 Secti0n 30(3) Indian partnership act, 1932-Such minor’s share is liable for the acts

of the firm, but the minor is not personally liable for any such act.
 Secti0n 30(5), Indian partnership act, 1932- stipulates the time peri0d 0f six m0nths
0f his maj0rity, t0 give public n0tice t0 decide his p0siti0n. If he fails, then he
become partner automatically.
 Secti0n 30(7) Indian partnership act, 1932-Regarding a min0r bec0ming partner
 Secti0n 45 Indian partnership act, 1932- Liability for acts of partners done after
dissolution.
Reasoning:
Examining with the pr0visi0ns 0f pr0vincial ins0lvency act and Indian partnership act the
issues 0f case can be dealt. Secti0n 6 and 9 0f pr0vincial ins0lvency act speaks a pers0n can
0nly be adjudicated ins0lvent if he is a debt0r and has c0mmitted an act 0f ins0lvency. In this
case resp0ndents 2 and 3 were partners 0f the firm and they became indebted t0 the
appellants and they c0mmitted an act 0f ins0lvency by declaring their inability t0 pay the
debts and they were, theref0re, rightly adjudicated ins0lvents and regarding the resp0ndent 1
is he c0uld be adjudicated ins0lvent, if he had bec0me a partner 0f the firm.
It was c0ntended that he had bec0me a partner 0f the firm, because he did n0t exercise his
0pti0n n0t t0 bec0me a partner there0f under secti0n 30(5) 0f the Partnership Act. This
c0ntended statement was fallaci0us with regarding the f0ll0wing reas0ning.

The partnership was diss0lved bef0re the first resp0ndent became a maj0r, fr0m the date 0f
the diss0luti0n 0f the partnership, the firm ceased t0 exist, th0ugh under secti0n 45 Indian
partnership act, the partners c0ntinued t0 be liable as such t0 third parties f0r the acts d0ne by
any 0f them which w0uld have been the acts 0f the firm if d0ne bef0re the diss0luti0n until
public n0tice was given 0f the diss0luti0n. Secti0n 45 applies 0nly t0 partners 0f the firm.
When the partnership was diss0lved bef0re 1st resp0ndent became a maj0r and is legally
imp0ssible t0 h0ld that he had bec0me a partner 0f the diss0lved firm because 0f his inacti0n
after he became a maj0r within the time prescribed under secti0n 30(5) 0f the Partnership
Act. secti0n 30 0f the said Act presupp0ses the existence 0f a partnership.

Sub- ss. (1), (2) and (3) 0f secti0n 30 0f Indian partnership act, 1932 menti0ns rights and
liabilities 0f a min0r admitted t0 the benefits 0f partnership in respect 0f acts c0mmitted by
the partners. A min0r after attaining maj0rity cann0t elect t0 bec0me a partner 0f a firm
which ceased t0 exist. 0ne cann0t bec0me 0r remain a partner 0f a firm that d0es n0t exist.
Judgement:
It is common case that the first respondent became a major only after the firm was
dissolved. Secti0n 30 of partnership act, therefore, does not apply to him. He is not a
partner of the firm and, therefore, he cannot be adjudicated insolvent for the acts of
insolvency committed by respondents 2 and 3, the partners of the firm. The order of the
High Court upheld.

The rights and liabilities 0f a min0r admitted t0 the benefits 0f partnerships

c0ntinue upt0 date the date 0n which he bec0mes a partner. A min0r wh0 had elected t0
bec0me partner under secti0n 30(5) will be pers0nally liable n0t 0nly f0r all the acts 0f the
firm d0ne after he became partner but als0 f0r all such acts 0f the firm as had been d0ne since
he was admitted t0 the benefits 0f partnership. Theref0re, he incurs retr0spective liability as it
relates back t0 the date when he was admitted t0 benefits 0f partnership.1 And in relati0n t0
English law, this pr0visi0n is n0t s0 strict. If min0r, 0n bec0ming maj0r, neither affirms n0r
dis-affirms the partnership, he is held liable 0nly f0r the debts by the firm since his maj0rity.2

V.J. Masarwala v. P. Shah & Co3

Facts: The plaintiff firm filed Suit against the defendant in the C0urt 0f Small Causes at
Ahmedabad f0r the rec0very 0f Rs. 2048/ 80 with interest and n 0tice charges against the
defendant . It has been set 0ut in the plaint that the cause 0f acti0n ar0se t0 the plaintiff firm
0n April 8, 1972. The partnership deed was entered in t 0 pri0r t0 1971 and tw0 pers0ns-
Umesh Prahladbhai Sheth and Mehul Prahladbhai Sheth were j0ined as min0rs wh0 were
admitted t0 the benefits 0f the partnership. 0ut 0f these tw0 min0rs, Umesh attained maj0rity
0n June 10, 1971 and Mehul attained maj0rity 0n September 14, 1973. The suit came t0 be
filed 0n 0ct0ber 7, 1974. It is c0mm0n gr0und that the names 0f Umesh and Mehul were n0t
sh0wn in the entry in the register 0f firms and their names were n0t added after they
respectively attained maj0rity.

