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Case Number

A.S No. 619 of 1951

Attorney(S)

For the Appellant: K. P. Abraham
For the Respondent: 1st A. T. Markose
For the Respondent: 2nd

Judges

Govinda Pillai
Vithayathil, JJ.

Acts

Section 173 of the Travancore Companies Act, of 1092, corresponding to Section 171 of the Indian Act,
Section 68(2) of that Act corresponding to Section 69(2) of the Indian Partnership Act.
Section 68(2) of the Travancore Partnership Act. Section 171 of the Companies Act
instituted.14. Again, Section 68(2)(Section 69(2) of the Indian Act)
Partnership Act, 12 of 1115. Section 68(2) of that Act
Section 68(2) of the Travancore Partnership Act
Section 57(1) of the Travancore Partnership Act
Section 28(2) of the Provincial Insolvency Act.
Section 173 of the Travancore Companies Act
Section 69(2) of the Indian Partnership Act
Section 58 of the Indian Partnership Act
Section 69 of the Indian Partnership Act,
Section 171 of the Indian Companies Act,
Section 69(2) of the Partnership Act,
SECTION 69 PARTNERSHIP ACT
SECTION 68 PARTNERSHIP ACT
SECTION 171 COMPANIES ACT

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Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

The plaintiff-appellant is the Bank of Koothattukulam (a firm represented by its Managing Proprietor). Defendant 1 issued a cheque for Rs. 3,700 on 8-10-1947 in favour of defendant 2, to be drawn on the Moovattupuzha branch of the Palai Central Bank Limited on 14-10-1947. Defendant 2 endorsed the cheque the same day (8-10-1947) in favour of the plaintiff-bank and allegedly received Rs. 3,700. When the plaintiff presented the cheque it was returned dishonoured on the ground that defendant 1 had countermanded payment. The plaintiff alleges that defendant 1 counter-manded payment after knowing that the plaintiff-bank had paid defendant 2 and sued to recover Rs. 3,700 with interest at 12% per annum.

Both defendants contested the suit on factual and procedural grounds. The trial Court found that the plaintiff-bank had paid the sum to defendant 2, but dismissed the suit because the plaintiff-bank (a firm) was not registered under the Travancore Partnership Act and therefore the suit was held not maintainable under Section 68(2) of that Act (corresponding to Section 69(2) of the Indian Partnership Act). The present appeal challenges that dismissal.

Legal Issues Presented

Whether the Court below was correct in dismissing the suit on the ground that the plaintiff-bank (a firm) was not registered under the Travancore Partnership Act at the time the suit was instituted (i.e., whether Section 68(2) barred the suit).
Whether sending the statement prescribed by Section 57(1) of the Travancore Partnership Act along with the prescribed fee (on 8-11-1947) amounted to registration of the firm for the purposes of Section 68(2), given that the Registrar received those materials on 12-11-1947 and the suit was instituted on 10-11-1947.
Whether registration of the firm during the pendency of the suit (i.e., after institution) is sufficient to cure the defect of non-registration at the date of institution so that the suit may proceed (i.e., whether subsequent registration validates a suit filed earlier).
How Sections 57 and 58 of the Travancore Partnership Act should be read together in determining when registration is effected.

Arguments of the Parties

Plaintiff-Appellant (Bank of Koothattukulam) — principal contentions

The plaintiff alleged it had paid Rs. 3,700 to defendant 2 and claimed recovery with interest at 12% per annum.
It was pleaded in the plaint that the plaintiff-bank was registered under the Partnership Act.
On appeal the plaintiff contended that sending the statement required by Section 57(1) together with the prescribed fee on 8-11-1947 amounted to registration of the firm; because that mailing occurred before the suit was instituted (suit instituted 10-11-1947), the plaintiff argued Section 68(2) did not bar the suit.

Defendant 1 — principal contentions

Asserted that he issued the cheque on 4-10-1947 (not 8-10-1947) and that it was a post-dated cheque dated 14-10-1947.
Maintained that defendant 2 had represented he would deposit funds before 10-10-1947 and that defendant 1 agreed defendant 1 might countermand payment if the deposit was not made.
Stated that once he learned defendant 2 had not deposited the amount he instructed the bank not to encash the cheque.
Denied liability on the ground that neither defendant 2 nor the plaintiff-bank had any right to present the cheque on 8-10-1947, and alleged no notice had been issued to him.

