Sunday, 16 September 2018

How to interprete legally enforceable debt and liability in context of unregistered partnership firm?

The words,' legally enforceable debt or other liability' used in the
explanations to Section 138 of the Negotiable Instruments Act refer to the
enforceability in law of the debt or the liability in question and have no

reference to the right of the person enforcing it. If there is no legal impediment
for enforceability of a debt or other liability in general, disability of a particular
individual or entity to enforce such right to recover such debt or liability does
not render such debt or liability not legally enforceable debt or liability. The
intention of the legislature is to make non payment of amounts of cheques
despite service of notice as per the provisions of the Act an offence only when
the cheque has been issued for payment of a legitimate debt or liability. Amount
required to be paid as price of articles or goods is a legitimate debt or liability
and therefore it is a legally enforceable debt or liability. The disability of an
unregistered firm under Section 69(2) of the Indian Partnership Act to file a suit
to enforce a right arising out of a contract does not make such debt or liability
not a legally enforceable debt or liability.”

Cr. Appeal No. 140 of 2018

Date of decision : 11.09.2018.

M/s Uttam Traders Ranghri Vs  Tule Ram alias Tula Ram

 Mr. Justice Tarlok Singh Chauhan, Judge.
Read full judgment here: Click here
Print Page

No comments:

Post a Comment