Judgment

SHAH, J.:- This appeal with special leave is filed against the judgment of a single Judge of the High Court of Bombay dismissing a petition under Section 33 of the Indian Arbitration Act, 1940.

2. On December 22,1966, the appellant and the respondent, who are brothers, entered into an agreement to carry on in partnership three businesses (1) Messrs. F. D. Mehta & Company; (2) The Great Western Stores; and (3) Dr. Writer s Chocolates and Canning Company. The relevant terms of the deed of partnership were as follows:

"1. The agreement has come into effect from the 2nd day of November 1966.

3. The duration of the partnership shall be at will.

7. The net profits of the partnership after payment of all the out goings incidental to the partnership business shall belong to the partners in equal shares and they shall likewise bear all losses including loss of capital.

15.All disputes and questions whatsoever which shall either during the partnership or afterwards arise between the partners or between one of them and the personal representatives of the other or between their respective personal representatives touching these presents or the interpretation of this deed or the construction of the application thereof or any clause or thing herein contained or any account valuation or division of assets, debts or liabilities to be made hereunder or as to any act, deed or commission of either partner or as to any act which ought to be done by the partners in dispute or as to any other matter in any way relating to the partnership business or the affairs and transactions thereof or the rights, duties or liabilities of either partner under these presents shall be referred to two Arbitrators one to be appointed by each party to the difference in accordance with and subject to the provisions of the Indian Arbitration Act, or any statuary modification thereof for the time being in force."

3. Disputes arose between the two partners. The respondent claimed that on January 17, 1968 the partners reached an oral agreement stipulating that the appellant shall retire from the partnership and shall assign and transfer to the respondent his right, title and interest in the partnership business against payment of the price fixed by Mr. Jal Desai a Chartered Accountant. The appellant denied the agreement set up by the respondent. On June 13, 1968 the respondent addressed a letter to the appellant setting out the terms of the oral agreement dated January 17, 1968 and intimated that "having regard to the attitude adopted by" the appellant "there was no alternative left but to have a legal arbitration", and that Mr. K. M. Diwanji Solicitor of the High Court of Bombay was nominated an arbitrator by the respondent, and the apellant was called upon to nominate his arbitrator "so that the disputes and differences between the parties may be resolved" by the patnership deed. This request was repeated in a letter dated June 14 1968. By his reply dated June 26, 1968 the appellant denied the agreement and without prejudice to his contention nominated Mr. J. B. Maneckji as arbitrator. He simultaneously intimated that if the arbitrators seek to arbitrate on "the issue of the alleged agreement of" the appellant "to go out of the firm" he "would contend that they had no power to do so".

4. The arbitrators were unable to make an award within the period prescribed by the Arbitration Act.There was a reference to Mr. Mehta an Advocate of the High Court of Bombay as umpire to adjudicate the dispute. The appellant then submitted an application to the High Court of Bombay under S. 33 of the Arbitration Act praying (a) for a declaration that there was no existing arbitration agreement in regard to the dispute in petition as to whether or not the agreement was entered into between the parties on January 17, 1968 as stated in the statement of claim filed by the respondent before the arbitrators on October 8, 1969: (b) for a declaration that even if the deed of partnership containe