Defendant 2 — principal contentions

Contended that the plaintiff-bank (a firm) was not registered under the Travancore Partnership Act and therefore the suit was not maintainable.
Argued that when he endorsed the cheque to the plaintiff-bank he was told payment would be made only on the maturity of the cheque, and that he did not receive any amount from the plaintiff-bank.
Asserted that no notice was issued to him and that he was not liable for any amount.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
(Firm) Ram Prasad-Thakur Prasad v. (Firm) Kamta Prasad-Sita Ram…, AIR 1935 All 898	Considered the argument that sending the registration statement before suit constituted registration; Kendall, J. held registration involved more than sending the statement.	The Court relied on this decision to support the view that registration is effected only when the Registrar records the entry and files the statement (i.e., under S.58), and not merely when the statement is dispatched.
Varadarajulu v. Rajamanika, AIR 1937 Mad 767	Held (Horwill, J.) that a Court may take notice of events after filing the plaint and that subsequent rectification (registration pendente lite) may validate continuation of a suit from the date of registration.	Cited by the appellant as supporting subsequent registration curing defects; the Court treated this as a contrary (minority) view and declined to follow it, distinguishing it from majority authorities.
Radhacharan v. Matllal, 41 Cal WN 534	Expressed the view that registration during the pendency of the suit could permit the suit to proceed from the date of registration.	Cited by appellant; the Court noted this as part of the minority line of authority and did not follow it, treating it as inconsistent with the majority view.
Jakiuddin v. Vithoba, AIR 1939 Nag 301	Included language indicating that if registration were done during pendency the suit might legally proceed from that date (Gruer, J., obiter).	Not treated as establishing the prevailing rule; the Court observed this view was not followed in later decisions and was not binding for the present appeal.
Nazir Ahmad v. People's Bank of Northern India Ltd., AIR 1942 Lah 289 (Full Bench)	Full Bench held that subsequent obtaining of leave under Companies Act Section 171 cured initial defect (in a different statutory context), but language differs from Partnership Act.	The Court distinguished the Companies Act provision and treated the Lahore decision as not authoritative for Section 68(2) of the Partnership Act; observed that remarks in the Lahore case on partnership registration were obiter and not followed by majority.
Ponmichami Goundar v. Muthusami Goundar, AIR 1942 Mad 252	Held registration of the firm is a condition precedent to the right to institute the suit and Court has no jurisdiction to proceed when the condition precedent has not been fulfilled.	Relied upon as a leading authority endorsing the majority view; the Court followed this reasoning in holding the suit not maintainable for lack of registration at the date of institution.
Bhagchand Dagdusa v. Secretary of State, AIR 1927 PC 176 (Privy Council)	Held provisions like Section 80 CPC (mandatory notice condition) are mandatory and suits instituted without compliance are not maintainable; used analogically with partnership registration provisions.	Adopted by the Court (through reliance on Madras Chief Justice's use) as supporting the interpretation that Section 68(2) is mandatory and registration is a precondition to institution.
Ghouse Khan v. Balasubba Rowdier, AIR 1927 Mad 925 (FB)	Addressed leave/permission provisions (Provincial Insolvency Act Section 28(2)); held subsequent leave would not cure initial defect.	Used as precedent supportive of the view that subsequent compliance cannot validate an initially defective institution; the Court cited it in the line of authority rejecting subsequent registration as curing defect.
Davood Mohideen Rowther v. Sahabdeen Sahib, AIR 1937 Mad 667	Related to Section 28(2) of the Provincial Insolvency Act; held subsequent leave would not cure initial defect.	Relied upon with other Madras decisions as supporting rule that subsequent compliance does not validate an earlier defective suit.
Subramania Mudaliar v. East Asiatic Co. Ltd., AIR 1936 Mad 991	Held registration of a firm after institution of suit would not cure non-registration at date of institution.	Adopted as authority in favour of the majority view and cited by the Court in rejecting appellant's contention.
Ibrahim Sahib & Brother v. Gurulinga Aiyar, AIR 1938 Mad 185	Held subsequent registration of the firm would not cure the defect of non-registration at suit institution.	Referred to by the Court as part of supporting Madras jurisprudence endorsing the condition-precedent rule.
Girdharilal Son & Co. v. Kappini Gowder, AIR 1938 Mad 688	Addressed the effect of registration after institution; one Judge expressed same view though other Judges did not express opinion on point.	Cited as part of the body of Madras decisions that disallow validation by subsequent registration.
Firm Laduram Sagarmal v. Jumuna Prasad, AIR 1939 Pat 239	Held Patna High Court would not treat subsequent registration as curing initial defect; no provision permits treating plaint as filed on a later date.	Adopted by the Court as supporting the majority rule against validation by subsequent registration.
Danmal Parshotamdas v. Baburam Chhotelal, AIR 1936 All 3	One of the All-India decisions cited concerning effect of subsequent registration (cited with approval by some Courts).	Referred to among the authorities considered; the Court treated the weight of authority as contrary to validation by subsequent registration.
Krishuari Lal Ram Lal v. Abdul Ghafer Khan, AIR 1935 Lah 893	Part of Lahori jurisprudence addressing registration/curative effect questions.	Included among authorities considered; the Court noted it as part of the broader survey where majority disapproved of validation by subsequent registration.
Chhagan Lal v. Firm Mangal Sain Raj Narain, AIR 1938 Lah 767	One of the Lahore decisions on partnership/registration issues.	Referred to in the course of surveying conflicting authorities and treated as not displacing the majority rule relied upon by the Court.
Firm Mohanlal Ram Copal v. Firm Udai Ram Sewa Ram, AIR 1936 Pat 140	Patna decision in the line that subsequent registration does not validate a previously unregistrable suit.	Cited approvingly among cases supporting the majority position that registration is a condition precedent.
Mahadeo v. Shah Vijava Kumar Hiralal, Civil Revision No. 613 of 1949 (decision referenced)	Later decisions showing shift/abandonment of earlier obiter views about subsequent registration.	Noted by the Court as part of decisions where judges abandoned earlier contrary obiter views; used to show trend against validation by subsequent registration.
Abdul Karim v. Ram Das, AIR 1951 Nag 159	Nagpur High Court considered the question and preferred Madras view that registration is condition precedent; disagreed with earlier obiter endorsing validation.	Referred to as part of the majority trend aligning with the proposition that subsequent registration does not cure the defect.
Firm Des Raj Premchand v. Firm Hiralal Kali Ram, AIR 1952 Punj 415	Punjab Full Bench distinguished the Lahore Full Bench observations and held later registration does not validate a previously unregistrable suit.	Used as authority for the proposition that remarks in the Lahore case were obiter and the weight of authority is against validating subsequent registration.
Firm Ganga Ram Puranmal v. Central Bank of India Ltd., AIR 1953 Punj 235	Punjab High Court followed majority view that subsequent registration will not validate the suit.	Cited as further supporting authority; Court relied on this line of decisions in reaching its conclusion.
Prithvi Singh v. Hasan Alli, AIR 1951 Bom 6	Bombay High Court concluded Section 69(2) bars institution by unregistered firm and subsequent registration cannot cure the initial defect.	Relied upon as another High Court decision endorsing the majority rule; cited by the Court to reinforce its conclusion.
Dwijendra Nath Singh v. Govinda Chandra, AIR 1933 Cal 497	Calcutta Division Bench disagreed with 41 Cal WN 534 and held subsequent registration does not cure defect.	Cited as showing Calcutta High Court's later view aligning with majority that subsequent registration does not validate a prior defective suit.
Nand Kishore v. Firm Maheswari Mills, AIR 1953 Madh.-B. 42	Madhya Bharat decision holding registration is a condition precedent and subsequent registration will not cure defect.	Cited as supporting the majority position; the Court included it in its survey of authorities.
Ganapathy Chettiar v. Abdul Kani Rowther, 1946 Trav LR 260	Travancore High Court indicated registration is a condition precedent and subsequent registration cannot remedy the defect; cited Madras decision in support.	Quoted by this Court as prior Travancore authority endorsing the condition-precedent view; used to show local court consistency with the majority rule.
Krishna Pillai v. Travancore National and Quilon Bank Ltd., 1943 Trav LR 458	Interpreted Section 173 of Travancore Companies Act regarding leave in company-winding context; distinguished statutory language and effect from Partnership Act provisions.	Used to demonstrate that differences in statutory wording affect whether an initial defect is curable; the Court relied on the distinction between company-leave provisions and partnership-registration provisions.

