for the benefit of the joint family in relation to  his appointment as the Managing Director of the company. The  managing agency of the company was that of the partnership firm  in which  the four  outside members with a majority of  shares in  the partnership  were interested and the managing  agency firm cannot therefore, be considered to be an  asset of  the joint  family. It  was the  interest of Dattatraya and  Bhagwant in  the managing agency firm on the basis of  their shares  in the partnership which belonged to the joint  family and  the managing  agency was an agreement between the  company and the partnership firm. The effect of not renewing  the agreement  was that  the interest  of  the partnership firm  of Sulakhe  & Co.  in the  company as  the managing agent thereof with all the rights and privileges on the basis  of the  said agreement  came to  an end. With the termination of the managing agency agreement the interest of the joint  family in the managing agency on the footing that two of  the members  of the joint family, namely, Dattatraya and Bhagwant  were as  partners of  the firm associated with the managing agency and were acting as the managing agent on the basis  of the  partnership agreement  and  the  managing agency agreement also ceased. [197 C-G; 198 G-H]

JUDGMENT:      CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 2622 & 2622A of 1969.      From     the      Judgment     and     Decree     dated 18/19/20/25/29.9.1967 and 9.10.1967 of the Bombay High Court in First Appeal Nos. 278 and 279 of 1969.      V.M. Tarkunde,  Dr. Y.S. Chitale, Mukul Mudgal, Mrs. M. Karanjawala and D.N. Mishra for the Appellant.      M.C. Bhandare,  D.R. Dhanuka,  Mrs. Rani  Chhabra  K.H. Kapadia and G.B. Sathe for the Respondents. 175      The Judgment of the Court was delivered by      A.N. SEN,  J. This is an unfortunate litigation between near relations  and this  litigation between  the parties is now going on for over four decades.      These two  appeals have been filed with the certificate granted by  the High  Court against the judgment of the High Court by  the plaintiff  in the  suit instituted  by him for partition of joint family properties, for accounts and other reliefs mentioned in the plaint.      By a common judgment delivered by the High Court in two separate appeals filed by the defendants in the suit against the judgment  of  the  Trial  Court.,  the  High  Court  has substantially reversed the judgment of Trial Court.      The facts  of the  case have  been fully set out in the judgment of  the Trial Court and also in the judgment of the High Court. We shall briefly indicate the facts material for the purpose  of disposal  of these  two appeals. As the High Court disposed  of both  the appeals  by one common judgment and the  two appeals  which have  been preferred against the

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same judgment  have been  heard together, this judgment will dispose of both the appeals.      One Pandarinath Martand Sulakhe died leaving behind him his  sons   Viswanath,  Gopal,   Govind  and   Bhagwant  and considerable properties. The properties left by him included agricultural lands,  a number  of houses in Barshi and three shops. Of  the three shops one was a Sharafi shop at Barshi, another cloth  shop at  Barshi and  the other  a  commission Agency and  Sarafi shop  at Bombay.  Business in  all  these three shops  was carried  on in the name of P.N. Sulakhe. Of the four sons Vishwanath died in 1910 leaving behind him his son Dattatraya who happens to be the second defendant in the suit. Govind,  one of  the brothers  who constituted a joint family after  the death  of their father Pandarinath Sulakhe separated from  the joint family in 1914 taking his share of the family  properties. Though Govind separated in 1914, the other brothers and the son of Vishwanath continued to remain joint and lived as members of the joint family. Bhagwant who filed a suit for partition as the plaintiff was the youngest of the  four brothers.  He graduated in law in the year 1914 and commenced practice as a lawyer at about that time. 176      In 1922,  a public limited company named Lokmanya Mills Ltd.   (hereinafter referred to as the Company) was intended to be floated and with that end in view, the defendant No. 2 Dattatraya  and   the  plaintiff  Bhagwant  entered  into  a partnership under  the name  and style of M/s. Sulakhe & Co. with four  outsiders.  Managing agency agreement between the company and  the partnership  firm of  Sulakhe & Company was executed. The mill actually went into production in 1938. On the basis  of the  managing  agency  agreement  between  the company and  the firm  of Sulakhe  & Co. the defendant No. 2 Dattatraya  acted  as  the  managing  agent  upto  1935  and thereafter  the  plaintiff  Bhagwant,  became  the  managing agent.  Sometime  after  the  plaintiff  Bhagwant  had  been appointed the managing agent, the defendant No. 2 Dattatraya was appointed  as the  Director of  the Company.  It appears that in  the year  1935, a new Adat shop had been started at Barshi. All  the shops were run in the name of P.N. Sulakhe. It is  not in  dispute that  all the shops were joint family businesses. It  is also not in dispute that the remuneration paid to  the defendant No. 2 and also the plaintiff Bhagwant as managing  agent and also the amount of commission falling into the  shares of  defendant  No.  2  Dattatraya  and  the plaintiff Bhagwant  out of  the  commission  earned  by  the managing agency firm were treated as joint family properties and were shown in the point family books so long as disputes between the  parties had  not arisen. During the period when there were  no disputes  between the parties, the Director’s fees paid  to defendant  No. 2  Dattatraya and the plaintiff Bhagwant were treated as income of the point family and even the professional  h income  of the plaintiff Bhagwant earned by him  as a  lawyer was  also thrown  into the joint family hotch-pot and  Was treated  as joint  family income.  In the income-tax returns  filed on behalf of the joint family, all these amounts  were shown  as income cf the joint family. It appears that  everything did not go well with the members of the point family and disputes arose between the parties soon after  the   commencement  of  the  second  world  war.  The plaintiff Bhagwant  by his  letter  dated  15th  July,  1941 addressed to  the defendant  No. 2  Dattatraya informed  him that the  remuneration received by him as the managing agent of  the   company  on  the  basis  of  the  managing  agency agreement, fees  received by  him as  the  director  of  the company and  his income  from his  profession as lawyer were

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his personal  income and  should be treated as such. By this letter, he  made it  clear that he was not prepared to throw any of  these incomes into the point family hotch-pot and he asked the  defendant No. 2 Dattatraya that all these amounts should be  shown as  his separate income for the purposes of income tax and should be credited to his personal 177 Khata in  Sarafi  shop  account.  Disputes  and  differences between   the parties became more acute and the plaintiff on 8.12.1941 intimated  to the  defendant No.  2 Dattatraya his intention to  cause severance  of the  joint family  status. Thereafter attempts  were  made  to  divide  the  properties amicably between  the parties without success. The plaintiff Bhagwant claimed  that the  remunerations paid to him by the company as  managing agent, the fees paid to him as director of the  company and  his income  from his  profession  as  a lawyer were  his personal  income and  as such  his personal property. The  defendants did  not accept  the claim  of the plaintiff Bhagwant  that the  remuneration paid  to  him  as managing agent  by the  company and  the fees paid to him as the director  of the  company, could  be his personal income and the defendants claimed that all such amounts received by him belonged  to the  joint family  and formed  part of  the joint family  properties. Ultimately  Bhagwant filed  a suit being suit No. 166/43 in the original side of the High Court in Bombay.  In this  suit Gopal  was the first defendant and Dattatraya was  the second  defendant and the suit was filed in the  original side  of the Bombay High Court on the basis that the  Adat Shop and Sarafi Shop were situated within the original jurisdiction  of the  Bombay High  Court.  In  this suit, Bhagwant  the plaintiff  did not made any reference to the managing  agency of  the company  in the  plaint and  he claimed partition  of the  joint family  shares and moveable and  immovable   properties  mentioned   in  the  plaint  as belonging to  the joint family, seeking to reserve his right under 0.  2, rule 2 of the Code of Civil Procedure to file a suit for  partition of  the joint family properties situated at Barshi.  The plaintiff  Bhagwant  in  this  suit  claimed various other  reliefs. He  prayed for  a direction that the immovable properties  and the  business at  Bombay should be ordered to be partitioned under the directions of the Court, that the  joint family firms should be wound up that the sum of Rs.  6843-36 claimed  by him  as his personal Income as a lawyer from  his profession  from 1940  should be awarded to him with  interest at  12% interest  on the same and he also claimed as  consequential relief  that the defendants should be ordered  to account  for the  profits earned by them from the joint  family business  from the  date of  severance and also  of   the  income   derived  by  them  from  immoveable properties belonging to the joint family. In the suit Govind as defendant  No. 1  and Dattatraya  as defendant No. 2 were impleaded and  no other  members of their branches were made parties to  the suit.  On the death of defendant No. 1 Gopal during the  pendency of  the suit his five sons were brought on record  as  his  heirs  and  legal  representatives.  The defendants resisted the suit of the plaintiff on 178 various grounds,  mainly however  on  the  ground  that  the plaintiff had  asked for partition only of some of the joint family properties  without including  in  the  suit  various other joint  family properties,  particularly the shares and interest of  the joint family in the company. The defendants contended that  the plaintiff  was bound  to include  in the suit all  the joint  family properties  which also comprised all the  interests of  the joint  family in  the company and

