Registrar Of Firms Cannot Refuse To Record Changes To Partnership Deed: Bombay High Court

The Bombay High Court at Goa has recently held that the Registrar of Firms does not have the power to refuse or withhold recording changes incorporated in a partnership deed under Section 63(1) of the Indian Partnership Act, 1932, holding that the Registrar's role is limited to recording such changes.

A division bench of Justices Valmiki Menezes and Amit S. Jamsandekar said:

“Sub-section (1) of Section 63 of the Partnership Act only empowers the Registrar to record changes in the constitution of the Firm. There is no power vested in the Registrar under Section 63 to reject any Application for recording any changes, which are incorporated in the Deed of constituted partnership. The power is limited and the provisions of Section 5 cannot be availed by the Registrar to examine the Partnership Deed and reject the Application under Section 63(1) for recording the constitution or dissolution of the partnership.”

The ruling came in a writ petition filed by Rajesh Ashok Khaunte and Akshada Rajesh Khaunte, businesspersons from Goa, challenging a communication issued by the Registrar of Firms, Tiswadi, calling upon them to furnish further information regarding the status of their marriage to facilitate registration of a reconstituted partnership firm.

Rajesh Ashok Khaunte had originally registered a partnership firm on February 11, 2016 along with his brother Rohan Khaunte. The firm was reconstituted on June 5, 2025, by inducting Akshada Rajesh Khaunte, his wife, as a partner. The firm was again reconstituted on June 27, 2025 after the retirement of Rohan Khaunte, following which the partnership continued with Rajesh Ashok Khaunte and Akshada Rajesh Khaunte as partners.

Rajesh Ashok Khaunte and Akshada Rajesh Khaunte, whose marriage is registered under the Civil Code of Goa and governed by the regime of communion of assets, executed a deed of reconstitution dated June 27, 2025, and applied to the Registrar under Section 63(1) of the Indian Partnership Act read with Rule 7(6) of the Rules in Form VI for recording the changes in the Register of Firms.

Instead of recording the changes, the registrar issued a communication dated October 28, 2025, seeking clarification regarding the status of the marriage between the petitioners.

Referring to Section 63(1), the Court held that the provision only empowers the Registrar to record changes in the constitution of a firm and does not vest any power to reject an application or to examine the partnership deed.

Referring to Rule 5 of the Indian Partnership Act as amended for the State of Goa, the Court noted that the provision recognises that spouses governed by the regime of communion of assets under the Civil Code of Goa can enter into a partnership by contract, and the mere fact that the partners are husband and wife is not an impediment to the reconstitution of a partnership.

The Court held that the Registrar could not rely on Rule 5 to examine the partnership deed or refuse recording of changes under Section 63(1) and that the communication seeking clarification on the marital status of the petitioners travelled beyond the limited powers vested in the Registrar.

The High Court accordingly allowed the petition, quashed the communication dated October 28, 2025, and directed the Registrar of Firms to record the changes in the reconstituted partnership deed within two weeks.