Allied Laws

16. Appeal – Condonation of delay –
Mentally disturbed – Prolonged illness and hospitalisation – Sufficient cause
for condonation. [Limitation Act, 1963; Section 5]

Ummer vs. Pottengal Subida
and Ors. AIR 2018 Supreme Court 2025

There was a delay of 554
days in filing an appeal before the High Court. Hence, the Appellant filed an
application u/s. 5 of the Limitation Act praying for condonation of delay in
filing the appeal.

The
High Court dismissed the application for condonation of delay as well as the
appeal. In the opinion of the High Court, the Appellant failed to make out any
sufficient cause for condoning the delay in filing appeal and hence the
application seeking condonation of delay of 554 days in filing the appeal was
not liable to be condoned.

It was
held by the Apex Court that the delay in filing the appeal was to be condoned
because of the reasons that appellant was mentally disturbed due to disputes
going on in his family and was not able to attend to his day-to-day duties due
to his old age, prolonged ailments and hospitalisation due to heart disease.

17. Assignment of rights – Not a
transfer of Immovable   property.    [Indian  
Stamp   Act,       1899;

Section 2(10), 2(14), 57; Art. 62 &
23 of schedule 1 of the Indian Stamp Act]

Kotak Mahindra Bank Ltd.
vs. State of U.P. and Ors. AIR 2018 Allahabad 182 Full Bench

The
issue was whether assignment of rights in debt was transfer of immovable
property or movable property?

In the
present case, the Assignor in the course of its business advanced financial
facilities to various borrowers, who in turn executed agreement/instrument (s)
of mortgage in lieu thereof.

The
Assignee agreed to purchase and acquire the debts from the Assignor with all
rights title and interest of the Assignor and underlying financial instruments,
for a consideration agreed to by the parties.

The
High Court observed that debt is purely an intangible property, like,
intellectual property right or goodwill, as against documentary intangibles,
viz., bill of lading, promissory note or bill of exchange, which has to be
claimed or enforced by action and not by taking physical possession thereof, in
contrast to immovable and movable property.

The
Court held that the instrument is an instrument of assignment chargeable with
stamp duty under Article 62(c) of Schedule 1-B of the Stamp Act which stated
that chargeability of stamp duty would be on transfer of an interest secured by
a bond or mortgage deed and not on the stamp duty prescribed for immovable
property. 

18. 
Limited liability partnership – Jurisdiction – Registrar of Companies –
Only administrative – Cannot adjudicate and resolve issues. [Limited Liability
Partnership Act, 2009; Section  25, 43]

Neeraj Kumarpal Shah vs.
C2R Projects LLP and Ors. AIR 2018 Gujarat 80

In the
present case, ROC had rejected the form filed for the purpose of change in the
partnership agreement. ROC passed an impugned order, inter alia,
informing the LLP that LLP form No. 3 was examined and marked as invalid and
not taken on record mainly on the ground that the original respondent had filed
interim relief application and therefore the said matter is sub-judice and in
this regard the LLP has not submitted satisfactory reply.

The
High Court held that when the prescribed forms are submitted before the ROC for
examination and registration, the ROC is required to consider as to whether the
provisions of the Act of 2008 and the Rules of 2009 are complied with or not.
Thus, the duty of the ROC is of ministerial in nature and he is acting as an
administrative authority. The ROC cannot adjudicate and go into the merits of
the dispute pending between the partners. The ROC has to register the necessary
forms subject to outcome of the proceedings pending before the competent Court
between the concerned partners.

19. Partnership – Suit by an
unregistered firm is not maintainable. [Partnership Act, 1932; S.69(2)]

Arihant  Rice Industries, Tumkur vs. Shubha-laxmi Venkateswara
Traders, Gangavathi AIR 2018 (NOC) 478 (Kerala)

A suit
was filed by plaintiff who was a partnership firm, for recovery of money from
third party. The partnership firm was an unregistered one. The only question
which arose was whether the suit filed by the plaintiff in the Court below was
maintainable in view of section 69(2) of the Indian Partnership Act, 1932?

Admittedly,
the plaintiff firm was an unregistered firm, as such, the unregistered firm
cannot maintain a suit in view of section 69 of the Partnership Act. Defendant
further submitted that in order to overcome the said lacuna of non-registration
of the firm, the plaintiff has falsely projected itself as a proprietorship
concern.

However,
there was no evidence regarding the dissolution of the partnership firm and
neither notice nor any paper publication for dissolution of firm was carried
out. As such, the plaintiff was still a partnership firm, but not a
proprietorship concern.

The
Court held that, since it is held that the plaintiff had failed to prove that
it was a proprietorship concern as at the time of institution of the original
suit and that the plaintiff concern was to be taken as partnership firm, thus
the suit was not maintainable.

20. Power of Attorney – genuineness – No
entry is made in the Notary Registrar – Power of attorney is held to be invalid

Veljibhai Mavjibhai Mistry
vs. Joitiben and Ors. AIR 2018 (NOC) 479 (Gujarat)

The
original owner challenged the genuineness of a power of attorney on the ground
of fraud. No documents in original were produced. The Trial court came to the
conclusion that the execution of the Power of Attorney was not done
simultaneously by all parties and therefore the execution was invalid. There is
no evidence brought on record by the defendants to show as to when the Notary
actually signed and stamped the document or made entries in the Notary
Register.

In
light of the same, the Court held that due to various contributing factors,
individually and collectively, suggested that the exercise of execution of the
Power of Attorney apart from its manner showed that the entire transaction was
founded on fraud.

Having held the
Power of Attorney to be an invalid document, the consequential transaction of
sale is also bad.