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2024 Supreme(Online)(Kar) 38975

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF JULY, 2024 BEFORE THE HON'BLE MR JUSTICE R DEVDAS CIVIL MISC. PETITION NO. 407 OF 2022 BETWEEN:

SMT. SAYEEDA FATHIMA AMREEN, W/O IMRAN KHAN, AGED ABOUT 34 YEARS, PARTNER M/S. ERISN SOFTWARE SOLUTIONS, HAVING OFFICE AT NO. 46, 3RD FLOOR, SADATH CENTER, NANDIDURGA ROAD, JAYMAHAL EXTENSION, BANGALORE - 560 046.

…PETITIONER (BY SRI. NAVEED AHMED., ADVOCATE)

AND:

1. MR. ILYAS PASHA, S/O MUNAWAR PASHA, Digitally signed by AGE ABOUT 37 YEARS, DHARMALINGAM Location: H IGH COURT OF 2. MS. SHOBHA N, KARNATAKA D/O MR. NARAYANSWAMY LAKHMAIAH, AGED BOUT 30 YEARS, BOTH ARE WORKING AT SILQEN SOFTWARE PRIVATE LIMITED, NO. 7, SREE DEVI COMPLEX, 1ST FLOOR, NAT ROAD, GANDHIBAZAR, BASAVANAGUDI, BANGALORE - 560 004.

…RESPONDENTS (BY SRI. DINESH RAO N, ADVOCATE)

THIS CIVIL MISC. PETITION UNDER SEC.11(4)(A) OF THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING TO RESOLVE THE DISPUTE BETWEEN THE PARTIES AND GRANT SUCH OTHER RELIEF OR RELIEFS AS THIS HON'BLE COURT DEEMS FIT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, UNDER CLAUSE-13 OF THE DEED OF PARTNERSHIP DATED 03/05/2019 AT ANNEXURE-A, IN THE INTEREST OF JUSTICE AND EQUITY.

THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, THE COURT MADE THE FOLLOWING:

ORDER

R.DEVDAS J., (ORAL):

This Civil Miscellaneous Petition is filed under Section

11(4)(A) of the Arbitration and Conciliation Act, 1996 seeking appointment of a sole arbitrator to arbitrate the disputes that have arisen between the parties in terms of Clause 13 of the Deed of Partnership at Annexure-A dated 03.05.2019.

2. Learned counsel for the respondents seeks to raise an objection while stating that admittedly the partnership firm, which was constituted by three partners, became a proprietorship concern, consequent to the resignation of the respondents in terms of Annexures-D1 and D2 dated 03.05.2021 and 05.05.2021, respectively. Further, it was pointed out from document No.1 filed along with the statement of objections that the petitioner has converted the proprietorship concerned into a company. The partnership firm, which was earlier known as Erisn Software Solutions, is now Erisn Tech Private Limited. That being the position, since there is no partnership firm and admittedly, the firm is now a company without the presence of the respondents, the petitioner cannot be permitted to invoke the arbitration clause contained in the Partnership Deed.

3. However, the position of law as declared by the Hon'ble Supreme Court in many judgments, including the Branch Manager, Magma Leasing and Finance Limited and Another Vs. Potluri Madhavilata and Another reported in (2009) 10 SCC 103, is that merely because the contract has come to an end by its termination due to breach, the arbitration clause does not get perished nor is it rendered inoperative; rather, it survives for resolution of disputes arising "in respect of" or "with regard to" or "under" the contract. That being the position, even though it is accepted that the partnership has been dissolved in a manner known to law or by virtue of the resignation of partners, nevertheless, the petitioner will be entitled to seek resolution of the disputes which arose in the partnership firm during its existence.

4. In that view of the matter, this Court proceeds to consider whether there is otherwise compliance of the requirement in terms of Section 11 of the Arbitration and Conciliation Act, 1996.

5. This Court has gone through the Annexures filed along with the memorandum of Civil Miscellaneous Petition. This Court is satisfied that the petitioner has fulfilled the requirements as provided under Section 11 of the Act, 1996.

6. Consequently, this Court proceeds to pass the following order.

ORDER (a) The petition is allowed appointing Shri.Vithal Vishnupant Joshi, Retired District Judge, as the sole arbitrator to enter reference of the disputes between the petitioner and the respondent and conduct proceedings at the Arbitration and Conciliation Centre (Domestic and International), Bengaluru according to the Rules governing the said Arbitration Centre.

(b) All contentions inter se parties are left open for adjudication in the arbitration proceedings.

(c) The office is directed to communicate this order to the Arbitration and Conciliation Centre and to Shri.Vithal Vishnupant Joshi, Retired District Judge, as required under the Arbitration and Conciliation Centre Rules, 2012.

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