Dwarka Prasad Gupta, J.
1. This appeal has been referred by a learned Single Judge of this Court for decision by a larger Bench, as according to him it involves an important question of law relating to the interpretation of the provisions of Section 69(2) of the Indian Partnership Act, 1932 (hereinafter referred to as 'the Act').
2. The only question argued before us in this appeal related to the maintainability of the suit by a partnership firm and it was submitted by the learned Counsel for plaintiff appellant that the suit was maintainable as the petitioner firm was a registered partnership firm within the meaning of Section 69(2) of the Act; while according to the learned Counsel for the defendant respondent, the suit by the plaintiff firm was not maintainable. The facts which have a bearing on the aforesaid question raised in this appeal lie in a very narrow compass. Umaraomal defendant is alleged to have taken a loan of 11,000/-from the plaintiff firm on June 27, 1966 with the stipulation to repay the same together with interest at rate of Rs. 12% per annum and he executed a promissory note and a receipt for the said amount in favour of the plaintiff firm, by way of collateral security for the repayment of the amount of Rs. 11,000/-borrowed from the plaintiff-firm. As the defendant failed to make payment of the loan inspite of repeated demands, the plaintiff firm filed a suit against the defendant-respondent on March 28, 1971 in the court of District Judge, Jodhpur for the recovery of the sum of Rs. 11,000/- as principal and Rs. 3,500/- by way of interest, in all a sum of Rs. 14,550/-. The plaintiff in the said suit was referred to as M/s Sohanlal Basant Kumar, a registered partnership firm of Jodhpur. It was stated in the plaint that the plaintiff was a registered partnership firm duly registered under the provisions of the Act and that there were three partners of the plaintiff firm, namely, Sohanlal, Gumanmal and Mangilal. The plaint was signed on behalf of the partnership firm by Sohanlal, one of the partners of the plaintiff firm.
3. The defendant contested the suit on the ground inter-alia that neither Sohanlal, Gumanmal and Mangi Lal were partners of the plaintiff firm, nor the plaintiff firm was duly registered. The receipt of the loan was also denied by the defendant. One of the issues framed in the suit was, 'whether the firm (plaintiff) is a registered partnership firm?' The said issue was considered to be preliminary issue and with the consent of the parties arguments were heard in respect of the said issue. The learned District Judge Jodhpur following the decisions of this Court in Kesrimal and Anr. v. Dulichand and Ors. held that the requirements laid down in Section 69(2) of the Act was not complied with, in as much as the name of Mangilal was not shown in the Register of Firms as a partner of the plaintiff firm on the date of the institution of the suit and so the suit could not be held to be maintainable. The learned District Judge, therefore, dismissed the plaintiff's suit by his judgment and decree dated March 7, 1977.
4. When the first appeal filed by the plaintiff was argued before the learned single Judge, he was of the view that even though the names of some of the partners suing have not been shown in the Register of Firms on the date of the institution of the suit, yet if it is proved that such persons were in fact partners of the plaintiff firm on the date of the suit, they could institute the suit without committing any breach of the provisions of Section 69(2) of the Act. Learned single Judge was of the view that three decisions given by single Judge of this Court in Kesrimal's case and Firm Alwar Iron Syndicate v. Union of India and Chandrabhan Banshilal v. Municipal Council, Bikaner 1974 RLW 100 required reconsideration in the light of the interpretation of the provisions of Section 69(2) which applied to him. The learned single Judge (S.N. Modi, J.) also observed that one of the decisions referred to above, in the case of M/s Chandrabhan Bansilal's case 1974 RLW 100 though delivered by him, but on second thought in his opinion the same also required reconsideration and in this view of the matter, the appeal was referred to a larger Bench for decision.
5. It is common ground between the parties that the plaintiff firm was duly registered on Nov. 5, 1963 with the Registrar of Firms, Rajasthan, Jaipur under the provisions of the Indian Partnership Act, 1932, as appears from the registration certificate Ex. 1. A certified copy of the entry of the Register of Firm produced as Ex. 2 on the record shows that on Nov. 3, 1963 the plaintiff firm M/s. Sohanlal Basant Kumar consisted of two partners, namely, Sohan Lal and Gumanmal, both the partners having joined the firm on October 28, 1962. It also appears from a perusal of Ex. 2 that the constitution of the plaintiff firm was subsequently altered by the admission of Mangi Lal as a partner thereof with effect from November 4, 1964. The entry relating to the admission of Mangilal as a partner in the plaintiff firm was made on July 13, 1971, when the requisite notice of change in the constitution of the firm was given to the Registrar of Firms Under Section 63 of the Act.
6. As we have mentioned earlier, the suit was filed by the plaintiff firm on March 26, 1971 and thus, undoubtedly the notification in the constitution; of the plaintiff firm was recorded in the Register of Firms on July 13, 1971, after the institution of the suit and thus the name of Mangilal was not shown on the date of the institution of the suit as a partner of the plaintiff firm in the Register of Firms. Now the question which arises for determination in this appeal is as to whether on the aforesaid facts the suit filed by the plaintiff firm was maintainable or not? The decision of the aforesaid question rests upon a proper interpretation of the provisions of Section 69(2) of the Act, which are as under:
69(2) 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.
7. It is undisputed that the provisions of Section 69(2) of the Partnership Act are mandatory in nature and that one of the two essential conditions is that the names of the persons suing should be shown on the date in the Register of Firms as partners of the firm. It was submitted that if one of the two alternatives was proved the second condition would stand satisfied & as Mangilal was undoubtedly a partner of the plaintiff firm on the date of the institution of the suit, the suit was maintainable, irrespective of the fact that his name was not shown as partner of the firm in the Register of Firms on the date of the institution of the suit. This interpretation appealed to the learned single Judge who observed that the use of the word 'or' in the second condition is significant, which according to him was suggestive of two alternatives. The view which the learned single Judge was thus inclined to take was that for the fulfillment of the second condition contained in Section 69 of the Act, either the names of the persons suing must be shown to have been entered, on the date of the suit, in the Register of Firms as partners of the firm or the persons suing must be proved as a matter of fact to be partners of the said firm on the date of the suit. Thus, according to the learned single Judge, even if the name of some of the partners suing have not been shown in the Register of Firms as partners of the firm on the date of the institution of the suit, they could still institute the suit in the name of the partnership firm if it was proved that they were as a matter of fact partners of the plaintiff firm on the date of the suit.
