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2019 Supreme(Mad) 3434
IN THE HIGH COURT OF MADRAS
Pushpa Sathyanarayana, J.
S. Jegatheesan and Ors. - Appellant
Versus
S. Vaikundarajan and Ors. - Respondent
O.P. Nos. 372 to 374, 380 to 382, 384 of 2019 and O.A. No. 543 of 2019
Decided On : 06-09-2019
For the Appellant : T.V. Ramanujam, Senior Counsel for Aparajitha Vishwanath
For the Respondent: AL. Somayaji, Senior Counsel for V. Perumal, V. Lakshminarayanan for Kingsly Soluman and AR. L. Sundaresan, Senior Counsel for S. Elambharathi
Headnote:
Arbitration and Conciliation Act, 1996 - Section 74 - Partnership deeds - Partnership firms - Business of manufacturing, mining and selling of beach sand minerals such as garnet, ilmenite etc - Whether petitioners are entitled to invoke arbitration clause in partnership deeds when same are superseded by "Partition Deed - Whether applicants are entitled for injunction as prayed for - whether said Partition Deed is an award and if so, whether it requires registration, after affixing required stamp duty - Held, It is true that parties have agreed to certain terms, but they cannot be straight away enforced by taking up execution - Court find in spite of our careful scrutiny, serious deliberations and analysis of materials on record, particularly memorandum of conciliation proceedings and letter of comfort, that either taken individually or even together - They or any one of them cannot legitimately claim to be entitled to or assigned status of a settlement agreement within meaning of Section 73, for purposes of Act - Court case on hand, after arriving at settlement, all parties have signed Partition Deed, which is not in dispute - Naturally so-called settlement agreement drawn up by conciliator does not bear signatures of parties - As the impugned order shows, said settlement has been given a status higher than an arbitral award inasmuch as Court has refused to even entertain any objection against said settlement agreement reiterating position that settlement arrived at by conciliator will be binding on parties – Petitions are dismissed
ORDER :
Pushpa Sathyanarayana, J.
1. Since all these petitions and the application concerns the dispute among the same parties, they are taken up together for hearing and disposed of by means of this common order.
2. The first and second petitioners are husband and wife. The first and second respondents are husband and wife. The petitioners 3 to 5 and the respondents 3 to 5 are their respective children. The first petitioner and the first respondent are brothers. The background facts of the dispute among them leading to the filing of these petitions run infra:
2.1. The parties herein are partners of various partnership firms, such as Vetrivel Minerals, V.V. Mineral (EOU), V.V. Mineral, Edison Paints and Chemicals, V.V. Marine Products, Vijay Cements and Vetrivel Marketing and Warehousing (VVM Warehousing) which were formed under the respective partnership deeds dated 26.02.2009, 01.02.2012, 01.02.2012, 30.06.2011, 06.01.2014, 13.02.2014 and 26.02.2009 and have been engaged primarily in the business of manufacturing, mining and selling of beach sand minerals such as garnet, ilmenite etc. and other mineral products. The first respondent is the Managing Partner of those entirely family owned and operated partnerships firms. One another brother of the first petitioner and the first respondent S. Chandresan was also a partner of those firms and in 2009, he raised certain disputes which led to the appointment of Hon'ble Mr. Justice Shivaraj V. Patil, Judge (Retd.), Supreme Court of India, as the Arbitrator to decide the dispute. The parties arrived at a Compromise, the terms of the which were reduced in writing and filed before the learned Arbitrator, based on which an Award dated 13.07.2011 was passed.
2.2. Thereafter, the present partners were inducted in the firms. There were certain disputes arose among the partners also. Though the first respondent assured to sort out the disputes and placed some proposals, nothing was taken forward. According to the petitioners, the respondents were not transparent in their actions and the petitioners were kept in dark by them. During the year 2018, the petitioners came to know that there were statutory violations by the respondents and the officials of the Income Tax Department conducted raids in their premises. In such backdrop, the petitioners sought for partition and division of all the firms equally between the parties.
2.3. Subsequently, the first respondent agreed to divide the properties and informed the petitioners that a "Kaithadi Partition Deed" dated 31.12.2018 (in short "Partition Deed") has been prepared by him. As the petitioners throughout believed the first respondent, they signed the Partition Deed without even reading it and there was no third party witness to the same and it was an unregistered document. When the petitioners studied the Partition Deed later, they realized that the properties were not divided equally and some of the properties purchased from and out of the funds of the firms in the names of the respondents did not find a place in the Partition Deed.
2.4. The first petitioner sent an email on 23.01.2019 unequivocally revoking the Partition Deed and called upon the first respondent to convene a meeting to divide the properties equally. The first respondent issued a reply notice dated 24.01.2019 alleging that the first petitioner had split the properties, handed over the schedules to the respondents and all the parties signed the Partition Deed agreeing and consenting the terms therein and also making counter allegations.
2.5. Since the first petitioner wanted to settle the issue amicably, he sent another email dated 05.02.2019 seeking for referring the matter to Hon'ble Mr. Justice Shivaraj V. Patil, Judge (Retd.), Supreme Court of India, to resolve the matter amicably, as the learned Judge earlier dealt with the issue as the learned Arbitrator. However, the first respondent via email dated 18.02.2019 replied that the Partition Deed is final and the same cannot be rev
