Illegal liquor partnership on one partner's licence is void because it amounts to unauthorised transfer or unlicensed sale.

A partnership to carry on arrack or toddy vending on a licence granted to only one partner is unlawful under the Madras Abkari Act and the rules framed under it. A liquor licence is a personal privilege, not partnership property, and cannot be treated as jointly shared without permission. If the licensed partner uses the licence for the firm, the arrangement amounts to an unauthorised transfer; if the unlicensed partner carries on the business through the licensed partner, it amounts to sale without a licence. In either form, the partnership is void ab initio and contrary to public policy, so a suit founded on such an illegal arrangement cannot be maintained.

---

---

Issues: Whether a partnership formed for vending arrack on a licence standing in the name of only one partner is void and unlawful, and whether such an arrangement contravenes the Madras Abkari Act and the rules made thereunder.

Analysis: The licensing scheme under the Madras Abkari Act requires that every person carrying on abkari business as a principal be licensed. A licence to vend liquor is a personal privilege and cannot, without permission, be treated as the property of the partnership or shared by all partners as of right. If the licensee uses the licence for the partnership, the arrangement involves an impermissible transfer of the licence. If the non-licensed partner carries on the business through the licensed partner, the arrangement still results in sale without a licence. On either view, the partnership is formed to accomplish what the statute forbids, and the transaction offends both the statutory scheme and the public policy underlying it.

Conclusion: The partnership is void ab initio and illegal, whether formed before or after the licence was issued, when the business is carried on on a licence granted only to one partner.

Final Conclusion: The revision petition succeeds, and the suit founded on the illegal partnership cannot stand.

Ratio Decidendi: A partnership to carry on arrack or toddy business on a licence granted to only one partner is unlawful because it necessarily involves either an unauthorised transfer of the licence or sale by an unlicensed person, both of which are prohibited by the Abkari Act and its rules.

---