1965 Supreme(Pat) 61
PATNA HIGH COURT
K.Sahai, J.
Basant Lal Jain
Versus
Union Of India
Appeal From Appellate Decree No. 201 of 1962 ;
Decided On : APRIL 30, 1965
A suit by an unregistered firm or by persons who are not shown in the Register of Firms as partners of the firm is not maintainable under Section 69(2) of the Indian Partnership Act.
Headnote:
PARTNERSHIP ACT - REGISTRATION OF FIRM - SECTION 69 - SUIT BY UNREGISTERED FIRM - MAINTAINABILITY - REQUIREMENTS.
Fact of the Case:
Plaintiffs, claiming to be partners of an unregistered firm, sued for damages for non-delivery of a consignment of green ginger. The suit was dismissed on the ground that it was not maintainable under Section 69 of the Indian Partnership Act, 1932. Plaintiffs obtained a registration certificate for the firm and filed a fresh suit.
Finding of the Court:
The court held that the suit was not maintainable as the plaintiffs had not established that their names were entered in the register of firms as partners of the firm in question, as required by Section 69(2) of the Indian Partnership Act.
Issues: Whether the suit was maintainable in view of the fact that the plaintiffs' firm was not registered and their names were not entered in the register of firms as partners of the firm.
Ratio Decidendi: Section 69(2) of the Indian Partnership Act requires that a suit to enforce a right arising from a contract shall not be instituted by or on behalf of an unregistered firm unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm.
Final Decision: The appeal was dismissed, and the parties were directed to bear their own costs.
1. This appeal by the plaintiffs arises out of a suit for recovery of a sum of Rs. 1,072/- as damages for non-delivery of a consignment of fourteen bags of green ginger.
2. The plaintiffs claim to be partners of a firm which carries on business under the name and style of Messrs Surajmal Naresh Kumar Jain at New Market in the town of Patna. Their case is that the pro forma defendant, Sekhar Chand Jain, despatched the consignment in question from Manipur Railway Station in Assam (Bengal Assam Railway) on the 17th February, 1951, to Hajipur Railway Station on the Oudh Tirhut Railway. Sekhar Chand Jain transferred the railway receipt to the plaintiffs. The ordinary time taken for a consignment from Manipur to reach Hajipur is about ten days. The consignment should, therefore, have reached Hajipur on or about the 27th February, 1951. The plaintiffs made a claim from the Oudh Tirhut Railway for a sum of Rs. 958/- on account of the price of the green ginger; but their claim was not satisfied.
The plaintiffs instituted Money Suit No. 32 of 1952 on the 26th February, 1952, for recovery of damages for non-delivery of the consignment in question. The suit was dismissed on the 20th March, 1956, on the ground that the suit was not maintainable under Sec. 69 of the Indian Partnership Act, 1932 , inasmuch at the alleged firm of the plaintiffs was not a registered firm. The plaintiffs allege that they got the firm registered and obtained a registration certificate (exhibit 9) on the 5th May, 1956. On this basis, they filed the present suit on the 19th May, 1956.
3. The Munsif, who tried the suit, dismissed it by his judgment dated the 14th December, 1959. The plaintiffs took an appeal to the District Court, and it was heard by the 3rd Additional Subordinate Judge of Muzaffarpur, who dismissed the appeal. Hence, the plaintiffs have come up to this Court.
4. The learned Subordinate Judge has held that no notice under Section 77 of the Indian Railways Act has been served upon the defendants. In this connection, he has also held that the letter (exhibit 5) said to have been sent by the plaintiffs to railway authorities did not constitute a notice under the section. He has further held that Sec.14 of the Limitation Act is not applicable to the facts and circumstances of this case, and that the suit is barred by limitation. He has also held that the plaintiffs have not established that they are persons who "have been shown in the Register of Firms as partners in the firm" within the meaning of Sub-section (2) of Sec. 69 of the Partnership Act, and as such, the suit must fail.
5. Mr. Satyanand Kumar, who has appeared on behalf of the plaintiff-appellants, has challenged all the above findings of the learned Subordinate Judge. It is unnecessary for me to consider all the points raised because it is clear that the plaintiffs must fail on the ground that they have not established that they are persons whose names have been entered in the register of firms as partners of the firm Surajmal Naresh Kumar Jain.
6. Some of the allegations made by the plaintiffs in the plaint in the new suit are that the present suit is not barred by the principle of res judicata because, the previous suit having been filed in contravention of Sec. 69 of the Partnership Act was no suit at all, and that, after the dismissal of the first suit, "they got themselves registered under the Indian Partnership Act". This allegation is rather vague. It is difficult to understand from the statement that the plaintiffs got the firm registered or that they got their own names registered as partners of the firm or both. In paragraph 6 of the written statement filed on behalf of the defendants, it was stated that the plaintiffs firm is hot registered. One of the issues which were raised in the suit was whether the suit was maintainable in its present form. The learned Munsif considered the objection of the defendants on this point in paragraph 7 of his judgment, He thought that the