The point that arises for consideration in this case is whether a partnership that was entered into for the purpose of exploiting a licence for an arrack shop before the licence was obtained is void ab initio and therefore a suit based upon such partnership for settlement of accounts is not maintainable.

The facts are these. On the 8th March, 1943, plaintiff, defendant, Arjunam Pillai and Ramaswami Mudaliar agreed that the licence for the Kallidaikurichi arrack shop should be taken in the name of the defendant but that the profits from the shop should be equally divided between the four members. There was a settlement of account on 9th April, 1944, whereunder the defendant had to pay a sum of Rs. 260-4-6 to the plaintiff. On that day itself the defendant paid Rs. 130-4-6. The suit was filed for the recovery of the balance due to the plaintiff. The defendant raised various contentions one of them being that the suit was not maintainable in view of the Rules under the Madras Abkari Act I of 1886. The learned District Munsiff held that the plaintiff was not a partner but a mere financier and there was no question of any transfer of a right to vend. Following the decision of Wadsworth,

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