APPAYA NIJLINGAPPA HATTARGI Vs. SUBRAO BABAJI TELI

JUDGEMENT

(1.) This is a revision application which raises a point of law of some general importance. The plaintiffs allege in the plaint that they were partners in a partnership shop, and that the partnership shop closed on October 19, 1933. I think that allegation amounts to an allegation that the partnership was dissolved on October 19, 1933, and that allegation is not traversed in the written statement. That being so, I must take it that on the facts the partnership was dissolved in October, 1933. The learned Subordinate Judge held that that fact was not proved. But if an allegation made in the plaint is not denied in the written statement, it is taken to be admitted, and need not be proved. The further allegation in the plaint is that during the continuance of the partnership, a debt was incurred by the defendants to the partnership, and the plaintiffs, as the persons who were members of the partnership and therefore entitled to the debt, sue after the dissolution of the partnership to recover the debt. The learned Judge held that even if the dissolution of the partnership were proved, nevertheless the suit would not lie, having regard to Section 69 of the Indian Partnership Act, and the question is whether that decision is right.

(2.) Section 69 of the Indian Partnership Act forbids the bringing of suits in respect of partnerships which have not been registered under the Act. The scheme of the Act as to registration is to give any firm a right to register, disclosing the particulars required by the Act, and then Section 69 is designed to encourage registration by imposing a disability in the case of firms which are not. registered. It is to be noticed that an existing firm can get over the disability by registering before it brings its suit, but, of course, a firm cannot register after it has ceased to exist. So that in the case of a dissolved firm any bar imposed by Section 69 becomes absolute, and cannot be got rid of by sub-sequent registration. Section 69(I) bars the right of any person suing as a partner in the firm to enforce his rights against the firm or any person alleged to be or to have been a partner in the firm, unless the firm is registered. Then Sub-section (2) deals with enforcing claims by the firm against third parties, and prohibits the enforcing in a suit of any right on behalf of the firm against a third party, unless the firm is registered. Then Sub-section (3) to which I will refer more in detail in a moment, introduces certain exceptions to the disabilities imposed by the first two sub-sections. I have been referred to a decision of my own in the case of Patel v. Hussembhai, (1936) 39 Bom. L.R. 260 in which the plaintiff alleged that he had paid on behalf of a firm in which he had been a partner with the defendant the whole income-tax of the firm, and he was suing to recover from the defendant contribution towards that payment. I pointed out in that case that Sub-section (2) and (2) in terms only refer to a firm, and not to a dissolved firm. But, having regard to the exceptions to those two sub-sections contained in Sub-section (3), exceptions which relate largely to matters connected with a dissolved firm, I thought that Sub-section (1) and (2) must be held to cover the case not only of a firm, but of a dissolved firm. But I was not in that case concerned to consider the extent of the exceptions contained in Sub-section (3), because it was clear in that case that the suit did not fall within any of the exceptions. Now it is alleged in this case that the suit does fall within the exceptions contained in Sub-section (3), Clause (a), of Section 69. That clause reads as follows :