Partnership disputes can be referred to arbitration in accordance with the provisions of the Partnership Deed.

JUDGMENT

1. This is a petition filed under Section 11 (5) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the Act') seeking reference of the disputes arising out of and in connection with the Partnership Deed dated 02.08.2009, executed between the parties to an independent arbitrator.

2. The case of the petitioner is that the petitioner and the respondent both purchased an acre of land in Gunnampalli Village, Dwaraka Tirumala Mandal, West Godavari District in the name of the partnership firm vide a Sale Deed dated 03.011.2009 and Rectification Deed dated 18.01.2010. The land was purchased to construct a factory for manufacturing cartons. It is stated that as per the Partnership Deed, the applicants share in assets and liabilities of the firm was 60% whereas the respondent's share of the assets and liabilities was to the extent of 40%. It is stated that on account of a fire incident, the factory constructed over the said plot of land was damaged. The liabilities of the firm, it is stated were discharged thereafter. It is further stated that the petitioner made several requests to respondents for dissolving the firm and for settlement of the accounts in terms of the relevant clauses of the Partnership Deed, which did not elicit any response at all.

It is stated that finally, a legal notice dated 02.11.2022 was issued and served upon the respondents informing the respondent that being a partnership at will it stood dissolved and yet again asked the respondent to settle the accounts which also did not elicit any response finally it is stated that vide notice dated 07.12.2022, by invoking clause 18 of the partnership deed, the petitioner nominated his arbitrator and asked the respondent either to confirm the arbitrator appointed by the petitioner as a sole arbitrator or to propose an alternate arbitrator for resolving the disputes. The said notice however was refused by the respondent as per the record of the postal authorities. In these circumstances it is prayed that the disputes having arisen between the parties, the same may be referred for adjudication to a sole arbitrator.

3. Copy of the partnership deed dated 02.08.2009, is on record. Clause 18 of the partnership deed envisages:

'18. That in the event of any dispute the matter shall be referred to sole arbitrators in accordance with the provisions of the Arbitration and Conciliation Act, 1996 and the decision of the arbitrator or arbitrators as the case may be in shape of his or their award, shall be binding on the parties hereto.'

4. Counsel for the respondent Mr. Palla Balu Anil Kumar, had earlier appeared on 04.12.2023 and took time to file his response, however, today the learned counsel made a statement that he had no instructions in the matter.

5. Be that as it may, in view of the disputes between the parties, the same need to be adjudicated upon through the mechanism of arbitration in terms of Clause 18 of the Partnership Deed.

6. Accordingly, the Arbitration Application is allowed, Sri A. V. Partha Sarthy, retired District and Sessions Judge, is appointed as a sole Arbitrator, who shall enter upon the reference and adjudicate upon the disputes between the parties. The parties shall be free to file detailed claims and counter-claims before the Arbitrator, who shall render an Award within the prescribed statutory period. The Arbitrator shall be entitled to claim her fee in consultation with the parties, keeping in view the provisions of the Act of 2016 and the Rules framed thereunder. No order as to costs.

Pending miscellaneous applications, if any, shall stand closed.