Partners' Dispute Vis-a-vis- Bank's Role
udai s parmar
(Querist) 16 February 2010
This query is : Resolved
FACTS OF THE CASE
1. Mr. DPG and his brother Mr. VG were partners in a firm called M/s DPB. Mr. DPG died on 01.01.2008 and in his place DPG’s wife Mrs. NG was taken as a partner in the firm.
2. Mr. VG is active partner and conducts the business of a firm from Chennai. The firm has also an office in Mumbai and some business is also conducted from Mumbai.
3. Mr. VG resides in Chennai and Mrs. NG resides in Mumbai . Mrs. NG is not at all familiar with the business operations and the business is conducted solely and wholly by Mr. VG.
4. The firm is availing credit facilities from a Bank for which the necessary loan papers have been signed by both partners.
5. There is a clause in a partnership deed saying that any partner giving three months notice to another partner can retire from the firm.
6. Now due to some family dispute relating to other business entities, Mrs. NG has written a letter to the bankers of a firm alleging that the affairs of the firm are mismanaged by other partner i.e. Mr. VG and accordingly the letter may be treated as notice to a Bank for stopping the operations of the firm with immediate effect. Needless to say that Mrs. NG’s allegation against other partner is without any basis and proof.
OPINION SOUGHT
Under the afore stated circumstances:
(1) What is the correct stand the Bankers of the firm can take in the matter?
(2) Is there any way to save the business of the firm ?
(3) If the stalemate continues- will the Bank let the said account become NPA in their books?
s.subramanian
(Expert) 24 August 2010
1. The banker cannot continue the opertaions.
2. No, the business has to be wound up.
The partnership has to be dissolved.
