Q.Which of the following is a consequence of a firm remaining UNREGISTERED, under Section 69 of the Indian Partnership Act, 1932?
(A) The firm cannot be sued by any third party
(B) The firm cannot sue a third party to enforce a right arising from a contract
(C) The firm's partners automatically lose their limited liability protection
(D) The firm must pay a penalty to the Registrar of Firms every year

Section 69's bar runs only one way — it blocks the unregistered firm itself from suing on a contract, while leaving outsiders completely free to sue the firm.

Section 69 provides that an unregistered firm cannot sue a third party to enforce a right arising from a contract, and cannot sue a co-partner or the firm to enforce a right arising from the partnership agreement. This bar does not, however, prevent outsiders from suing the unregistered firm — the disability runs one way only.

Option-by-option analysis:

• (A) Incorrect — an unregistered firm CAN be sued by third parties; only the firm's own right to sue is restricted.
• (B) Correct — this is precisely the Section 69 consequence. …