8. On the other hand, it was contended by the learned Counsel for the defendant that the second condition specified in Section 69(2) of the Act contemplated that the names of the persons suing must presently be shown in the Register of Firms as partners in the firm on the date of the suit or should have been previously shown in the Register of Firms as partners in the firm, and that in case some persons were actually partners of the firm on the date of the institution of the suit, but their names were not shown in the Register of Firms as partners in the firm on that date, then the suit on behalf of such firm was not maintainable because of the bar created by Section 69 of the Act.
9. We may here also refer to the provisions of Order 30, Rule 1 C.P.C. Sub-rule (1) of which provides that any two or more persons' claiming or being liable as partners and carrying on business in India may sue or be sued in the name of the firm of which such persons were partners at the time of the accrual of the cause of action. It has further been provided in Sub-rule (2) of Rule 1 that where persons sue or are sued as partners in the name of their firm under Sub-rule (1) and any pleadings or other document is required by or under the Code of Civil Procedure to be signed, verified or certified by the plaintiff or the defendant, then it would suffice if such pleadings or other document is signed, verified or certified by any one of such persons. Rule 2 of Order 30 C.P.C. also provides that were a suit is instituted by the partners in the name of their firm the plaintiff or their pleader shall, on demand in writing by or on behalf of the defendant, forthwith supply a statement of the names and addresses of the persons, who at the time of accrual of the cause of action constituted the plaintiff firm. Thus the plaintiff or his pleader, when required, has to declare in writing the names and places of residence of all the persons constituting the firm on whose behalf the suit is instituted. If the names of the partners are declared, the suit shall proceed in the same manner on their behalf and the consequence in all respects shall follow as if all such persons have been named as plaintiffs in the plaint.
10. There can be no doubt that a suit by an unregistered firm is not maintainable and the bar under Section 69 of the Act hits at the very root or the very institution of the suit. If a firm is not registered or if the conditions specified in Section 69(2) are not complied with, the partners of the firm may file a suit, but then all of such partners will have to be joined as plaintiffs. Only when the conditions specified in Section 69(2) are satisfied, then a suit can be instituted by or on behalf of the partnership firm in the name of the firm. Both the conditions specified in Section 69 of the Act must be satisfied at the time of the institution of the suit, namely, that the firm must be registered, and the persons suing must be or have been shown in the Register of Firms as partners of the plaintiff firm. We may observe that the argument advanced by the learned Counsel for the plaintiff appellant is illusory, in as much as although the use of the word 'or' indicates the existence of two alternatives, either of which must be satisfied on the date of the institution of the suit, in order that the suit may be held to be maintainable yet one of the alternatives cannot be that the persons suing should be partners of the plaintiff firm on the date of the suit because of the simple reason that the persons suing should be partners of the plaintiff firm is an essential condition which must be satisfied in either case and it could not be one of the alternative conditions. If the persons suing are not partners of the plaintiff firm on the date of the suit and the first alternative condition is not fulfilled, then the other alternative condition suggested by the learned Counsel for the plaintiff could not at all be fulfilled that their names must be shown in the Register of Firms on the date of the suit as partners of the firm. If the argument of the learned Counsel for the appellant is accepted, and if the two alternatives suggested by him may be considered as conditions incorporated in Sub-section (2) of Section 69, then the simple question which arises is as to whether it is possible that the names of the persons suing may be shown in the Register of Firms as partners of the firm on the date of the suit, without such persons being as a matter of fact partners of the plaintiff firm on the date of the suit. Such a contingency cannot be visualised that the persons who are not partners of the firm on the date of the suit could be shown in the Register of Firms as partners of the plaintiff firm at that time, because only those persons who are actually partners of the firm can be shown in the Register of Firms as partners thereof. Section 63 of the Act envisages that if any change occurs in the constitution of the registered firm, then any incoming, continuing or outgo in partners may give notice of such change or dissolution of the firm to the Registrar specifying the date thereof and (he Registrar shall make a record of the notice in the entry relating' to the firm in the Register of Firms. Section 69 provides that any statement, intimation or notice recorded by the Registrar of Firms shall as against any person, by whom or on whose behalf such statement intimation or notice was signed, would be conclusive proof of any fact stated therein. A certified copy of the entry relating to the firm in the Register of Firms shall be proof of the registration of such firm and of the contents of any statement, intimation or notice recorded in the Register of Firms. In this view of the matter the law casts the liability upon the incoming continuing or outgoing partners of the firm to send an intimation to the Registrar of Firm regarding any change in the constitution of the registered firm, whenever such change takes place. Thus, before the names of the persons suing could be shown in the Register of Firms as partners in the firm on the date of the institution of the suit, the essential prerequisite condition is that such persons must be partners of the plaintiff firm on the date of the suit. In the absence of some of the persons suing being partners of the plaintiff firm on the date of suit, their names could not find place in the Register of firms on that date as partners in the Firm.
