1. ' This appeal is directed against the judgment and decree dated 20-7-1987 passed by the learned III Senior Civil Judge, Hyderabad (Mr. Anwar Ahmed Memon) in F.C. Suit No,1 of 1979 filed by the respondents/plaintiffs against the appellants/defendants.
2. ' The respondents/plaintiffs which is a partnership firm dealing in business of building construction filed suit for declaration, injunction and recovery of Rs,97,32,606. The facts as disclosed in the plaint are that the respondent was awarded a contract vide work order dated 13-11-1975 for the construction of C-type Bungalows at Badin for Grade-17 'and 18 officers at the cost of Rs,5,96,800 at 169.75% above 1967 composite scheduled rates as approved by the Superintending Engineer (appellant No,3), Provincial Building Circle No,1, Government of Sindh, Hyderabad. During this period the Executive Engineer Provincial Buildings, Nawabshah (appellant No,5) had also invited tenders for two more projects i,e, construction of Academic Block for People's Medical College, Nawabshah for Rs,45,000,000 and contruction of Hospital ward for People's Medical College, Nawabshah at the cost of Rs,50 lacs but the respondents were awarded only one project of Hospital ward and that other work was awarded to some other contractor. It is further alleged that when the respondents protested for not being awarded both the contracts, the appellants got annoyed and started victimizing and harassing the respondents. Thereafter the respondent was also awarded another contract for construction of Boys Hostel at Jamshoro by the Government of Sindh through the Secretary, Public Works Department (appellant No,1) and through the Executive Engineer, Provincial Buildings, Jamshoro at Dadu at the costs of Rs,56 lacs. The respondent also alleged in the plaint that they were victimized by the officers of the appellant during the construction works by various methods including issuance of warnings and denial of necessary facilities. The respondent also claimed that due to various reasons the work could not be completed within the prescribed period and therefore, extensions were granted by the appellants. According to the respondent they carried out construction at Badin despite all kinds of obstacles. They completed and delivered the possession of one Bungalow and rest of the Bungalows needed only finishing and some more work but the payment was not made to them and finally after issuance of warning letters contract was rescinded by the appellants on 25-3-1978. The construction of the remaining works was readvertised and fresh tenders were invited by the appellants. Regarding contract for Boys Hostel at Jamshoro the respondent alleged that due to hurdles created by the appellants and denial of facility of construction material and withholding of payment of running bills as well as due to natural calamities like floods etc. This contract also remained incomplete and ultimately the contract was rescinded vide letter dated 20-11-1976. The respondent further alleged that besides causing harassm ent and serious handicaps the appellants also seized all the machines, tools, implements and other materials belonging to the respondent. Their application for registration as A-Class Contractor was rejected which caused loss to them. In the plaint the respondent also alleged that the revocation of contracts and withholding of payments were mala fide, illegal and bad in law.
3. ' The appellants contested the matter and filed their written statement through appellant No,3.
4. They denied all adverse averments in the plaint. Their case is that the contract for construction of C-type Bungalow at Badin was not for Rs,5,96,800 at 169.75% above the composite schedule rates but in fact it was for Rs,27,66,072 excluding premium as per BI Agreement. Furthermore, the two projects of People's Medical College, Nawabshah were two different contracts for all purposes therefore, the respondent's tender was accepted for only one project. This decision was accepted by the respondent without raising any objection or protest. The appellant denied the allegation regarding non-supply of material. According to them the respondent failed to complete the work within the stipulated period although a number of extensions were given to them. They were defaulter even prior to seasonal minor floods. They were also supplied cements and other facilities in the interest of speedy progress of the work though the appellants were under no legal obligation to do so. The payment of bills was also made from time to time as per the measurements of the works recorded. Furthermore, the penalty clauses were invoked as the respondent had failed to complete the work according to the schedule. Thus in short when the respondent failed to complete the three contracts in spite of all concessions and extension of facilities, the appellants were compelled to get the remaining work executed through other contractors. They also raised the legal pleas regarding jurisdiction valuation of the suit and misjoinder of different causes of action.
