ORDER
Dr. M.K. Sharma, J.
1. The present suit has been instituted by the plaintiff against the defendants seeking for a permanent injunction restraining the defendants from passing off of the trade mark of the plaintiff as also the copyright of the plaintiff and also for rendition of accounts.
2. The defendant No.2 filed an application under Order 7 Rule 11 CPC praying for rejection of the plaint on various grounds raised in the application. One of the grounds taken in the said application is that the present suit is barred under Section 69 of the Partnership Act. The defendants have stated that on the date when the present suit was filed by the plaintiff, the plaintiff was an unregistered firm and since no suit could be instituted by a Partnership firm unless the firm is registered and the person suing is shown in the Register of Firms as a partner in the firm, the suit is barred and, therefore, is liable to be dismissed on that count alone. It is, however, necessary to mention that apart from the aforesaid ground several other grounds have been raised by the defendants in the aforesaid application seeking for rejection of the plaint.
3. However, at the time of arguments, the learned counsel for defendant No.2 stated that except for the ground taken by the defendant No.2 for dismissal of the suit on the ground of non-registration of the plaintiff firm, the other grounds taken in the said application could be agitated also during the trial and, therefore, the said grounds are not pressed at this stage. In view of the aforesaid statement made by the counsel for the defendants, the said present application under Order 7 Rule 11 CPC is considered only for the purpose of deciding as to whether the suit is barred under the provisions of Section 69 of the Partnership Act and the defendant No.2 is given the liberty to raise the other grounds at a subsequent stage, if the suit survives and continued. Therefore, the scope of the present application is restricted only to the extent of the objection taken by the defendants that the suit is not maintainable and is liable to be dismissed in view of the provisions of Section 69 of the Indian Partnership Act, as on the date of filing of the suit, the plaintiff was not a registered firm.
4. Counsel for the defendants drew my attention to the statement made by the plaintiff in paragraph 1 of the plaint contending, inter alia, that the plaintiff is a registered firm. The aforesaid statement on the face of it appears to be a misstatement, inasmuch as, it is an admitted position that on the date of filing of the suit, the plaintiff was an unregistered firm and obtained registration of the firm subsequent to the filing of the present suit. The documents placed on record clearly corroborate and prove and establish the aforesaid fact.
5. The plaintiff firm was originally registered on 25.7.1983, but, was subsequently dissolved before February, 1995 and thereafter on 7.2.1995, Shri Girish Kumar Juneja and Shri Vijay Kumar formed a new partnership who applied for its registration on 23.9.1995. In pursuance of the aforesaid application, the firm was registered on 2.12.1997 and as such on the date of institution of the suit in July, 1997, the firm was unregistered. The counsel appearing for the plaintiff could not, but, admit the aforesaid position in view of the existence of several other documents on record. I also find on record that subsequently the plaintiff also sought for amendment of the plaint on that count and the same was also granted. Thus, it is to be seen and considered as to whether the present suit instituted by an unregistered firm is maintainable or not. Section 69 of the Partnership Act is relevant for the purpose and all the Clauses thereof are extracted hereinbelow for proper appreciation of the issue in question:
“69. Effect of non-registration.-(1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
(2) No suits 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.
(3) The provisions of sub-sections (1) and (2) shall apply also to a claim of setoff or other proceeding to enforce a right arising from a contract, but shall not affect-
(a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm; or
(b) the powers of an official assignee, receiver or Court under the Presidencytowns Insolvency Act, 1909 (3 of 1909), or the Provincial Insolvency Act, 1920 (5 of 1920), to realise the property of an insolvent partner.
(4) This section shall not apply-
(a) to firms or to partners in firms which have no place of business in [the territories to which this Act extends], or whose places of business in [the said territories] are situated in areas to which, by notification under [Section 56], the Chapter does not apply, or
(b) to any suit or claim or setoff not exceeding one hundred rupees in value which, in the Presidencytowns, is not of a kind specified in Section 19 of the Presidency Small Cause Courts Act, 1882(15 of 1882), or outside the Presidencytowns, is not of a kind specified in the Second Schedule to the Provincial Small Cause Courts Act, 1887 (9 or 1987), or to any proceeding in execution or other proceeding incidental to or arising from any such suit or claim.”