11. The alternatives which are envisaged in the second condition contained in Sub-section (2) of Section 69 appear to us to be that the persons suing should be presently in the Register of Firms on the date of the suit as partners in the firm or in the alternative, the persons suing should have been shown prior to the institution of the suit in the Register of Firms as partners in the firm. Such persons might have been partners in the plaintiff firm at the time of accrual of cause of a actions but they might have since then ceased to remain as partners of the plaintiff firm by retirement or otherwise. It is well settled that the expression 'person suing' occurring in Sub-section (2) of Section 69 of the Act refers to all the partners of the plaintiff firm on the date of the institution of the suit and not merely to those partners who actually signed the pleadings on behalf of the plaintiff firm. Thus the correct interpretation of second condition contained in Sub-section (2) of Section 69 can only be that when the suit is filed in the name of the firm, the names of all the partners of the firm, as on the date of the institution of the suit, must be shown in the Register of Firm as partners in the firm and further the partners of the firm at the time of the accrual of the cause of a action should be shown in the Register of Firms as partners in the firm. The reason is not far to seek. It is well known that a firm is not a legal entity and is not a 'person' within the meaning of Section 4 of the Partnership Act. As a matter of fact, a partnership firm is a compendium of persons and the firm name is more or less abbreviation of the names of all its partners. It is because of this reason that Order 30 Rule 2(3) C.P.C. provides that when the names of the partners are declared in the manner specified in Sub-rule (I) of that rule, the suit small proceed in the same manner and same consequences in all respects shall follow, as if all the partners have been as plaintiffs in the plaint. Thus, a suit brought in the name of the partnership firm is essentially a suit brought by all its partners under the firm name and all the partners of the firm on the date of the institution of the suit would be deemed to have jointly filed the suit in the name of the firm. As a matter of fact, all the persons suing in the name of the firm must be shown in the Register of Firms as partners of the firm on the date of the suit and for that reason none of them could be left out for the purposes of the suit. It is because of this reason that Sub-section (2) of Section 69 of the Act provides an essential condition that names of all persons suing namely, all the partners of the Firm should be entered in the Register of Firms as partners of the firm on the date of the suit. The significance of the expression's have been shown' occurring in Sub-section (2) of Section 69 is that the competence of all the partners of the plaintiff firm regarding the filing of the suit could not be challenged on the ground that the names of some other persons were also shown in the Register of Firms as partners who have been earlier partners of the plaintiff firm but had ceased to remain as such partners on account of retirement or otherwise. The object for which Section 69 has been enacted is to bring pressure to bear upon the partners to have the firm and themselves registered. Section 69 has been brought into existence with a view to compel a firm which is a going concern to get it self registered and bring the names of its partners on the Register of Firms as partners in the firm by giving proper intimation to the Registrar, of firms, if it has to institute a suit or make claim in a court of law. It is well established that the provisions of Section 69(2) are mandatory and a suit filed in violation thereof is not maintainable. The subsequent registration would not validate the institution of the suit.
12. This Court has consistently taken the aforesaid view. A learned Judge of this Court took the same view in Kesrimal's case AIR 1959 Raj. 140, one of the partners of the plaintiff firm having died, his son became a partner in the firm but his name was never intimated to the Registrar of firms under Section 63 of the Act at any time until the suit was filed. I.N. Modi, J., held that as the son of the deceased partner was one of the persons on whose behalf the suit was filed, although the first condition laid down in Section 69(2) of the Partnership Act stood fulfilled, but the second condition was not fulfilled as the name of one of the partners owing was not shown in the Register of Firms as partners of the Firm; and even if one of the conditions was not fulfilled, the suit was not maintainable and it has to be dismissed on the ground. It was observed by the learned Judge that Sub-section (2) of Section 69 created the bar to the institution of such a suit.
13. In M/s Alwar Iron Syndicate's case AIR 1970 Raj. 86, although the firm was registered it was found on disclosure of the names of the existing partners under Order 30 Rule 3 C.P.C. that the names of some of the existing partners were not included in the Register of Firms. It was held by P.N. Shanghai, J. as he then was, that when the suit was brought in the name of the firm, it is really a suit brought by all the partners under the firm name and as such name of the partners of the firm on the date of the suit could be left out. The learned Judge held that Sub-section (2) of Section 69 did not only require that the persons actually signing the plaint on behalf of the firm should be shown in the Register of Firms as its partners but the names of all the partners of the firm on the date of the suit must be borne on the Register of Firms. The learned Judge dissented from the view taken by the Punjab High Court in M/s Durga Das Janak Ram v. Preete Shah Sant Ram , wherein it was held that the requirement of Section 69(2) was fully satisfied if the firm was registered and the name of the person through whom the firm brought the suit appeared in the Register of Firms as a partner of the firm at the time of institution of the suit. The view which was taken in the aforesaid two cases was also taken by S.N. Modi, J. in Chandrabhan Bansilal's case 1974 RLW 100 and it was held that the names of all the partners suing as partners of the plaintiff firm must be shown in the Register of Firms as partners on the date of the suit and if the names of some of the partners were included in the Register of Firms on that date the suit was not maintainable.
14. In yet another case, Firm Sitaram Agarwal v. Harnath and Anr. , P.N. Singhal, J. as he then was, observed as under with regard to the provisions of Section 69(2):
Thus the sub-section prohibits the institution of a suit on behalf of a partnership firm unless two requirements are fulfilled; (i) the firm has been registered, and (ii) the persons suing are or have been shown in the Register of Firms as partners in the firm. As has been stated, it is beyond doubt that in the present case the plaintiff firm was not registered Under Section 59 and the first requirement of Sub-section (2) of Section 69 was not therefore fulfilled before the institution of the suit.
15. A Division Bench of this Court in Seth Sobhagmal Lodha and Ors. v. Edward Mills Co. Ltd. Beawar and Ors. 1969 WLN 499 held that two mandatory requirements must be fulfilled before a suit filed by a partnership firm against a third party to enforce a right arising out of a contract could be instituted, namely, that the firm must be a registered firm and persons suing are or have been shown in the Register of Firms as partners of the firm. Both the conditions are mandatory and unless both the condition were fulfilled, the suit would be wholly incompetent in a court of law.
16. In Bank of Keethatlukulam v. Ittem Thomas and Anr. AIR 1955 TC 155; it was held that the registration of a firm was effected only after the statement prescribed Under Section 58 and the required fee are sent to the Registrar and when the entry of the statement is recorded in the Register of Firms and the statement is filed by the Registrar as provided in Section 59. It was also held that the registration of a firm is a condition precedent to its right to institute a suit of the nature specified in Section 69(2) of the Partnership Act. Their Lordships of the Travancore-Cochine High Court held that for the removal of the bar Under Section 69(2) of the Act not only that the firm should be registered but the persons suing must be shown as partners in the firm and when it was found that on the date when the plaint was filed the second part of the condition was not fulfilled, then the suit was not maintainable Under Section 69(2) of the Act. The second condition prescribed by Section 69(2) evidently meant that when the suit was instituted the names of the persons suing must find a place in the Register of Firms as partners of the firm. Their Lordships quoted with approval the observations made in Firm Ramprasad Thakur Prasad v. Firm Kana Prasad Sitaram AIR 1955 All 893 in this respect.
