According to the rule followed earlier, if you had secured 39 marks out of 100 and passed the rest of the subject. Then the teacher might give you grace marks, however, the marks would not be reflected in your result. It would be shown like 39#.
According to new rules released in 2014, internals carries 30% weightage along with 70% for External. In order to clear your exam, you had to secure 40% marks in both internals and theory papers, that is; 28/70 and 12/30.
If you are short of 1-2 marks in your theory paper, then grace might be given by your teacher but it is compulsory that you pass your internals with 40% marks.