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Apr 1, 2009

Partnership –Sec 69(2) Raptakos Brett & Co. Ltd. Vs ganesh Property 1998 (7) SCC 184 that the bar in Section 69(2) of the Act did not operate to bar a suit by an unregistered firm seeking enforcement of a statutory right or a common law right. It was held that a passing off action being a common law action based on tort, and not on contract, Section 69(2) did not apply. The reliefs of permanent injunction and damages were claimed on the basis of infringement of registered trademark. Thus the suit was held to be one based on statutory right under the Trade Marks Act, and therefore not barred by Section 69(2). "A mere look at the aforesaid provision shows that the suit filed by an unregistered firm against a third party for enforcement of any right arising from a contract with such a third party would be barred at its very inception. To attract the aforesaid bar to the suit, the following conditions must be satisfied : (i) That the plaintiff-partnership firm on the date of the suit must not be registered under the provisions of the Partnership Act and consequently or even otherwise, the persons suing are not shown in the Register of Firms as partners of the firm, on the date of the suit. (ii) Such unregistered firm or the partners mentioned in the sub- section must be suing the defendant-third party. (iii) Such a suit must be for enforcement of a right arising from a contract of the firm with such a third party".

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