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TMI Blog1954 (9) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... devudu, his brother Burugu veerayya, Parripati Venkatarathnam, and his two brother Subrahmanyam and Venkata Subba Rao as partners was formed in 1925. They executed a registered agreement on 8-6-1925 setting out the terms and conditions of the partnership. The Partnership Act (hereinafter referred to as the Act) came into force in 1932. The firm of Burugu Viswanadham Bros. consisting of those partners was registered under the Act in 1933. The names of the said five partners are shown in the Register of Firms as partners of the firm. Burugu Veerayya died on 17-7-39. Parripati Venkatarathnam and his two brothers became divided on 11-11-1939. Under the partition the interests of the three brothers in the assets and liabilities of the firm was t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmed in the year 1925 was automatically and legally dissolved and the plaintiff firm was a new firm constituted under Ex. B-1, and (ii) B-1 expressly disolved the old firm and constituted a new firm in its stead. 6. The relevant provision of the Act is S. 69 (2). It reads: 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 firs is registered and the persons suing are or have been shown in the Registrar of firms as partners of the firm. Under this Section, a firm is disabled to file a suit against a third party unless two conditions are complied with (i) the firm is registered and (ii) the persons suing are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olved as between all the other members. This view certainly is unexceptionable as the provisions of S. 253 (7) are clear. But after the enactment of the Partnership Act, the rules governing the dissolution of the partnership are laid in ss. 39 to 44 tha Act. In the Contract Act the circumstances under which the dissolution of a partnership takes place, and its consequences are not exhaustively and separately laid down. But in the Partnership Act, a separate chapter has been allotted and definite rules are prescribed for dissolution and its consequences. Pollock and Mulla in their book on the Indian Partnership Act summarise the relevant sections at page 113 as follows: We have now rules, mainly following those laid down in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess there is a contract to the contrary. Whether there is a contract to the contrary falls to be considered on the construction of the Articles of the Partnership agreement Ex. A-15, dated 8-6-1925. The relevant Article reads: Now these presents witness that the said Burugu Mahadevudu and Burugu Veerayya of the first part hereinafter jointly called the principal partners, which expression, unless it is repugnant to the subject or contract shall mean and include not only the said Burugu Mahadevudu and Veeraya, but also their survivors, heirs, executors and administrators, and the said Parripati Venkatarathnam, Venkata Subba Rao andsubrahmanyam of the second part hereinafter referred to as working partners, have agreed to conti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ners and the death of another should have been notified to the Registrar under S. 63(1) as the said events effects a change in the constitution of the firm. But the default made by the firm is not, in not so notifying, of any relevance in considering the question of the maintainability of the suit under S. 69(2). There is the essential distinction between the Constitution of a firm and its dissolution. Non-compliance with the provisions of S. 63 (1) may have other consequences, but under S. 69 (2) only two conditions should be complied with by a firm to enforce a right arising from a contract and those two conditions are complied with in the present case. 13. It is then contended that, under Ex. B-1, the old firm was expressly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he firm. Under Ex. B-1, the business is agreed to be carried on by the remaining partners, notwithstanding the change in the Constitution of the firm under the same name viz., Burugu Viswanatham and Bros. The document only records the changing in the constitution and provides for continuing the existing business. It does not either express of by unnecessary implication dissolve the earlier partnership and form a new firm. There is nothing on record to show that the earlier accounts were looked into and the rights and liabilities of the partners were settled. The mere fact that the scope of the business has been enlarged is not decisive on the question whether the firm was dissolved for an existing firm can always extend the sco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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