Court's Reasoning and Analysis

The Court conducted a step-by-step analysis grounded in the statutory text and a comprehensive survey of case law:

Factual-dates and registration evidence: The Court examined the timeline of events and documentary evidence. The plaintiff asserted registration in the plaint, but the actual sequence was that the statement under Section 57(1) and the fee were sent by post on 8-11-1947 and were received by the Registrar on 12-11-1947. The suit had been instituted on 10-11-1947.
Statutory interpretation of Sections 57 and 58: Section 57(1) (Travancore Partnership Act) provides that registration "may be effected at any time by sending by post or delivering to the Registrar a statement in the prescribed form and accompanied by the prescribed fee." Section 58 requires that when the Registrar is satisfied the provisions of Section 57 are complied with, he shall record an entry in the Register of Firms and file the statement.
Legal question of when registration is "effected": The appellant argued that dispatching the statement and fee (i.e., sending by post) effected registration on the date of posting (8-11-1947). The Court read Sections 57 and 58 together and concluded that registration is completed only when the Registrar records the entry and files the statement; sending the statement is not by itself conclusive of registration.
Application of the evidence to the statutory test: Because the Registrar received the statement only on 12-11-1947 (after the plaint was filed on 10-11-1947), the Court found the firm was not registered at the time of institution of the suit and the names of those suing were not shown in the Register of Firms on the date of institution.
Review of authorities on curative effect of subsequent registration: The Court undertook an extensive review of conflicting judicial authority. It identified a minority line (e.g., Varadarajulu, 41 Cal WN 534) supporting validation by subsequent registration and a majority line (e.g., Ponmichami Goundar, Subramania Mudaliar, Patna and Madras Division Bench authorities, and numerous High Court decisions) holding registration is a condition precedent and subsequent registration does not cure the initial defect.
Distinguishing of authorities from other statutory contexts: The Court distinguished precedents construing company-law provisions (e.g., Section 171 Companies Act) or other statutory regimes where language differs, explaining those decisions did not control the present statutory phrasing under Section 68(2).
Conclusion of law: Adopting the majority view reflected in the surveyed authorities and reading Sections 57 and 58 together, the Court concluded registration had not occurred when the suit was instituted and that subsequent registration during pendency does not cure the defect. Consequently the trial Court was right in dismissing the suit for non-registration at the time of institution.
Consequential decisions on merits and issues: Because the defect of non-registration was dispositive, the Court deemed it unnecessary to decide the merits of the underlying cheque claim. It set aside certain findings of the Court below on Issues Nos. 1, 2 and 5 and left those questions open. The appeal was otherwise dismissed and the memorandum of objections dismissed except as modified.

Holding and Implications

APPEAL DISMISSED.

Core holding:

The Court held that registration of a partnership firm under the Travancore Partnership Act is a condition precedent to instituting a suit of the nature covered by Section 68(2).
Sending the statement and fee by post does not itself constitute completion of registration for the purposes of Section 68(2); registration is effected when the Registrar records the entry in the Register of Firms and files the statement under Section 58.
Registration effected during the pendency of the suit (i.e., after institution) does not cure the defect of non-registration at the date of institution.

Direct consequences for the parties:

The dismissal of the original suit by the trial Court for non-registration was affirmed (subject to the modification that certain findings on specified issues were set aside and left open).
The merits of the cheque claim were not decided because the jurisdictional defect was dispositive.
The parties were directed to bear their respective costs both in this Court and in the Court below.

