Mere allegations of fraud do not inherently preclude arbitration unless they raise complex issues requiring a full trial; straightforward financial disputes remain arbitrable under the Arbitration and Conciliation Act, 1996.

JUDGMENT :

V. SRISHANANDA, J.

1. The present Civil Revision Petition is a classic example of how an arbitration proceedings can be delayed even at the very inception stage in utter disregard to the laudable object of early resolution of civil dispute and Alternate Dispute Resolution System and defeating the very object of the enactment of Arbitration and Conciliation Act, 1996. It is often said that resolution of disputes by arbitration in India is full of brakes and no engine. Present case is best example for the said saying.

2. Present Civil Revision Petition is filed by the appellant in M.A No.36 of 2015 on the file of the III Additional City Civil and Sessions Judge, Bengaluru,(CCH- 25) challenging the validity of the said judgment dated 24.11.2018 dismissing the Appeal filed by him challenging the order passed by the arbitrator, whereby the arbitrator recorded a finding that the dispute between the parties is not an arbitral dispute.

3. Facts in the nutshell which are utmost necessary for disposal of the present Civil Revision Petition are as under:

It is alleged that petitioner, respondent Nos.1 to 4 along with other persons constituted a partnership firm in the name and style ‘M/s Paramount Vijetha Holdings’ (‘firm’ for short) through a deed dated 24.05.2006. The said firm was reconstituted on 15.05.2007 as the other partners apart from respondent Nos.1 to 4 retired from the firm. Respondent Nos.1 to 4 continued as partners.

4. The partners decided to induct few more partners and therefore respondent Nos.5 and 6 were also intended to be inducted as partners with a limited interest in the firm that the share of profits of respondent No.4 would be shared by respondent Nos.5 and 6.

5. However, on account of legal issues, inducting respondent Nos.5 and 6 to the firm was not finalized.

6. Material on record would reveal that firm was engaged in Real Estate business and it ventured for development of the agricultural land measuring 3 acres 39 guntas comprised in Sy.Nos.45/2 and 45/3 of Arakere Village by entering into a Joint Development Agreement (‘JDA’ for short) with its owner Sri Krishna Reddy on 29.06.2006.

7. As per the terms of the JDA, M/s Sovern Developers and Infrastructure Company Limited (‘construction company’ for short) was entrusted the work of construction.

8. The revision petitioner namely Ashok S. Dhariwal is the ‘working partner’ of the firm whereas first respondent is the ‘Managing Partner’.

9. There were some differences between owner of the land i.e., Sri Krishna Reddy and the firm on account of improper handling of the development by the first respondent.

10. Therefore, Krishna Reddy filed an arbitration case in A.A No.25/2008. But, at the intervention of the petitioner, the said arbitration case ended in a compromise.

11. It is further allegation of the revision petitioner that the first respondent was immature in handling the business dealings and there are few misunderstanding between the construction company and the firm.

12. As such, the construction company also filed an arbitration case in AA No.697/2009 against the firm and firm also filed an arbitration case against construction company in AA No.728/2009.

13. It is further alleged that, on account of pending arbitration cases, the development work got delayed and the project cost got escalated solely on account of the conduct of the first respondent. It is also alleged by the revision petitioner that first respondent sidelined the revision petitioner by misusing the blank cheques signed by the revision petitioner and transferred the amounts from account of the fir