17. The same view was taken by a Judge of the Nagpur High Court in Kapurchand Begaji Firm v. Laxman Triabuk and Ors. AIR 1952 Nagpur 57, wherein it was held that Under Section 69(2) no suit to enforce a right arising from a contract can 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 of the firm. It was also held that the Register of Firms being a public document the requirements of Section 69(2) are complied with by producing a certified copy of an entry from that register. The oral evidence of the plaintiff-partner is not admissible as secondary evidence to prove the fact that the firm was registered or that the alleged partners were shown in the Register of Firms as partners. In the absence of such evidence the suit instituted by a partner is not maintainable. Under Order 30 C.P.C. a suit can be brought in the name of the firm but firm is not a separate legal entity and all the partners constituting a firm are plaintiffs and persons suing. It is, therefore, necessary to prove by production of an entry from the Register of-Firms that all the partners of the plaintiff firm are shown in the Register of Firms as partners thereof.
18. In Chhotelal Darbarilal v. Mohammed Hussain and Ors. AIR 1955 VP 44, Jagat Narayan J. as he then was, also took the view that the oral evidence on the question whether the plaintiff was a registered firm under the Partnership Act was not admissible and the production of a certified copy of an entry from the Register of Firms was the only admissible evidence to find out whether the provisions of Section 69(5) of the Partnership Act were complied with or not.
19. The same view was also taken in M/s Badrimal Ramcharan and Co. v. M/s. Gama Kaul and Sons and Ors. AIR 1971 J&K; 103 wherein a bench of they Jammu and Kashmir High Court observed as under with regard to the interpretation of the provisions of Section 69(2) of the Partnership Act:
What is required is that any change in the constitution of the firm has to be intimated to the Registrar of the Firms who has to make consequent changes in his register and secondly Under Section 69(2) no suit can be brought on behalf of a firm unless the persons suing have been shown in the Registrar of Firms as partners in the firm. The present suit is on behalf of the firm under Order 30 of the Civil Procedure Code. It will be deemed to be on behalf of all the partners of the firm may be signed by any one or more of them, But what is obligatory, the body of persons as a whole i.e. all the partners of the firm must be shown as partners in the records of the Registrar. Unless that is so, the suit is not maintainable.
20. In Sardar Singh and Sons v. Sikri Brothers AIR 1955 Oudh 37, a Bench of Oudh Chief Court took a different view. In that case the suit was filed by Sikri Brothers, through M.R. Nagpal, who was described as a partner and Manager of the firm and a general power of attorney was executed by Jwala Ram and Nihalchand partners of the firm in favour of Nagpal, authorising him to file the suit. At that time, although Nagpal was admittedly a partner of the firm, yet an application for introducing his name in the Register of Firms was moved much later.lt was held by the Oudh Chief Court in that case that even if Nagpal could not be considered to a partner in the sense that his name was not borne on the Register of Firms as partner of the firm, yet the real plaintiff was Sikri Brothers and Nagpal was a Manager holding power of attorney from the two persons, whose name was shown in the register of firms as partners of the firm. Their Lordships of the Oudh Chief Court held that the defect, if any, was one of form and not of substance.
21. A similar view was also expressed by the Allahabad High Court in M/s Ram Kumar Ram Chandra v. The Dominion of India : AIR1952All695 , and it was held that the suit was brought by the firm and addition of the words 'through' are redundant and of no consequence.
22. In M.S. Pearl Sound Engineer v. M/s. Poonam Chand and Ors. : AIR1975All207 , the suit was filed on behalf of the firm and also its partners. It was held that when the suit is instituted by all the partners, it was not necessary to implead the firm, as the firm name collectively stood for all those persons who were partners of the firm at the time of filing of the suit. The partners may choose to file the suit in the name of their firm or they may file the suit in the name of all the partners, and impleading the firm is unnecessary in such a case where all the partners were impleaded as plaintiffs and addition of the firm is merely a surplusage.
23. In Pratapchand Ramchand & Co. v. Jahangirji Bomanji Chinoy AIR 1940 Bom 237, one of the three partners of the registered partnership firm expired and the fact of his death was not communicated to the Registrar of Firms so that the change in the constitution of the firm was noticed by the Registrar until after the suit was filed on behalf of the partnership firm. It was held that Section 69(2) did not bar the suit by the partnership firm, because even after the death of one of the partners not with standing the change in the composition of the partnership, the partnership firm should be deemed to be continued to be registered, although an account of the death of one of the partners the original statement regarding the names of the partners of the firm which had been filed had become inaccurate. Thus, the position was that on the date of the institution of the suit the partnership firm was registered and the names of the two of the original partners who still continued to remain as partners of the firm were also shown in the Register of Firms as partners of the firm at the time of the institution of the suit. Thus, the mandatory conditions that the firm should be registered at the time of the institution of the suit and the names of the persons suing should be shown in the Register of Firms as partners in the firm were complied with. The Bombay High Court further observed as under in the aforesaid case:
It would be seen that the Legislature introduced the words with which that sub-section concludes, viz. 'and the persons suing are or have been shown in the register of firms as partners in the firm' advisedly. If additional partners had come into the firm as partners since the date of registration and their names had not been entered on the register in accordance with a notice of a change in the constitution of the firm given to the Registrar, it may well be that the firm as then constituted could not sue, because although it was a registered firm some of the persons then suing would not be shown in the register of firms as partners in the firm at the date of the suit. That is not this case. The partners who are suing were shown in the register originally and are still shown, and the firm according to my construction of the Act remained registered not with standing the death of one of the original partners.
24. We may also refer to the decision of Punjab High Court in Dr. V.S. Bahal v. M/s S.L. Kapur and Co. , wherein the decision of the Oudh Chief Court in Sardar Singar Singh's case AIR 1955 Oudh 37 was dissented from and it was held that the words 'persons suing in Section 69(2) meant not only the persons signing the plaint but the expression referred to all the partners of the plaintiff firm. In that case the bench of the Punjab High Court observed as under:
The question which arises in the present case is whether in order to institute a suit a partnership firm must not only be a registered firm, but also all the persons who are partners in the firm at the time of the institution of the suit must be or have been shown as such in the Register. This certainly appears to be the plain meaning of the words in Section 69(2), 'unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm'. It is difficult to imagine what other meaning the words 'person suing' are capable of bearing in this context.