5. ' In view of the pleading of the parties the following issues were settled by the learned Trial Court:--
(1) Whether the suit is barred under the provisions of Contract Act and Civil Procedure Code?
(2) Whether the suit is bad for multifariousness and for misjoinder of causes of action?
(3) Whether the honourable Court has no jurisdiction in the matter?
(4) Whether the plaintiff was entitled to charge for the extra items and unsanctioned items at the prevailing market rates?
(5) Whether the defendants were liable to pay the escalation charges for the cement, steel and other building material, to the plaintiff?
(6) Whether the action of the defendants in rescinding the contracts of the plaintiffs is legal?
(7) Whether it was the duty of the defendants to provide the cement and water etc. To the plaintiff and if so, whether the defendants performed this duty properly?
(8) Whether any machinery tool and other implements belonging to the plaintiffs were seized by the defendants and if so, whether the plaintiff is entitled to the hire charges thereof?
(9) Whether the cement was supplied by the defendants and whether the plaintiff made the payment for cement?
(10) Whether the plaintiffs' work proceeded as per schedule and whether the plaintiffs completed the contract work within the stipulated period?
(11) Whether the plaintiffs were allowed the extenstions of the completion of work and whether the plaintiffs completed the contract work within the said period?
(12) Whether the action taken by defendants under clause 3 of the Agreement and cancelling the plaintiff's contract was illegal and mala fide?
(13) Whether the plaintiffs have signed the remaining bills in acknowledgement of measurement and the sates, if so, what is the effect?
(14) Whether any amount of plaintiffs is outstanding against the defendants or the defendants are entitled to recover the amount from the plaintiffs?
(15) Whether no loss was caused to the plaintiff due to the action of the defendants?
(16) Whether the defendants are entitled to compensatory costs under section 34, C.P.C.?
(17) What should the decree be?
6. ' The parties led their evidence and also produced documentary evidence. The respondent examined three witnesses, namely, Daud Hashim, Muhammad Hassan and Ali Bux. The appellants examined Mr. Agha Shahjehan A.E., Badin, Nadeem, Ahmed A.E., Nawabshah and Ahmed Nadeem A.E., Jamshoro. The learned III Senior Civil Judge, Hyderabad passed the impugned judgment and decree against the appellant for Rs,95,62,003. 80 and also awarded escalation charges, cost of extra charges of documents etc. The amount of which has not been mentioned in the decree.
7. ' I have heard Mr. Shaikh Abdul Sattar learned Special Counsel appearing for the appellants and Mr. Naimatullah Soomro, learned counsel for the respondent I will start with the consideration of the preliminary point as to whether the suit was itself not maintainable for want of registration under the Partnership Act. In order to appreciate this point it would be necessary to go through the relevant part of section 69: "69. (1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Finns as a partner in the firm."
8. ' Admittedly, the respondent is a partnership firm and in terms of section 69 of the Partnership Act 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 serving are or have been shown in the Register of Firms as partners in the Firm. As such, the first and foremost question which arises for consideration is whether the respondent was registered firm when it filed the suit on 1-1-1979. Exhibit 57 is the certificate of registration of the respondent issued by the Registrar of Firms and it shows that the firm was registered on 13-12-1981. This document was produced by the respondent and its authenticity is not under challenge. Thus the factual position emerging from the material on record is that the respondent was not a registered partnership firm at the time when its claim was lodged with the Civil Court and it lacked the requisite competence under section 69 to have recourse to the legal proceeding out of which the instant appeal arose.
