Here is the background:
There is a partnership firm called 'ABC Chemist' run by 3 folks (Tom, Sam, and Pat), each having 33% stake in the firm. Apparently they run pharmacy in a small private hospital and then they decide to seek license for a chemist shop in a big govt. hospital. ABC submits tender alongwith all necessary paperwork and seek the license in Pat's name. To finance the project ABC hooks up with three individuals viz Jim, Jay, and Ron who promise to make payment in two installments each. In return, ABC agrees to modify its original partnership deed by adding a supplementary partnership deed to admit Jim, Jay, and Ron as shareholders who get 12%, 12%, and 25% shares respectively. Tom, Sam, and Pat are awarded 17% each. The contribution from Jim, Jay, and Ron is not disclosed in the supplementary partnership deed though and the supplementary partnership deed is supposed to expire as soon as the project terminates. Each Jim, Jay, and Ron make the first deposit in ABC's current account and follow up with the second deposit about a month later. However, the second set of deposit is made in Pat's savings account. Pat uses proceeds from these two sets of deposit to submit security money and bank guarantee respectively to the Govt. Jim, Jay, and Ron started looking after the new chemist shop actively under Pat's control and supervision.
Here is the problem:
Pat does lot of purchase in # 2 and charges commission from dealers. Not only that he presents fabricated purchase and sale numbers month in and month out to sales tax department and evades sales tax. Jim does not like it, obviously he thinks his money is at risk. Jim protests and opts to stay out of the partnership and wants his money back. Pat and others start disliking Jim. They charge him of stealing money from the shop and decide to forfeit his partnership as penalty. They also decide to deduct X amount from his contribution as recovery.
So how does Jim get his capital back alongwith interest? In case Pat and party show some cooked up numbers to prove that the business is running in loss and given the fact that the second set of deposit was made in Pat's personal account, can Jim at least claim the second deposit on grounds that it was money lent to Pat against interest? Please advise.
