Partnership dissolution and limitation period for arbitration claims.

JUDGMENT :

The applicant has preferred the present Application under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the ‘Act’) to seek appointment of an Arbitrator to adjudicate the disputes between the parties.

2. The case of the applicant is that the applicant entered into a partnership deed dated 01.10.1981 to carry on the business under the name and style of “M/s Bhatia Enterprises”, along with several other partners. He further states that the said Firm was reconstituted on 01.11.1999 upon retirement of one of the partners, namely Sri Suraj Prakash Bhatia. The applicant states that upon reconstitution, there were several partners in the partnership firm, wherein the applicant has 4% share. The applicant narrates that the records of the Firm were being maintained by Sri Kishan Lal Bhatia. Upon his demise, the records were taken into custody by respondent No. 5-Sri Chander Prakash Bhatia. He further states that upon demise of the existing partners, their legal representatives became partners of the Firm. The applicant narrates that several proceedings under Section 9 of the Act were initiated by one or the other parties. He further states that in the year 2019, it was decided between the partners of the Firm and their heirs that the construction standing over the property of the Firm be demolished and the property be divided as per the percentage of the shares. The applicant has placed on record the Agreement executed between the parties in that regard.

3. In Paragraph-12 of the Application, it is stated that dissolution of the Firm has not taken place. He further states that Sri Jitendra Bhatia has not made available the Books of Account for inspection, despite the applicant’s demands. He further states that the applicant’s demand for partition of the property in respective shares was not agreed to by the respondents. It is further claimed that respondent No. 5 has sought to deal with the property of the partnership firm in September, 2021. Clause 27 of the Partnership Deed contains the Arbitration Agreement. The applicant states that disputes and differences have arisen between the parties under the Partnership Deed, which need to be resolved through arbitration.

4. Notices have been exchanged between the parties, which have been referred to in the Application.

5. Upon filing of this Application, notices were issued to the respondents. A reply has been filed on behalf of respondent No. 4; a composite reply has been filed on behalf of respondent Nos. 5, 6, 7, 8, 9 & 15, and; another reply has been filed on behalf of respondent Nos. 3, 10, 11, 12, 13 & 14.

6. The stand taken by the respondents is that the aforesaid Partnership Firm stood dissolved in the year 2011 with the issuance of a notice for dissolution which was issued by Sri Jeet Ram Bhatia, one of the partners of the Firm, on 21.01.2011. In the said notice, which was addressed to the existing partners, including the applicant Sri Jagdish Chand Bhatia, Sri Jeet Ram Bhatia expressly conveyed his intention of dissolving the Firm w.e.f 21.01.2011. He also stated that “You are aware that the business of the firm stands closed w.e.f. 20.01.2011.”

7. The applicant responded to the said notice, through registered AD post, and the response of the applicant-Jagdish Chand Bhatia has also been placed on record, which reads as follows:-

“To,

Sir,

Shri Jeet Ram Bhatia,

S/o Late Shri Rikhi Ram Bhatia,

R/o 124/5, Rajendra Nagar, Street No. 4, Kaulagarh Road,

Dehradun.

Kindly refer to your letter dated 21/01/2011. In context of the above notice we have to state the following facts: -

1. That your letter is without any basis and is an attempt on your part to avoid payment of legitimate dues to us. You are withholding the accounts and funds of the firm.

2. That the letter has been issued by you only to evade payment of the legitimate dues of the partners and to coerce us to forego our rights.

3. I have also learnt that you have filed an application under Secti