M M PULIMOOD Vs. REGISTRAR OF FIRMS

JUDGEMENT

(1.) The petitioner and six others formed into a partnership for the purpose of owning and managing plantations under the name and style of "Pulimood Plantations". The firm came into existence on 1st June, 1983. Ext. P1 dated 1-6-1983 is the partnership deed. Partner No. 7 is the "Wynad Plantations Private Limited" which is a private limited company registered under the Indian Companies Act, 1956, An application under S.58 of the Indian Partnership Act in the proper form signed by all the partners was presented to the respondent the Registrar of Firms for the purpose of registration of the Partnership under S.59 of the Partnership Act. Ext. P4 is a photostat copy of the application in Form No. I submitted to the respondent. The requisite fee for registration was also paid. The application was returned as per Ext. P5 memo for the reason stated therein that ''A firm cannot be recognised as partner". The application was represented with Ext. P6 letter of the auditors of the firm stating that the Wynad Plantations Private Ltd., one of the partners of the firm M/S. Pulimood Plantations, is not a partnership firm, but a company duly incorporated under the provisions of the Indian Companies Act. It was also stated that an incorporated company is a separate legal entity which can very well be a partner of the firm. Ext. P7 is a reminder to Ext. P6 by the auditors of the firm "Pulimood Plantations". Ext. P7 reminder was returned with an endorsement that reads as follows: ''We have returned your application noting defects on 3-1-84. Please retransmit the application after rectifying the defects for registration" signed for Registrar of Firms. The application itself was returned along with a memo, a photostat copy of which is produced as Ext. P8 dated 31-12-1983. The defect noted in Ext. P8 memo is that "A company cannot be made partner of a Partnership firm". On receipt of the return of the application along with Ext. P8 memo, the auditors of the firm as per Ext. P9 letter dated 30-1-1984 requested the respondent for clarification as to the reason why a company cannot be a partner of a firm. Ext. P9 was returned with the endorsement "A company cannot be admitted as a partner as per S.4 of Partnership Act" signed for Registrar of Firms. The application was represented with Ext. P10 letter of the auditors of the firm wherein it was stated that S.4 has no relevance and that a company is a person entitled to be a partner of the firm. Ext. P11 dated 27-2-1984 is a reminder after the representation of the application along with Ext. P10. The application is still pending before the respondent and the firm is not yet registered under S.59 of the Indian Partnership Act. This O.P. is to quash Ext. P8 memo and the endorsement on Ext. P9 as per which the respondent has taken the view that a company cannot be a partner of a firm.

(2.) S.4 of the Indian Partnership Act referred to in the endorsement on Ext. P9 defines the expressions "partnership", "partner", "firm", and "firm name". There is nothing in S.4 that precludes a company from becoming a partner of a firm. "Partnership" is defined as "the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all". The expression "person" is defined in S.3 clause (42) of the General Clauses Act, 1897 to "include any company or association or body of individuals, whether incorporated or not", unless there is anything repugnant in the subject or context to exclude a company registered under the Indian Companies Act from becoming a partner of the firm. It is a "person" within the meaning of S.4 of the Indian Partnership Act and can very well be a partner of a firm. Ext. P2 is the Memorandum of Association of the Wynad Plantations Private Limited shown as partner No. 7 in Ext. P4 application. The Memorandum of Association shows that one of the objects of the company is "to enter into any partnership or joint adventure, or any agreement for cooperation or sharing or pooling of profits, or controlling or limiting profits or output, or otherwise for mutual assistance, with any person or company carrying on or proposing to carry on any business which this Company can carry on, and to amalgamate with any other company or companies in such manner as this Company shall think fit".

(3.) As per S.58 of the Indian Partnership Act "the registration of a firm may be effected at any time by sending by post or delivering to the Registrar of the area in which any place of business of the firm is situated or proposed to be situated, a statement in the prescribed form and accompanied by the prescribed fee" and containing the particulars mentioned in the said section signed by all the partners or their agents with verification of the signatures in the prescribed manner. As per S.59 the Registrar shall record an entry of the statement in a register called the Register of Firms, and shall file the statement on his satisfaction that the provisions of S.58 have been duly complied with. A company being a "person" within the meaning of S.4 of the Indian Partnership Act, registration cannot be declined for the reason of its being a partner of the firm. I therefore quash Ext. P8 and the endorsement by the respondent on Ext. P9 and direct the respondent to register the firm as applied for as per Ext. P4. The Original Petition is allowed. There will be no order as to costs.