The appointment of an arbitrator is invalid if the partnership deed is not duly stamped and jurisdiction lies where the immovable property is situated.

JUDGMENT

V. Kameswar Rao, J. (Oral)

I.A. 13204/2021

This is an application filed by the respondent seeking permission to file additional documents on record.

For the reasons stated in the application, the same is allowed and the additional documents are taken on record.

Application is disposed of.

ARB.P. 383/2021

1. This petition has been filed by the petitioner seeking an appointment of an Arbitrator for adjudicating the dispute between the parties.

2. The case of the petitioners is, they and Surender Kumar Saxena with Neerja Saxena established an unregistered partnership firm carrying on the business under the name and style "M/s Bharat Interlock Tiles" having its office in Alwar, Rajsthan. The partnership firm while carrying its business had purchased an immovable property bearing No. E-86, MIA Alwar, Rajasthan, having ownership in the name of M/s Bharat Interlock Tiles and all the partners having equal share in the property and the possession of the same is with the respondents. It is their case that both the parties to the petition lost interest in carrying out the business and the firm completely stopped working and became functus officio.

3. The firm was dissolved by mutual consent of the partners except the abovementioned immovable property of the firm on September 08, 2007.

4. It is the case of the petitioners that as per clause 3 of the partnership deed dated September 26, 1998 all the four partners having equal share in the ratio of 25% in partnership firm are entitled to the equal distribution of the abovementioned property.

5. The submission of Mr. Rahul Sharma is that as per Clause 12 of the Partnership Deed the parties have agreed to refer all the disputes arising out of the partnership deed to the arbitration. He stated that the arbitration clause in the partnership deed reads as under:

"That in case of any dispute between the partners hereto relating to any terms of this instrument or of any other matter relating to the partnership business the same shall be refer to the Arbitration and the Indian Arbitration Act enforce shall be binding on the firm and the partners."

6. According to Mr. Sharma, the place of arbitration has not been defined in the partnership deed. It is left open to the discretion of parties to decide the place of arbitration. The parties being residents of Delhi have approached this Court for appointment of an Arbitrator. In support of his submission he has relied upon the judgment between the some of the parties herein i.e., Narendra Kumar Saxena v. Neerja Saxena, ARB. PET. 365/2021 decided on October 01, 2021.

7. A reply has been filed by the respondents. It is contended by Mr. Abhinay, their counsel that there is no notice issued by the petitioners invoking arbitration (in the present matter) as the same is pre-requisite for commencement of the proceedings under Section 21 of the Act. He relied upon the judgment of the Supreme Court in the case of Milk food Ltd. V. GMC Ice cream Pvt. Ltd., (2004)7 SCC 288.

8. He stated that this Court has no territorial jurisdiction to adjudicate the matter as no cause of action has arisen within the territorial jurisdiction of this Court, as:

i. The immovable property in dispute is in the state of Rajasthan. It is well settled law that if the suit is regarding distribution of immovable properties then such a suit can be instituted only in the local limits of the jurisdiction of the immovable property.

ii. The par