I started giving consultation to a business owned by Y in 1994. In 1997 Y proposed that a manufacturing unit be started together. Due to good relations with Y, I accepted to enter into a partnership, but Y wanted the partnership to be btw X (son of Y) & I.
Ours was a de-facto partnership based on good will of Y and since X was 18 years old we did not see any problem, but according to his affidavit in court now, he could not have been 18 then, maybe that is why Mr Y insisted that No Deed of Partnership be registered, but the firm was. A plot was bought and structure erected on loans in 2004. The firm did brisk business till 2006 while X’s only contribution was signing of cheques. At this point I underwent a by-pass surgery of the heart and could not attend to the firm, during this time, Y took responsibility of managing the business who took advantage of my absence and moved stocked raw material and machinery from this firm to his own citing convenience in looking after the business. Upon my return, a request to return the material or make payment for its worth was made and same was promised. But delaying techniques were being adopted which ultimately led to complete shut down of operations of the said firm in the year 2007, please note that X during this period due to differences with his own father, chose to pursue other career options rather than the one he committed to years ago and joined a reputed business school for further studies and was placed in a company in UK & hurriedly left the country giving full GPA authority to his father Y.
All operations were shut in 2007 as was agreed upon by both parties verbally.
Since firm ABC also owed money to my wife and with no scope of recovery of any money, the building premises was leased to my wife's firm 'WI' for a nominal amount in consent and total agreement of the GPA holder, with the clause that allows 'WI' to sub-let the said premises to run her own business. The differences between X & Y grew during this time and X only returned in 2014 for the cremation of his father – Y (GPA) who fell critically sick in 2013, and again left hurriedly without any dialogue. In the years that followed, X filed multiple litigation cases against his Mother, other family members and I to name a few.
Against Me, x has filed a case arbitrating half of the proceeds of rent collected by WI which has over the years reinvested most of the money generated from sub-letting in maintain the plot & building and has also made additions to structure to suit the needs of its tenants.
What is rightfully his is not being denied, half of the property. But can he demand a share from firm WI over which I have no control.
Asked 4 years ago in Business Law
please note that all the communication between Y and I had been verbal and there is no documentation to support the same. since the starting of partnership (1997) till date all documents have been signed by me. only the cheques were signed by the co-signatory (x) and later by Y upon conferring of GPA.
Lease deed signed with WI (wife) has been signed by me only on behalf of ABC.
Property Tax and Tax on Income have been duly paid till FY [deleted] by me only.
keeping the above facts in mind can X claim portion of the rent earned by WI. however i am agreeable to pay half of the rent received by ABC from WI and share the property in the ratio upon vacation of the premises.
Also X claims collusion btw my wife and I with the intention of cheating him and denying him a share of the rent earned by WI and can a criminal case be filed based on that?
Please do share citing of court on similar case if possible as that may help me understand the situation i am in better.
Asked 4 years ago