There is no doubt that in a sense the firm itself is a person but to my mind there can be no doubt that the words 'persons suing' here mean persons in the sense of individuals, and that the only individuals referred to must in my opinion to the partners in the firm... In the circumstances although I hesitate to throw out the two apparently well founded claims of the plaintiff' firm on such a technical ground as this, I feel constrained to hold that the suit at the time of its institution suffered from the defect that one of the partners of the firm, who had been a partner for several years, had not at the time of the institution of the suit been shown in the Register of Firms as a partner and in my opinion the same principle which applies to the registration of the firm itself must also be held to apply to the individual partners and a defect of this kind, which is a bar to the institution of the suit, cannot be removed 'pendente lite.
25. In M/s. Durga Das Janak Raj's case , four persons were partners of the plaintiff firm, which was registered under the Partnership Act, but one of the partners Santram had expired in 1946 but the partnership firm continued with the erstwhile partners of the original firm. Their Lordships of the Punjab High Court, following the decision of the Bombay High Court in Pratapchand Ramchand & Co's case AIR 1940 Bom 237 held that the firm which was duly registered continued to be registered on the date of the institution of the suit and the mere fact that one of the partners had died not have the effect of dissolution of the firm. Thus it was held that the firm continued to remain as a registered firm and was entitled to institute a suit.
26. In Firm But a Mal Devraj v. Chaman Mal and Ors. AIR 1964 Punjab 270; it was observed by the Punjab High Court that the use of the plural 'persons' in Section 69(2) is obviously deliberate and although a firm may bring a suit through a manager who is only an employee and not a partner, though authorised by the partners to institute the suit on behalf of the firm, such a person cannot be regarded as covered by the expression 'person suing' occurring in Section 69(2) since under no circumstances would the name of such a manager or employee be included as a partner in the Register of Firms. Obviously when a suit is instituted in the case of a firm, the suit is on behalf of all the partners and not only such of them as are shown in the Register of Firms and so all the partners must be the persons suing contemplated in Section 69(2) of the Act.
27. The decisions of the Punjab High Court in Dr. V.S. Bahel's case and the Nagpur High Court in Kapur Chand Bhagaji's AIR 1952 Nagpur 57 were followed by their Lordships of the Calcutta High Court in Hansraj Manot v. M/s. Gorak Nath Champalal Pandey (1962) 66 Calcutta Weekly Notes 262. While interpreting the provisions of Section 69(2), their Lordships of the Calcutta High Court observed as under:
The purpose of Section 69 is to protect third parties against frauds and against omissions. Really this is not anything which effects the partners between or among themselves. They may know the position as well. But a third party is expected to know who are the partner of the firm with which a third party is dealing, unless there is some record kept by some person authorised by law to keep a record, there may be various difficulties. One day some body will say that such and such was partner, the next day it would be said that he was not, and the third parties would be in jeopardy as they do not know with whom they were actually dealing, and it is for the protection of their interest that this section was provided in the Act... The plain meaning is that if the firm institutes a suit, two conditions are to be satisfied, namely whether the firm is registered and the persons suing are or have been shown in the register of firms. The same conditions will have to be satisfied even it is a suit on behalf of the firm. The plain meaning certainly supports that.... Section 69(2) of the Act has been interpreted only to mean that if all of the persons suing are still on the Register, they can institute a suit not with standing the fact that some others are dead or some others have retired at the date of the suit. That would not be any violation of the words of the statute. I, therefore, hold that a suit on behalf of a firm by certain persons or by a firm may be instituted provided the firm is registered and the persons suing, which means the persons then suing, must have their names shown in the register of firms. In this case it might have been so if it had been disclosed by the plaintiff that only the surviving person is the partner of the alleged firm but they have disclosed the names of other persons whose names are not there in the Register.
28. The decision of Chatterjee, J. in Hansraj Manot's case (1969) 74 Calcutta Weekly Notes 269 was upheld by a division bench of the Calcutta High Court on appeal in M/s. Goraknath Champalal Pandey v. Hansraj Manot AIR 1955 VP 44. The same view was again taken by a Bench of the Calcutta High Court in Ram Kumar Shev Chandrai v. Dominion of India now the Union of India : AIR1977Cal57 , where in the decision of the Mysore High Court in M.A. Hussain v. M/s. Panchmal AIR 1970 Mysore 299; relied upon by the learned Single Judge in this referring order was dissented from with the following observations:
With respect, we are unable to agree with this view as expressed by the learned Judge. Both the conditions under Section 69(2) are mandatory. In our opinion, the second condition will be fulfilled only when the names of the persons suing are or have been shown in the Register of Firms as partners in the firm. In the instant case, as the second condition of Section 69(2) has not been fulfilled, it must be held that the suit is barred by that section.... A firm's name is merely a compendious mode of describing the partners constituted in the firm. When a suit is instituted in the name of the firm, it is really a suit by all the partners of the firm. In such a case, 'the persons suing' within the meaning of Section 69(2) of the Partnership Act, are all the partners on the date of the suit. The partners during whose time the cause of action arose may also sue in the firm name, but the names of those partners must appear on the face of the plaint so that they can be said to be the 'persons suing'. If the firm is only shown as the plaintiff, in that case, all the partners of the firm on the date of the suit must be held to be the persons suing and not only those partners during whose time the cause of action arose. Under Sub-rule (1) of Rule 2 of Order 30, where a suit is instituted in the name of the firm, plaintiff or their pleader shall, on demand in writing by or on behalf of any defendant forthwith declare in writing the names and addresses of all the persons constituting the firm. In the instant case, the plaintiff is the firm, that is, all the partners of the firm as on the date of the suit. In other words, all the partners of the firm on that date were the persons suing within the meaning of Section 69(2) and, as required by the second condition of that section, their names must be shown in the Register of Firms as partners in the firm. Admittedly, Durga Prasad Poddar was a partner of the firm on the date of the suit, but his name is not or has not been shown in the Register of Firms and, accordingly, the second condition is not fulfilled.
29. In Krishna Chandra Agrawalla and Ors. v. Shanti Prasad Jain and Ors. : AIR1961Cal199 , the view earlier taken by the Calcutta High Court in Hansraj Manot's case (1962) 66 Calcutta Weekly Notes 262 was followed. In that case on the death of one of the three partners of a registered partnership firm, the son of the deceased partner was taken as a partner in the newly constituted partnership firm and a suit was filed. It was held that the suit filed by the original partnership firm could not be maintained or proceeded with by the two surviving partners as the son of the deceased partner had already been admitted as the partner of the newly constituted firm, but his name did not appear in the Register of Firms, as such the suit filed by the firm could not be proceeded with because of the provisions of Section 69(2) of the Partnership Act.