Broader implication addressed in the opinion: The decision aligns with a substantial line of High Court authority (surveyed in the opinion) that registration of the firm must exist at the date of institution and that subsequent registration pendente lite does not validate a suit that was incompetent at inception. The Court distinguished contrary, minority authorities and decisions in different statutory contexts.

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Bank Of Koothattukukin v. Itten Thomas And Another

The Judgment of the Court was delivered by

Vithayathil, J.:— Plaintiff is the appellant. Plaintiff is the Bank of Koothattukulam, a firm represented by its Managing Proprietor. Defendant 1 issued a cheque for Rs. 3,700/- on 8-10-1947 in favour of defendant 2 to be drawn on the Moovattupuzha branch of the Palai Central Bank Limited on 14-10-1947. Defendant 2 endorsed the cheque on 8-10-1947 itself in favour of the plaintiff-bank and received Rs. 3,700/-. When the cheque was sent by the plaintiff-bank to the Moovattupuzha branch of the Palai Central Bank Limited it was returned dishonoured on the ground that defendant 1 had counter-manded payment. It is alleged that defendant 1 counter-manded payment after knowing that the plaintiff-bank had paid the amount to defendant 2. The suit is for the amount paid by the plaintiff-bank with interest at 12 per cent, per annum.

2. Both the defendants contested the suit. Defendant 1 contended that he issued the cheque in favour of defendant 2 on 4-10-1947 and not on 8-10-1947, that it was a post dated cheque bearing the date 14-10-1947, that defendant 2 made him understand that he had purchased a lorry for which he had to pay Rs. 3,000/-, that defendant 2 wanted a cheque bearing date subsequent to 10-10-1947 since he undertook to deposit the amount in the bank in the name of defendant 1 before that date, that defendant 2 had agreed that if the amount was not deposited within that time defendant 1 might countermand payment, that when he came to know that defendant 2 did not deposit the amount as undertaken by him he asked the bank not to encash the cheque, that neither defendant 2 nor the plaintiff-bank had any right to present the cheque on 8-10-1947, that he was not liable for the-amount, and that no notice had been issued to him. Defendant 2 contended that the plaintiff-bank which was a firm was not registered under the Travancore Partnership Act, that the suit was therefore not maintainable, that when he endorsed the cheque in favour of the plaintiff-bank he was told that the money would be paid to him only on the maturity of the cheque, that he did not receive any amount from the plaintiff-bank, that no notice was issued to him, and that he was not liable for any amount.

3. On the question whether the plaintiff-bank paid the sum of Rs. 3,700/- to defendant 2 the Court below found that the amount was paid. But the suit was dismissed on the ground that the plaintiff-bank was not registered under the Travancore Partnership Act and that the suit was therefore not maintainable under Section 68(2) of that Act corresponding to Section 69(2) of the Indian Partnership Act. The parties were directed to suffer their respective costs.

4. The only question to be decided in this appeal is whether the Court below was right in dismissing the suit on the ground that the plaintiff-bank was not registered under the Partnership Act. It is not disputed that the plaintiff-bank is a firm coming within the purview of the Travancore Partnership Act, 12 of 1115. Section 68(2) of that Act provides:

“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 is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm.”

5. The present suit is admittedly one coming within the ambit of the sub-section. One of the points that arise for consideration in deciding whether the suit is hit by the sub-section is whether the plaintiff-bank was registered before the suit, was instituted. In para. 3 of the plaint it is alleged-that the plaintiff-bank was one registered under the Partnership Act. But what really happened was that a statement as required by Section 57(1) of the Travancore Partnership Act was sent to the Registrar of Joint Stock Companies along with the prescribed fee on 8-11-1947. The records relating to this were not filed by the plaintiff in the Court below. They were, however, produced in this Court and were accepted in evidence. Ex. J is the postal receipt of registration of the statement sent by the Managing Proprietor of the plaintiff-bank on 8-11-1947 to the Registrar of Joint Stock Companies. Ex. K is the money order receipt for the sum of Rs. 3/- sent on the same date. Ex. J. is the receipt dated 12-11-1947 relating to the sum of Rs. 3/- sent by money order.

6. These records show that the Managing Proprietor of the firm sent the statement prescribed by S. 57(1) and the fee required for the registration of the firm, on 8-11-1947, and that they were received by the Registrar of Joint Stock Companies on 12-11-1947. Ex. H, which was produced in the Court below, is the certificate of registration of the firm. It does not contain the date on which it was signed. Only the month and the year are given, i.e, Kumbhom 1123. The firm was entered in the Register as Firm No. 26/2-3. The entry could have been made only on 12-11-1947 or some day after that.

7. It was, however, argued for the appellant that the sending of the statement prescribed by S. 57(1) along with the required fee amounted to registration of the firm and that, therefore, the plaintiff firm must be deemed to have been registered on 8-11-1947. The suit was instituted on 10-11-1947. It was, therefore, argued that the suit is not hit by Section 68(2) of the Travancore Partnership Act, Section 57(1) of the Act (Section 58(1) of the Indian Act) relating to the registration of firms reads thus:

“57(1) The registration of a firm may be effected at any time by sending by post or delivering to the Registrar a statement in the prescribed form and accompanied by the prescribed lee, stating—

(a) the firm name,

(b) the place or principal place of business of the firm,

(d) the date when each partner joined the firm,

(e) the names in full and permanent addresses of the partners, and

(f) the duration of the firm,

8. The statement shall be signed by all the partners, or by their agents specially authorised in this behalf.”

9. It was contended for the appellant, that according to the wording of the section, registration of a firm is effected by sending a statement to the Registrar in the prescribed form along with the prescribed fee and that the subsequent filing of the statement and the name of the name of the firm in the Register of Firms are only ministerial acts done by the Registrar in pursuance to the registration.

