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2026 Supreme(MP) 140
IN THE HIGH COURT OF MADHYA PRADESH AT INDORE
Pavan Kumar Dwivedi, J.
Jagdish And Others – Petitioners
Versus
Ghanshyam – Respondents
Arbitration Case No. 75 of 2022
Decided On : 28-04-2026
For the Petitioner:Shri A.K. Sethi, learned Senior Advocate assisted by Shri Rishabh Sethi, learned counsel
For the Respondent:Shri Amit Agrawal, learned Senior Advocate assisted by Shri Aditya Goyal, learned counsel
The doctrine of res judicata applies when a judicial authority rejects an application for reference to arbitration under Section 8. If that decision attains finality, the party cannot subsequently invoke the jurisdiction of the court under Section 11(6) to appoint an arbitrator for the same disputed subject matter.
Headnote:
Civil P. C., 1908 -- S. 11 -- Arbitration and Conciliation Act, 1996 -- Ss. 8 and 11 -- res judicata -- application filed before High Court for appointment of arbitrator u/s. 11 of Arbitration Act -- same application u/s. 8 concerning same subject considered and rejected by trial Court -- rejection order attained finality -- recourse u/s. 11 of Arbitration Act not available to either party -- principle of res judicata will apply. (2015) 2 SCC 583 and 2025 SCC Online 2517 followed. 2025 SCC Online Del. 8453 relied on. [Paras 11 to 13
flfoy çfØ;k lafgrk] 1908 & èkkjk 11 & ekè;LFke~ v©j lqyg vfèkfu;e] 1996 & èkkjk 8 rFkk 11 & iwoZ U;k; & eè;LFk dh fu;qfä d¢ fy, ekè;LFke~ vfèkfu;e dh èkkjk 11 d¢ vèkhu mPp U;k;ky; d¢ le{k vkosnu çLrqr fd;k x;k & mlh fo"k; ls lacafèkr èkkjk 8 d¢ vèkhu oSls gh vkosnu ij fopkj.k U;k;ky; }kjk fopkj fd;k x;k rFkk ukeatwj fd;k x;k & ukeatwjh vkns'k vafre gks x;k & fdlh Òh i{kdkj d¨ ekè;LFke~ vfèkfu;e dh èkkjk 11 dk vkJ; miyCèk ugÈ & iwoZ U;k; dk fl)kar ykxw g¨xkA ¼2015½ 2 ,llhlh 583 rFkk 2025 ,llhlh vkWuykbu 2517 vuqlfjrA 2025 ,llhlh vkWuykbu fnYyh 8453 voyafcrA ¼iSjk 11 ls 13
| Table of Content |
|---|
| 1. establishment and attempted dissolution of the partnership firm. (Para 1 , 2) |
| 2. contention regarding maintainability after prior section 8 dismissal. (Para 4) |
| 3. application of res judicata based on judicial precedents. (Para 5 , 6 , 7 , 8 , 9 , 10) |
| 4. section 11 arbitration is barred if section 8 application failed. (Para 11 , 12 , 13) |
ORDER :
Pavan Kumar Dwivedi, J.
The present application has been filed by the petitioners for appointment of Arbitrator in terms of Section 11(6) of the Arbitration and Conciliation Act, 1996.
2. The facts in brief of the case are that the petitioners and the respondent constituted a Partnership Firm under the name of M/s JRG Reality vide agreement dated 20.09.2010. The business operations of the Partnership Firm commenced with effect from 01.09.2010.
2.1 The above-said Partnership Agreement was later on changed to the extent that the new address of the registered office of the firm was recorded in the Partnership Deed. As per the Partnership Deed, petitioner No.1 holds 30% share, petitioner No.2 holds 25% share and the respondent holds 45% share in the said Partnership Firm.The duration of the partnership, as per Clause 5 of the agreement, was 'At Will' of the partners.
2.2 It is stated in the application that according to the above-said Clause 5 of the agreement, public notice was issued on 23.06.2022 in newspaper to dissolve the Partnership Firm in terms of Section 72 of the Indian Partnership Act, 1932.
2.3 The petitioners had sent notice dated 21.06.2022 to the respondent in terms of Section 43 of the said Act for dissolution of the Partnership Firm, specifically mentioning discontinuation of business operations. The respondent was further called upon to provide detailed account of the profits, losses and assets of the Partnership Firm to enable settlement of accounts in terms of Section 48 of the said Act.
2.4 As the respondent did not advert to the notice given by the petitioners, the arbitration clause was invoked vide notice dated 21.06.2022, wherein the name of person was proposed for appointment as Arbitrator. As the respondent failed to submit consent pursuant to the said notice, the present application for appointment of Arbitrator has been filed.
3 Learned senior counsel in view of the above-said facts, submits that dispute is very much present between the parties. Despite notice of dissolution of the Partnership Firm, even though it is partnership 'At Will' in accordance with Clause 5 of Partnership Deed, the respondent has failed dissolve the first and also failed to discontinue the business of the Firm. Thus, the petitioners invoked the arbitration agreement as contained in Clause 22 of the Partnership Deed. As the respondent failed to give his consent to the proposed Arbitrator, the present application has been filed for appointment of Arbitrator. It is submitted that in view of the above facts, the present application deserves to be allowed.
4. The respondent initially filed preliminary objections against the maintainability of the application on account of the fact that the dispute involved is not arbitrable. It was also stated in the said objections that with respect to the present dispute Regular Civil Suit No. (A) 1376/2022 has already been filed by the respondent. In the said civil suit, the present petitioners have filed application under Section 8 of the Arbitration and Conciliation Act, 1996. Taking into account said fact, this Court vide order dated 07.02.2023 adjourned the proceedings of the present case sine die awaiting the outcome of the said application.
4.1 Subsequently, by way of additional reply filed vide document No.3131/2026, the respondent brought on record the fact that the concerned Civil Court has dismissed the said section 8 application of the petitioners vide its order dated 25.02.2023 in the above said civil suit. The learned Senior Counsel for the respondent submits that the order dated 25.02.2023 has become final as the same has not been cha
