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2014 Supreme(Bom) 1649

High Court of Judicature at Bombay
R.D. DHANUKA, J.
Minochar @ Minoo Aspandyar Irani
Versus
Deenyar Sheriar Jehani & Others
Arbitration Petition No. 1211 of 2013
Decided on: 22-08-2014

Advocate Appeared:
For the Petitioner:Virag Tulzapurkar, Senior Advocate, a/w. Sandeep Parekh, i/b. P.J. Ramchandani, Advocates.
For the Respondents:R1 to R5, D.D. Madon, Senior Advocate, Sarosh Bharucha, Maneck Mulla, Lara Jasani, i/b. M. Mulla & Associates, Advocates.

Headnote:Arbitration and Conciliation Act, 1996 - Section 9 Grant of interim measures. - Petitioner, taking no steps to appeal arbitrator despite notice invoking arbitration agreement, not entitled to seek any interim measures. It is held by the Supreme Court that the party having succeeded in securing an interim measure of protection before arbitral proceedings cannot afford to seek and sleep over the relief, conveniently forgetting the proximately contemplated or manifestly intended arbitral proceedings itself. A party who has no intension to ultimately refer the dispute to arbitration and seek final relief cannot be permitted to seek interim relief. Interim relief is in aid of final relief. The petitioner in this case has not taken any steps to appoint an arbitrator though notice invoking arbitration agreement was given as far back as on 30th January, 2008. The petitioner is not entitled to seek any interim measures on this ground alone.

       Arbitration and Conciliation Act, 1996 - Section 9 Petition for grant of interim measures. - Interim measures cannot be granted against third person, not party to petition under Section 9 of Act. Since petitioner has prayed for appointment of Court Receiver also in respect of the businesses and assets of these firms, none of these firms being party to this petition and party to arbitration agreement with the petitioner, no relief of appointment of Court receiver or injunction can be granted against those third parties in this proceedings. None of those firms are claiming through the respondent Nos. 1 to 5. Senior counsel is right in placing reliance on the judgment of the Supreme Court in case of Sukanya Holdings Pvt. Ltd. v. Jayesh Pandya, 2003 (3) All MR 325 (SC).

       Arbitration and Conciliation Act, 1996 - Section 9 Partnership Act, 1932, Section 69(3) Petition for interim measures. - Petition filed by power of attorney, of a petitioner, a partner of firm, cannot be said to be not maintainable merely because name of power of attorney is not registered as partner of firm. It is not in dispute that under the partnership deed entered into between the parties, petitioner was not a working partner of the suit firm. Respondent No. 6 on attaining the age of majority however, could act as working partner. The present petition is filed by the petitioner whose name was recorded in the certificate of registration of the suit firm. The name of respondent No. 6 is not registered as a partner of the suit firm, respondent No. 6 could not have filed this petition under section 9 of the Arbitration and Conciliation Act, 1996.

       The petition is filed by the petitioner and not by the respondent No. 6 as a proxy on behalf of the petitioner but has filed as a constituted attorney based on the power of attorney executed in favour of respondent No. 6 by the petitioner due to his inability to file the petition at the stage of filing the petition. Merely because the petition is affirmed and verified by respondent No. 6 as a constituted attorney of the petitioner, it cannot be construed as if the petition is filed by respondent No. 6. Court is not inclined to accept the submission of senior counsel that the petition is filed by respondent No. 6 or since the respondent No. 6 is not a registered partner, this arbitration petition filed by the petitioner is not maintainable in view of bar under Section 69(3) of the Indian Partnership Act, 1932.

       Civil Procedure Code, 1908 - Order XL, Rule 1 Partnership Act, 1932, Section 12 Appointment of Court Receiver. Petitioner, a partner of firm, if marks and strongest case, only then he can seek appointment of Court Receiver.

Judgment

1. By this petition filed under section 9 of the Arbitration and Conciliation Act, 1996 the petitioner seeks appointment of Court Receiver of the business and assets of the firm of M/s. Leopold Cafe and Stores, 'Cafe New York', 'Cafe Universal', 'Coffee House', ' Leostouch' and 'Leo's Boulangerie' including their bank accounts, licences, trade marks etc. and seeks other interim measures. Some of the relevant facts for the purpose of deciding this petition are as under :-

2. Sometimes in the year 1975 the petitioner was admitted as a partner in the firm known as M/s. Leopold Cafe and Stores (hereinafter referred to as the suit firm). Respondent nos. 1 to 5 were subsequently introduced to the said firm by the petitioner as partners. The respondent no.6 then a minor was also admitted as a partner by the petitioner. Respondent no.6 became major on 30th September 1997 and continued as a partner of the suit firm. Duration of the suit firm is at Will under the partnership deed. Clause 7 of the deed provides that each partners shall have free access to the books of accounts at all times and shall be at liberty to make such extracts therefrom as may be thought fit by himself or his agent. Clause 8 of the partnership deed provided that the respondent no.1 to respondent no.4 were working partners and were actively engaged in conducting the affairs of the business of the suit firm. Clause 9 (a) provided for salary to be paid to the working partners. Clause 9 (d) provided that by mutual agreement in writing or by executing supplementary deed or any other deed, the salary, remuneration, bonus or commission payable to the partners may be increased or deceased or modified.

3. Under the said partnership deed, the petitioner is entitled to share in the net profit at 15%. Respondent no.6 is entitled to net profit at 10%. The remaining 75% is shared by the respondent no.1 to 5 in the ratio set-out in clause 11 of the partnership deed. Clause 13 provided that respondent no.6 on his attaining majority shall be full fledged partner in the business of the suit firm irrespective of the fact that any fresh deed of partnership is drawn up and on attaining majority, he will have right to actively participate in the business of the firm.

4. Clause 17 of the partnership provided that in the event of any of the partners acquiring any other assets, properties etc. in the individual or joint names but with the funds and investments of the partnership business then in that event the same shall belong to the suit firm. Clause 22 provided that each of the partner shall diligently attend to the business of the suit firm.

5. It is case of the petitioner that respondent no.3 is an Iranian citizen and often visits Canada and while in India he is looking after the business of Cafe Universal situate at Fort, Mumbai. Respondent no.4 is also an Iranian citizen and has settled in Canada and visits India only for a short duration every year. Respondent no.5 is wife of respondent no.3 and is housewife. It is case of the petitioner that respondent nos. 1 and 2 are operating and running the business of the suit firm to the exclusion of the petitioner and respondent no.6 and other respondents.

6. It is not in dispute that neither the petitioner nor any of the respondents have given any notice for dissolution of the suit firm and that the firm is not dissolved. Mr. Tulzapurkar, learned senior counsel for the petitioner invited my attention to various alleged breaches committed by respondent nos. 1 to 5 of their obligations under the partnership deed in support of his submission that the interim measures as prayed in the arbitration petition shall be granted by this court. My attention is invited to various paragraphs of the arbitration petition in which the petitioner has specifically alleged about such breaches.

7. Learned senior counsel submitted that though under clause 7 of the partnership deed, each partner is entitled to have free access to the usual books of acco


























































































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