10. Section 58 of the Act (Section 59 of the Indian Act) relating to the filing of the statement and the entering of the name of the firm in the Register of Firms reads thus:

“58. When the Registrar is satisfied that the provisions of S. 57 have been duly complied with, he shall record an entry of the statement in a register called the Register of Firms, and shall file the statement.”

11. Reading Ss. 57 and 58 together we are inclined to take the view that a firm cannot be said to be registered when the statement prescribed by S. 57(1) and the required fee are sent to the Registrar of Joint Stock Companies and that the registration of the firm is effected only when the entry of the statement is recorded in the Register of Firms and the statement is filed by the Registrar as provided in S. 58. The argument advanced by learned Counsel for the appellant was advanced in — ‘(Firm) Ram Prasad-Thakur Prasad… v. (Firm) Kamta Prasad-Sita Ram…’, AIR 1935 All 898 (A). In that case also the statement and the lee were sent to the Registrar two day before the suit was instituted. In repelling the argument Kendall, J., said:

“If S. 58 stand alone, this argument might have some force; but S. 59 shows that registration amounts to more than what is said in S. 58. The Registrar, under S. 59, must be satisfied that the provisions of S. 58 have been duly complied with, and he must record an entry of the statement in his register”.

12. Reference was also made to Lindley on Partnership, Edn. 10, p. 922, where the learned author says;

“It is apprehended that registration is complete so soon as the prescribed statement has reached the Registrar; and that the filing of the statement and issue of the certificate are ministerial acts the omission of which would not deprive a limited partnership of the benefit of the Act”.

13. Even if it is possible to accept this view, in the present case the statement sent by the Managing Proprietor of file firm reached the Registrar only on 12-11-1947, i.e, two days alter the suit was filed. It cannot, therefore, be held that the firm was registered before the suit was instituted.

14. Again, Section 68(2)(Section 69(2) of the Indian Act) prescribes another condition also, i.e, “Persons suing are or have been shown in the Register of Firms as partners in the firm”. This evidently means that when the suit is instituted the names of the persons suing must find a place in the Register of Finns as partners in the firm. This aspect of the question was also considered by Kendall, J. in AIR 1935 All 898 (A). The learned Judge said:

“It is necessary therefore not only that the firm should be registered, but the person suing must be shown as a partner in the firm and it is admitted that on the date when the plaint was filed the second part of this condition had not been carried out”.

15. It follows from this that when the suit was instituted the plaintiff-firm was not registered and the name of the person suing was not in the Register of Firms.

16. The second point for consideration is whether the registration of the firm during the pendency of the suit is sufficient compliance with S. 68(2). It was argued for the appellant that the Court below ought to have treated the suit as one properly instituted on the date on which the firm was registered. Learned counsel relied on certain decisions in support of this position. One such is — ‘Varadarajulu v. Rajamanika’, AIR 1937 Mad 767 (B). In that case the firm was registered during the pendency of the suit. Horwill, J. who decided the case observed:

“It is a well established principle that the Court can take notice of events that happen subsequent to the filing of the suit and that any irregularities or deficiencies in the cause of action that may exist on the date of the Sling of the plaint can be overlooked if on some date subsequent to the filing of the plaint and before the suit comes up for trial those irregularities or deficiencies are rectified by the plaintiff or by processes of law”.

17. The learned Judge further observed:

“When the registration has been carried out, the requirements of the Legislature are fulfilled and there is no reason in equity why from the moment of registration a suit previously filed should not be allowed to go on. This suit is not of course one in which the subsequent act of registration validated the plaint from the date of its being filed; for no suit was maintainable before the date of registration. The most that the plaintiff can ask for is that his plaint should be treated as a valid one from the date of registration”.

18. The same view was taken by Mitter, J. in — ‘Radhacharan v. Matllal’, 41 Cal WN 534 (C). These two cases were cited with approval in — ‘Jakiuddin v. Vithoba’, AIR 1939 Nag 301 (D). Although, it was held in that case that the suit offended Section 69 of the Indian Partnership Act, Gruer, J., who decided the case observed:

“If registration had been done during the pendency of the suit it might, no doubt, have legally proceeded from that date unless there was a bar of limitation”.

19. Another case relied on by teamed counsel for the appellant is — ‘Nazir Ahmad v. People's Bank of Northern India Ltd.’, AIR 1942 Lah 289 (FB)(E). That was a case in which the plaintiff instituted the suit against a company in liquidation without obtaining the leave of the Court under Section 171 of the Indian Companies Act, but obtained such leave during the pendency of the suit. The Full Bench held that the suit was not liable to be dismissed on the ground that the leave of the Court was not obtained before the suit was instituted. The wording of Section 171 of the Companies Act is, however, different from that of Section 68(2) of the Travancore Partnership Act. Section 171 of the Companies Act runs as follows.

“When a winding up order has been made or a provisional liquidator has been appointed, no suit or other legal proceeding shall be proceeded with or commenced against the company except by leave of the Court, and subject to such terms as the Court may impose.”