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various other  immovable properties in the possession of the plaintiff. It  may be  noted that  defendant No. l Gopal and the defendant  No. 2 Dattatraya filed two suits in the Court of Civil  Judge against  the company  and the  plaintiff for payment of  the sum of money credited to the joint family in the books  of the  company in accordance with the respective shares of the parties. In the suits various proceedings were taken and  various orders  including the  appointment of the Court receiver  for all  the properties  of the joint family were passed  from time to time. It does not become necessary for us to refer to these proceedings at any length as in the present appeals  these questions  are no  longer germane. It appears that  as a  result of the various proceedings in the suit most  of the joint family properties came to be divided amongst the  parties in  accordance  with  their  respective shares and  the disputes  between the  parties now centre on the following questions :-           1. Whether  the shares  in the company standing in           the names of the various members of the family are           joint family properties?           2. Whether  the commission  received  by  the  two           members of  the family  namely,  defendant  No.  2           Dattatraya  and   plaintiff  Bhagwant   from   the           managing agency firm in respect of their shares in           the firm  out of  the total commission paid by the           company to the managing agency firm belongs to the           joint family?           3.  Whether   the  remuneration  received  by  the           plaintiff Bhagwant  from the  company as  managing           agent  on   the  basis   of  the  managing  agency           agreement  with   the  company   is  the  personal           property of  the plaintiff  or  whether  the  same           belongs to the joint family?           4. Whether the remunerations paid to the plaintiff           as the  managing director  of the  company is  his           personal income  or is  the property  of the joint           family? 179           5.  Whether  there  was  any  amount  in  cash  in           Mahalaxmi  room belonging to the family and if so,           how much?           6. Whether  there were any ornaments and jewellary           belonging to  the joint  family? If  SO, in  whose           possession and  custody are  such ornaments  lying           and what is the value of such ornaments? It  is   to  be  noted  that  during  the  pendency  of  the proceedings in  the Court relating to partition of the joint family properties  the managing agency agreement had come to an end  and it  has also become inoperative by virtue of the provisions of  law. The  plaintiff Bhagwant was the managing agent on  the basis  of the  managing agency  agreement  and thereafter he had been appointed ac the managing director of the company.  The learned trial Judge on the question of the remuneration paid  to the plaintiff as managing agent on the basis of  the managing agency agreement and the fees paid to him as the director of the company has held in favour of the plaintiff  that  these  are  the  personal  incomes  of  the plaintiff and do not belong to the joint family. The learned trial Judge  also held  in favour  of the  plaintiff on  the question of  cash money  belonging to the joint family found in  the   Mahalaxmi  room   and  also  on  the  question  of accountability of  the defendants  in respect  of the  joint family business.  The High Court in appeal has held that the income received  by the  plaintiff as  managing agent and as Managing director  of the company could not be considered to

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be the  personal property of the plaintiff and they belonged to the  joint family  and the  High Court  has reversed  the decision of  the trial  Judge on  this question.  On various other questions  also, the  High Court has held in favour of the defendants  reversing the  decision of  the Trial Court. The correctness  of the High Court judgment is questioned by the plaintiff in the appeals.      The principal  controversy between  the parties relates to  the  question  whether  the  remuneration  paid  to  the plaintiff Bhagwant  by the company as the Managing Agent and also as  the Managing  Director is  his personal property or whether the sane forms as part of the joint family property. The contention  of the  plaintiff-appellant Bhagwant is that the remuneration  received by  him for  acting  as  Managing Agent and  also as  Managing Director  of the company is his personal income  and cannot  be considered  to belong to the joint family,  whereas it is the case of the defendant No. 2 Dattatraya and  the heirs  of the  Defendant No. 1 Gopal and that all such remuneration received by the plaintiff 180 must belong  to  the  joint  family  and  must  be  held  to constitute   part  of  the  joint  family  properties.  They further contend  that the shares in the company subsequently purchased by the members of the plaintiff’s family must also be held to belong to the joint family. As this happens to be the most  important question  which has been urged at length before us,  we propose  to deal  with this  question in  the first place.  In our view it will be appropriate to consider this question  under two  separate heads,  namely,  (1)  the remuneration received  by the plaintiff Bhagwant as managing agent and  (2) remunerations  received by  him  as  managing director. We  first propose  to take up the question whether the remuneration  received by the plaintiff from the company as managing  agent, is  his  personal  income  or  the  same constitutes a part of the joint family property.      For a  proper  appreciation  of  this  question  it  is necessary to  consider some  broad facts  which are  not  in serious dispute.      A partnership  agreement was entered into on the 3rd of January, 1923  between defendant No. 2 Dattatraya, plaintiff Bhagwant,  one  Ramchandra  Moreshwar  Sane,  one  Moolchand Jotiram Baldote, one Nemchand Shivram Baldote and one Ganoba Andoba Gavane  to start  a mill  by the  name ’The  Lokmanya Mills Barso  Limited’ as  promoters and  agents of  the said mills on  terms and  conditions  set  out  in  the  deed  of partnership  dated   3rd  January,   1923.  This   deed   of partnership which  is not  in dispute  and  which  has  been exhibited in the suit provides :-           "An agreement  dated 3rd  of the month of January,           1923. We,  Dattatraya  Vishwanath  Sulakhe,  Caste           Brahmin, aged  37, profession  trader, resident of           Barsi and  Bhagwant  Pandharinath  Sulakhe,  caste           Brahmin, age  33, profession  pleader, resident of           Barsi,  and   Ramchandra  Moreshwar   Sane,  caste           Brahmin, age  64 profession  pleader, resident  of           Barsi  and   Moolchand  Jotiram   Baldote,   Gaste           Marwari, resident  of  Barsi  age  48,  profession           trade,  and   Nemchand  Shivaram   Baldote,  caste           Marwari, age  39, profession  trade,  resident  of           Barsi, and  Ganoba Andoba  Gavane, caste  Maratha,           age  58   profession  agriculturist   resident  of           Pangaon, Taluka  Barsi, Distt. Sholapur, all of us           make an agreement as follows :-           We all of us have agreed and decided between us on           29th November, 1922 to start a mill by name ’The

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181           Lokamanya Mills  Barsi Limited’. The following are           the   terms of  agreement, that we have agreed to,           between us  all as  the promoters  agents  of  the           Mills.           1.   The agency firm should be named as ’Sulakhe &           Co.’ and  the agreement  of this firm are to be in           force and  existence for  the period  of 35  years           from the date of registration of the said company.           2.   Messers. Dattatraya,  Vishwanath Sulakhe  and           Bhagwant  Pandharinath   Sulakhe  should   jointly           contribute towards  the purchase  of shares of the           value of Rs.40,625 (forty thousand six hundred and           twenty  five).   Mr.  Moolchand   Jotiram   should           purchase  in   his  name  shares  of  a  value  of           Rs.25,000 (twenty five thousand), Namchand Shivram           should purchase in his name shares of the value of           Rs.9375 (nine thousand three hundred seventy five)           and Ganoba  Andoba Gavane  should purchase  in his           name shares of the value of Rs.25,000 (twenty five           thousand) and  Ramchandra  Moreshwar  Sane  should           purchase in his name share of the value of Rs.3000           (Rupees three  thousand). The above named persons,           or in  case of  their death,  or  if  they  become           incapable on  account of  some illness  or if they           have been  unable to  purchase the  said shares or           have been  unable to pay further instalments after           purchase of  the said  shares on  account of  some           difficulty, their  heirs should  as  stated  above           purchase the  shares or  pay the amount of further           instalments.           3.   After the  shares are  purchased as stated in           the foregoing  clause, the  agents are  to get 10%           commission  on   the  net  profit  earned  by  the           Lokamanya Mills  Barsi Limited.  Out of  this  10%           commission 1/1/2%  amount  is  to  be  paid  to  a           committee appointed in that behalf for the purpose           of spending  that amount  over  public  charitable           purposes and  the remaining  8/1/2% commission  is           agreed to be distributed as follows:-           1. Messrs D.V.Sulakhe & B.P. Sulakhe to get 3/1/4%           2. Moolchand Jotiram                         - 2%           3. Ganoba Andoba Gavane                      - 2% 182           4. Namchand Shivaram                         -3/4%           5. Ramchandra Moreshwar Sane                 -1/2%           The  total   amount  of   8/1/2%  is  to  be  thus           distributed.           4.   The amount of profits is to be distributed as           stated in  the foregoing clause, after it has been           received by  the Managing Agents from the company.           If any  partner or his heirs had not purchased the           shares originally  or not  paid amount  of further           instalments after  allotment on  account  of  some           inability stated  in the  last foregoing clause 2,           he will  lose his share in the agency firm and his           share is  to be  distributed among  the  remaining           partners in  proportion to the capital contributed           by each  of them.  The partners  must keep in tact           their shares for the period of five years from the           date of  allotment. The  partners have no right to           dispose of  or mortgage  their share  within  that           period of five years. If any of the partners fails           to do  so, he  stands to  lose his interest in the           partnership.

