JUDGMENT.-The second plaintiff is the appellant in the second appeal. The plaintiffs filed the suit for a declaration that the partnership carried on in. the name and style of Swatantra Power Rice Mill, has been dissolved on 11th November, 1971 and for rendition of accounts from 16th February, 1961 and for distribution of assets and liabilities among the partners. It was claimed in the plaint that the first plaintiff and defendants have been running a partnership business for hulling paddy, rice flour and ground-nut with the machinery belonging to the firm in Veerapandi village from 1961. The first plaintiff was admitted into the partnership on 16th February, 1961 and was entitled to a one-fourth share in the partnership capital and assets and profits. The business was managed by the first defendant through her husband, Manicka Mudaliar. The firm was dissolved on 11th November, 1971 and the first plaintiff sold his share of the dissolved partnership to the second plaintiff. on 7th January, 1972 for a consideration of Rs. 4,200. The second plaintiff issued a notice demanding the amounts as claimed in the plaint. Defendants 1 and 2 colluding together, have refused to comply with the demand. 2. The third defendant remained ex parte. The first defendant filed a written statement adopting the statement filed by the second defendant. It was contended by them that the first plaintiff was taken as a partner in the hope that he would take care of the interests of the first defendant and also evince interest in the business. It is true that the firm was dissolved in November, 1971. It was agreed that each partner was to receive Rs.4,000 from the first defendant, and the first plaintiff had received his share of Rs.4,000 and relinquished his interests. It is only thereafter in May, 1972, the second defendant started running the Mill. Therefore the first plaintiff having relinquished his interests. The suit is not maintainable. Even otherwise, the suit is not maintainable in law as the licence for the Rice Mill was taken in the name of the first defendant and that it cannot be transferred to the partnership whole or in part, and hence the partnership itself is illegal, based on which the suit cannot be filed. 3. The trial Court dismissed the suit with costs. 3. The trial Court dismissed the suit with costs. On appeal, the only point on which arguments were advanced, was in respect of issue No. 7 as to whether the partnership is against the provisions of the Rice Milling Industries (Regulation) Act and the Rules framed thereunder, and if so, whether the partnership is illegal? The trial Court held that the partnership is illegal and this was upheld by the lower appellate Court. Being aggrieved by this finding, the present second appeal has been preferred, by the second plaintiff. 4. The only point on which arguments were advanced is whether the partner ship was an illegal one because the licence granted under Exhibit B-7 in favour of the first defendant under the said Act, can be utilised by the partnership concern, and if it is so utilised, will it make the partnership itself illegal? 5. The counsel for the appellant contends that the Courts below have proceeded on an erroneous basis particularly because of the decision in Velu Padayachi v. Sivasoorian Pillai1, which would not be applicable to the facts and circumstances of the present case. It is admitted that Exhibit B-7 is the licence issued in Form IV in favour of the first defendant to run the Rice Mill under the said Act. Condition 6 of the licence reads as follows:- “ This licence shall not be transferred to any other person, by the person to whom it is issued and in a case of change in the ownership of the mill by transfer, lease or otherwise a fresh licence shall be applied for by the person who has acquired such ownership.” 6. The counsel for the appellant states that the partnership concern had come into existence, even before the first plaintiff becoming a partner on 18th February, 1961. P.W. 1 has admitted that the licence stood in the name of the first defendant even at the time of his joining the partnership firm. Exhibit B-1 is dated 16th February, 1961, admitting the first plaintiff into the partnership firm. Exhibit B-2 shows that licenses were granted to the first defendant from 4th February, 1960. In the document, it is contended that there is nothing illegal in one of the partners holding the licence for operating the rice mill and the licensee thereafter taking other partners into the partnership firm. Exhibit B-2 shows that licenses were granted to the first defendant from 4th February, 1960. In the document, it is contended that there is nothing illegal in one of the partners holding the licence for operating the rice mill and the licensee thereafter taking other partners into the partnership firm. He relies upon the decision in Umacharan Shaw’s case2wherein the Supreme Court held that a partnership business can be carried on with property which does not belong to the firm, but belongs to a partner, and that, when the relevant statute regulating business conducted under a licence issued therein does not prohibit the licensee from having a partner, but simply prohibits the transfer or sublease of the licence, then the partnership business can be carried on the strength of a licence held by a partner and that in such a case, by the formation of a partnership business or by the conduct of its business, there is no transfer or sublease of a licence held by a partner. 7. He also refers to the decision rendered in Veerappa Pillai v. Raman and Raman Limited and others,3 which arose under the Motor Vehicles Act, 1939 in which also it has been held that the issue of a permit does not depend upon the ownership of the vehicle and what all was required was to obtain a permit in relationship to the vehicle. Section 59 forbids the transfer of a permit from one person to another except with the permission of the Transport authority which granted the permit. It states as follows: “Section 59 (1).