20. The words used in Section 68(2) of the Travancore Partnership Act are “No suit……………. shall be instituted in a Court.” In the circumstances, we do not think that the decision in ‘AIR 1942 Lah 289 (FB)(E)’, can be regarded as an authority for the position that the registration of the firm during the pendency of the suit is sufficient compliance with the requirements of Section 68(2) of the Travancore Partnership Act. It is true that Ramlall, J., one of the Judges who took part in the decision of the Lahore case dealt with Section 69(2) of the Indian Partnership Act in the course of the discussion and supported the view taken in ‘AIR 1937 Mad 767 (B)’; and ‘41 Cal WN 534 (C)’. The learned Judge said:

“It seems to me that even under the Partnership Act the better opinion is that as a matter of procedure the remedy which is available is withheld till a condition is complied with and that the grant of leave by the Court is such a condition. The right to enforce a claim is granted by a decree and if the condition for the enforcement of that remedy is complied with before the grant of the decree, it makes no difference whether this condition is complied with before or after the institution of the suit so long as it is complied with before the decree is made.”

21. ‘AIR 1937 Mad 767 (B)’; 41 Cal WN 534 (C)’ and ‘AIR 1939 Nag 301 (D)’, were considered in later decisions and were dissented from. The position now accepted by practically all the High Courts in India is drat the registration of the firm is a condition precedent to the right to institute a suit of the nature mentioned in Section 68(2) of the Travancore Partnership Act and that the defect of non-registration cannot be remedied by registration of the from during the pendency of the suit. So far as the Madras High Court is concerned the leading case is — ‘Ponmichami Goundar v. Muthusami Goundar’, AIR 1942 Mad 252 (F). In that case Leach, C.J, discussed the question with reference to decided cases and held that

“registration of the firm is a condition precedent, to the right to institute the suit and the Court has no jurisdiction to proceed with the trial when, the condition precedent has not been fulfilled.”

22. Reliance was placed by the learned Chief Justice on the decision of the Privy Council in — ‘Bhagchand Dagdusa v. Secretary of State’, AIR 1927 PC 176 (G). In that case the question for consideration was whether the provision contained in Section 80 of the CPC, was mandatory and whether a suit instituted without complying with that provision was maintainable. Their Lordships held that the provision was mandatory and that a suit instituted without complying with that provision was not maintainable. Following this decision, Leach, C.J observed:

“Section 80 of the CPC, has very much in common with Section 69 of the Partnership Act. It says that no suit shall be instituted against the Secretary of State for India in Council, or against a public Officer, for an act purporting to be done by him in his official capacity, until the expiration of two months next after notice in writing has been given. The Privy Council also observed that S. 80 imposes a statutory and unqualified obligation upon the Court and Section 69(2) of the Partnership Act, does the same.”

23. The learned Chief Justice also relied on the decision of the Madras High Court in — ‘Ghouse Khan v. Balasubba Rowdier’, AIR 1927 Mad 925 (FB)(H); and — ‘Davood Mohideen Rowther v. Sahabdeen Sahib’, AIR 1937 Mad 667 (I), which related to Section 28(2) of the Provincial Insolvency Act. That section prevents a suit being filed against an insolvent without the leave of the Insolvency Court. It was held in these cases that subsequent leave would not cure the initial defect and validate the institution of the suit. Reference was also made to — ‘Subramania Mudaliar v. East Asiatic Co. Ltd.’, AIR 1936 Mad 991 (J); — ‘Ibrahim Sahib & Brother v. Gurulinga Aiyar’, AIR 1938 Mad 185 (K); and — ‘Girdharilal Son & Co. v. Kappini Gowder’, AIR 1938 Mad 688 (L). In the first two cases it was held that the registration of the firm after the institution of the suit would not cure the defect of nonregistration before the institution of the suit. The same view was taken by Venkataramana Rao, J., in the third case, but the other two Judges who took part in the decision did not express any opinion on the point. The decision of Horwifl, J., in ‘AIR 1937 Mad 767 (B)’, was considered by the learned Chief Justice and was not followed. About that decision the learned Chief Justice observed:

“Whatever may be the principle which applies to the rectification of irregularities and deficiencies in the cause of action we are of the opinion that it cannot be applied here. The conclusion of Horwill, J., that subsequent registration will put the suit on a proper basis received support, however, from the judgment of the Calcutta High Court in ‘41 Cal WN 534 (C)’, and that of the Nagpur High Court in ‘AIR 1939 Nag 301 (D)’. These cases were decided by Judges sitting alone. In the Calcutta case it was said that when registration had been effected the suit might be treated as though the plaint had been received and the suit instituted on the day following the day of registration. The Patna High Court expressed dissent from this opinion in — “Firm Laduram Sagarmal v. Jumuna Prasad”, AIR 1939 Pat 239 (M), where Harries, C.J, observed that he knew of no provision of law which permits a Court to treat the plaint as having been filed on a date subsequent to the date on which it was actually filed and we know of no such provision.”

24. Reference was also made to the decisions in — ‘Danmal Parshotamdas v. Baburam Chhotelal’, AIR 1936 All 3 (N): — ‘Krishuari Lal Ram Lal v. Abdul Ghafer Khan’, AIR 1935 Lah 893 (O); and — “Chhagan Lal v. Firm Mangal Sain Raj Narain”, AIR 1938 Lah 767 (P). The learned Chief Justice concluded thus:

“The great weight of authority is in favour of the opinion that registration will not put the suit on a proper basis and that the Court's duty is to dismiss it. We consider that the majority opinion is correct. A suit is instituted when the plaint is filed in a Court of competent jurisdiction. S. 69 says that a suit by a firm shall not be instituted until the firm has been registered. The registration of the firm is a condition precedent to the right to institute the suit and the Court has no jurisdiction to proceed with the trial when the condition precedent has not been fulfilled.”