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         5.   The agents firm is entitled to receive 2-1/2%           commission on the amounts of expenditure which the           company may  incur  towards  the  construction  of           buildings,  purchase   of  machinery   and   other           necessaries,   purchase   of   lands   and   other           materials. Out  of the  amounts  so  received,  an           amount of  1-1/2% is  to be  paid  towards  public           charitable purposes and the remaining amount is to           be distributed among the partners in proportion to           their shares described above. This amount is to be           received in  the first  instance by  the  managing           agents, and  after setting  a part  the amount  of           charity, he  has to distribute the balance amongst           the partners  in proportion  of  their  respective           shares.           6.   All  the   responsibility  of   all  work  of           whatever kind  to be  performed  by  the  managing           agents firm  such as,  raising of  capital of  the           said  mill   running  of   the  mill,  keeping  of           accounts, purchase of land, purchase of machinery,           appointing and  removing of  servants, solicitors,           auditors,    banker,    agents,    brokers,    and           underwriters to  keep  accounts  and  prepare  the           reports 183           of the  company and  do  all  such  other  as  the           managing   agents are  required to  do shall be on           the managing agent Mr. D.V. Sulakhe or his family.           His family means the joint family of three persons           viz:  D.V.   Sulakhe,  B.P.   Sulakhe  and   Gopal           Pandharinath  Sulakhe.  The  other  partners  have           nothing to do with the above work and they have no           right to  interfere with the power of the managing           agents. The  company will’  hold only the managing           agent responsible  for his  faults and  the  other           partners are not to be responsible to the company.           7.   The preliminary  expenses of the mill will be           about Rs.8000  (eight thousand). This amount is to           be paid to the managing agent Mr. D.V. Sulakhe, by           all the  partners except Mr.sane, in proportion to           their respective  shares. The managing agent is to           return this  amount of expenditure to the partners           form the  proceeds of  the shares  of the  company           that may be collected after its registration.           8.   Some one  person from  among  the  family  of           Sulakhe described  above shall  always be  an  Ex-           officio Director.  some other  person from amongst           the agency firm, or some other person from outside           elected by  majority, and who is not in the agency           firm shall be a special director, but he shall not           be in  office permanently.  The term of his office           will be  as of the other directors and he shall be           eligible for  re-election. Some  person  from  the           firm or  some one  from outside  according to  the           opinion of  the firm  shall always  be  among  the           directors.           9.   No partner  of the agent’s firm, shall except           with the  leave of  the directors,  enter  in  any           other agency firm of a mill of the like tenure and           situate within  the limits of Barsi Taluka. If any           one of  them does  so enter  he will stand to lose           his share in this partnership firm of this mill.           10.  A  partner  of  the  agent’s  firm  shall  be           entitled as any other outsider to do business with           the company and enter into private transactions on

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         reasonable terms  and to  take commission from the           company. 184           11.   From the  date the  share, of  the value  of           Rs.7,00,000 (seven  lacs) are  sold  the  managing           agent  Mr.   Sulakhe  shall   get  a  remuneration           (salary) of  Rs.600 per  month. The other partners           or  the   charity  fund  shall  have  no  interest           whatsoever therein.  From the  time when  products           shall be begun to be manufactured in the mill, the           managing agents  are to  receive a remuneration of           Rs.1000 (salary)  every month.  Out of that amount           Rs.600 are to be taken by the managing agent every           month and  the remaining  amount of  Rs.400  (Four           hundred) is  to be  divided among all the partners           of  the   agency  firm   including   Sulakhe,   in           proportion to  their respective  shares (till  the           profits of  the company  come to 10% by the way of           divident) so that the partners may get an interest           over their  amounts at  the rate  of 5% per annum,           but from  and after  the date when the dividend of           the company  shall be  distributed at  the rate of           10% on  the   amount of shares, the other partners           shall have  no right  over the  said sum of Rs.400           (Four hundred)  to be  received every  month,  and           this amount  is to  be taken by the managing agent           Mr. Sulakhe  as the  increase in  his remuneration           (salary). After  that period  other partners  will           have no  claim whatever against the said amount of           Rs.400.           12. The  rights of the partners in the agency firm           are to pass to their respective lineal descendants           or  to   their  respective   assignees  after  the           expiration of the period of 5 years allotment. The           right of  a partner  shall go  to other persons by           partition among  his family  or by heirship and if           such persons  to whom  the rights  of a partner in           the agency  firm are  to pass,  are more than one,           they shall  unanimously elect  some one from among           themselves  for   the   purpose.   If   there   is           disagreement between  them the  board of directors           shall choose  some such person from among them and           the person  so chosen  shall take  interest in the           agency firm.  The company  or the  managing agents           shall  not  take  cognizance  of  the  other  sub-           partners.           The terms  of agreement  between  us  all  are  as           above, and  for that  this agreement (in writing),           is prepared  and is signed by us all and a copy of           this agreement  i.e.  a  counter  part  of  it  is           delivered to each of us 185           all.  This agreement made and signed on the 3rd of           the A month of January in the year of 1923, and it           is  in   the  handwriting   of  Sarbootam   Annaji           Madhekar, a resident of Barshi .                Sd/- Datartraya Vishwanath Sulakhe                d/- Bhagwant Pandharinath Sulakhe                Sd/- Ramchandra Moreshwar Sane                Sd/- Molchand Jotiram Marwadi                Nemchand Shivaram Marwadi                Ganoba Andoba Gavane.           The said  partnership firm  of M/s.  Sulakhe & Co.           consisting of  the aforesaid  six partners entered           into a  managing agency agreement on 5.2.1923 with

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         the company.  Relevant provisions  of the managing           agency agreement dated 5.2.192% may be set out:           1. The  Agents will  faithfully and  with best  of           their  ability   perform  the   offices   of   the           Secretaries, Treasurers  and Agents of the Company           for purposes of carrying on the best advantage the           business of the company so long as the company and           the  agents  shall  continue  to  carry  on  their           respective  business  (unless  prevented  from  so           doing in  manner  hereinafter  mentioned)  at  the           remuneration upon  the terms  and subject  to  the           conditions hereinafter  particularly mentioned and           described.           2. In  consideration of  the agreement hereinafter           contained on the part of the Agents and in further           consideration of  the Agents  having advanced  the           company -  the Company  hereby promise  and  agree           with the  Agents  that  the  agent  shall  be  the           Secretaries, Treasurers  and Agents of the Company           for the  period of 35 years from the date of these           presents unless  prevented from so doing in manner           hereinafter mention  ed PROVIDED  ALWAYS AND IT IS           HEREBY AGREED AND DECLARED that after the lapse of           the said  period of  35 years the Agents shall not           be removed  from the  office as  the  Secretaries,           Treasurers and  Agents but  shall carry  on  their           respective business  unless found  guilty of fraud           in the  management of their duties as Secretaries,           Treasurers and Agents of the Company. 186           Clause 2A.  The Managing Agents shall not transfer           or assign or cause to be transferred or assign the           present Managing  Agency Agreement  of the Company           their right,  title and  interest therein  to  any           person or  persons  firm  or  Company  during  the           continuation  of   the  security  created  by  the           Indenture  of  Mortgage  dated  the  29th  day  of           December 1950 without first obtaining the approval           in writing of the corporation to any such transfer           or assignment  and the  Company shall not cause or           permit or suffer to be transferred or assigned the           present Managing  Agency Agreement  of the Company           or the  right, title  and interest of the Managing           Agents therein  to any  other person or persons or           firm or Company during the continuance of the said           security without  first obtaining  the approval in           writing of  the Corporation  to such  transfer  or           assignment nor shall the Company appoint any other           person or  persons or  firm or  Company to  be the           Managing  Agents   of  the   company  during   the           continuance of  the said  security  without  first           obtaining  the   approval   in   writin   of   the           Corporation to such appointment.           (Amended as  per Special resolution No. 2 in Extra           ordinary general meeting held on 18.3.1951)           2. A  Commission at  the rate  of 10% per annum on           the annual  net profits  of the said company after           making all  allowance and  deductions from revenue           for interest  on loans  and deposits  and  working           expenses chargeable against profits without making           any deductions  for or  in respect  of interest on           debentures Income  Tax, Super Tax or any other tax           based on  profits or  of  any  amount  carried  to           insurance, reserve,  depreciation or  sinking fund           or to  any other special fund or in respect of any

