A & B are partners in a partnership firm. A introduced C, a former partner, as his partner to D. C remained silent at that moment, but later on informed D that he is actually a former partner of the firm. C had not issued any public notice in the year of his retirement from the partnership firm. D, a trader knowing well that only A & B are the partners of the firm, supplied 500 refrigerators to the firm on credit. The credit period expired and D did not get the price of his supplies. D filed a suit against A & C for the recovery of price. In light of the above circumstances answer which of the following is correct

Under Partnership Act, a retiring partner remains liable for firm debts incurred after retirement unless a public notice of retirement is given. However, liability extends only to contracts where the third party believed the retired person was still a partner. Here, D knew C was a former partner before supplying goods. C correctly informed D of his retirement status. Option C is correct - C is not liable because D had actual knowledge of retirement. Fraudulent intent (A) is irrelevant. Option B incorrectly makes C liable regardless, D incorrectly imposes liability for lack of public notice when actual knowledge negates the need for notice.