By Dr. K. Shivaram
Ajay R. Singh
Advocates
New Page 1
[The Registrar of Firms, Societies and Non-Trading
Corporations, West Bengal & Anr. v. Tarun Manna & Ors., AIR 2010 Calcutta
79]
The Registrar of Firms had declined to grant registration of
the firm which was desirous of carrying on business in foreign liquor as
wholesaler on the ground that the firm had not yet obtained any valid licence
from the concerned authority to start the business.
The Court observed that the partnership is the relation
between persons created by contract whereby the parties to such contract have
agreed to share the profits of a business with further condition that the
proposed business must be carried on by all or any of them acting for all.
Therefore the first condition of existence of a partnership is that there must
be an agreement by the partners to share the profits of a business. The other
condition is that such business must be agreed to be carried on by all or any of
them acting for all; in other words there must be existence of agency among the
partners of the proposed business as specifically recognized in S. 18 of the
Act.
Although a partnership firm can come into existence and
function without being registered at its own risk and at the risk of a third
party who deals with it, it is not the law that in order to have registration of
the firm the partners must be first exposed to risk of loss by dealing with the
third party without having any registration and then can only acquire the right
to apply for registration. There are various types of businesses which cannot be
even undertaken without first taking licence from appropriate authority.
Partnership is the relation among partners created by agreement and the
objection of S. 58 of the Act is to register such agreement by keeping note of
the particulars of the agreement arrived at by the parties for the benefit of
the partner as well as third parties who propose to deal with such firm. If
other formalities u/s.58 are satisfied the Registrar is bound to register the
firm.