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         expenditure on  capital amount  or on the wages or           remuneration which  shall be  payable  to  Bankers           Auditor, Solicitors,  Mukadams,  Clerks,  Brokers,           Under writers  or any  other officers or employees           who may  be employed  by the  said firm  for or on           behalf of  the Company  or  for  carrying  on  and           conducting the business of the Company and for any           rent,   cost   of   postage,   telegram   printing           stationery  or   other  expenses   or   travelling           expenses incurred  and to  be  paid  by  the  said           Company. 187           "The Company shall not pay and the Managing Agents           shall  not   receive  any  commission  during  the           pendency  of  the  loan  from  Industrial  Finance           Corporation of India as provided above in Clause 3           without  previous   consent  in   writing  of  the           Corporation unless  the interest and instalment of           principal sum  due in  any year as provided by the           Indenture of mortgage dated the 29th December 1950           have  been   duly  paid  by  the  Company  to  the           Corporation.           (Amended as  per Special  Resolution No.2 in Extra           ordinary general meeting held on 18.3.1951.)           Clause 4.  The Agents are entitled to two and half           percent commission  on all  sum or  sums  expended           towards the  purchase of the land, construction of           the mill  premises, including  outhouses etc., the           cost price  of Machinery,  appliances and  initial           stock  in  trade  necessary  in  establishing  and           starting the mill.           But  during   the  pendency   at  the  said  loan,           provisions contained in clause 4 above relating to           payment of  commission to  the Managing  Agents on           the Capital Expenditure shall remain suspended.           (Amended as per special Resolution No. 2, in extra           ordinary general meeting held on 18.3.1951.)           5. Out of the Commission of 10 per cent and out of           the amount  of 2-1/2 per cent commission as stated           above Agents  will have  to set  apart for  public           charitable purposes 1-1/2 per cent of their gains.           The purpose  shall be  uplift of the masses in the           Bombay  Presidency,  without  any  distinction  of           caste,  creed   or  religion  in  matters  social,           educational, economic cr national as the committee           of three persons, two of whom shall be unconnected           with the  firm of  the Agency  and  one  from  the           Agency firm.  The first such members shall be N.C.           Kelkar Esqr.  B.A. LL.B.  Editor of  Kesari Poona.           M.R. Jayalkar  Esqr. Bar-at-Law,  Bombay and  R.M.           Sane Esqr. pleader Barsi.           6. On  the death  or retirement of any of the said           members their  place or  places shall be filled in           by the  remaining members  of the Committee, or if           he or 188           they fail  or neglect  to make  the appointment as           aforesaid   within   a   reasonable   time,   such           appointment  is   to  be  made  by  the  Board  of           Directors strictly  conforming  to  the  condition           stated above  that the  majority of  the committee           should be  independent and  unconnected  with  the           firm of the Agency.           7. The  commission due  to  the  Agency  shall  be           payable yearly  immediately when  the accounts are

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         made up.           8. After  deducting the amount from the commission           for public  purposes as stated above the remaining           amount will  be received  by Mr.  D.V. Sulakhe and           his successors  and divided  among the  members of           the firm as agreed upon between them.           9. The  Directors are  authorised to  increase the           amount  of   remuneration  or  the  percentage  of           commission on  profits or  to allow  any bonus  if           they think  that the  profits of  the concern  are           encouraging enough to grant an increase.           Clause 9. The said clause shall remain modified to           the extent  that "so long as any moneys due to the           Corporation under  the Indenture of Mortgage dated           29th  day  of  December  1950  remain  unpaid,  no           payments what  soever under  this clause  shall be           made to the Managing Agent without first obtaining           the approval in writing of the Corporation to such           payment.           (Amended as  per Special Resolution No. 2 in Extra           ordinary general meeting held on 18.3.1951)           10. The  remuneration of the Agents’ firm shall be           Rs.600 per  month from  the date  of allotment and           Rs.1000 per  month from the date when products are           begun to be manufactured and the said remuneration           is always  to be  received from the Company by Mr.           D.V. Sulakhe or his successors.           11. If  the said  firm or  any member  of the firm           shall at  any time  hereinafter act as Mucadams or           brokers of the Company or as selling agents of the           Company’s yarn  or cloth  or for purchase of other           articles such as coal, wool machinery oil-seeds or           other products or 189           other things  required for  the  business  of  the           Company they  shall be  paid  such  commission  or           additional remuneration  as  shall  be  agreed  to           between them and the directors.           The said  clause  shall  remain  modified  to  the           extent that  so long  as any  moneys  due  to  the           Corporation under  the Indenture of Mortgage dated           29th  day  of  December  1950  remain  unpaid,  no           payments whatsoever under the clause shall be made           to the  Managing Agent without first obtaining the           approval in  writing of  the Corporation  to  such           payment." C           (Amended  as  per  special  Resolution  No.  2  in           Extraordinary general meeting held on 18.3.1951)           12. Until  the Company  is registered all expenses           of  whatever  nature  of  and  incidental  to  the           promotion thereof  shall be  defrayed in the first           instance by  the firm  of Agency as agreed between           them. The  sum or  sums os  expended will  be duly           refunded to the aforesaid firm when the first call           in respect of the subscribed shares of the Company           is paid in and realized.           13. All  work of  whatsoever kind which is usually           attended to  or done  by the  managing  agents  in           connection with  the business  of the  Company  by           virtue of  the  Articles  of  Association  of  the           Company such  as raising  the  necessary  capital,           erection of the mill premises employment of staff,           establishment of Agencies buying of raw materials,           disposing of  the finished  products  of the Mill,           keeping regular  accounts preparing  the statutory

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         reports &c. &c. will be attended to and all powers           of the  managing Agents  shall be  vasted  in  and           exercised by  Mr. D.V. Sulakhe alone or in case of           his retirement  or death by Mr. B.P. Sulakhe if he           survives him, or by a person of the Sulakhe family           nominated unanimously  by all  the surviving major           male  members   of  the  family  of  Messrs.  D.V.           Sulakhe, B.P.  Sulakhe and Gopal P. Sulakhe and in           case of  disagreement  between  these  members  in           nominating a  member from  the Sulakhe family, the           board of  directors will  choose some one from the           said Sulakhe family for acting as a Managing Agent           on behalf of the firm. There will be no inter- 190           ference or  obstruction from  any other  member of           the Agency  Firm who  will have  neither any voice           nor control  of  any  kind  over  the  matters  of           management of  the business of the company such as           those enumerated  above.  All  the  responsibility           with regard  to such work lies solely and entirely           on the  said D.V.  Sulakhe and  his  successor  or           successors as aforesaid.           14. me  other partners of the Agency firm who have           no right to take any part in the management of the           Agency business or no right to interfere with such           management  will   not  be   liable  in   any  way           whatsoever  to   the  Company   for  any  acts  of           commission or  omission, misfeasance,  malfeasance           fraud, misappropriation  or any  other act or acts           of the  said D.V.  Sulakhe and  his successors. me           company will look to and hold responsible the said           D.V.  Sulakhe  and  his  successors  aforesaid  in           respect of  the management  of the Agency business           in all branches and in all its aspects.           15. Either D.V. Sulakhe or B.P. Sulakhe may act as           Ex-officio Director  and after  them  some  person           from the  Sulakhe family  shall be entitled to act           as Ex  officio Director  and he will not be liable           to retirement  or he will not be removed from such           office.           15A. The  firm of  Agency has  always a  right  of           appointing any  one  of  them  or  outsider  as  a           special Director  and he  will be liable to retire           as other  Directors, but  he is  eligible for  re-           election by the firm of Agency.           20. The  shares  of  the  profits  of  the  Agency           business  to   which  each   partner  is  entitled           according to  their mutual  agreement will pass to           their direct  lineal  descendants  by  way  of  an           ancestral and hereditary right unless alienated or           disposed of  by such partner during his life time.           If the  said share  devolves on  more than  one of           such lineal  descendants by  way of inheritance or           otherwise  they  (they  said  descendants)  should           elect one  of them to be the member of the firm on           the-r  behalf.   If  they   cannot   agree   among           themselves for  the purpose  of such  election the           Board of 191           Directors has the right to elect one of them to be           their  representative   in  the  Agency  Firm  for           receiving  commission;   neither  the   Board   of           Directors nor  the Agents  are bound  to recognise           the  rights   of  the   other  heirs   and   legal           representatives as aforesaid.

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    Two of the relevant Articles namely, Art. 113A and Art. 146 cf  the Articles  of Association  may be noted. Art.113A reads:-           M/s. D.V. Or B.P. Or Gopal P. Sulakhe or any other           members of  the Sulakhe  family who  may be chosen           for that  purpose in terms of the agency agreement           shall be  an ex-officio  director of  the company.           Agents firm have, however, subject to the terms of           the agency  agreement to  appoint any other person           whether a  member of the firm or not, as a special           director. The person appointed as special director           as aforesaid  shall after  the lapse  of one year,           retire but be eligible for re-election. Art.  146   of  the  Articles  of  Association  provides  as follows:-           "The firm  of M/s.  Sulakhe & Co. and the partners           or members  for the  time being  constituting  the           said  firm   and  their   successors  in  business           notwithstanding any  change in the constitution or           in the  name or  style of  the said  firm  by  the           death, retirement  or insolvancy  of any member of           the  said  firm  shall  be  and  they  are  hereby           appointed the  managing agency  of the company for           the period  and upon  the  terms,  provisions  and           conditions set out in the agreement referred to in           article hereof.  Such agreement may be modified in           such manner  as may be mutually agreed between the           firm and  the directors  and the  Board is  hereby           authorised to execute the said agreement on behalf           of the company.      It has  to be  borne in  mind that at the time when the company was  incorporated and  its articles were adopted and also at  the time when the company entered into the managing agency agreement  with Sulakhe  & Co.  and when  the deed of partnership of  the firm  of Sulakhe & Co. was executed, the plaintiff Bhagwant  and the  defendant No. 2 Dattatraya were admittedly the  members of  the joint family and no disputed of any  kind had  arisen amongst  the members  of the  joint family. It is not in dispute that 325 shares 192 which were  Initially purchased  in the company - 200 in the name of  the defendant  No. 2 Dattatraya and 125 in the name of the  plaintiff Bhagwant were paid for by the joint family out of  the joint  family funds.  It  is  also  an  admitted position that  the entire  amount of  remuneration which was received by  the defendant  No. 2  Dattatraya and  plaintiff Bhagwant not  only on  account of their shares of commission under the  managing agency  agreement on  the basis  of  the partnership deed  but also on account of the Directors’ fees paid to  them and  also on  account of  the salary  paid  to defendant No.2 Dattatraya who acted as the managing agent on behalf of  the firm  was treated  as joint  family property. Defendant No.  2 Dattatraya had continued to be the managing agent of  the company  till 1935.  It is also not in dispute that when  the plaintiff  Bhagwant took over as the managing agent from  defendant No. 2 Dattatraya in 1935, the position continued to  be the  same and  the remuneration received by him formed  part of the joint family income till the dispute raised by  plaintiff Bhagwant by his letter dated 15th July, 1941 to  the defendant  No. 2  Dattatraya. The  agreement of partnership clearly  indicates that  the plaintiff  Bhagwant and the  defendant No.  2 Dattatraya  became members  of the firm M/s.  Sulakhe &  Co. which  was appointed  the managing agent of  the company  on the  basis of  the managing agency agreement, representing the joint family and for the benefit

