Arbitrator's award regarding goodwill valuation upheld, emphasizing limited grounds for judicial intervention under the Arbitration and Conciliation Act, 1996.

JUDGMENT :

NITIN JAMDAR, C.J.

1. The Appellant, R. Shiju, and the Respondent, V. Sunil Kumar, were carrying on a partnership business providing entrance coaching facilities for advanced studies such as Medical, Engineering, MBA and MCA courses under the name and style of ‘Zephyr’ pursuant to a partnership deed executed in the year 1997. Disputes arose between them, leading to the invocation of the arbitration clause contained in the partnership deed. An arbitral award was passed, which was subsequently challenged through an arbitration petition. Upon rejection of that petition, R. Shiju has now filed this appeal.

2. Mr. V. Sunil Kumar, the Respondent/Claimant, submitted a claim statement on 16 July 2013 before the Arbitrator, asserting that, due to the success of the partnership firm’s operations, the Appellant, Mr. R. Shiju, established a similar proprietary venture in the name and style of ‘Aspirant’ and publicised the new venture. He claimed that although the partnership was at will and could have been dissolved by issuing a notice of dissolution, the Respondent/Claimant, considering the future of the thousands of students enrolled in the institution, resorted to arbitration to effect the dissolution of the partnership. The Respondent sought dissolution of the partnership, settlement of accounts, and division of the firm’s assets in equal shares.

3. The Appellant – R. Shiju, filed a defence statement that commencement of the new venture ‘Aspirant’, did not violate any stipulation contained in the partnership deed. He contended that it was the Claimant who sought to dominate the management of the partnership and had denied the Appellant access to its records. The Respondent had also sought dissolution of the partnership and distribution of the assets.

4. The Arbitrator appointed two Commissioners, Mr. George Sacariah and Mr. Kylas, for the valuation of the properties, and also appointed Mr. Jobi as the Auditor of the firm to prepare and produce the accounts. No oral evidence was adduced by either side. The Arbitrator concluded the arbitration proceedings by directing the dissolution of the partnership, including its assets and goodwill. Accordingly, the award was rendered on 19 April 2014.

5. The Appellant filed a petition under Section 34 of the Arbitration and Conciliation Act, 1996 (Act of 1996), before the Court of the Additional District Judge, Thiruvananthapuram, in O.P. No. 341 of 2014. The learned District Judge, by judgment dated 23 March 2016, dismissed the Original Petition. Thereafter, the Appellant filed the present appeal under Section 37 of the Act of 1996 on 29 April 2016. In this appeal, the Appellant filed Application No. 3184 of 2017, placing the income tax proceedings on record and seeking a direction for the Respondent to pay or deposit in court a sum of Rs.25,96,359/-. In response, the Respondent filed a counter-affidavit, to which the Appellant subsequently filed a reply.

6. We have heard Mr. Elvin Peter P.J., learned Senior Advocate instructed by Mr. R.D. Muhamed Shameem assisted by