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1995 Supreme(MP) 887

1996 JLJ 225
Tej Shankar, J.
Kamal Pushp Enterprises v. D.R. Construction Co.
Civil Revn. No. 561 of 1994; against the order of Shri P. V. Namjoshi, District
Judge, Guna, passed in Misc. Civil Case No.6 of 1994;
Decided on 13.10.1995.

Advocates:
S.K. Sohani for petitioner; R.A. Roman for non-petitioner.

Headnote:(1) Partnership-Act, 1932 -- S. 69 -- bar under -- applies to initiation of suit or other proceedings arising out of a contract -- bar under is not applicable to defend such suit or other proceedings. [Paras 4 & 10]

        (2) Partnership Act, 1932 -- S. 69 -- Arbitration Act, 1940 -- Ss. 8 (2) and 20 -- proceedings under S. 8 (2) or 20 of Arbitration Act -- provisions under S. 69 of Partnership Act are attracted. AIR 1964 SC 1882 and AIR 1977 All. 352 relied on. [Paras 5 & 7]

        (3) Arbitration Act, 1940 -- Ss. 8 and 20 -- Partnership Act, 1932 -- S. 69 -- application under S. 8 or 20 of Arbitration Act, 1940 -- provisions of S. 69 of Partnership Act are attracted. AIR 1964 SC 1882 and AIR 1977 All. 352 relied on. [Paras 5 &7]

        (4) Partnership Act, 1932 -- S. 69 -- Arbitration Act, 1940 -- S. 14 (2) -proceedings under S. 14 (2) of Arbitration Act for making an award a rule of Court n provisions under S. 69 of Partnership Act are not attracted.

        (5) Arbitration Act, 1940 -- S. 14 (2) -- Partnership Act, 1932 -- S. 69 -proceedings under S. 14 (2) of Arbitration Act for making an award a rule of Court -- provisions under S. 69 of Partnership Act are not attracted.

       

        The proceedings based on an application under S. 14 (2) were not proceedings arising from contract, i.e., the agreement. It is a proceeding to enforce right arising from an award by the arbitrator of his own not necessarily with the consent of the parties. As the award is not and cannot be placed in the category of contract, S. 69 of the Indian Partnership Act shall be no bar to the maintainability of a proceedings to enforce a right arising there from. It is not, therefore, hit by the provisions of S. 69. AIR 1964 SC 1882 and AI R 1977 All. 352 distinguished. 1965 AU 1198 relied on. [Para 8]

        ¼1½ Hkkxhnkjh vf/kfu;e] 1932 & /kkjk 69 & ds v/khu otZu & lafonk ls mn~Hkwr okn vFkok vU; dk;Zokgh ds çkjaHk ij ykxw gksrk gS & ;g otZu ,sls okn ds çfrokn vFkok vU; dk;Zokgh ij ykxw ugha gksrkA ¿iSjk 4 rFkk 10

        ¼2½ Hkkxhnkjh vf/kfu;e] 1932 & /kkjk 69 & ek/;LFke~ vf/kfu;e] 1940 & /kkjk 8¼2½ rFkk 20 & ek/;LFke~ vf/kfu;e dh /kkjk 8 vFkok 20 ds v/khu dk;Zokgh & Hkkxhnkjh vf/kfu;e dh /kkjk 69 ds mica/k vkdf"kZr gksrs gSaA , vkb vkj 1964 ,l lh 1882 rFkk 1977 bykgkckn 352 voyafcrA ¿iSjk 4 rFkk 7

        ¼3½ ek/;LFke~ vf/kfu;e] 1940 & /kkjk 8 rFkk 20 & Hkkxhnkjh vf/kfu;e] 1932 & /kkjk 69 & ek/;LFke~ vf/kfu;e dh /kkjk 69 ds mica/k vkdf"kZr gksrs gSaA , vkb vkj 1964 ,l lh 1882 rFkk , vkb vkj 1977 bykgkckn 352 voyafcrA ¿iSjk 4 rFkk 7

        ¼4½ Hkkxhnkjh vf/kfu;e] 1932 & /kkjk 69 & ek/;LFke~ vf/kfu;e] 1940 & /kkjk 14 ¼2½ & iapkV djus ds fy, ek/;LFke~ vf/kfu;e dh /kkjk 14 ¼2½ ds v/khu dk;Zokgh U;k;ky; dk fu;e gS & Hkkxhnkjh vf/kfu;e dh /kkjk 69 ds v/khu mica/k vkdf"kZr ugha gksrsA