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of  the   joint  family.  Since  the  establishment  of  the partnership firm of Sulakhe & Co. On the 3rd day of January, 1923 and since this firm’s appointment as the managing agent of the  company under the managing agency agreement dated 5- 2-1923 till the dispute was raised by the plaintiff in July, 1941 this position appears to be accepted by all without any kind of  reservation. All  monies received  by the plaintiff Bhagwant and  defendant No.  2 Dattatraya  from the company, were treated  as joint  family income  , were entered in the books of  account of  joint family  and were shown in income tax returns to be the income of the joint family.      The  facts  and  circumstances  of  this  Case  clearly indicate that  in the partnership agreement and the managing agency  agreement   in  which  the  plaintiff  Bhagwant  and defendant No.  2 Dattatraya  were parties,  they had  become parties on behalf of the joint family representing the joint family and the entire remuneration received by them, whether by way  of commission  or the  directors’ fees  or by way of salary for  having acted  as the  managing agent,  was joint family income.  On  the  materials  on  record  we  have  no hesitation in  coming to  the conclusion  that the plaintiff Bhagwant and  the defendant  No. 2  Dattatraya became    the partners of  Sulakhe  &  Co.  which  was  appointed  as  the managing 193 agent of  the company  on the  basis of  the Managing Agency Agreement for  the benefit  of the  joint family  and  their interest in  the partnership  firm and Managing Agency was a part of  joint family  assets and whatever income was earned either by  the plaintiff  Bhagwant or by the defendant No. 2 Dattatraya on  the basis  of the  managing agency  agreement belongs to  the joint  family and  formed part  of the joint family property. As the entire income coming in the hands of the plaintiff  Bhagwant or defendant No. 2 Dattatraya on the basis of  the partnership  agreement and the managing agency agreement, whether  on account  of commission  or by  way of directors’ fees  or remuneration  for acting as the managing agent, belonged  to the  joint family and formed part of the joint family  property, the  same position  must necessarily continue in  the eye  of law  so  long  as  the  partnership agreement and  the managing  agency agreement continued. The plaintiff by  seeking to  bring about  a  severance  in  the status of  the joint family, cannot deprive the joint family of this  property and the income derived on the basis of the managing agency  agreement continues  to remain the property of the  joint family,  so long  as this pint family asset is not  partitioned   and  otherwise  continues  to  remain  in existence. We have, therefore, no hesitation in holding that the remuneration received by the plaintiff Bhagwant from the company for acting as the managing agent on the basis of the managing agency agreement must necessarily be held to be the joint family  property and  the  plaintiff  Bhagwant  cannot claim the same to be his personal property.      Mr. Tarkunde  had addressed  a  novel  and  interesting argument that  even if  the Income  derived by the plaintiff Bhagwant from  the company by way of remuneration for acting as the  managing agent can be considered to be the income of the joint  family, there  should be an apportionment of this income between  the plaintiff  and the  joint family, as the plaintiff alone  had rendered all services  on behalf of the family and  he should, therefore, be held entitled to retain a part thereof for himself for the services rendered by him. This argument of Mr. Tarkunde sounds attractive and my raise an interesting  question in  an appropriate case. But in the facts  and  circumstances  of  this  case  and  taking  into

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consideration the  true nature  of the  partnership and  the Managing Agency Agreement and the conduct of the parties, we are of the opinion that there is no merit in the plaintiff’s claim for retaining any part of the remuneration received by him from  the company  for the services rendered by him. The entire income  arising out  of the managing agency agreement and accruing 194 to the  two members  of the  family, namely,  the  plaintiff Bhagwant and  the defendant  No. 2 Dattatraya who might have rendered the  services, had been earned for and on behalf of the family  and as  representatives of the joint family. The defendant No.  2 Dattatraya  had continued  as the  managing agent for  a number  of years and there has been no question of apportionment  of  any  income  derived  by  him  as  his remunerations for  the services  rendered by him as managing agent. The  character of  any joint family property does not change with  the severance of the status of the joint family and a  joint family  property continues  to retain its joint family character  so long as the joint family property is in existence and  is not  partitioned amongst the cosharers. By an unilateral  act it is not open to any member of the Joint Family  to  convert  any  joint  family  property  into  his personal property.      We now  proceed to  consider whether  the remunerations received by  the plaintiff  Bhagwant from the company as the Managing Director  of the  Company  belonged  to  the  joint family or  not. The  position of  the Managing  Director  is entirely different  from the  position of the Managing Agent on the  basis of  the Managing  Agency Agreement between the firm of  Sulakhe &  Co. and  the company and the position of the  Managing   Director  stands  entirely  on  a  different footing.  At  the  time  the  plaintiff  was  appointed  the Managing Director  of the  company on 19.10.1957 with effect from 16th  January, 1957,  there was  complete disruption of the joint family and there was no joint family in existence. In fact at that point of time litigation between the parties was going  on. By  virtue of  the incorporation of S. 87A in the Indian  Companies Act  by amendment in 1937 the duration of any  Managing Agency Agreement was limited to a period of 20 years  only at  a time though on the expiry of the period of 20  years the  Managing Agency Agreement could be renewed by virtue  of the provisions contained in Sub-Sec. (2) of S. 87A of  the Act.  In view  of the  change brought about with regard to the duration of the Managing Agency Agreement at a time the  Managing agency Agreement automatically came to an end on the expiry of the period of 20 years and though there was the provision with regard to the renewal of the Managing Agency  Agreement   it  appears  that  the  Managing  Agency Agreement was  not renewed.  It appears  that the  Board  of Directors of  the Company had passed a resolution on 28.6.56 for the  renewal  of  the  Managing  Agency  Agreement.  The Managing Agency  Agreement was not ultimately renewed and it does not  appear that  any action  was taken  by the firm of Sulakhe &  Co. Or  any partner thereof for obtaining renewal of the Managing 195 Agency Agreement for a further term after 1957. On the other hand   it appears  that the company had amended its articles of association  and had  proceeded tc  appoint the plaintiff Bhagwant as the Managing Director. It is significant to note that no  partner of the firm of Sulakhe & Co. which had been appointed as  the Managing Agent of the Company or no member of the  joint family  took any  steps  for  challenging  the validity of  the amendment of the articles of association or

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the validity  of the  appointment of  the plaintiff  as  the Managing Director of the Company.      Before we  proceed to  decide whether  the remuneration received by  the plaintiff  as the  Managing Director of the Company can  be considered  to be  part of  the joint family property, it  will be  appropriate to refer to a decision of this Court  for proper  appreciation of  the legal position. Though a number of decisions had been cited from the Bar, we do not  consider it necessary to refer to all the decisions, as in  our view the legal position has been very lucidly and clearly discussed  in the  case of  Raj  Kumar  Singh  Hukum Chandji v. Commissioner of Income-Tax Madhya Pradesh, [1971] 1 S.C.R.  748 by  this Court  after  reviewing  the  earlier decisions  on   this  question.  After  considering  various earlier decisions, this Court at page 758-759 observed:-           At  first  sight  there  appears  to  be  conflict           between the  two lines  of decisions  namely  Kalu           Babu’s   case,    Mathura   Prasad’s   case;   two           Dhanwatey’s cases  and Krishna  Iyer’s case on one           side Palaniappa  Chettiar’s case,  Dakappa’s  case           and D.C.  Shah’s case  on the other. The line that           demarcates these  two lines  of decisions  is  not           very distinct  but on  a closer  examination  that           line cane be located. In order to find out whether           a given  income is  that of  the person to whom it           was purported  to have  been given  or that of his           family, several  tests have been enumerated in the           aforementioned  decisions   but   none   of   them           excepting Kalu  Babu’s case makes reference to the           observations of  Lord Summer in Gokal Chand’s case           that ’in  considering whether  gains are partible,           there is  no  (’  valid  distinction  between  the           direct use  of the  joint family  funds and  a sue           which qualifies  the member  to make  the gains by           his own  efforts.’ We think that that principle is           no more valid. The other tests enumerated are:           (1) Whether  the income  received by a co-parcener           of a  Hindu undivided  family as  remuneration had           any real 196           connection with the investment of the joint family           funds:           (2)  Whether  the  income  received  was  directly           related to any utilization of family assets;           (3) Whether  the family had suffered any detriment           in the process of realization of the income; and           (4) Whether  the income  was received with the aid           and assistance of the family funds;           In our  opinion form  these subsidiary principles,           the broader  principle that emerges is whether the           remuneration  received   by  the   coparcener   in           substance though  not in  form was  but one of the           modes of  return made to the family because of the           investment of  the family funds in the business or           whether  it   was  a  compensation  made  for  the           services rendered by the individual coparcener. If           it is  the former,  it is  an income  of the Hindu           undivided family  but if it is that latter then it           is the income of the individual coparcener. If the           income was  essentially earned  as a result of the           funds invested  the fact  that  a  coparcener  has           rendered  some   service  would   not  change  the           character of the receipt. But if on the other hand           it is  essentially a remuneration for the services           rendered by  a coparcener,  the circumstance  that

