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1980 Supreme(J&K) 122
IN THE HIGH COURT OF JAMMU AND KASHMIR AT JAMMU
I.K. Kotwal, J.
Girdhari Lal & Ors. - Appellant
Versus
New Bharat Finance Company (M/s) & Ors. - Respondent
CIMA No. 39/1977
Decided On : 05 November, 1980
Advocate For Appellant: R.P. Sethi
Advocate For Respondent: Nemo
A firm is not duly registered under the Partnership Act unless the necessary entry is made in the Register of Firms, after the Registrar is satisfied that the provisions of Section 58 of the Act have been fully complied with, and a certificate of registration is issued by the Registrar bearing his signature and the seal of his office.
Headnote:
PARTNERSHIP ACT - REGISTRATION OF FIRM - SECTION 57, 58, 69 - PARTNERSHIP ACT RULES, RULE 5, 9 - CERTIFICATE OF REGISTRATION - ASSISTANT REGISTRAR - VALIDITY OF REGISTRATION - ARBITRATION ACT, SECTION 20 - APPLICATION FOR REFERENCE TO ARBITRATION - MAINTAINABILITY - FIRM NOT DULY REGISTERED.
Fact of the Case:
An application was filed under Section 20 of the Arbitration Act by the first respondent against the appellant, who was the debtor. The appellant raised several objections to the maintainability of the application, including the fact that the respondent firm was not duly registered under the Partnership Act. The trial court decided all the issues against the appellant and held that the firm was duly registered and made a reference of the disputes to the Arbitrator.
Finding of the Court:
The court held that the respondent firm was not duly registered and that the application under Section 20 of the Arbitration Act was not maintainable. The court found that the certificate of registration produced by the first respondent did not bear the signature of the Registrar of Firms but instead bore the signature of the Assistant Registrar, who was not a recognized authority under the Partnership Act.
Issues: Whether the respondent firm was duly registered under the Partnership Act.
Ratio Decidendi: The court held that an application under Section 20 of the Arbitration Act cannot be filed on behalf of a firm unless the firm is duly registered. The court further held that the registration of a firm takes effect only when the necessary entry is made in the Register of Firms, after the Registrar is satisfied that the provisions of Section 58 of the Partnership Act have been fully complied with. The court also held that the certificate of registration must be signed by the Registrar of Firms and bear the seal of his office.
Final Decision: The court allowed the appeal, set aside the order of the trial court, and dismissed the application made by the first respondent under Section 20 of the Arbitration Act.
"Whether the plaintiff firm is not registered in accordance with law? O. P. D "
2. The parties joined the issues and led evidence in support of their respective cases. The trial court decided all the issues against the appellant and held that the firm was duly registered. It accordingly made a reference of the disputes mentioned in the application to the Arbitrator. It is this order which has been assailed in this appeal
3. I have today heard Mr. Sethi appearing for the appellant only, as no one is present to oppose the appeal on behalf of the respondents.
The appeal, in my opinion, can be disposed of on the short ground that the respondent firm is not duly registered. It is now well settled that an application u/s 20 of the Arbitration Act cannot he filed on behalf of a firm unless the firm is duly registered. Section 57 of the Partnership Act empowers the Government to appoint Registrars of Firms for the purpose of the Act, and further empowers it to define the areas in which they shall exercise jurisdiction. This section speaks of appointing Registrars of Firms. only but does not speak of appointing Assistant Registrars of Firms There is also no other provision in the Act under which a Registrar of firms may include an Assistant Registrar of Firms. Obviously, therefore, an Assistant Registrar is in authority not known to the Act. Sec. 50 says that when a Registrar is satisfied that the provisions of Sec. 56 have been duly complied with, he shall record an entry of the statement in a Register called the Register of Firms. This Register in terms of Rule 5 of the Rules framed under the Partnership Act shall be in Form A. The registration of a firm cannot take effect by merely sending a statement required to be made u/s 55 of the Partnership Act to the Registrar, but will take effect only when the necessary entry is made in the Register of firms, after the Registrar is satisfied that provisions of Sec. 58 have been fully complied with. How these entries are to be made in the Register of Firms has been provided in Rule 5 which reads as under:
"5. Register of Firms. The Register of Firms shall be in Form A annexed to these rules. The name of and the particulars relating to, a firm shall be entered therein in the order of its registration on a separate page or pages, as the case may be. Each firm shall be assigned a number in a consecutive serial commencing and ending with a calendar year. A note of every document filed shall be entered in the Register in the page or pages allotted to the firm concerned and shall be signed by the Registrar."
4. As would appear from the plain reading of this Rule, signing of the Register by the Registrar after the entries are made in it is a necessary requirement of the Rule. This is obvious because appearance of his signature on the Register will be a prima facie proof of his satisfaction that requirements of Section 58 have been duly complied with. It is true, that satisfaction reached by the Registrar is not open to challenge, either in an appeal or in a suit, but the fact still remains that the satisfaction is to be his and of none else.
5. That a firm has been duly registered may be proved either by proving the original record containing the entry made in it or by, production of certificate of its registration of a certified copy thereof. Rule 9 makes provision for issuing such a certificate. This Rule reads as und