6. According to the counsel appearing for the plaintiff, the suit against the defendants is not based on any contract and as such the provisions of Section 69 of the Contract Act is not applicable. The counsel drew my attention to the averments made in the plaint in order to substantiate his submission that the suit is not founded upon any Contract. Counsel for the plaintiff further submitted that defendant No.2 has already been struck off from the array of parties and, therefore, the suit against defendant No.1 and 3 is not based on any Contract, for whatever contract is referred to in the plaint were all in respect of the Contract entered into between the plaintiff and defendant No.2. He further submitted that the plaint is one seeking action against infringement of the registered trade mark of the plaintiff and also for passing off and rendition of accounts which are Tortuous Act in their essential nature. He further submitted that Section 69 of the Partnership Act does not apply to suits of the present nature which are instituted for infringement of trade mark and copyright and as such actions are in substance of deceit under the Law of Tort.
In support of his contention, the learned counsel relied upon the decision in Bengal Waterproof Ltd. Vs. Bombay Waterproof Mfg. Co.; reported in 1997 PTC (17) wherein, it was held by the Supreme Court that an action for passing off is a common law remedy being an action in substance of deceit under the Law of Torts and wherever and whenever fresh deceitful act is committed, the person deceived would naturally have a fresh cause of action in his favour and thus, every time when a person passes of his goods as those of another he commits the act of such deceit. It was also held that similarly whenever and wherever a person commits breach of a registered trade mark of another he commits a recurring act of breach or infringement of such trade mark giving a recurring and fresh cause of action at each time of such infringement to the party aggrieved.
The counsel for the plaintiff also submitted that subsequent to the filing of the suit, the plaintiff has obtained registration and in that view of the matter also, the present suit cannot be held to be not maintainable. He also submitted that the provisions of Section 69 is applicable provided the proviso added thereto is not applicable. The proviso states that if in case the suit is for rendition of accounts then in that case such a suit is maintainable although the firm was not registered on the date of filing of the suit and thus, according to the counsel since the suit is also filed for rendition of accounts by the plaintiff, the suit is maintainable.
7. Learned counsel appearing for defendant No.2 refuted all the aforesaid submissions and contended that on a bare reading of the plaint it would be apparent that the plaintiff based its claim on a Contract. In support of his submissions, the learned counsel referred to paragraphs 3,4,5 and 9 of the plaint. Counsel submitted that a bare perusal of the aforesaid paragraphs would show that the plaintiff based his suit on the alleged agreement dated 2.6.1987. Counsel submitted that thus, the suit is clearly hit by Section 69 of the Indian Partnership Act and relied upon the ratio of the decision in Lalit Kumar & Ors. Vs. Municipal Corporation of Delhi & Anr.; reported in 56 (1994) Delhi Law Times 123 where the suit was held to be not maintainable as the firm was unregistered.
8. In order to appreciate the contention of the counsel appearing for the plaintiff, I have looked into the averments made in the plaint. The plaintiff states that there was in fact an agreement between the plaintiff and defendant No.2 dated 2.6.1987 on the basis of which defendant No.2 was manufacturing the various drugs called ‘BESTOGESIC Oil’, ‘GESTOCORDIAL Syrup’, ‘SYNAFED’ AND ‘NORMALAX Granules’, for the infringement and passing off of which the present suit has been instituted. It is also stated in paragraph 9 of the plaint that there was some misunderstanding between the plaintiff and defendant No.2, as a result of which the agreement between the plaintiff and the defendants was terminated in 1996 and that even after termination of the said agreement, defendant No.2 has been manufacturing the aforesaid products in similar packing and contents and thereby committing the act of infringement as also passing off the trade mark as also of the copyright of the plaintiff. Thus, the defendant No.2 as apparent from the averments made in the plaint was manufacturing all the four drugs in the same trade name atleast from 1987 and defendants No.1 and 3 are selling and/or manufacturing the goods of defendant No.2. It is also stated in paragraph 4 of the plaint that defendant No.2 under the agreement was bound not to sell the aforesaid formulations to anyone. Thus, on a reading of the contents of the plaint, it is crystal clear that the present suit is also based on a Contract as pleaded in the plaint.
