Back
In the High Court of Bombay at Aurangabad
M.T. JOSHI, J.
Sanjay Suganchand Kasliwal
Versus
Jugalkishor Chhaganlal Tapadia & Others
Civil Revision Application No. 140 of 2013
Decided on : 21-11-2013
Arbitration - Partnership Dispute - Arbitration and Conciliation Act, 1986, Section 8 - Summary of Acts and Sections: The court discussed the arbitration clauses in the partnership agreements of the three firms involved in the dispute, the applicability of Section 8 of the Arbitration and Conciliation Act, 1986, and the interpretation of the subject matter of the suit and the arbitration agreements. The court concluded that all the parties to the suit can be referred to a single Arbitral Tribunal.
Fact of the Case:
The dispute arose from the alleged misuse of funds by defendant no.1, who unilaterally withdrew funds from three partnership firms and acquired properties in his name. The plaintiff sought a declaration that the properties belonged to the partnership firms.
Finding of the Court:
The court found that the subject matter of the suit and the arbitration agreements were the same, and all parties to the suit were also parties to the arbitration agreements. Therefore, the court set aside the trial court's order and referred the parties to arbitration.
Issues: The issues involved whether the subject matter of the suit and the arbitration agreements were the same, and whether all parties to the suit were also parties to the arbitration agreements.
Ratio Decidendi: The court held that the subject matter of the suit and the arbitration agreements were the same, and all parties to the suit were also parties to the arbitration agreements, allowing for a single Arbitral Tribunal.
Final Decision: The court set aside the trial court's order and referred the parties to arbitration, appointing a specific Arbitral Tribunal.
1. Rule. Rule made returnable forthwith. With consent of learned counsel for both the sides, heard finally.
2. Aggrieved by the order dated 15/3/2013 passed by the Joint Civil Judge Senior Division, Aurangabad in Special Civil Suit no. 257 of 2012, rejecting the application of the present petitioner/original defendant no.1 for referring the parties to arbitration under section 8 of the Arbitration and Conciliation Act, 1986 (for short "the Act"), the present Civil Revision Application is filed.
3. For the sake of convenience, the petitioner herein would be termed as defendant no.1, respondent no.1 would be termed as plaintiff while respondent nos.2 to 4 would be termed as defendant nos.2 to 4 as arrayed in the trial court.
4. Admittedly the composition of the three partnership firms involved in the present dispute is as under:
PARTNERSHIP FIRM EXISTING PARTNERS STATUS IN SUIT SHARES
M/s Kasliwal Bhagyoday 1] Jugalkishor Chaganlal Tapadia
2] Sanjay Suganchand Kasliwal Plaintiff-Defendant 40%60%
M/s. T.K. Developpera
(Reconstituted) 1] Jugalkishor Chaganlal Tapadia
2] Sanjay Suganchand Kasliwal
3] Venugopal Omprakash Jaju
4] Vijaykumar Ramprasad Jaju Plaintiff-Defendant No.1-Defendant No.3
Defendant No.4 25%42%
17%
16%
M/s Kasliwal Tarangan
(Reconstituted) 1] Jugalkishor Chaganlal Tapadia
2] Sanjay Suganchand Kasliwal
3] Neelam Pankaj Gangwal Plaintiff-Defendant No.1-Defendant No.2 25%65%
10%
5. The clause regarding the arbitration agreement in each of the agreements of partnership firms is as under :
PARTNERSHIP FIRM ARBITRATION CLAUSE
M/s Kasliwal Bhagyoday CLAUSE NO. 18: If any dispute or difference arise between the parties hereto touching the business of the firm or interpretation of any provision hereof or otherwise, relating to the firm and its business the same shall be referred to three Arbitrators to be appointed by the consent of both partners and in case of this disagreement such of the partner shall appoint one Arbitrator. Both the Arbitrators will appoint third Arbitrator and thereupon the majority decision of arbitration will be final and the Arbitration shall be governed by the Arbitration Act 1940.
M/s T.K. Developers
(Reconstituted) CLAUSE NO. 17: If any dispute or difference arise between the parties hereto touching the business of the firm or interpretation of any provision hereof or otherwise, relating to the firm and its business the same shall be referred to three Arbitrators and the Arbitration shall be governed by the provisions of Arbitration Act 1940.
M/s Kasliwal Tarangan
(Reconstituted) CLAUSE NO. 17: If any dispute or difference arise between the parties hereto touching the business of the firm or interpretation of any provision hereof or otherwise, relating to the firm and its business the same shall be referred to three Arbitrators to be appointed by the consent of the all the partners and in case of this disagreement each of the partner shall appoint one Arbitrator and the Arbitration shall be governed by the provisions of Arbitration Act 1940.
6. Plaintiff and defendant no.1 are known as builders and developers and have certain projects which are developed jointly. The dispute in essence is regarding the suit properties as given in the schedules and annexed to the plaint. Pleadings in the plaint :
7. The defendant no.1 being the active partner of the present partnership firm by playing fraud, continuously withdrew amount of Rs.36,14,48,582/- during proceeding three years from the accounts of those firms and by making jugglery, rotated amount in other firms and in his individual account. From the funds, he has purchased and acquired the properties as detailed in Schedule "A" in his individual name. Since he utilized the funds of the above said firms in law the suit properties are assets of the above referred firms.
It was further pleaded that the present suit is not related to the dispute in between the partners of the partnership firm but relates to the right of the partnership firms as owner and possessor o
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