9. The fate of suits by unregistered firms was considered in several cases decided by the superior Courts and reference can be conveniently made to the judgments reported as Messrs Sh. Mian Allah Bux v. Universal Corporation and others (PLD 1960 Karachi 736), Cooperation Development Funds and Projects v. Glimmer Textile Printing Industries, Karachi (PLD 1976 Karachi 808), Messrs Taj Construction Company v. Federation of Pakistan and 9 others (PLD 1982 Karachi 378), Messrs Kamleem Cloth Market and 11 others v. Gool Bai Shorabji S. Chinoy and 8 others (1985 CLC 2423) and M. Aslam Awan v. Ras Tariq Chaudhry (1985 CLC 2514) wherein it was observed that for the purpose of filing a suit a partnership firm must be registered under the Partnership Act. It is thus an established legal position that section 69 is mandatory in character and registration of firm is a condition precedent of right to institute suits and the Court has no jurisdiction to proceed with trial when such a condition has not been fulfilled. A suit instituted in contravention of section 69 is not maintainable and merits dismissal. Mr. Niamatullah Soomro, the learned counsel representing the respondent when confronted with this situation made two-fold submissions; one that this objection was neither raised in written statement nor in the memo of appeal and should not be allowed to be agitated during the course of arguments; the other that the subsequent registration during pendency of the suit would remove the defect and the suit could then validly proceed. So far as the first submission is concerned, I find that there was already an issue pertaining to jurisdiction of the Court over the matter which would cover this point though not unequivocally pleaded. Moreover, it is apparent from the record that the firm was not registered at the time of filing of the case. Thus, this is a pure question of law which does not require fresh investigation and can be raised at any stage specially when it hits the very root of the case. It is also the duty of the Court itself to apply the law whether it has been cited or even relied upon by a party or not. Once it has come to the notice of this Court that the suit was filed at the time when the firm was not registered it must be examined whether the action was maintainable irrespective of any objection to that effect raised by the other party. Section 69 bars filing of suit by the unregistered firm and it does not confer any right on the defendant which he can waive at his option. Even his consent in such a suit cannot enable the Court to pronounce a decree in favour of the plaintiff which is an unregistered partnership firm.
10. ' So far as the second submission is concerned, Mr. Soomro has relied upon the judgment of Nagpur High Court reported as Jakiuddin and others v. Vithose and another (186 IC 670) wherein Gruver, J. Held: "Where the firm has been registered when the suit is pending the suit may be legally proceeded from the date of registration unless there is a bar of limitation. But when the suit is disposed of before the registration is carried out, the proceedings cannot be validated and the Appellate Court cannot look into the merits and pass a decree even if registration is effected during the appeal."
11. Mr. Niamatullah Soomro also urged that if a firm is registered when the suit is pending, the Court can proceed with it. As mentioned earlier, a firm must be registered before it can file a suit and this is the absolute requirement of section 69. It will not be out of place to mention that when the law requires a thing to be done in a particular manner, it ought to be done in that manner or not to be done at all. It will also be useful to reproduce the following observations of the Hon'ble Supreme Court of Paldstan from the judgment reported as Atta Muhammad v. Settlement Commissioner (PLD 1971 SC 61): "It is well-settled that the neglect of plain requirement of a statutory enactment which prescribed how something is to be done will invalidate thing being done in some other manner if the enactment is absolute but not if it is merely directory."
12. ' Section 69 is mandatory in its terms and the effect of its violation is that the suit is at its very inception bad and the Court must treat it as not having been filed. Such being the legal position subsequent registration of the firm will not make the suit maintainable so as to enable the Court to try it as from the date of registration. In my opinion such a suit should be dismissed. I am fortified in my conclusion by the judgments reported as The Australasia Bank Ltd. v. Messrs A. Ismail & Sons (PLD 1952 Lahore 314), Messrs United Cotton Factory, Hyderabad v. Ahmed Khan (PLD 1960 Karachi 774) and Province of West Pakistan v. Messrs Asghar Ali Muhammad (PLD 1968 Kar. 196).
13. Moreover, even if Mr. Niamatullah Soomro's plea is accepted that registration of the firm will validate the suit the question of limitation will come in his way. The suit is based on contract and the cause of action accrued due to the alleged breach/cancellation of the contract by the defendants. The causes of action as shown in the plaint arose in November, 1976, June, 1977 and February, 1978. The reliefs sought are for enforcement of the contracts and damages and the period of limitation for such type of cases is three years. Beside the point of jurisdiction there are also issues touching the merits of the case, however, since I have come to the conclusion that the suit itself is barred and not maintainable, it will be a mere exercise in futility to discuss other issues.
14. ' The appeal is, therefore, allowed but there will be no order as to costs.