30. The same view was expressed by Subbarao, C.J. as he then was of the Andhra Pradesh High Court in Moddi Sudarsanam and Ors. v. Berogu Viswanadham Brothers represented by its power of Attorney and Partner Venkatarathanam and Ors. : AIR1955AP12 . It was held in that case that the retirement of death of a partner is although required to be notified under Section 63 to the Register of Firms but a default in notifying the same is not of any relevance in the matter of maintainability of the suit under Section 69(2). It was observed that there was an essential distinction between the constitution of a firm and its dissolution. Non-compliance of the provisions of Section 63(1) in failure to intimate to the Registrar of Firms the death of a partner or the retirement of another partner may have other consequences but they did not effect the maintainability of the suit. Under Section 69(2) only two conditions should be complied with by a firm in order to file a suit to enforce a right arising from a contract. It was observed in the aforesaid case that the second condition laid down in Section 69(2) was also satisfied and the persons suing, i.e. the present partner were shown in the Register of Firms as partners of the firm though the same Register shows two other partners, one of whom died and the other retired. But the presence of their names in the Register of firms as partners of the firm did not effect the essential condition specified in Section 69(2), enabling the partnership firm to file the suit.
31. In Firm of V. Ramchandraiah Gupta & Am. v. Ravula Venkat Reddy 1970 (1) Andhra Weekly Reporter 243 Chinnappa Reddy, J., as he then was, approved the decision of the Calcutta High Court in Hansraj Manot's case (1962) 66 Calcutta Weekly Notes 262 and dissented from the decision of the Allahabad High Court in Ramkumar Ramchandra's case AIR 1952 All 695. It was observed by the learned Judge that whether a suit was filed by a firm or on behalf of a firm Sub-section (2) of Section 69 was applicable and it clearly prescribed that both the requirements specified therein should be satisfied. The contention that it was open to the person suing to establish that he was a partner of the firm even if he was not shown in the Register of Firms as a partner, was rejected and it was held that it was not possible to construe the provisions of Section 69(2) in that manner as such a construction would defeat the very object of the provision, which is avowedly to provide pressure to be brought to bear on the partners to have the firm and themselves registered.
32. In H.J. Velu Mudaliar and Anr. v. Sri Venkateswara Finance Corpn. and Ors. : AIR1971AP63 ; a single Judge of the Andhra Pradesh High Court without noticing the earlier judgments of that court expressed a discordant note. The learned Judge followed the decision of the Oudh Chief Court in Sardar Singer Singh's case AIR 1955 Oudh 37 and the Allahabad High Court in Ram Kumar Ramchandra's case : AIR1952All695 and also relied upon the decision of the Hyderabad High Court in Firm Sankari Yadgiri & Co. v. Union of India : AIR1977Cal57 . In holding that the production of a certificate showing the registration of the firm is sufficient in a case where a suit was instituted in the name of the firm without there being any further description of the partners. It was held that the requirement contemplated by the later part of Sub-section (2) of Section 69 was intended to come into play only in cases where a disclosure of the names and particulars is called for in accordance with the provisions of Order 30 C.P.C.
33. With great respect we are unable to agree with the view expressed by the learned Judge in the aforesaid case as the use of the conjunction 'and' between the two conditions specified in Sub-section (2) of Section 69 is significant and clearly indicated that both the requirements must be satisfied before a suit can be instituted by a firm or on behalf of the firm against a third party in respect of a claim arising out of contract.
34. In the case of M.A. Hussain and Anr. AIR 1954 Hyd 172 Malimath, J. of the Mysore High Court, following the view taken in Bharat Sarvodaya Mills Co. Ltd. v. M/s. Mohatta Brothers : AIR1969Guj178 , held that although both the conditions specified in Section 69(2) were mandatory and must be fulfilled and the suit would be wholly incompetent if either of these two conditions were not fulfilled, but the second condition consisted of two alternatives and it was enough if one of them was fulfilled. The learned Judge proceeded to observe as under:
It is clear from this provision that there two alternatives available in the second condition. The persons suing may establish either that they are partners on the date of suit or that they are persons whose names are shown in the register of firms as partners in the firm. As already observed, the second alternative, namely, the fact that the names of the persons suing have been shown in the Register of firms as partners of the firm can be established either by producing relevant Register of firms or a certified copy of the same and not by adducing oral evidence. But there is no legal bar to prove the first alternative, namely, that the persons suing are partners of the firm by adducing evidence other than register of firms or its certified copy. It appears that pointed attention of the court has not been invited to the first alternative of the second condition in above referred case decided by the Nagpur High Court. In my opinion, the persons suing must either in fact be partners on the date of suit or must be persons whose names are shown as on the date of suit in the Register of Firms as partners of the firm. Even if the names of the partners suing have not yet been entered in the Register of firms, they can still institute the suit by proving that they are in fact partners of the firm on the date of suit. That can only be proved by evidence other than the Register of firms. I therefore respectfully disagree with the view taken by Justice Deo in the decision reported in AIR 1952 Nag. 57. In my opinion, oral evidence other than the Register of Firms or its extract can be adduced to prove that the persons suing are partners of the firm as on the date of suit.
35. However, this view was not followed in a latter decision of the same High Court and a different view was expressed by Ponniah, J. as he then was, in P. Raghurama Shetty v. B.C. Savadi and Sons, a firm by its partners and Ors. ILR 1975 Karnataka 761. In that case, oral evidence was led by the plaintiff to prove that the plaintiff was one of the partners of the firm. The learned Judge held that the oral evidence was not admissible as it was not enough to prove that the firm was registered but it must also be proved that the persons suing are or have been shown in the Register of Firms as partners of the Firm. Thus there was no evidence that the partners of the firm have been shown in the Register of Firms as partners thereof, which fact could only be proved by producing a copy of the entry from the Register of Firms.
36. In Gurushiddayya Kalkayye Delimath and Ors. v. Shah Hirachand Venechand and Co. and Ors. AIR 1972 Mys 209, it was held that a suit by or in the name of a firm is really a suit by or in the name of all its partners. Similarly a suit against the firm is really a suit against all the partners of the firm. It was further held that a suit by the firm is really a suit by all the partners who were its partners of the firm at the accrual of the cause of action. There Lordships of the Mysore High Court held that the expression 'persons suing, in Section 69(2) meant all the partners of the firm who were its partners at the time of the accrual of the cause of action.