-Save as provided in section 61 and subject to the provisions of sections 62-D and 62-E, a permit shall not be transferable from one person to another except with the permission of the transport authority which granted the permit and shall not without such permission operate to confer on any person to whom a vehicle covered by the permit is transferred any right to use that vehicle in the manner authorised by the permit.” Condition No. 6 extracted above, also states that the license would not be transferred and in case of change of ownership, a fresh licence shall be applied for. Even though under section 59 of the Motor Vehicles Act, it was provided that except without the permission of the transport authority, a transfer of a permit will not operate to confer on the transferee any right to use the vehicle as authorised in the permit, the Supreme Court has held that it does not relate to a partnership firm with the object of carrying on the transport business and hence the partnership is not illegal. 8. The learned counsel for the appellant also refers to the decision in Dayabhai and Company Barmani v. Commissioner of Income-tax1which refers to the decision of the Supreme Court above referred to. The counsel for the respondent contends that whatever may be the decision of the Supreme Court rendered in respect of the matters arising under the Motor Vehicles Act or under the Income-tax Act, so long as the decision of the Full Bench in Velu Padayachi v. Sivasooriyan Pillai2is not yet set aside, it will be binding on this Court. His main contention is that the point that arises for consideration in this case has been directly dealt with in the Full Bench decision in Velu Padayachi v. Sivasooriyan Pillai2in which it has been held that when the Abkari Act prohibits transfer of license without Collector’s previous permission, it would not entitle a partner to claim the balance amount due on settlement of accounts of the partnership, when the business had been run by a license-holder as a partner of the partnership firm. In the Full Bench decision, it was held that there are provisions in the Abkari Act to punish those who contravene the terms and conditions of the license or permit. Section 15 of the Act provided that no liquor or intoxicating drink shall be sold without licence from the Collector. Section 55 provides for punishment in contravention of the Act or Rules or license granted under the Act. Rule 27 says that no privilege of supply or vend shall be transferred, sold or sub-rented without the Collector’s previous permission. The licence was granted to one of the partners and the question arose as to whether, without the permission of the Collector, the licensee can enter into a partnership which would be a legal one or not. Rule 27 says that no privilege of supply or vend shall be transferred, sold or sub-rented without the Collector’s previous permission. The licence was granted to one of the partners and the question arose as to whether, without the permission of the Collector, the licensee can enter into a partnership which would be a legal one or not. It was held by the Full Bench that such a partnership is an illegal one, and even if it had been lawful at its inception, it nevertheless becomes unlawful when it intends to conduct the business jointly on a license granted to one of the partners. 9.In Dayabhai’s case1the point involved was in relationship to the permit granted under the Motor Vehicles Act being transferred, and consequently whether the partnership becomes an illegal partnership or not. I find that a reference has been made in this decision to the Full Bench decision in Velu Padayachi v. Sivasooriyan Pillai2and also to Umacharan Shaw and Bros. v. Commissioner of Income-tax, West Bengal 3 . It has been held: “In our judgement, the decision of the Supreme Court in Umacharan Shaw’s case 3(gives a conclusive answer to the reasoning adopted in Madras Andhra Pradesh and Kerala High Court cases and the view expressed in those cases that a partnership entered into for the purpose of conducting a business on a licence granted or to be granted to one of the partners is voild ab initio if the statute under which the licence is granted prohibits a transfer of the licence is not correct. In those cases, it has been held that there is a violation of the provision against transfer because if the licenced partner carries on the partnership business, then the unlicensed partner by himself or through his agent, the other partner, carries on the business in direct violation of the prohibition. In those cases, it has been held that there is a violation of the provision against transfer because if the licenced partner carries on the partnership business, then the unlicensed partner by himself or through his agent, the other partner, carries on the business in direct violation of the prohibition. As to this it is sufficient to say that when, as we have endeavoured to point out earlier, a partnership business can be carried on by a partner with property belonging to the firm or to himself or to the other partner on the strength of a permit or license held by him and the relevant statute does not require a partnership as such to take out a licence for carrying on the business, then there is no question of the unlicensed partner by himself or through his agent, the other partner, carrying on the partnership business without a licence.” 10. If the licence granted under the Abkari Act is transferred, there are provisions made in the Act and the Rules to make it punishable. Equally in respect of Rice Milling (Regulation) Act also, provision has been made under section 13 (2) of the Act for penalties to be imposed if the rules and conditions of licence are violated. Rule 4 contemplates the grant of a licence in Form No.LV. It is in Form No. LV, condition No. 6 prohibits transfer of the licence. It is therefore contended that if a licence is so transferred, it would be opposed to public policy under section 23 of the Contract Act, and such trafficking in licence results in an illegal partnership coming into existence. I do not think that such a contention will any longer he available in view of the decision of the Supreme Court in Umacharan Shaw and Bros. v. Commissioner of Income-tax, West Bengal1and Veerappa Pillai v. Raman and Raman Limited2 . 