IMPORTANT POINT
Appointment of Arbitrator – While dealing with petition under Section 11 of Arbitration and Conciliation Act, 1996, Court by default would refer the matter when contentions relating to non-arbitrability are plainly arguable – In such case, issue of non-arbitrability is left open to be decided by Arbitral Tribunal.

JUDGMENT :

ABHAY S. OKA, J.

Leave granted.

1. These three appeals take exception to the similar orders passed by a learned Single Judge of the Bombay High Court on 6th March 2020 on the petitions under Section 11 of the Arbitration and Conciliation Act, 1996 (for short “the Arbitration Act”). The appellant, the respondent no.1 and the respondent nos.3 to 5 were the partners of three different partnership firms in the name and style of M/s M.M. Developers, Nisarga, M/s M.M. Developers, Shanti Nagar and M/s M.M. Developers, Shramjivi. The facts of these three cases are identical and therefore, for convenience, we are referring the facts of the case in Civil Appeal arising out of Special Leave Petition (Civil) No. 7635 of 2021. A deed of retirement-cum-continuation dated 12th September 2014 (for short “the retirement deed”) in respect of the firm M/s M.M. Developers, Nisarga (the respondent no.2) was executed by and between the appellant, the respondent no.1 and the respondent nos.3 to 5. The retirement deed recorded that the respondent no.1 retired from the respondent no.2 partnership firm on the terms and conditions mentioned therein and the business of partnership firm was continued by the appellant and the respondent nos.3 to 5.

2. The respondent no.1 by his advocate’s notice dated 18th February 2019 invoked the arbitration clause (clause 19) in the retirement deed. According to the case of the respondent no.1, the appellant and the respondent nos.3 to 5 did not respond to the said notice. Therefore, a petition under Section 11 of the Arbitration Act was filed by the respondent no.1. By the impugned Order dated 6th March 2020, the learned Single Judge of the Bombay High Court allowed the petition and appointed a member of the Bar as the sole Arbitrator. Similar orders were passed in relation to the two other firms. The present appeals have been filed on 9th June 2021.

3. A counter affidavit has been filed by the respondent no.1 contending that though the appellant was served with the advocate’s notice of the petition under Section 11 of the Arbitration Act, he did not appear in the petition. In the counter affidavit, it is pointed out that on 8th May 2021 in the preliminary meeting held by the learned Arbitrator, the appellant was represented by an advocate. It is pointed out that the respondent no.1 filed an application under Section 17 of the Arbitration Act before the learned Arbitrator claiming certain interim directions. The respondent no.3 filed an application under Section 16 of the Arbitration Act contending that there was no arbitration agreement in existence and that the claim made by the respondent no.1 before the Arbitrator was barred by limitation. By the order dated 25th May 2021, the learned Arbitrator rejected the objection raised under Section 16. The respondent no.1 has pointed out in the counter affidavit that before the learned Arbitrator, the appellant, the respondent no.2 and respondent nos.4 and 5 were represented by a common advocate who specifically supported the submissions of the learned counsel appearing for the respondent no.3 in support of the application under Section 16. It is also pointed out that the aforesaid material facts have been suppressed in the present appeals filed on 9th June 2021. It is also pointed out that by the order dated 24th June 2021, the learned Arbitrator allowed the application under Section 17 filed by the respondent no.1. By filing additional documents, the respondent no.1 has brought on record a copy of an appeal filed by the appellant and the respondent no.2 for challenging the Order dated 24th June 2021 before the Bombay High Court.

4. During the course of submissions, Mr. Manish Vashisht, the learned Senior Counsel appearing for the appellant accepted that the appellant has filed a petition under Section 34 of the Arbitration Act for challenging the order dated 25th May 2021 passed by the learned Arbitrator overruling the objections raised by the respondent no.3.

5. The l