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1938 Supreme(Mad) 58

IN THE HIGH COURT OF MADRAS
Varadachariar, J.
S. Girdharilal Son and Co.
Versus
B. Kappini Gowder and Ors.
Decided On : 03.02.1938

The central legal point established in the judgment is the interpretation and application of Section 69 of the Partnership Act to determine the maintainability of a suit by unregistered partners.

Headnote:

Partnership Act - Suit Maintainability - Section 69(2) - Section 69, Section 74 - The judgment discusses the application of Section 69 of the Partnership Act to a suit filed by unregistered partners. It analyzes the language of the section, the exemption under Section 74, and the distinction between remedy and rules of procedure. The court concludes that the suit is maintainable and overrules the objection based on Section 69(2) of the Partnership Act.

Fact of the Case:

The suit involved a promissory note executed before the Partnership Act came into force, and the question was whether unregistered plaintiffs could maintain the suit.

Finding of the Court:

The court found the suit maintainable and overruled the objection based on Section 69(2) of the Partnership Act.

Issues: The issues revolved around the application of Section 69 of the Partnership Act to a suit filed by unregistered partners and the exemption under Section 74.

Ratio Decidendi: The court analyzed the language of the sections, the distinction between remedy and rules of procedure, and the purpose and effect of Section 69 to reach its decision.

Final Decision: The decree of the lower Court was set aside, and the case was remanded for disposal on the merits. The appellants were entitled to a refund of the Court-fee paid on the Memorandum of Appeal and the costs of the appeal.

JUDGMENT

Varadachariar, J.

1. I agree with Pandrang Row, J., that the present suit is maintainable and that the objection based on Section 69(2) of the Partnership Act must be overruled. The arguments that can be urged in favour of one view or the other have been fully set out in the judgments delivered by my learned brothers; it is therefore not necessary for me to deal with every one of them in detail or with the several decisions referred to in their judgments.

2. The relevant facts and dates are: The promissory note sued on was executed on 12th March, 1931, the Partnership Act except Section 69 came into force on 1st October, 1932, Section 69 came into force on 1st October, 1933, and this suit was filed in August, 1934. On these facts, the question arises, whether the plaintiffs who admittedly constitute a firm but had not got themselves registered before the date of the institution of the suit are entitled to maintain the suit. If the matter were wholly res Integra it may be open to argument whether the language of Section 69 of the Partnership Act clearly and necessarily applies to contracts entered into before the date of the coming into force of the Act. In Wright v. Greenroyd (1861) 1 B. and S. 758 : 121 E.R. 896 where the question arose with reference to Section 32 of the English Medical Act of 1858, Blackburn, J., thought that it was clear from the language of that section that the prohibition referred to a charge incurred after the 1st January, 1859. The language of that section was that:

After the 1st January, 1859, no person shall be entitled to recover any charge in any Court of law for any medical or surgical advice, attendance or for the performance of any operation, or for any medicine which he shall have both prescribed and supplied, unless he shall prove upon the trial that he is registered under this Act.

3. As a matter of language, it is not easy to see any marked difference between the above words and the language of Section 69 of the Partnership Act. In view however of the way in which the general words of this section of the Partnership Act have been understood in many of the reported decisions, I prefer to deal with the case on the footing that, but for other considerations, the language employed is capable of being applied even to contracts entered into before the Act came into force and to causes of action that accrued before that date.

4. On the above assumption two questions arise for decision : (1) Whether the saving words found in Section 74 have the effect of exempting a suit like the present from the operation of Section 69, and (2) if Section 74 has no such operation, whether on general principles the Court ought to hold that Section 69 does not apply to a suit to enforce a cause of action which had accrued prior to the date of the coming into force of the Act. In dealing with Section 74,1 may note one ambiguity which however is not very material to this case. In Clause (a), (b) and (c) reference is made to "the commencement of this Act" and the learned Counsel for the respondents rightly pointed out that it may not be easy to say when dealing with an objection under Section 69, whether the above words should be held to refer to 1st October, 1932, when the Act except Section 69 came into force or to 1st October, 1933, when that section came into force. I do not however express any opinion upon this question because the right of action in the present case accrued even before 1st October, 1932, when the Act came into force. The material clause of Section 74 is Sub-clause (b) which [omitting the unnecessary words and importing what is necessary from Sub-clause (a)] will read as follows:

Nothing in this Act shall affect any remedy in respect of any right acquired or accrued before the commencement of this Act.

5. In view of the words legal proceeding found in Sub-clause (b) it has been held in some of the reported decisions that all that, the exemption was intended to secure was the continuance of procee




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