9. Counsel for the plaintiff referred to the written statement and the counter claim filed by the defendants to state that the suit is not based on any Contract and it is merely a suit for restraining infringement, passing off and for rendition of accounts.
10. Applicability of Section 69 of the Partnership Act could be looked into at the very threshold. If the suit is based on a Contract for enforcement of which the suit is instituted by an unregistered firm, the same is not maintainable in law. The relevant date for examination of the same is the date of filing of the suit. If on the date of filing of the suit, the suit was not maintainable, it was void ab initio. Subsequent obtaining of registration and/or averments made in the written statement and counter claim and/or subsequent deletion of one of the parties would not make the suit valid. In this connection, reference may be made to a decision of the Supreme Court in M/s. Siri Ram Finance Corporation and others Vs. Yasin Khan and another; . In the said decision the Supreme Court held that if a suit is hit by the provisions of Section 69 of the Partnership Act on the date of filing of the suit would not be saved by subsequent amendment in the plaint.
11. The plaintiff through an application got the name of defendant No.2 deleted from the array of parties on 15.9.1998. The aforesaid position, in my considered opinion, would not in any manner change the nature of the suit which is still based on the alleged contract as in the said paragraphs wherein the contract is pleaded has not been deleted as yet. Even otherwise defendant No.3 has taken over the activities of defendant No.2 and, therefore, dropping of defendant No.2 will not make any difference so far as the bar of Section 69 of the Indian Partnership Act is concerned. The provisions of Section 69(3)(a) would not also save the present suit from the bar of Section 69 of the Indian Partnership Act as because the suit is neither for enforcement of any right or power to realise the property of the dissolved firm, nor the same is for rendition of any accounts of the dissolved firm. In this connection, reference may be made to a decision of the Supreme Court in Loonkaran Sethia etc., Vs. Mr. Ivan E. John and others; . In paragraph 21 of the said judgment, it was held by the Supreme Court that a bare glance at Section 69 is enough to show that it is mandatory in character and its effect is to render a suit by a plaintiff in respect of a right vested in him or acquired by him under a contract which he entered into as a partner of an unregistered firm, whether existing or dissolved, void. The Supreme Court further clarified the position by stating that a partner of an erstwhile unregistered partnership firm cannot bring a suit to enforce a right arising out of a contract falling within the ambit of Section 69 of the Partnership Act. The Supreme Court found that on the facts of the said case the firm in question was not a registered firm under the Indian Partnership Act and it also could not be denied that the suit was also for enforcement of the agreement entered into by the plaintiff as a partner which was an unregistered firm and that being so, the suit was undoubtedly found to be a suit for the benefit and in the interest of the firm and consequently a suit on behalf of the firm. It was thus held that the suit was clearly hit by Section 69 of the Partnership Act and was not maintainable. In my considered opinion, the ratio of the aforesaid decision is fully applicable to the facts and circumstances of the present case also.
12. Besides the plaintiff made a calculated mis-statement that on the date of filing of the suit, the plaintiff firm was a registered firm. Such mis-statement is apparent from a bare reading of paragraph 1 of the plaint. Subsequently, the plaintiff admitted that the firm was not a registered firm on the date of filing of the suit, but, obtained registration subsequent to the filing of the suit. This Court granted an ad interim injunction in favor of the plaintiff on the ground that the plaintiff was a registered firm, for reference of the same is also made in the order of this Court dated 16.7.1997. It is categorically stated in the said order that the plaintiff as per the averments made in the plaint is a registered firm which was in fact a wrong statement on the said date. Thus, the plaintiff also did not come to the Court with clean hands. Thus, I hold that the present suit filed by the plaintiff is hit by Section 69 of the Partnership Act and is not maintainable and the suit accordingly stands dismissed in this count alone.
All the pending applications stand disposed of in terms of the aforesaid order. Interim order passed by this Court stands vacated. No order as to costs.