11. It is since made clear that a partnership can be carried on even though some of the properties belong to a partner. The licence issued to one of the partners will be a property in his hands, which will be available for the benefits of the partnership firm. 11. It is since made clear that a partnership can be carried on even though some of the properties belong to a partner. The licence issued to one of the partners will be a property in his hands, which will be available for the benefits of the partnership firm. As pointed out by the Supreme Court, in such a case, by the formation of a partnership itself or by the conduct of its business, it does not result in the transfer of a licence held “by the partner. If there is no transfer of his license in favour of the partnership and it continued to be with the partner, the mere fact that a partnership had come into existence later on, would not mean that there has been a transfer of a licence. In this case, it is admitted that even before the first plaintiff was admitted into the partnership on 16th February, 1961, the first defendant had already obtained the licence and the business was being conducted as a partnership concern. As contended by the counsel for the appellant, even under the Motor Vehicles Act wherein the provisions contained in section 59 are comparatively rigorous, than what is provided in condition No.6 of the licence, the Supreme Court has held that the partnership will not become an illegal partnership. To find out whether a particular condition is opposed to public policy under section 23 of the Act, the terms and conditions will have to be properly understood. In the Full Bench decision of this Court, it was found that there was a clear-cut prohibition against transfer of a licence to trade or vend in liquor or intoxicating drugs, and it was considered that only the licensee alone should trade in liquor, and therefore it was felt that to permit third parties to exercise the privilege of supply or vending in liquor, the Collector’s previous permission is necessary. It was clearly provided that without Collector’s previous permission, the privilege granted under the Act shall not be sold or transferred. Condition No. 6 of the licence states that the licence shall not be transferred and that in case of a change in the ownership of the Mill by transfer, lease or otherwise, a fresh licence shall be applied for by the person who has acquired such ownership. 12. This condition does not result in a total prohibition. Condition No. 6 of the licence states that the licence shall not be transferred and that in case of a change in the ownership of the Mill by transfer, lease or otherwise, a fresh licence shall be applied for by the person who has acquired such ownership. 12. This condition does not result in a total prohibition. It is of a permissible nature. It comes into operation after the change in ownership is effected. Even more so, in my opinion, it relates only to the transfer of ownership of the Mill or by lease or otherwise of the Mill, which calls for a fresh licence to be applied by the persons who acquired such ownership. Even before the first plaintiff was admitted into the partnership, the first defendant was conducting the Mill as a partnership, and it had continued till 11th November, 1971. Hence, it cannot be said that an illegal partnership had come into existence, because the licence granted to the first defendant was not transferred in the name of the partnership. For these reasons, I hold that the facts and circumstances of this case are not squarely covered by the decision of the Full Bench in Velu Padayachi v. Sivasooriyan Pillai3. 13. A decision of this Court in Dorairaj v. Rajan4was placed before me at the fag end of the arguments which also dealt with the scope of section 23 of the Contract Act, and relates to a partnership constituted in respect of a licence granted under the Madras Cinemas (Regulation) Act, 1955. It has been held therein as follows: "Under section 23 of the Indian Contract Act, an agreement is lawful unless it is forbidden by law or the Court regards it as opposed to public policy. When an unlawful agreement is brought before the Court it would be necessary to find out the exact scope of the statutory prohibition. It is a matter of construction of a particular statute in each case. Except in cases where the law forbids it with a view to the protection of the public, normally the Court may enforce the contract." The Full Bench decision of this Court was also placed before the Division Bench, and after consideration of the relevant decisions placed before the Court, it has been held that a partnership so constituted will not be an illegal partnership. Equally in Dayabhai and Company v. Commissioner of Income-tax1, the Division Bench has also held, after referring to the Full Bench decision of this Court and to the decisions of the Supreme Court, that in view of the subsequent decisions of the Supreme Court, the view expressed in the Full Bench decision, cannot any longer be good law. I have already held that the nature of the condition No. 6 is such, that it is quite different from the conditions imposed under the Abkari Act and therefore the first respondent herein is not justified in contending that the decision in the Full Bench is squarely applicable to the facts and circumstances of this case. 14. As already stated, in the lower appellate Court, the parties did not argue the facts of the case, but sought a finding of the Court only on Issue No. 7, regarding the maintainability of the suit. Since it came to the conclusion that the partnership is an illegal partnership, it did not consider the other points. Therefore it necessitates the matter being remanded to the lower appellate Court for consideration of the other issues which had come up for consideration in this matter. It is contended by the counsel for the appellant that the partnership was not confined only to Rice Mill operations, but also included other business and therefore to that extent he would be entitled to get relief. It is stated that there is no evidence or pleading of severance of the contract. But, now that the matter is remanded for being disposed of on the other issues, and in view of the finding above given, it is not necessary specifically to deal with this aspect in this appeal. 15. In the result, the second appeal is allowed, and the judgment and decree of the lower appellate Court are set aside, and the matter is remanded to the lower appellate Court for fresh disposal in the light of what has been stated above. Court-fees paid on the appeal memorandum is directed to be refunded. No order as to costs.