The plaintiff in O.S.No.1238 of 1999 on the file of the III Additional Junior Civil Judge, Chittoor, is the appellant. The appellant is a Partnership Firm, and it filed the suit against the respondents for recovery of amount covered by a chit transaction. While the 1st respondent was the prized subscriber, the 2nd respondent is the guarantor. It was pleaded that the appellant started chits in Group No.7 of the value of Rs.50,000/-, of the duration of 20 months with monthly subscription of Rs.2,500/-. 1st respondent subscribed to one of the chits and became successful bidder in August, 1995. He stated that having received the prize amount of Rs.33,300/-, the 1st respondent committed default in payment of the instalments. Interest was claimed @ 24% per annum.

2. The 1st respondent filed a written statement and the 2nd respondent adopted the same. It was admitted that the 1st respondent is a prized subscriber. However, it was urged that all the instalments were paid as per the schedule. An objection was raised as to the maintainability of the suit, on the ground that the foreman, by name, Mr.Y. Raghu, through whom the suit is filed, is not competent to represent the partnership firm. According to the respondents, one Mr.Bhaskar Naidu is the Managing Partner, and on account of the disputes with him, Raghu got the suit filed. The trial Court dismissed the suit, through judgment, dated 08.09.2004, by accepting the plea as to the bar of the suit under Section 69 of the Partnership Act (for short ‘the Act’). A.S.No.168 of 2004 filed by the appellant before the District Court, Chittoor, was dismissed on 06.08.2008. Hence, this Second Appeal.

3. Sri Mehar Chand Noori, advanced arguments on behalf of the appellant. He contends that the bar under Section 69 of the Act operates only against a firm, which is not registered and the appellant herein did not suffer from any disability, since it is registered. He contends that once the firm is registered, it is not necessary that the name of every partner must be entered to enable them to institute independent proceedings in relation to the firm. He has places reliance upon a judgment rendered by this Court in Sri Laxmi Cloth Stores, Vijayawada v. Ratna and Co., Cloth Merchant, Machilipatnam (1999 (6) ALT 681), and the judgment of the Supreme Court in GwalliarOil Mills v. Supreme Industries (1999) 9 SCC 113).

4. Sri Sumanth, learned counsel for the respondents, on the other hand, submits that the prohibition contained under Section 69 of the Act disables not only an unregistered firm, but also a partner, whose name is not entered in the register, maintained by the Registrar of Firms.

5. As observed earlier, the suit was filed for recovery of amount covered by a chit transaction. When the issues were framed at the initial stage, it appears that much attention was not paid to the effect of Section 69 of the Act, on the suit. Accordingly, the following issues were framed:

1. “Whether the discharge of the chit instalments as alleged in the written statement is correct?

2. Whether there is cause of action for the plaintiff to file the suit?

3. To what relief?”

Thereafter, the following additional issues were framed:

1. “Whether Y.Raghu is the foreman of the plaintiff?

2. Whether the plaintiff has issued legal notice as alleged in para 11 of the plaint?”

6. On behalf of the appellant, PW.1 was examined and Exs.A.1 to A.17 were filed. On behalf of respondents, DWs.1 and 2 were examined and Exs.B.1 to B.5 were filed. The trial Court answered issue No.1 in favour of the appellant herein. Issue No.2 was treated as superfluous. However, it answered additional issues 1 and 2 against the appellant. In A.S.No.168 of 2004, the lower Appellate Court framed the following points for its considered and dismissed the appeal.

1. “Whether Y.Raghu, who is representing the plaintiff-firm is competent to file the suit on behalf of the plaintiff-firm?

2. Whether the suit claim is hit by Section 25(1) of A.P.