2005 Supreme(Pat) 693
PATNA HIGH COURT
R.N.Prasad, J.
Sunil Kumar Singh
Versus
Prabha
Civil Revision No. 1010 of 2005 ;
Decided On : AUGUST 04, 2005
Headnote:Arbitration and Conciliation Act, 1996-Section 8-Reference to arbitrator-suit filed by plaintifs O.P. 2 to 7 for declaration that reconstituted partnership deed is illegal, void, without jurisdiction etc-Petitioner-Defendant No. 3 filing petition in the suit for referring the matter to arbitration in view of the specific provisions in this regard-Plaintiffs-O.P. 2 to 7 contending that since they were not parties in the reconstituted partnership deed, matter cannot be referred to arbitrator-By the impugned order the petitioners prayer rejected-In the earlier partnership deed also, by virtue of which the plaintiffs are claiming rights, a clause of reference of the dispute to the arbitrator available and the petitioner is party in both the partnership deeds and his right cannot be taken away-Any objection can be decided by the Arbitrator in view of Section 16 of the Act-Error committed by the Court below-impugned order set aside-Civil revision allowed. (Paras 9, 12)
AIR 1962 SC 1810, 2003(6) SCC 503-Referred to.
R.N.Prasad, J.
1. Heard counsel for the parties. The petitioner has challenged the order dated 17.3.2005 passed by Subordinate Judge X, Patna in Title Suit No. 296 of 1998 whereby the petitioners prayer to refer the dispute forarbitration has been rejected.
2. Title Suit No. 296 of 1998 was filed by the plaintiffs- opposite parties-1st set for declaration that the reconstituted partnership deed dated 17.2.1992 effective from 1.4.1992 is illegal, void, without jurisdiction and without the desire and intention to retire from the partnership of Babu Rajendra Prasad Singh and it be declared that the plaintiffs being heirs of Babu Rajendra Prasad Singh be deemed to be continuing as partners to the extent of the share of Babu Rajendra Prasad Singh.
3. Summons were issued to the defendants in the said suit, Defendant No. 2 appeared in the suit and filed written statement. Defendant No. 3 who is petitioner in this civil revision also appeared in the suit and before filing written statement filed a petition to contest the suit. He also filed petitions on 25.11.2004 and subsequently 16.12.2004 and 28.2.2005 making prayer therein that the matter be referred to the arbitrator in view of the specific provisions of sending the dispute to the Arbitrator.
4. Some facts relevant to the case are necessary to be mentioned. Veena Theatre is a partnership Firm and there was a partnership deed executed on 13.1.1989, Annexure 2. Clause 17 of the said partnership deed reads as follows:
That in case of any dispute between the parties hereof as regards their respective rights and liabilities, the same will be referred to a sole arbitrator chosen by the parties hereof whose award will be final with regard to the matters referred to him.
5. Subsequently a fresh partnership deed was executed on 17.2.1992, Annexure 3. Clause 20 of the said partnership deed roads as follows:
That in case of any dispute between the parties hereof with regard to their respective rights and liabilities, the came will be referred to a sole arbitrator chosen by the parties hereof whose award shall be final with regard to the matter referred to him.
6. Both partnership deeds Annexures 2 and 3 contain clauses for reference of the dispute to the Arbitrator. The suit was filed by the plaintiffs-opposite parties-1st set for declaration of the partnership deeds to be illegal, void and inoperative on the ground that they were not informed about the execution of the said partnership deeds. They have right by virtue of the partnership deed executed in 1989 Annexure 2. In Annexure 3 the plaintiffs opposite parties-1st set are not the party but the petitioner and opposite party Nos. 8 and 9 are parties. It is evident from the materials on record that on the strength of the arbitration clause in the partnership deeds executed in 1989 and 1992 the petitioner filed petitions for referring the dispute to the Arbitrator. The said petitions were rejected on the ground that since relief sought for in the plaint is for declaration of the partnership deed executed on 17.2.1992 to be illegal, void and without jurisdiction, the petitions for referring the dispute to the arbitrator are not entertainable and the said issue has to be decided by the Court itself.
7. Submission of the learned counsel for the petitioner is that u/s. 8 of the Arbitration and Conciliation Act, 1996, hereinafter to be referred to as 1 the Act 1996, specific provision, has been made for referring the dispute to the Arbitrator if the deed contains clause of arbitration. The petitioner was a party to Annexure 3 and also appeared in the suit and filed petitions before filing of the written statement for reference of the dispute to the. Arbitrator and as such the Court below has committed error of law in passing the order impugned. The contention of the petitioner was also supported by the counsel for opposite party Nos. 8 and 9.
8. On the other hand, counsel for plaintiffs-1st set-opposite party Nos. 2 to 7 submitted that