Skip to main content

Unregistered Partnership Firm Can File Application Under Insolvency Code

Cause Title : Rourkela Steel Syndicate vs Metistech Fabricators Pvt. Ltd., Company Appeal (AT)(Insolvency) No. 924 of 2022, National Company Law Appellate Tribunal Principal Bench, New Delhi

Date of Judgment/Order : 06.02.2023

Corum : [Justice Ashok Bhushan] Chairperson, [Mr. Barun Mitra] Member (Technical)

Citied: 

  1. Gaurav Hargovindbhai Dave Vs. Asset Reconstruction Company (India) Limited and Anr.
  2. B.K. Educational Services (P) Ltd. v. Parag Gupta and Associates, (2019) 11 SCC 633

Background

Section 69(2) in The Indian Partnership Act, 1932 states that only a registered firm can file a suit against any third person to enforce a right. 

The appeal was filed against the order passed by the Adjudicating Authority (NCLT, Cuttack) rejecting the application filed under Section 9 of IBC on the ground that the application is barred by Section 69(2) of the Partnership Act. The Adjudicating Authority took the view that Section 69(2) of the Partnership Act bars a suit by an unregistered partnership, hence the above Application which was filed by the Appellant against the third party for enforcing a right arising out of contract is barred.

Judgment

The NCLAT observed that it has been decided by the Hon’ble Supreme Court judgment in Hargovindbhai Dave’s case that an application under Section 9 of IBC cannot be said to be a suit. Further, also it is well settled by the judgment of the Hon’ble Supreme Court in B.K. Educational (supra) that provision of Section 5 Limitation Act are also fully applicable in Section 7 & 9 IBC applications. Section 5 Limitation Act is not applicable in a suit which is also a clear indication that Application under Section 7 & 9 are not a suit.

Holding that the Adjudicating Authority had erred in rejecting the application held that in view of the above, the bar of Section 69(2) is not attracted in the present case since the application under Section 9 cannot be treated as suit.

Comments

Post a Comment

Most viewed this month

Partition proceedings are vitiated even if single co-sharer is not made party or is not served in accordance with law

Cause Title :  Bhagwant Singh vs  Financial Commissioner (Appeals) Punjab, Chandigarh,  CWP-2132-2018 (O&M), High Court Of Punjab & Haryana At Chandigarh Date of Judgment/Order : 31.08.2022 Corum : Hon’ble Mr. Justice Sudhir Mittal Background A large parcel of land was owned by the Nagar Panchayat. Thereafter, some of the co-sharers sold their shares to third parties including the petitioners herein. On 22.11.1995, respondents No.3 to 5 filed an application for partition of the land. The petitioners were not impleaded as parties.  On completion of proceedings, sanad was issued on 28.08.1996. Vide two separate sale deeds dated 28.05.2008 respondents No.3 and 5 sold some portion in favour of respondent No.6 and 7. These respondents sought implementation of the sanad resulting in issuance of warrants of possession dated 05.06.2008. Allegedly, it was then that the petitioners realized that joint land had been partitioned and that proceedings h...
Post a Comment
Read more

Power of Attorney holder can also file cheque bounce cases: Supreme Court

The Supreme Court has held that a criminal complaint in a cheque bounce case can be filed and pursued by a person who holds a power of attorney (PoA) on behalf of the complainant. A three-judge bench headed by Chief Justice P Sathasivam gave the "authoritative" pronouncement on the issue, referred to it by a division bench in view of conflicting judgements of some high courts and the apex court. "We are of the view that the power of attorney holder may be allowed to file, appear and depose for the purpose of issue of process for the offence punishable under Section 138 of the Negotiable Instruments Act (which deals with cheque bounce cases)," the bench, also comprising justices Ranjana Prakash Desai and Ranjan Gogoi, said. The bench, in its judgement, said, "...we clarify the position and answer the questions in the following manner: "Filing of complaint petition under Section 138 of Negotiable Instruments Act through PoA holder is perfectly legal...
1 comment
Read more

Christian who reconverts as Hindu SC will get quota benefits

Amid the controversy over “ghar wapsi”, the Supreme Court on Thursday ruled that a person who “reconverts” from Christianity to Hinduism shall be entitled to reservation benefits if his forefathers belonged to a Scheduled Caste and the community accepts him after “reconversion”. Citing articles by B R Ambedkar and James Massey, and reports by Mandal Commission and Chinappa Commission, the court said: “There has been detailed study to indicate the Scheduled Caste persons belonging to Hindu religion, who had embraced Christianity with some kind of hope or aspiration, have remained socially, educationally and economically backward.” The bench of Justices Dipak Misra and V Gopala Gowda held that a person shall not be deprived of reservation benefits if he decides to “reconvert” to Hinduism and adopts the caste that his forefathers originally belonged to just because he was born to Christian parents or has a Christian spouse. Expanding the scope of a previous Constitution benc...
1 comment
Read more