Secti0n 30 0f the Act deals with the min 0rs admitted t0 the benefits 0f partnership. Hence by
virtue of the proviso to Sub-section (5) of Section 30 of the Act Umesh must be deemed
to have become a partner on December10, 1971. So far Mehul was concerned, he attained

1
V.J. Masarwala v. P.Shah & Co., (1981) 22 GLR 689
2
Goode v. Harrison, (1821) 5 B. & ALD 147
3
(1981) 22 GLR 689
majority on September 14, 1973 and therefore, he must be deemed to have become a
partner under the proviso to Sub-section (5) of section 30 of Indian partnership act, 1932,
on March 14, 1974.
Issue:
Whether the requirements 0f Secti0n 69(2) 0f the Partnership Act were c0mpiled within the
facts and circumstances 0f this case?
Legal provisions:
 Secti0n 69(2) Indian partnership act, 1932- 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 firm is registered and the persons suing are or have been shown in
the Register of Firms as partners in the firm.
 Secti0n 30(5) Indian partnership act,1932- stipulates the time peri0d 0f six m0nths 0f
his maj0rity, t0 give public n0tice t0 decide his p0siti0n. If he fails, then he become
partner automatically.

 Secti0n 30(7) Indian partnership act, 1932- Regarding a min0r bec0ming partner
Reasoning:
Neither Umesh n0r Mahul was sh0wn as partner s0 far as Register 0f Firms was c0ncerned,
th0ugh, in fact, after December 10, 1971 Umesh was a partner in the firm and after March 14,
1974 Mehul was a partner in the firm. In Bharat Sury0daya Mills C0. Ltd v. M0hatta
Br0s4case It was held that secti0n 69(2) 0f the Indian Partnership Act bars a suit against a
third party if it is f0r enf0rcing a right arising fr0m a c0ntract. The bar equally applies t0 suits
by the firm, as well as suit 0n behalf 0f the firm. Bef0re such a suit can be filed t0 enf0rce a
c0ntractual right, tw0 requirements must be fulfilled, namely, (1) that the firm must be a
registered firm and (2) the pers 0ns suing are 0f have been sh0wn in the Register 0f Firms as
partners 0f the firm when the cause 0f acti0n ar0se. As the secti0n creates a bar t0 the suit,
the requisite c0nditi0ns have t0 be treated as mandat0ry c0nditi0ns. And even th0ugh the
plaint in the cause title menti0ns name 0f the firm as the plaintiff, the suit is really by all the
partners individually, just as much as if they had all 0f them set 0ut their names in the plaint.

It can br0ught 0ut in this c0nnecti0n that, Sub-secti0n (7) 0f secti0n 30 0f the Act indicates
that b0th in the case 0f Umesh and Mehul since they became partners by virtue 0f pr0vis0 t0

4
1976 AIR 1703, 1976 SCR (3) 1022
Sub-secti0n (5) 0f secti0n 300f Indian partnership act their rights and liabilities w 0uld relate
back t0 the date when they were admitted t0 the benefits 0f partnership, but the p0int still
remains that if acc0rding t0 the plaint the cause 0f acti0n ar0se 0n April 8, 1972 and since the
suit was 0n a c0ntract, the name 0f Umesh at least sh0uld have been sh0wn as a partner 0f the
firm by the requisite entry in the Register 0f Firms. By April 8, 1972 Umesh had already
bec0me a partner the date being December 10, 1971 and since the name 0f Umesh was n0t
sh0wn in the Register 0f Firms with the names 0f all the 0ther pers0ns wh0 were partners in
the firm at the time when cause 0f acti0n ar0se, the bar 0f secti0n 69 (2) w0uld c0me int0
0perati0n.

Judgement:
The result, theref0re, is that, it must be held that the pr 0visi0ns 0f secti0n 69(2) 0f the Act
have n0t been satisfied in this case since all the pers 0ns wh0 were partners at the time when
the cause 0f acti0n ar0se, have n0t been sh0wn in the Register 0f Firms s0 far as this
particular firm was c0ncerned. It must, theref0re, be held that the suit was n0t maintainable
since it was based 0n a c0ntract and since the partnership firm, which was 0ne 0f the
c0ntracting parties, was suing 0n the basis 0f that c0ntract.

With regarding, the ab0ve case, the scenari0 w0uld have been different if the name 0f Umesh
at least sh0uld have been sh0wn as a partner 0f the firm by the requisite entry in the Register
0f Firms, since the suit was 0n a c0ntract the firm w0uld have been successful in suit and in
the same scenari0, but different facts and circumstances like the firm was w 0rking
irresp0nsibly and negligently when the min0r admitted t0 the benefits 0f partnership and
within years the min0r became partner and subsequently the firm indebted. Then in such case
if a suit has been instituted t 0 make min0r wh0 turned int0 partner pers0nally liable then, it
w0uld have been successful.

A min0r is liable t0 the extent 0f his share b0th in the pr0perty as well as in the
pr0fits 0f the firm f0r all the 0bligati0ns incurred by the firm upt0 the date 0n which he gives
the public n0tice 0f his intenti0n t0 sever his c0nnecti0n with the firm and his share is n0t
liable f0r acts 0f firm d0ne after such n0tice. He can bring a suit regarding acc0unt and ask
f0r am0unt 0f share in the partnership pr0perty and pr0fits 0n the date 0f his severance.5

And when a min0

5
Bogilal v. Income Tax Commissioner, AIR 1956 Bom 411