Can a Recovery suit be filed by unregistered partnership firm

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No member of an unregistered firm can enforce his rights under the partnership contract against either the firm or any present or past member of it, nor can the firm sue its customers on their contracts. The firm remains liable to be sued by persons outside it, and cannot plead a set-off. Only suits for dissolution of the firm, and the powers of official assignees under the Insolvency Acts, are exempt from the prohibition. A small and harmonious firm dealing in a small way and mainly for ready money might be content to take these risks, mitigated as they are by the proviso of sub-s (4)(b) as to claims not exceeding Rs 100 in value. For a business of any considerable magnitude they appear sufficiently deterrent. Mandatory character.

Now, the mischief primarily intended to be prevented by the mandatory provisions of Section 69 was the hardship and difficulty to which third parties dealing with a firm were subjected in the matter of proving as to who were the partners. As to the provisions affecting the partners themselves it seems clear that the main object and intention of the Legislature was to prevent a partner from enforcing his claims against fellow partners if the firm was not registered and to compel in such a case dissolution of the firm by laying down that the court will entertain suits only when dissolution and accounts and winding up of the affairs of the firm is sought or where accounts or winding up of the affairs of an already dissolved firm is sought.

Partnership Act, 1932 : Section 59(2). Suit by unregistered firm-Maintainability of–Unregistered firm filed a suit for permanent injunction restraining the defendants. from infringing its trademark-The suit was based on common law and contractu – Dismissing the appeal, this Court HELD : 1.1. A suit is not barred by Section 69(2) of the Partnership Act, 1932 if a statutory right or a common law right is being enforced. [1256-C] Raptokas Brett Co. Ltd. v. Ganesh Property, [1988] 7 SCC 1

Advocate Siddhant Sharma LawRato