25. So far as the Calcutta High Court is concerned, the decision of Mitter, J., in ‘41 Cal WN 534 (C)’, was dissented from in — ‘Dwijendra Nath Singh v. Govinda Chandra’, AIR 1933 Cal 497 (Q), decided by a Division Bench of that Court consisting of Das Gupta and Guha Ray, JJ. After referring to ‘41 Cal WN 534 (C)’, and an unreported decision of that Court in which a contrary view was taken, and the decisions of the other High Courts on the point, Das Gupta, J., agreed with the view that registration of the firm after the date of the suit would not cure the defect of non-registration before the date of suit. The learned Judge observed:

“When the Legislature forbids the doing of an act it is not proper for a Court to allow the doing of that act by subterfuge. Sub-ss. (1) and (2) of S. 69 forbid the institution of a suit by or on behalf of an unregistered firm. With the policy underlying that legislation we are not concerned but we are bound to give effect to the fiat of the Legislature. The only way we can do it is by dismissing the suit. Not to dismiss such a suit by reason of the fact of later registration is really to relieve the party who has not carried out the requirements of the law by means of a subterfuge.

It might seem hard and at first sight pointless to drive a party to bring a fresh suit but if the law requires that, I do not see that we should be justified in helping him to avoid that position by interpreting the law to mean something which it does not say. If later registration would have been sufficient compliance with the law, it was for the Legislature to say that the Legislature did not say that but said on the contrary that no suit shall be instituted by or on behalf of a firm in certain matters unless the firm has been registered. It is the duty of the Courts to carry out the law as it is and to resist the temptation of interpreting it to meet the hardship supposed or real of a particular case.”

26. “AIR 1939 Nag 301 (D)’, the other case relied on by the appellant, was considered by the Nagpur High Court in — ‘Abdul Karim v. Ram Das’, AIR 1951 Nag 159 (R). Mudholkar, J., preferred to follow the decision of the Madras High Court in ‘AIR 1942 Mad 252 (F)’. With regard to ‘AIR 1939 Nag 301 (D)’’, this is what the learned Judge said:

“A contrary view as to the effect of the registration of a firm subsequent to the suit was expressed by Gruer, J., in obiter in ‘AIR 1939 Nag 301 (D)’. But it was abandoned by him later in — ‘Kanchedilal v. Gaorishankar, Civil Revo. No. 765 of 1938, D/- 10-7-1940 (S). In — ‘Mahadeo v. Shah Vijava Kumar Hiralal”. Civil Revn. No. 613 of 1949, D/- 20-4-50 (T) Deo, J., has come to the same conclusion as Gruer, J., in his second decision.”

27. The learned Judge considered the decisions in ‘AIR 1937 Mad 767 (B)’, and ‘41 Cal WN 534 (C)’: and refused to follow them. — ‘Firm Mohanlal Ram Copal v. Finn Udai Ram Sewa Ram’, AIR 1936 Pat 140 (U); ‘AIR 1935 Lah 893 (O)’; and ‘AIR 1936 All 3 (N)’, were also cited with approval.

28. ‘AIR 1942 Lah 289 (E)’ was distinguished by talshaw and Kapur, JJ. in — ‘Firm Des Raj Premchand v. Firm Hiralal Kali Ram’, AIR 1952 Punj 415 (V). This is what Falshaw, J., remarked about the observation of Ramiall, J., in ‘AIR 1942 Lah 289 (E)’:

“There is no doubt that at page 542 (of ILR, (1942) Lah) Ramiall, J., has on the strength of “AIR 1937 Mad 767 (B)’; and %41 Cal WN 534 (C)’, made certain observations which appear to indicate that in his view a suit filed by an unregistered partnership firm could be validated by registration of the firm ‘pendente lite’, but since a different matter was under consideration by the Full Bench those remarks must be regarded simply as obiter and they have not been endorsed by cither of the other two learned Judges who constituted the Bench. Beckett, J., delivered a separate judgment in which he did not consider the matter at all, but confined himself to Section 171 of the Companies Act and Tek Chand, J. merely said that be agreed with the answer proposed by his learned brother. The weight of authority, & in fact all the reported cases on the point which deserves to be taken into consideration, are clearly to the effect that subsequent registration will not validate the suit, and with this view I am in respectful agreement.”

29. The same view was taken by the Punjab High Court in — ‘Firm Ganga Ram Puranmal v. Central Bank of India Ltd.’, AIR 1953 Punj 235 (W), decided by Harnam Singh and Kapur, JJ. In that case also ‘AIR 1942 Lah 289 (E)’ was distinguished and the observations of Ramiall, J., were considered as mere obiter.

30. The Bombay High Court considered the question in — ‘Prithvi Singh v. Hasan Alli’, AIR 1951 Bom 6 (X). Rhagwati, J., who wrote the judgment in the case considered the decisions of the various High Courts on the question and came to the conclusion that Section 69(2) of the Partnership Act (Indian)

“bars the institution of a suit to enforce a right arising out of a contract unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm and a subsequent registration of the partnership firm cannot and does not cure the initial defect in the institution of the suit.”

31. The learned Judge further observed;

“A plain reading of the terms of S. 69(2) of the Act, without anything more, clearly shows that the institution of a suit to enforce a right arising from a contract is barred unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm. No words could be clearer than these to prevent a suit being instituted by or on behalf of a firm unless the firm was registered, and it is really surprising to find even the few authorities that have been cited against this proposition.”