37. The view taken in M.A. Hussain's case AIR 1970 Mysore 299 was also taken by the Patna High Court in Chiman Lal and Anr. v. Firm New India Traders Rice Merchants and Ors. : AIR1962Pat25 . In that case, a firm was registered in 1948 with two partners. Three more partners were subsequently added but they did not care to get their names entered in the Register of firms. It was held that Section 69(2) read with Order 30 Rule 1 C.P.C. apparently means that when a suit is instituted in the name of a registered firm, only these persons who are registered as partners of the firm could get the benefit of a decree in favour of the firm or would be liable for a decree against the firm and subject to these conditions the suit is maintainable. It was, thus held that only the two partners whose names were contained in the Register of Firms would be deemed to be the partners of the firm and the suit was held to be maintainable
38. The same view was also expressed in a later decision of the Patna High Court in M/s. J. Purshuttam Das and Co. v. M/s. S.R. Brothers and Ors. : AIR1973Pat300 . It was held in that case that the requirements of Sub-section (2) of Section 69 were that it must to established firstly that the firm is a registered one and secondly either where all the partners sue they are in fact partners of the Firm on the date of the institution of the suit irrespective of the fact whether their names are shown in the Register of Firms or not or where the suit is not by all but only some of the partners, their names have been entered in the Register of Firms. In other words, where the suit was not in the name of the firm itself but in the name of the partners it could be instituted either by all the partners irrespective of the fact whether their names are shown in the Register of Firms or not or by such of the partners only of the firm whose names have been shown in the Register of Firms. Following the decision of the Mysore High Court in M.A. Hussain's case AIR 1970 Mysore 299 it was also held that there was no legal bar for proving the fact that the persons suing were partners in the firm by adducing evidence other than the Register of Firms or a certified copy of the entry thereof.
39. In M/s. Shanker Housing Corporation v. Smt. Mohan and Ors. : AIR1978Delhi255 a Bench of the Delhi High Court pointed out that the expression 'person suing' in Section 69(2) of the Act meant all persons who were partners of the firm at the time of the institution of the suit. The Bench of the Delhi High Court expressed its agreement with the view taken by the Bombay, Madras, Travancore-Cochin, Punjab, Rajasthan, Jammu & Kashmir and Calcutta High Courts while expressing its dissenting from the view taken by the Gujarat, Mysore, Patna High Courts and Oudh Chief Court. It was also held that both the requirements contained in Section 69(2) ought to be fulfilled if a suit is filed by or on behalf of a firm to enforce a right arising out of a contract, against a third party.
40. In Purushottam Umed Bhai & Co. v. M/s Manilaland Sons : [1961]1SCR982 , it was held that the provisions of Order 30 Rules 1 and 2 are enabling provisions to permit persons who are partners in a firm to sue or be sued in the name of the firm. Since, however, a firm is not a legal entity the privilege of suing in the name of a firm is permissible only to those persons who as partners are doing business in India.
41. In Her Highness Maharani Mandalam Devi and Ors. v. H. Ram Narain Private Ltd. and Ors. : [1965]3SCR421 , it was held by their Lordships of the Supreme Court that a suit by or in the name of the Firm is really a suit by or in the name of all its partners. The decree passed in the suit though in form is against the firm is in effect a decree against all the partners. Their Lordships quoted with approval the following observations made by Lindley, L.J. in Western National Bank of City of New York v. Para, Triana & Co. 1891 1 QB 304 at page 314:
When a firm's name is used, it is only a convenient method of denoting those persons who compose the firm at time when that name is used, and a plaintiff who sues partners in the name of their firm in truth sues them individually, just an such as if he had set out all their names.
42. It may also be observed that the decision of the Gujarat High Court in Bharat Sarvodaya Mill's case : AIR1969Guj178 was set aside by their Lordships of the Supreme Court on appeal in M/s. Mohatta Brothers v. The Bharat Sarvodaya Mills Co. Ltd. Ahmedabad : [1976]3SCR1022 on the ground that the subsequent deed of partnership was not acted upon, but in that case their Lordships did not express any view on the question relating to the proper construction of Section 69(2) of the Partnership Act, as it was no longer necessary to go into that question after the decision of the High Court was set aside as another ground.
43. A consideration of the aforesaid decisions of the various High Courts leads to the following conclusions. A firm is not a legal entity at all but is the collective term or an abbreviated name for all the persons who are partners thereof. All such persons who have entered into a partnership with one another are individually called partners and collectively they are called a firm and the name under which their business is carried on is called the firm name. Ordinarily, a suit may not be brought by a firm in its own name but a suit may be filed by all the partners acting together or by some of the partners only, but impleading the remaining partners also as parties to the suit. However, Order 30 Rule 1 of the Code of Civil Procedure prescribes a special procedure by which a suit may be brought in the name of the firm. Order 30 Rule 1 of the Code of Civil Procedure enables two or more persons, claiming or being liable as partners and carrying on business in partnership, to sue or be sued in the name of the firm, of which such persons are partners at the time of the accrual of the cause of action. Any party to a suit, in such a case, may apply to the court for a statement of the names and addresses of the persons who were at the time of the accrual of the cause of action partners in such firm. Where persons sue or are sued as partners in the name of the firm, it shall suffice if any of the partners may sign, verify or certify any pleadings or other documents required under the Code of Civil Procedure to be signed, verified or certified by the plaintiff or the defendant, as the case may be. If a demand is made as mentioned above, in the case of a suit instituted by the partners in the name of the firm, the plaintiffs shall forthwith declare in writing the names and places of residence of all partners constituting the firm on whose behalf the suit is instituted. Thus, there can be no doubt that a suit brought in the name of the firm is actually one by all the persons who were partners of the firm at the time of the institution of the suit. Thus although the firm is not a legal entity, yet the provisions of Order 30 Rules 1 and 2 C.P.C. enable several persons doing business as partners to sue or be sued in the name of the firm. The effect of a suit instituted in the name of the firm in the manner prescribed by Order 30 Rule 1 C.P.C. is as if the suit is filed by all the persons collectively. Whether the suit is filed by all the partners collectively or by some only of the partners impleading the rest as parties to the suit or whether it is filed in the name of the firm by one or more partners in the manner indicated by Order 30 rule I C.P.C. the conditions prescribed by Section 69(2) must be fulfilled. They are:
(1) that the firm must be registered; and
(2) that the persons suing are or have been shown in the Register of Firms as partners in the Firm. The second condition requires that the names of the persons suing are presently shown or have been previously shown in the Register of Firm as partners in the firm. That appears to fallow pliantly from the provisions of Section 69(2).
