In a judgment that stirred an old partnership feud, the Supreme Court on Thursday overturned a Karnataka High Court ruling and reinstated a 2004 Bellary District Court order. The dispute revolved around a tiny but valuable “one-anna” share in a family-run firm, M/s Gavisiddheshwara & Co., dating back to the 1970s.
Background
The quarrel began when Singamasetty Bhagavath Guptha inherited his late father’s one-anna stake in the firm. Pressed by family debts, he allegedly offered to sell his portion to partner Allam Karibasappa in March 1975. Creditors soon dragged Guptha and his mother into insolvency proceedings. During those proceedings, a court-appointed receiver transferred the share to Karibasappa through a registered deed in 1983.
Years later, Guptha paid off creditors and got the insolvency annulled. The Bellary court, after a long probe, ruled in 2004 that the key “offer-and-acceptance” letters from 1975 were fabricated and cancelled the transfer deed. But the High Court revived the sale in 2011, reasoning that acts of the receiver were protected under Section 37 of the Provincial Insolvency Act.
Court’s Observations
The Supreme Court bench of Justices Pamidighantam Sri Narasimha and Atul S. Chandurkar disagreed sharply with the High Court. “The High Court committed a serious error in reversing the findings of the District Court,” the bench observed. They noted that the Bellary judge had examined evidence in painstaking detail, exposing contradictions in the alleged 1975 correspondence.
Crucially, the bench pointed out that the 1983 transfer deed “had no legs to stand” once the earlier authorising order was set aside and the matter remanded. “For Section 37 to apply, the sale or disposition must have attained finality,” the judges said, stressing that appellate courts must give clear reasons when overturning trial findings.
Decision
Allowing Guptha’s appeals, the Supreme Court restored the Bellary District Court’s 2004 order cancelling the 1983 sale deed and dismissed the counter-appeals of Karibasappa’s heirs. With this, Guptha regains his one-anna partnership share, ending a five-decade legal tangle.
Case Title: Singamasetty Bhagavath Guptha & Anr. vs. Allam Karibasappa (Dead) by LRs & Others
Date of Judgment: 25 September 2025