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         his services were availed of because of the reason           that he  was a  member of  the  family  which  had           invested funds  in that  business or  that he  had           obtained the  qualification shares from out of the           family funds  would  not  make  the  receipts  the           income of the Hindu undivided family." This decision was no doubt given in a case arising out of an Income-Tax  matter.   The  various  cases  which  have  been referred in  the  judgment  also  arise  out  of  Income-tax matters  and   they  mainly   deal  with   the  question  of determination of  the nature  and character  of remuneration received by a member of the family, whether the remuneration so received is income of the joint family property or is the personal income  of the  individual, -  for the  prupose  of assessment of income-tax on such income. It is no doubt true that the observations which we have earlier quoted have been made on  the nature  and character of the income received by way of remuneration by a member of the joint family while 197 considering the question of assessment of Income-tax on such A  income;   but,  in  our  opinion,  the  legal  principles enunciated in  this decision for determining the true nature and character  of the remuneration received by any member of the joint  family apply  equally in  deciding the nature and character of  the  remuneration  received  by  the  Managing Director in  the instant  case. This  decision, to our mind, correctly lays  down the  tests which  have to be considered for deciding  the question whether the income derived by any member of  the  joint  family  by  way  of  remuneration  as managing Director is his personal income or is the income of the joint family.      In the facts and circumstances of this case, we have no hesitation in coming to the conclusion that the remuneration received by  the plaintiff  Bhagwant as Managing Director of the company  from the  company is  his personal  income  and cannot be  considered to  be the income of the joint family. At the  time the  plaintiff  Bhagwant  became  the  Managing Director of  the Company,  the joint  family had  completely disrupted and  it cannot  be said that the plaintiff was the member of any joint family of which the defendants were also members. In  fact, litigation  between the parties was going on. Though  the defendant No. 2 Dattatraya was also a member of the  managing agency  firm Sulakhe  and Co.,  it does not appear that  he took any steps for reappointment of the said firm as the managing agent. There were four outside partners interested in  the Managing Agency Agreement and it does not appear that  the defendant  Dattatraya or  the other outside partners of the managing agency firm Sulakhe & Co. had taken any steps against the company for ’not renewing the managing agency agreement.  It is to be borne in mind that it was for the company  to renew the managing agency agreement. For the purpose  of   appointing  the   plaintiff  as  the  managing director, the  articles of association of the company had to be amended  and Art.  146A  had  been  incorporated  in  the Articles of  Association by  amendment. It  does not  appear that  defendant  No.  2  Dattatraya  or  the  other  outside partners of  the managing  agency firm  Sulakhe & Co. Or any other shareholder  of the  company  sought  to  prevent  the company  from   amending  the  articles  of  association  or challenged the  validity of  the amendment  of the articles. The appointment  of plaintiff  Bhagwant as Managing director after the  amendment of the Articles also does not appear to have been  challenged by  the defendant  No. 2 Dattatraya or any of  the other  partners of the managing agency firm. The termination  of  the  managing  agency  agreement  with  the

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partnership firm Sulakhe & Co. appears to have been accepted by the members of the said firm including the 198 defendant No.  2  Dattatraya  who  alongwith  the  plaintiff Bhagwant were  partners of  the firm  representing the joint family. It  is also to be noted that in the partnership firm of Sulakhe  & Co.  which was appointed the managing agent sf the company  on the  basis of the managing agency agreement, the four  partners who  did not  belong to  the family  held majority shares in the partnership although by virtue of the agreement between  the parties  they had  agreed that either the plaintiff  Bhagwant or  defendant No. 2 Dattatraya would act as  the managing  agent of  the company on behalf of the managing agency  firm and  should receive  the  remuneration which would  be paid to the managing agent acting as such on behalf of  the firm.  These outside  partners who  held  the majority shares  in the  partnership firm  of Sulakhe  & Co. which had been appointed and had been acting as the managing agent of  the company  on the  basis of  the managing agency agreement, raised  no protests  for  not  renewing  managing agency for  a further  term, though under Sub-section (2) of S.  87A  of  the  amended  provision,  the  managing  agency agreement which  stood terminated  in 1957,  could have been extended. It  appears, therefore,  that the  majority of the partners had  lost interest  in the  renewal of the managing agency agreement.  In any event, the undisputed facts remain that the  managing agency  agreement was  not renewed  after 1957 and  no action was taken against the company or anybody else by  the firm  of Sulakhe & Co. which had been acting as the managing  agent or  by any  partner thereof  either  for renewal of the managing agency agreement or for not renewing the managing  agency agreement. It also does not appear that the firm  Sulakhe &  Co. Or  any of  its partners  took  any action to prevent the company from amending its articles and for appointing  Bhagwant as  the Managing  Director  of  the company. The  facts and  circumstances of  the  case  go  to indicate that  the partners  of the firm Sulakhe & Co. which had been  acting as  the Managing  Agent on the basis of the managing agency  agreement with  the  company  accepted  the termination of the managing agency on the expiry of the term prescribed under the amended law without any protest and did not seek  to enforce  the right  or renewal  of the managing agency agreement or of any other provision of the agreement. As the  managing agency agreement had ceased to exist at the time the  plaintiff  Bhagwant  was  appointed  the  Managing Director of  the company  and as  at that  time there was no joint family of the plaintiff Bhagwant and the defendants in existences, the  plaintiff Bhagwant  cannot be  said to have been appointed  as the  Managing  Director  of  the  company either because  of the  Managing agency agreement or because of his  being a  member of  the joint  family. The facts and circumstances make  it clear  that the partnership agreement or the managing 199 agency agreement  had no relevance to the appointment of the plaintiff Bhagwant  as the Managing Director of the Company. As we  A have  earlier indicated  the company  had initially contemplated to  renew the  managing agency on the expiry of the term  prescribed by  law and  the Board of Directors had passed a  resolution accordingly.  Subsequently, for reasons known to  the company,  the company  decided not to continue the  managing   agency  agreement  and  decided  to  appoint plaintiff Bhagwant  as the Managing Director of the company. For the  purpose of appointing the plaintiff Bhagwant as the Managing Director,  the company had to amend its Articles of

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Association and  the company,  in  fact,  duly  altered  the Articles  of   Association  and  the  company.  Neither  the partnership firm  of Sulakhe  & Co. which had been appointed as the  Managing Agent of the company and had been acting as such till the expiry of the term nor any partner thereof had taken any  effective step for renewal of the managing agency agreement  or   had  made  any  effective  protest  for  not reappointing the  firm Sulakhe  & Co. as the managing agents of the  firm and  for appointing  the plaintiff  as managing director of the company after having amended the articles of association of  the company.  The facts and circumstances of the case  also do not go to indicate that the appointment of the plaintiff as managing director of the company was by way of any  return to  the family  because of the investments of the family  funds in  the business  of company.  As  earlier noticed the  joint family  had purchased  only 325 shares at the time  of the  managing agency agreement with the company and, in  fact, other  parties have  invested a  much  larger amount in  the purchase of shares. Taking into consideration the total  investment made in the company by various parties it appears that the contribution of the joint family appears to be  insignificant. It cannot, therefore, be said that the appointment of the plaintiff as Managing Director, at a time when there  was complete  disruption of the joint family and the members of the family were fighting in Court, was by way of any return on the investment made by the Joint family. It Is quite  clear that the plaintiff Bhagwant was appointed as the Managing  Director by  the company  for services  to  be rendered by him, as the company might have been impressed by his performance as the managing agent for a number of years. Though undoubtedly  the  plaintiff  Bhagwant  acted  as  the managing agent for and on behalf of the joint family and for benefit of the joint family, yet what must have weighed with the company  is the  kind of services rendered by him to the company. The company was concerned with his services and not with the  question whether he was rendering the services for and on  behalf of  the family.  The plaintiff  Bhagwant, was therefore appointed as the managing 200 director for  the services  rendered by him and for services to be  rendered by  him. The  remuneration which the company agreed to  pay to  the plaintiff  Bhagwant for acting as the managing director  was for  the services  to be  rendered by him. This  remuneration must,  therefore,  be  the  personal income of  Bhagwant and does not belong to the joint family. The decisions of this Court and the principles enunciated by this Court  which we  have earlier noted clearly support the view we have taken.      In facts and circumstances of this case there can be no question of the plaintiff Bhagwant being a trustee or acting as the  trustee for  the benefit  of  the  joint  family  in relation to  his appointment as the managing director of the company.      It has  to be borne in mind that it was the partnership firm of  Sulakhe &  Co. which  was appointed as the managing agent of  the company  and on  the basis  of the partnership agreement and  the managing  agency agreement, the defendant No. 2 Dattatraya and thereafter the plaintiff Bhagwant acted as the  managing agent  of the  company and  was entitled to receive the remuneration from the company for acting as such managing agent.  As we  have already noticed the partnership firm consisted  of six  members, four of whom were outsiders and did not belong to the family. These four outside members of the  partnership firm  had, in  fact, held  the  majority shares in the partnership. me defendant No. 2 Dattatraya and