44. The use of the conjunction 'and' shows that both the aforesaid conditions must exist together on the date of the institution of the suit. As a matter of fact, these two requirements constitute the conditions precedent to the institution of the suit. It may be pointed out that merely filing a statement under Section 58(1) of the Act in the office of the Registrar of Firms in the prescribed form, giving the particulars of the partnership firm and its partners together with the prescribed fee would not be enough for the fulfillment of the aforesaid conditions. A certificate of registration in the prescribed form should be made available to the partners of the firm and an entry of the statement filed under Section 58(1) should be recorded by the Registrar in the Register of Firms before the institution of the suit. Thus, even if the certificate of registration is made available, yet the second requirement of Sub-section (2) of Section 69 cannot be fulfilled merely by sending or delivering to the Registrar of Firms the statement required by Section 58, but it must also be shown that an entry of the statement so furnished was made by the Registrar in the Register of Firms before the date of the institution of the suit. Similar is the position of a statement sent to the Registrar under Section 65 of the Act intimating the alterations or changes occurring in the constitution of the firm on account of addition, death or retirement of some of the partners. We may also observe that use of the expression 'person suing' in Section 69(2) of the Act is significant. Ordinarily a singular used in an enactment includes a plural, but the use of the word 'persons' in the aforesaid provision indicates that the legislature intended to refer to all those persons who are the partners of the firm at the time of the institution of the suit. The reason is simple, as all these persons who desire to obtain a decree in their favour in a suit must become plaintiffs in the suit and all those persons against whom a decree is to be passed must similarly be made defendants in the suit. When the suit is filed by or on behalf of the partnership firm, either all the partners of the firm should individually be named as plaintiffs in the suit or some of them maybe named as plaintiffs, while the remaining partners may be named as proforma defendants in the plaint. Another alternative mode has been provided by Order 30 Rule 1 C.P.C. in such cases and the suit may be filed in the name of the firm, which name collectively represents all the partners of the firm at the time of institution of the suit. Such a suit filed in the name of the firm shall be deemed to be a suit on behalf of all the partners of the firm.
45. The other limb of the requirement contained in Sub-section (2) of Section 69 is that all such persons who are partners of the firm at the time of the institution of the suit must be or have been shown in the Register of Firms as partners of the plaintiff firm. The expression 'is or have been' refers to such persons whose names were entered in the Register of Firms as partners in the firm at the time of accrual of the cause of action and continues to remain so entered in the Register of Firms at the time of the institution of the suit. Thus either the persons whose names were entered in the Register of Firms as partners in the firm at the time of the accrual of cause of action and continued to remain so entered therein until the institution of the suit or persons whose names were entired in the Register of Firms as partners of the firm at the time of the institution of the suit could maintain a suit in the name of the firm or on behalf of the firm. It has also been held in some of the cases cited above that all the persons whose names were entered in the Register of Firms on the date of the institution of the suit could file a suit notwithstanding the fact that the names of some other persons also find place in the Register of Firms as partners of the firm, who have either died or have since retired and thus ceased to be partners of the firm at the time of the institution of the suit. The crux of the matter is that the names of all those persons, who continued to hold together as partners of the firm at the time of the institution of the suit must be shown to be entered in the Register of Firms on the date of the institution of the suit. If the relevant entry in the Register of Firms containing some other names of persons who have either died or have retired from the partnership, the same would not affect the maintainability of the suit, in as much as the suit in the name of the firm could be filed only by or on behalf of the surviving partners of the firm. But if the name of one or more of the existing partners of the firm at the time of institution of the suit does not find place in the Register of Firms on that date, then the suit by or on behalf of the partnership firm is not maintainable. It is also clear that no oral evidence can be taken for the purpose of deciding as to who were the partners of the plaintiff firm at the time of the institution of the suit and the names of the persons suing must be shown in the Register of Firm as partners of the plaintiff firm at the time of the institution of the suit, as the suit in the name of the firm is virtually a suit by all the partners of the firm and in order to prove the fact as to who were the partners of the plaintiff firm at the time of the institution of the suit, the only evidence admissible is a certified copy of the relevant entry in the Register of Firms. Thus the only possible interpretation to be placed on the expression 'are or have been shown in the Register of Firms' could be the persons suing must either be presently shown in the Register of Firms as partners of the firm at the time of the institution of the suit or they must have been earlier shown in the said Register of Firms as partners of the firm, no other interpretation is possible so as to give a rational meaning to the provision.
46. In this view of the matter, we hold that earlier decisions of this Court, referred to above were correctly decided and we agree with those decisions. We also find ourselves in agreement with the view taken by the Bombay, Madras, Travancore-Cochin, Punjab, Jammu & Kashmir and Calcutta High Court regarding the interpretation of Section 69(2) of the Partnership Act, while we respectfully dissent from the view taken by the Gujarat, Mysore and Patna High Courts and the Allahabad High Court in M/s. Ramkumar Ram Chandra's case AIR 1952 All 695 and by the Oudh Chief Court in Sardar Singar Singh's case AIR 1955 Oudh 37. As the name of Mangilal, who was admittedly one of the partners of the plaintiff firm on the date of the institution of the suit was not recorded in the Register of Firm as partner of the said firm on that date, the requirement contained in the second limb of Section 69(2) of the Partnership Act was not fulfilled in the present case. Therefore, the plaintiff's suit was rightly dismissed by the trial court on the preliminary ground that the said suit was not maintainable for non compliance with the provisions of Section 69(2) of the Partnership Act.
47. In the result the, appeal fails and is dismissed but without any order as to costs. The learned District Judge was also justified in not awarding costs to the defendant in the suit, because the decision of the case turned around a pure question of law, about which there is divergence of judicial opinion in the country. Consequently, the cross objections filed by the defendant have no merit and are dismissed with no order as to costs.