32. The Patna High Court dealt with the question in ‘AIR 1939 Pat 239 (M)’, already referred to. After referring to the decisions of the other High Courts on the question, Harries, C.J, observed at p. 241:

“It is therefore clear that the trend of authority is in favour of the respondents' contention in this case viz., that a suit which is not maintainable by reason of non-compliance with Section 69 of the Partnership Act, cannot become maintainable at a later stage by reason of registration. In my view, subsequent registration cannot cure the initial defect. A plaint filed by an unregistered firm is in effect no plaint at all because S. 69 makes claims arising out of a contract unenforceable if the firm is unregistered at the date of the institution of the suit. An unregistered firm has no right to sue, and therefore the plaint filed by it has no legal effect. If at the time the plaint is filed the claim is bound to fail, I cannot see how subsequent registration can improve the position.”

33. In ‘AIR 1935 All 898 (A)’, which was already referred to, the facts are similar to those of the present case. In that case also the statement prescribed by Section 58 of the Indian Partnership Act was sent to the Registrar along with the required fee two days before the date of the institution of the suit and the name of the firm was entered in the Register of Finns during the pendency of the suit. Kendall, J., held that the suit was not maintainable. This view was confirmed by a Division Bench of the Allahabad High Court consisting of Sulaiman, C.J and Bennet, J., in ‘AIR 1936 All 3 (N)’.

34. The Madhya Bharat High Court also has taken the same view in a recent decision of that Court viz., — ‘Nand Kishore v. Firm Maheswari Mills, Moiena’, AIR 1953 Madh.-B. 42 (Y). Chaturvedi, J., considered the decisions of the various High Courts on the question and held that the registration of the firm is a condition precedent to its right to institute a suit and that subsequent registration would not cure the defect.

35. Although this question has not directly arisen for consideration before the Travancore High Court, that Court also has expressed its opinion on the point in — ‘Ganapathy Chettiar v. Abdul Kani Rowther’, 1946 Trav LR 260 (Z). The question that arose for consideration in that case was whether Section 68(2) of the Travancore Partnership Act could be given retrospective operation. In the course of this discussion, Abraham, J., observed at p. 273:

“Under Section 68 of the Partnership Act the registration of a firm is a condition precedent to its right to institute a suit, and a Court has no jurisdiction to proceed with the trial of the suit when the condition precedent has not been fulfilled. Registration of the firm subsequent to the date of the institution of suit cannot remedy the defect, and the Court is bound to dismiss it. ‘AIR 1942 Mad 252 (F)’.”

36. In ‘Krishna Pillai v. Travancore National and Quilon Bank Ltd.’, 1943 Trav LR 458 (Z1), a Full Bench of the Travancore High Court interpreted Section 173 of the Travancore Companies Act, of 1092, corresponding to Section 171 of the Indian Act, in the same manner as the Lahore High Court interpreted it in ‘AIR 1942 Lah 289 (E)’, that is, a suit instituted against a company in liquidation without the leave of Court is not liable to be dismissed on that ground since the institution of the suit is not barred by the section but only the commencement of further proceedings. When discussing the question, Krishnaswami Iyer, C.J, pointed out the difference between the language used in Section 173 of the Travancore Companies Act and that used in other enactments when the Legislature wanted to prohibit the institution of the suit unless a particular condition is satisfied. The learned Chief Justice said:

“The Legislature has used express language when such institution itself is prohibited and the Legislature is well aware of such language. When the institution itself is prohibited it would mean that the parties are disabled from presenting a suit and the Court is disabled from receiving it, i.e, assuming jurisdiction over it. Such an instance of disability is found enacted in the following case where the words used are different……

37. The learned Chief Justice then quoted Section 65 of the Travancore CPC, in which the words used are: ‘No suit shall be instituted against the Diwan of Travancore………………’ It will be seen from this that, according to the learned Chief Justice, if the words used are ‘no suit shall lie instituted’ it will amount to a prohibition of the institution of the suit, and the Court will have no jurisdiction to entertain the suit.

38. The above review of the case law on the subject shows that the view held by practically all the High Courts in India is that the registration of the firm is a condition precedent to its right to institute a suit of the nature mentioned in Section 69(2) of the Indian Partnership Act and that registration after the institution of the suit cannot cure the defect of non-registration before the date of suit. It follows from this that the Court below was right in dismissing the suit on the ground that the plaintiff-firm was not registered under the Travancore Partnership Act before the suit was instituted. In this view of the case, it is not necessary to record a finding on the issues relating to the merits of the case. It is, therefore, unnecessary to consider the memorandum of objections filed on behalf of respondent 1. The findings of the Court below on Issues Nos. 1, 2 and 5 are set aside and the questions raised in those issues are left open. Subject to this modification, the judgment and decree of the Court below are confirmed and the appeal is dismissed. The memorandum of objections is also dismissed except to the extent mentioned above. In the circumstances of this case, we think it proper to direct the parties to bear their respective costs both here and in the Court below, and we order accordingly.

39. Appeal dismissed.

Bank Of Koothattukukin v. Itten Thomas And Another

Structured Summary of the Opinion

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Plaintiff-Appellant (Bank of Koothattukulam) — principal contentions

Defendant 1 — principal contentions

Defendant 2 — principal contentions

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Bank Of Koothattukukin v. Itten Thomas And Another

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