The referral court's scope under Section 11(6-A) is limited to the prima facie existence of an arbitration agreement. A formal notice under Section 21 is not mandatory if the respondent has prior knowledge of the dispute, and the bar under Section 69 of the Partnership Act is inapplicable to arbitration.

JUDGMENT :

SANJEEV PRAKASH SHARMA, J.

1. This is an application which has been filed seeking appointment of an arbitrator under Section 11(6) of the Arbitration and Conciliation Act 1996 (hereinafter referred to as the ‘Act of 1996’) and as per the arbitration clauses enshrined in the partnership deeds.

2. The applicants are two partners of a registered partnership firm operating under the name of M/s. Kota Service Station (hereinafter referred to as ‘firm’) which is in the business of petrol, diesel and other petroleum products in collaboration with M/s. Hindustan Petroleum Corporation Limited (hereinafter referred to as ‘HPCL’).The brief facts giving rise to the present dispute is that on account of the various allegations made, disputes have arisen between the partners of the firm and non-applicant 1 which has hindered the collaboration with HPCL and caused loss to the firm.

3. Learned counsel for the applicants submits that for efficient functioning of the collaboration by the firm, the income earned was to be deposited with various banks, for which current account was opened and could be operated by any partner as per the partnership deed. Learned counsel further submits that in 2023, when the collaboration with HPCL was in force, a dispute arose when the son of non-applicant 1 (Shri Anil Gupta, son of Shri Prakash Chandra Gupta) started to interfere with the business operations carried out by the partners of the firm which violated the policy of HPCL.

4. Learned counsel also submits that owing to such refusal, non-applicant’s son levelled various false allegations and also initiated multiple proceedings aimed at restricting the applicant’s bank operations, etc. Learned counsel further submits that multiple letters were also written to HPCL, causing loss. Learned counsel further submits that no third party was authorised to enter the premises of the petrol pump and that no interference by any third party could have been done which would also violate the collaboration agreement. Learned counsel submitted that owing to the aforementioned, the applicants filed an application under Section 9 of the Act of 1996 before the learned Commercial Court, Kota, owing to which, serious differences have arisen amongst the partners, affecting the reputation and prestige of the firm.

5. Learned counsel further submitted that as a reply to the applicant’s Section 9 application, the non-applicant stated that there was no dispute. However, the non-applicant had previously invoked the jurisdiction of the learned Commercial Court, Kota by impleading the applicants as a party to the Civil Misc. Arbitration Application No. 10/2023 filed on 25.07.2023 under Section 9 of the Act of 1996, wherein it was averred that disputes have arisen amongst the firm’s partners and that Shri Anil Gupta was not allowed to carry out supervision work as the representative of Shri Prakash Chandra Gupta. Learned counsel also submits that the application also made a mention of a clause in the partnership deed, which stipulated resolution of disputes by an Arbitrator as per the Act of 1996.

6. Learned counsel for the applicant also submits that from a bare perusal of the aforesaid submissions, all ingredients for appointment of an Arbitrator can be culled out as a valid arbitration clause in the partnership deed exists and existence of a dispute can also be made out owing to the Section 9 applications submitted by both