Unregistered partnership firm can prosecute cheque dishonour claims; Section 69(2) does not bar Section 138 proceedings.

Section 69(2) of the Indian Partnership Act, 1932 bars only a suit by an unregistered firm to enforce a contractual right, and does not extinguish the underlying right or extend to criminal proceedings. Prosecution under Section 138 of the Negotiable Instruments Act, 1888 is penal in character and arises from cheque dishonour once the statutory ingredients are satisfied, so it is not a suit for enforcement of a contract. The term "suit" in Section 69(2) cannot be expanded to include criminal prosecution. Accordingly, a complaint under Section 138 by an unregistered partnership firm is not barred.

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Issues: Whether prosecution under Section 138 of the Negotiable Instruments Act, 1888, is barred by Section 69(2) of the Indian Partnership Act, 1932 when the complainant is an unregistered partnership firm.

Analysis: Section 69(2) creates a bar only against a suit to enforce a contractual right by an unregistered firm; it does not extinguish the underlying right nor convert a statutory remedy into an impermissible claim. Proceedings under Section 138 are penal in character and are founded on the dishonour of a cheque, with liability arising from the statute once the ingredients of the offence are satisfied. The term "suit" in Section 69(2) cannot be expanded to cover criminal prosecution, and the statutory bar is confined to enforcement of contractual obligations in civil proceedings.

Conclusion: Prosecution under Section 138 of the Negotiable Instruments Act, 1888 is not barred by Section 69(2) of the Indian Partnership Act, 1932.

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