Jakiuddin Badruddin v. Vithoba Jagannath Gadali

1. It is unfortunate that this case was tried out on the merits before a finding on the issue about its maintainability was given. It would have been better had that issue been tried first. The findings on the merits are in favour of the plaintiffs-applicants, but the suit has been dismissed because the plaintiff's firm has not been registered under Section 69 of the Partnership Act. Plaintiffs are the sons of Badruddin, who died some years ago, and since then they are admittedly carrying on their father's business. Plaintiff 1 is now major and the others are minors represented through their mother as next friend. It is now submitted that Section 69 of the Act was inapplicable. The plaintiffs, it is said, got the business of their father by inheritance and should have been treated as co-owners and not as partners: partnership implies a contract and there was no such contract; in any case a certificate of registration has now been obtained and presented to this Court, which is asked to hold that the case is now validated, and to pass a decree in favour of the plaintiffs. Plaintiffs rely on 49 Cal 5601 in which a minor was absolved from liability in a new business. That family was a Hindu one, so special considerations applied as will be seen from Section 5 of the Partnership Act, which says that the members of a Hindu undivided family carrying on a family business as such are not partners in such business. Here the parties are Maho-medans. They themselves in their reply, dated 5th March 1937, stated that they had become partners of the family business by reason of their being heirs to Badruddin and not by any contract among them. They did not say they were co-owners merely. The contract of partnership may be implied and need not be expressed.

2. It is to be noted that even during the lifetime of the father the firm was styled “Badruddin Mulla Shamsuddin and Sons.” By not having the firm registered the plaintiffs are precluded under Section 68 of the Partnership Act, from denying that a firm exists. Under S. 58 they had to give details about the partners. A copy of their application is not forthcoming, but it cannot be doubted that all the present plaintiffs were registered as partners. They were in the same position when they carried on the business at their father's death.

3. The minors are themselves incapable of contracting but there is nothing to prevent their guardian from contracting on their behalf. In this case a contract is implied. The institution of the suit was therefore invalid. Is it now validated because registration has since been effected? Learned counsel relies on AIR 1937 Mad 7672 in which a suit previously filed was allowed to go on after registration. The Judge in that case was careful to remark that the subsequent act of registration does not validate the plaint from the date of its being filed. In 41 CWN 5343 a suit was dismissed although registration had previously taken place while the suit was pending. It was held that it should not have been dismissed but ought to have been deemed to have been instituted on the date when the firm was registered. In ILR (1937) Nag 4304 it is pointed out that a second suit will lie if the previous suit was dismissed under S. 69(2), provided that there was no determination of the subject-matter of the suit. That case is not helpful to the contention now put forward that a decree can be passed in plaintiff's favour in the present suit. About the possibility of bringing in fresh suit, I make no pronouncement. In AIR 1938 Mad 1855 it was held that S. 69 must be strictly construed and a suit instituted contrary to its provisions is bad and cannot be subsequently validated by compliance with those provisions. To the same effect is the judgment in AIR 1939 Pat 2396 and AIR 1938 Lah 767.7

4. The effect of all these authorities then is that as the present suit was disposed of before registration was carried out, these proceedings cannot be validated and this Court cannot look into the merits and pass a decree as requested by the applicants. 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. The application fails and is dismissed with costs. Counsel's fee Rs. 20.

D.S/R.K

5. Application dismissed.