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the plaintiff Bhagwant had become members of the partnership firm for  and on behalf of the joint family and representing the joint  family interest.  The firm  had entered  into the Managing Agency  agreement with  the company.  The  managing agency of  the company  was that  of the partnership firm in which the  four outside members with a majority of shares in the partnership were interested and the managing agency firm cannot, therefore, be considered to be an asset of the joint family. It  was the  interest of the defendant No. 2 and the plaintiff Bhagwant  in the managing agency firm on the basis of their  shares in  the partnership  which belonged  to the joint  family.  Furthermore,  the  managing  agency  was  an agreement between  the company  and the partnership firm. It would no  doubt be  open to  the partnership firm to ask for renewal of  the managing  agency agreement  and it  would be equally open  to the  company to  decide  what  the  company should do.  We have  earlier observed  that on the expiry of the term  of the  managing agency  by virtue  of the changes introduced in the Companies Act no effective steps appear to have been taken by the firm Sulakhe & Co. which acted as the managing agent  or any  partner thereof  for renewal  of the managing 201 agency  agreement.   The  alterations  of  the  articles  of association   of the  company and  the  appointment  of  the plaintiff as  managing director  after the  amendment of the articles also  went without  any effective  challenge by the firm of Sulakhe & Co. or any partner thereof or by any share holder of  the company.  The  effect  of  not  renewing  the agreement was  that the  interest of the partnership firm of Sulakhe &  Co. in  the company as the managing agent thereof with all  the rights and privileges on the basis of the said agreement came  to an  end.  With  the  termination  of  the managing agency  agreement the  interest of the joint family in the  managing agency  on the  footing  that  two  of  the members  of  the  joint  family,  namely,  defendant  No.  2 Dattatraya and  plaintiff Bhagwant  were as  partners of the firm associated  with the managing agency and were acting as the managing agent on the basis of the partnership agreement and the  managing agency  agreement also  ceased. As we have earlier observed,  the appointment of the plaintiff Bhagwant as  managing   director  was  not  because  of  any  special investment by  the joint  family  in  the  company  and  the remuneration which  was agreed  to be paid by the company to the plaintiff  Bhagwant for  acting as the managing Director of the  company  was  not  by  way  of  any  return  on  the investment of  the joint  family  in  the  company  and  the plaintiff  Bhagwant   became  entitled   in  his  individual capacity as  the managing  director of  the company  to  the remuneration offered  to him for the services to be rendered by him  as such  Managing Director.  The plaintiff  Bhagwant earned  the   remuneration  in  his  personal  capacity  for services rendered by him. The argument advanced on behalf of the defendants  that plaintiff  Bhagwant was in the position of a trustee with regard to the remuneration received by him for acting  as managing  director  of  the  company  and  is accountable to  the joint  family for all such remunerations received  by   him  is,   therefore,  in   the   facts   and circumstances of this case without any merit.      At the  time when  the  company  was  incorporated  and admittedly when  the family  was joint,  325 shares  in  the company were  purchased, -  200 in the name of the defendant No. 2  Dattatraya and  125 in  the  name  of  the  plaintiff Bhagwant. Admittedly the price for these shares was paid out of the  joint family  funds. There  can,  therefore,  be  no

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dispute that  these shares  belong to  the joint  family  in which each branch of the joint family has an equal share. In fact, it is so conceded ’before us by the parties concerned. It appears that 79 further shares in the company in the name of the  plaintiff Bhagwant  and four  further shares  in the name of  defendant No.  1 Gopal  were purchased.  It further appears 202 that the  purchase price  of these  83 shares were also paid out of  the joint  family funds.  So far  as the four shares purchased in The names of defendant No. 1 it is not disputed that the said four shares belong to The joint family. Though the plaintiff  claims that  the 79  shares belong to him and not to  the joint  family on the plea that the price paid by the joint  family for  the purchase  of the  said shares was paid to the plantiff Bhagwant by way of loan to him, we must hold taking  into consideration  the facts and circumstances of this  case and  in particular  the fact that the story of the loan  by the  joint family,  has not been accepted, that these 79  shares also  belong to  the joint  family.  Shares which  were  subsequently  purchased  by  the  parties  were purchased when  the status  of the  joint  family  has  been completely disrupted  and there  is no  evidence to indicate that the  joint family  had paid for the shares subsequently purchased by  the parties.  Shares had been purchased by the plaintiff,  his  sons  and  other  members  of  the  family. Plaintiff’s son  is a  Doctor and  has his own income. It is not established  that the  plaintiff purchased shares out of the remunerations earned by him as the Managing Agent or the managing director of the company. Even if we assume that the plaintiff has paid for these shares out of the remunerations paid to  him by the company for acting as the Managing Agent or the managing director, the joint family can have no claim with regard to any such share. The plaintiff Bhagwant may in the facts  and circumstances  of this case be accountable to the joint  family for   the  remuneration earned  by him  as Managing Agent,  but he  is not  a trustee  and  the  shares purchased by  him will  not belong  to the  joint family. We have already held that the plaintiff was not in the position of a  trustee for  the benefit  of the  joint family  in his capacity as  the managing  director of  the company  and the remuneration which  the plaintiff earned belonged to him and was his personal income. We, therefore, hold that 200 shares standing in the name of defendant No. 2, 125 shares standing in the  name of the plaintiff Bhagwant, four shares standing in the name of defendant No. 1 and the 79 shares standing in the name  of the  plaintiff or his sons which were purchased out of the joint family funds belong to the joint family and each branch has equal 1/3 shares in these shares.      We now  proceed to  consider the question of cash money which was  found in the Mahalaxmi room. The plaintiff claims that in  the Mahalaxmi  room there was about a Lac of Rupees belonging to the joint family which had been secreted by the defendants. When  the receiver  counted the  money,  it  was found that there was cash 203 money in  Mahalaxmi room  over  twenty-one-thousand  rupees. There is no evidence on record which would justify the claim of the  plaintiff that  there was  a Lac  of Rupees  in  the Mahalaxmi room. Materials on record show that there was some cash money  belonging to  the joint  family in the Mahalaxmi room. To  ascertain exactly how much cash money was there in the Mahalaxmi  room, it  becomes necessary  to direct that a proper account  should be  taken. The litigation between the parties is going on for decades, and any reference directing

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accounts to be taken on this question would necessarily mean that the  litigation would  be prolonged  further. Taking an overall view  of the  matter we  have decided  that  in  the interest of  justice and  in the  interest of the parties it will ’be  appropriate in The facts and circumstances of this case that  this Court should determine and reasonable amount on the  basis of the materials which are there on the record and on  the basis  of the submission made by the counsel and the counsel  for the  parties also  suggested  that  in  the interest of the parties concerned it would be desirable that this Court  should  fix  an  amount  which  the  Court  will consider reasonable.  We propose  to take  this aspect  into consideration while passing the decree in these appeals.      The last  question which  falls for determination is on the question  of ornaments, jewellery and utensils. There is no proper  evidence on record which will justifiable lead to the conclusion  that any  ornaments, jewellery  or  utensils belonging to  the joint  family are in the possession of any particular party.  Materials on  record, on  the other hand, suggest that  these movables  have already been partitioned. We are,  therefore, inclined  to take the view that whatever ornaments, jewellery  and utensils  are in the possession of any of  the parties  now belong  to them  and  there  is  no question of  any party  being in  possession  of  any  joint family ornaments, and utensils.      In the result we hold :-           1.  That   all  remunerations   received  by   the           plaintiff Bhagwant  from the  company  by  way  of           commission director’s  fees and  remunerations  as           the managing  agent of  the company so long as the           managing agency  agreement continued its existence           till 1957,  belong to  the joint  family  and  the           plaintiff is  bound to  render true  and  faithful           accounts of  all such  amounts received by him and           to pay  to the  other two  branches  their  share,           namely, 1/3rd  to each  of the  other branches who           happen to be the defendants in the suit. 204           2. The  position of the defendant No. 2 Dattatraya           who was  the other person in the firm of Sulakhe &           Co. representing  the joint  family and  who  also           acted as  a managing agent is also the same. There           is no  question, however,  of the  defendant No. 2           Dattatraya rendering  any account  in  respect  of           such  sums  received  by  him  as  all  such  sums           received by  him had been treated without any kind           of dispute  as joint  family income  and had  been           entered in  the books  of the  joint  family.  The           question  of  rendition  of  any  account  by  the           defendant No.  2 Dattatraya  therefore,  does  not           arise.           3. The  remuneration received  by the plaintiff as           managing  director   of   the   company   on   his           appointment as managing director of the company in           1957, belongs to the plaintiff personally and does           not  belong   to  the  joint  family.  The  entire           remuneration received  by the  plaintiff after the           termination of  the managing  agency agreement and           after his  appointment as managing director of the           company is  the personal  income of  the plaintiff           and the  joint family or any member thereof has no           interest or  claim in  the amounts  so received by           the plaintiff.           4. 200  shares of  the company  in the name of the           defendant No.  2, 125 shares in the company in the

