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HIGH COURT OF CALCUTTA
Das Gupta, Guha Ray
DWIJENDRA NATH SINGH - Appellant
Versus
GOVINDA CHANDRA - Respondent
Civil Rule 1264 Of 1952
Decided On : AUGUST 5, 1952
PARTNERSHIP ACT - SECTION 69 - SUIT BY UNREGISTERED FIRM - SUBSEQUENT REGISTRATION - MAINTAINABILITY - A suit which was not maintainable, under the provisions of Section 69 of the Partnership Act at the time it was instituted because the firm was not registered, did not become maintainable at a later date when the firm was registered during the pendency of the suit.
Fact of the Case:
A suit was filed by two persons described as the owners of the firm Samanta Naskar and Co. On the date of institution of the suit, 8-6-1951, the firm was not registered. However, it was registered before the suit came to be heard. The Munsif, relying on a decision of the Calcutta High Court, held that the suit was maintainable despite the firm's unregistered status at the time of institution and passed a decree in part in favor of the plaintiffs.
Finding of the Court:
The court held that the suit was not maintainable as it was instituted by an unregistered firm in violation of Section 69 of the Partnership Act. The court observed that subsequent registration of the firm could not cure the initial defect and that the suit should have been dismissed.
Issues: Whether a suit which was not maintainable under Section 69 of the Partnership Act at the time of institution due to the firm's unregistered status becomes maintainable upon subsequent registration of the firm during the pendency of the suit.
Ratio Decidendi: The court interpreted Section 69 of the Partnership Act strictly and held that the institution of a suit by an unregistered firm is barred. The court reasoned that the terms of Section 69 are imperative and that subsequent registration cannot cure the initial defect. The court also noted that the Legislature's intent in enacting Section 69 was to prevent unregistered firms from instituting suits and that allowing such suits to proceed by way of subterfuge would undermine the purpose of the legislation.
Final Decision: The court set aside the order passed by the Munsif and ordered that the suit be dismissed. The petitioners were awarded costs in both the courts.
( 1 ) THE only question in this case is whether a suit which was not maintainable, under the provisions of Section 69 of the Partnership Act at the time it was instituted because the firm was not registered, became maintainable at a later date when the firm was registered during the pendency of the suit.
( 2 ) THE suit was brought by two persons who are described as the owners of the firm Samanta Naskar and Co. On 8-6-1951, when the suit was instituted this firm had not been registered. It however was registered before the suit came to be heard. The learned Munsif relying on a decision of this Court in --'radha Charan Saha v. Matilal Sana', 41 Cal WN 534 (A), held that the suit was maintainable in spite of the fact that the firm was not registered on the date of institution of the suit and passed a decree in part in favour of the plaintiffs.
( 3 ) IT is contended before us that the decision in -- 41 Cal WN 534 (A)', was not correct.
( 4 ) THE first and second sub-sections of Section 69 of the Partnership Act are in these words:" (1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm. (2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm has been shown in the Register of Firms as partners in the firm. "
( 5 ) IN --''41 Cal WN 534 (A)', the Court had to consider the provisions of Section 69 (2) of the Partnership Act. What happened there was that the plaintiffs' firm was registered on 20-6-1934, the suit having been instituted on 25-5-1934. D. N. Mitter J. said that there was no reason why he should not hold that the suit was properly instituted at any rate on 20-6-1934 when the firm was registered. He observed:"the plaint in this suit was allowed to remain on the file and it did remain on the file till the date of registration. In such circumstances, the suit may be treated as though the plaint had been received and the suit instituted on the day following the day of registration. "he observed further:"the defendant waited till the last stage of the second hearing and took the objection after the close of the plaintiff's case at the time of the argument. This objection has not been taken in the written statement which was filed in May 1934. There was nothing to prevent the plaintiffs from getting the firm registered immediately after the plea in bar had been taken in the written defence. But no such plea was taken. "
( 6 ) ON a consideration of these circumstances, his Lordship came to the conclusion that it would be consonant with justice to hold that the suit was instituted after the registration and so did not offend against the provisions of Section 69 (2) of the Partnership Act.
( 7 ) A contrary view has been taken by Roxburgh J. in an unreported decision in -'abdul Hayet Mondal v. Siddheswar Kumar', A. F. A. D. No. 405 of 1948, D/- 28-6-1951 (Cal) (B ). After considering the decision in --'radha Charan Sana's case (A)', Roxburgh J considered the views taken by several other High Courts on this question and finally came to the conclusion that there was abundant weight of judicial opinion that Section 69 (2) of the Partnership Act was also to be interpreted in the same strict sense as the Privy Council had laid down for Section 80, C. P. C. and that the suit being bad at its inception was not made good by a subsequent registration of the firm. In that view his Lordship confirmed the order passed by the appellate Court dismissing the suit by the plaintiff firm when the same was registered sometime after the date of institution of the suit.
( 8 ) THESE appear to be the only cases In which thi
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