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2021 Supreme(Del) 3

IN THE HIGH COURT OF DELHI
V. KAMESWAR RAO, J.
Mohit Saraf - Appellant
Versus
Rajiv K. Luthra - Respondent
O.M.P. (I). (COMM). No. 339 of 2020, I.As. No. 9626 & 9772 of 2020
Decided On : 18-01-2021

Advocate Appeared:
For the Appellant :Parag Tripathi, Arvind Nigam, Sr. Advocates, Promod Nair, Sandeep Das, Anusha Nagaraj, Raghuvendra Singh, Arushi Mishra, Advocates.
For the Respondent:Dr. Abhishek Manu Singhvi, Neeraj Kishan Kaul, A.S. Chandiok, Sr. Advocates, Haripriya Padmanabhan, Pooja Dhar, Shrutunjay Bharadwaj, Dipak Joshi, Ashima Chauhan, Simran Kohli, Advocates.

Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 9 - Termination of partnership - Petition challenging unilateral termination by one partner of the firm - Court finds that the respondent lacked authority to unilaterally terminate the petitioner’s partnership; termination was executed in violation of the partnership deed and the provisions of the Partnership Act - The petitioner maintains a prima facie case for reinstatement in the firm after establishing that the partnership was not at will and could not be dissolved without following due process as per the deed. (Paras 1-74)

(B) Partner's Rights - The relationship of partners is one of equality and fiduciary duty, hence the purported expulsion of a partner without express provision in the partnership deed is impermissible and may only occur in good faith as per statutory requirements. (Paras 17-20, 70-72)

(C) Notice Requirement - A notice to terminate a partnership must comply with the terms outlined in the partnership deed and the general statutory requirements; a failure to do so renders the termination invalid. (Paras 36-50)

(D) Interim Relief - The court, exercising jurisdiction under Section 9 of the Arbitration Act, finds the suspension of the termination is just and convenient while awaiting arbitration proceedings.

JUDGMENT :

I.As. 9626/2020 & 9772/2020

1. These applications have been filed by the petitioner seeking permission to file additional documents on record.

The same are allowed and the additional documents are taken on record. Applications are disposed of.

O.M.P. (I) (COMM) 339/2020

1. The present petition has been filed by the petitioner under Section 9 of the Arbitration and Conciliation Act, 1996 (‘Act of 1996’, for short) with the following prayers:

“Therefore, in the light of the facts and circumstances of the present case, and the submissions made in regard thereto, this Hon'ble Court may be pleased to:

(a) Stay the notice issued by the Respondent No. 1 to the Petitioner by way of email sent on 13.10.2020 purportedly terminating the Petitioner's partnership with L&L Partners, New Delhi and all actions taken consequent thereto;

(b) Restrain the Respondent No. 1 from directly or indirectly, interfering with the management and /or administration, and from participating in the affairs of the firm L&L Partners, New Delhi;

(c) Restrain the Respondent No. 1 from holding himself out as, or representing himself to be a partner in L&L Partners, New Delhi;

(d) Direct the Respondent No. 1 to forthwith hand over to the Petitioner all assets and properties of the firm L&L Partners, New Delhi, currently within his possession, including ownership and control over the website www.luthra.com;

(e) Restrain the Respondent No. 1 from accessing or using any of the assets of the firm, including but not limited to restraining the Respondent No. 1 from withdrawing any monies, or authorizing any payments out of, or otherwise operating bank accounts held by the firm, without the consent of the Petitioner;

(f) Restrain the Respondents from interdicting the Petitioner's rights to conduct and manage the affairs of the firms L&L Partners, New Delhi, L&L Partners, Mumbai and L&L Partners Litigation, New Delhi;

(g) Direct the Respondents to forthwith restore the Petitioner's access to his firm email id - MSaraf@luthra.com and the Petitioner's name as being part of the management on the websites of the firms, L&L Partners, New Delhi, L&L Partners, Mumbai and L&L Partners, Litigation, and further restrain the Respondents from directly or indirectly, preventing or otherwise restricting the Petitioner's access to and use of the Delhi Firm's IT infrastructure such as personal laptop, desktop, email with the domain name@luthra.com, servers, database, software subscriptions;

(h) Direct the Respondents to forthwith restore the access of all employees and staff to, and enable use of the IT infrastructure such as personal laptop, desktop, emails with the domain name@luthra.com, servers, database, software subscriptions, whose access has been drastically blocked since 13.10.2020;

(i) Direct the Respondent No. 1 to remove the 'bouncers' stationed by him at the office of the Delhi Firm at the 1st and 9th Floors, Ashoka Estate, 9, Barakhamba Road, New Delhi - 110001 and further restrain the said Respondents from restricting any manner the Petitioner's ingress and egress to the office space at 1stand 9th Floors, Ashoka Estate, 9, Barakhamba Road, New Delhi-110001;

(j) Restrain the Respondents from causing any disturbance or damage to the office cabin of the Petitioner;

(k) Direct the Respondent No. 1 to cease and desist from entering the offices at 1st and 9th Floors, Ashoka Estate, 9, Barakhamba Road, New Delhi - 110001, soliciting or contacting the employees, retainers, or clients of L&L Partners, New Delhi;

(l) Restrain the Respondent No. 1 from making any representation to any of the clients or retainers or employees of any of the firms, L&L Partners, New Delhi, L&L Partners, Mumbai or L&L Partners, Litigation, New Delhi, and from making any representation, communication, filing, applications etc. to any regulatory authorities including the Registrar of Firms, or to the media t

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