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         name  Of   the  plaintiff   which  were  initially           acquired by  the joint  family and  the subsequent           acquisition of  79 shares  by the plaintiff in his           name  or   in  the   name  of  his  sons  and  the           acquisition  of   four  shares   in  the  name  of           defendant No.  1 belongs  to the  joint family and           each branch  of the  joint  family  has  an  equal           interest in  the shares. In other words, these 408           shares belong  to the  joint family  and being 408           shares have  to be  divided  equally  amongst  the           three Branches  of the family. All other shares in           the company  standing in  the names of the parties           or their  children do  not  belong  to  the  joint           family and  form  no  part  of  the  joint  family           property.           5. So  for as the cash money in the Mahalaxmi room           is concerned there was undoubtedly some cash money           lying in  that room belonging to the joint family.           The exact  amount  of  cash  money  lying  in  the           Mahalaxmi room is difficult, if not impossible, to           ascertain on the 205           basis of  the materials  on  record.  It  will  be           equally difficult  to ascertain  the exact  amount           even  if   a  reference  is  directed  as  on  the           materials  on   record  and   after  hearing   the           submissions of  the counsel  for the  parties,  we           find that  there is no dependable material to come           to any  definite conclusion.  The plaintiff claims           that there  was approximately  a  Lakh  of  Rupees           whereas the  receiver found only an amount of over           Rs. 21,000.  The plaintiff  Bhagwant is  no  doubt           entitled to  a reasonable  amount  in  respect  of           money lying  in Mahalaxmi  room and  we shall take           this account  into account while passing the final           decree herein.           6. So far as the ornaments, jewellery and utensils           are concerned,  we hold  that there is no material           on  record   to  establish   that  any   party  in           possession  of   any  ornaments,   jewellery   and           utensils  belong   to  the   joint   family.   The           ornaments,   jewellery   and   utensils   in   the           possession  of  the  respective  parties  will  be           treated as  their own properties. There is nothing           further  to   enquire  into  or  decide  on  these           questions.      On the  basis of  the aforesaid findings we now proceed to consider  the nature of the relief that should be granted and the kind of decree that we should pass in these appeals. We are  of the  opinion that  taking into consideration that the litigation  between the  parties has  been going  on for over four decades, it will be in the interest of justice and in the interest of parties that any kind of decree would not be passed  which may  have  the  effect  of  prolonging  the litigation. In that view of the matter we are of the opinion that we  should not  pass any  decree for  accounts, as  any reference for taking accounts will result in prolongation of litigation to  the detriment of the interest of the parties. The learned  counsel appearing on behalf of the parties also submitted before  us that  we should  pass a final decree to put an  end to  the litigation. To enable us to pass a final decree without any directions for taking of accounts between two parties  we directed  all the parties to place before us the relevant  facts and  the necessary figures in respect of their claims  on each  head. On  the basis of the directions

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given by  us, the  parties have  furnished  the  Court  with relevant facts  and figures  relating  to  their  claims  in respect of  every item  of claim  and have  also made  their submissions  before   US  on  the  basis  thereof.  We  have carefully considered  all  the  materials  which  have  been placed before us by the parties and also the 206 submissions made  in support  thereof by  the parties.  On a careful consideration  of all the materials placed before us and also  the submissions  made on behalf of the parties, we now proceed to pass the final decree in these appeals in the following terms :-           (1) The  plaintiff Bhagwant  who happens to be the           appellant before  us will  pay a  sum of Rupee two           Lacs to  the  defendants  to  be  divided  equally           between  the   two  respective   branches  of  the           defendants. In other words, the plaintiff Bhagwant           will pay  a sum  of Rupees one lac to the heirs of           defendant No.  1 Gopal and a sum of Rupees one lac           to the defendant No. 2 Dattatraya.           (2) The  said sum  of Rupees two lacs will be paid           to the defendants in the manner aforesaid, namely,           one lac  to the heris of defendant No. 1 Gopal and           Rupees one  lac to  the defendant No. 2 Dattatraya           within a period of two months from date.           (3) In  default of  payment of the said sum within           the  aforesaid  period,  the  decretal  amount  of           Rupees 1  lac in  favour of  each  branch  of  the           defendants will carry interest @ 9% per annum from           the date  of default  till recovery  of  the  said           amount by  the defendants.  In  other  words,  the           interest on  the said  sum of  Rupees one lac each           for defendant No. 2 and the heirs of defendant No.           1 Gopal  will run  from 1st December, 1985, if the           said amount  is not  paid by  the end  of November           1985.           (4) If  the amount  of Rupees  one Lac or any part           thereof   remains unpaid  by the  end of November,           1985 to  the heirs of defendants No. 1 Gopal or to           the  defendant   No.  2   Dattatraya,   the   said           defendants or either of them who would not be paid           the entire  sum of  Rupees one  Lac by  the end of           November, 1985  will be  entitled to  execute  the           decree for  the said  amount of  Rupees one Lac or           any part  thereof which  will remain  unpaid  with           interest on  the said  amount, on the basis of the           decree passed herein.           (5) It  is declared  that 408 shares which we have           held to  be the  property of  the Joint  family as           recorded in  our finding No. 2 belong to the joint           family and the 207           plaintiff Bhagwant, the defendant No. 2 Dattatraya           and heirs of defendant No. 1 Gopal shall have each           1s/3 share  in the said 408 shares in the company.           The said  408  shares  shall  be  divided  equally           amongst the  three branches and the plaintiff will           get 136  shares, defendant  No. 2  Dattatraya  136           shares and the heirs of Defendant No. 1 Gopal will           get 136 shares.           (6) Mr. S.B. Sulakhe son of the plaintiff Bhagwant           who happens to be the present managing director of           the  company   is  hereby  appointed  Commissioner           without any  remuneration  to  divide  the  shares           equally in  the aforesaid  three lots and to. have

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         the same  transferred and  registered in the names           of the parties on the basis of the division of the           said shares  to be  effect  ed  in  terms  of  the           decree. The  plaintiff will  proceed to divide the           said shares  in the  manner directed  above within           two months  from date.  All the  parties will give           necessary co-operation  to the  plaintiff  in  the           matter of  effecting  division  of  the  said  408           shares in the manner aforesaid.           (7) If  for any  reason, the plaintiff in not able           to divide  the said  shares within a period of two           months from  date of the decree any of the parties           will have  the liberty  to apply  before the Trial           Judge for  the appointment  of a  Commissioner  of           partition to  divide the  said 408 shares in three           equal lots  of  136  shares  each  in  the  manner           directed by this decree.           (8) It  is declared  that the  amount which  would           have been  payable to  the plaintiff  as his share           out of cash money lying in the Mahalaxmi room, has           been taken  into consideration  while passing  the           decree for  Rupees two  lacs against the plaintiff           and the  plaintiff  will  have  no  further  claim           against the defendants on this account.           (9) It  is declared  that no  party has  any claim           against the  other on  account of any joint family           ornaments, jewellery  and utensils.  It is further           declared that  whatever  ornaments  jewellery  and           utensils are  in the  possession  of  any  of  the           parties are  their own  properties  and  no  other           party has any claim in respect thereof. 208           (10) It  is declared that there are no other joint           family properties  in respect  of which any of the           parties can  make any  claim  and  it  is  further           declared that  apart from what is provided in this           decree, no  party  has  or  will  have  any  claim           against any  other  party  on  the  basis  of  any           property  being   a  part   of  the  Joint  family           property.           (11) Save and except the costs already paid by the           plaintiff to  the defendants, the parties will pay           and bear  their own  costs. It  is made clear that           the plain  tiff will  not be  entitled to  recover           whatever  costs   he  might   have  paid   to  the           defendants and  the defendants will be entitled to           retain all  sums received  on account of costs and           will not  be called upon to refund any part of the           amounts received  by them by way of costs from the           plaintiff.           (12) Any  direction or  finding of  the High Court           contrary to  what we  have held  must  necessarily           stand set  aside and  appeals to that extent stand           allowed. S.R.                                 Appeals partly allowed. 209