        ¼5½ ek/;LFke~ vf/kfu;e] 1940 & /kkjk 14 ¼2½ & Hkkxhnkjh vf/kfu;e] 1932 & /kkjk 69 & iapkV djus ds fy, ek/;LFke~ vf/kfu;e dh /kkjk 14 ¼2½ ds v/khu dk;Zokgh U;k;ky; dk fu;e gS & Hkkxhnkjh vf/kfu;e dh /kkjk 69 ds v/khu mica/k vkdf"kZr ugha gksrsA

        /kkjk 14 ¼2½ ds v/khu vkosnu ij vk/kkfjr dk;Zokgh lafonk vFkkZr~ djkj ls mn~Hkwr dk;Zokgh ugha FkhA og e/;LFk }kjk Lo;a gh] vko";dr% i{kdkjksa dh lgefr ls ugha] fd, x, iapkV ls mn~Hkwr vf/kdkj çofrZr djus dh dk;Zokgh gS D;ksafd iapkV lafonk ugha gS rFkk lafonk ds çoxZ esa ugha ekuk tk ldrk] vr% mlls mn~Hkwr vf/kdkj çofrZr djus dh dk;Zokgh pykus ds fy, Hkkxhnkjh vf/kfu;e dh /kkjk 69 dk otZu ykxw ugha gksxkA vr%] /kkjk 69 ds mica/k mlls vkdf"kZr ugha gksrsA , vkb vkj 1964 ,l lh 1882 rFkk , vkb vkj 1977 byk- 352 çHksfnrA 1965 , ,y ts 1198 ,l lh 1882 rFkk , vkb vkj 1997 byk- 352 çHksfnrA 1965 , ,y ts 1198 voyafcrA ¿iSjk 8

ORDER

1. This revision petition raises an important question of law with respect to the applicability of section 69 (3) of the Indian Partnership Act to the proceedings which arise out of a filing of an Award by the Arbitrator. Admittedly there was a contract with the petitioner by Gas Authority of India Ltd., Vijaypur, tahsil Raghogarh, district Guna (hereinafter referred to as GAIL) for horticulture work. After this agreement with the GAIL the petitioner entered into an agreement with the respondent for carrying out the said work of horticulture in GAIL. A dispute had arisen between the petitioner, on one hand, and the respondent, on the other, and the matter was referred to sole arbitrator Shri Padam Kumar Jain, Advocate, Guna, with the consent of both the parties. The Arbitrator after recording necessary evidence and hearing parties passed an Award on 6.12.93 and submitted it on 2.2.94 before the District Judge, Guna, for making the Award rule of the Court. Notices u/s. 14 (2) of Arbitration Act were issued by the District Judge whereupon an objection was filed by the petitioner with respect to the maintainability of the Award on 28.4.94. He also challenged the legality of the Award raising a legal objection that it was not maintainable in view of the provisions of S. 69 of the Partnership Act. The learned District Judge framed a preliminary issue in this regard and after hearing the parties held that provisions of S. 69 (3) of the Act were not applicable on the proceedings which arise from the filing of the Award.

2. The contention raised before me by the learned counsel for the revisionist is that proceedings relating to enforcement of an Award are covered within the meaning of S. 69 (3) of the Partnership Act. A lengthy and laboured argument has been made by the learned counsel for the revisionist. He also made reference to the history of Partnership Act and placed reliance upon several authorities and an article written by former Chief Justice of Delhi High Court, Justice V.S. Deshpande published in 1991 (2) Arbitration Law Reporter page 13 which shall be dealt with henceforth.

3. On the other hand, it has been contended that S. 69 has no application to a case where an Award has been filed suo motu by the Arbitrator because. irrespective of the fact whether an application for making the Award rule of the Court is made or not if the Court comes to the conclusion that there is no cause to remit the Award or set aside the Award, the Court shall, after the time for making an application to set aside the Award has expired and in case the said application is made, after refusing it, proceed to pronounce judgement in accordance with the award u/s. 17 of the Arbitration Act. It cannot be said to be a proceeding for enforcement of a right arising out of a contract as provided u/s. 69.

4. Before entering into the discussion it is relevant to mention the provisions of S. 69 of the Partnership Act, so far as it is relevant for our purposes, it runs as follows:

69. Effect of non-registration.-- (1)No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of firms as partner in the firm.

(2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partner in the firm.

(3) The provisions of sub-sections (1) and (2) shall apply also to a claim of set off or other proceeding to enforce a right arising from a contract, but shall not effect - .

(a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise





























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