Recently, twenty-seven years of silence proved fatal for a partner of M/s Law Publishers, as the Allahabad High Court refused to grant any interim protection in a long-standing partnership dispute. Dismissing the appeal filed under Section 37 of the Arbitration and Conciliation Act, 1996, the Court upheld the Commercial Court’s order rejecting the plea for interim relief under Section 9.
The Division Bench of Chief Justice Arun Bhansali and Justice Kshitij Shailendra observed, "Once it is not established on record as to what triggered the claim for interim injunction by the appellant in the year 2023 after deep slumber of 27 years since after 1996, though she tried to correlate the same with respondents’ intention to transfer the properties, irrespective of merits or demerits of the respective cases of the parties in proceedings for appointment of an Arbitrator under section 11 of the Act, 1996, we are not inclined to grant any relief to the appellant in so far as the proceedings under Section 9 of the Act are concerned and reject her claim for aforesaid reasons in addition to those recorded by the Commercial Court in the order impugned."
The case stemmed from a long-standing dispute within ‘M/s Law Publishers’, a family-run partnership business in Allahabad engaged in the publication and sale of law books. The firm was first constituted through a partnership deed, followed by another deed. In her Section 9 application, Smt. Vibha, claiming to be a sleeping partner, alleged that the other partners were attempting to alienate the firm’s properties and misappropriate its assets, which led her to issue a notice in 2023. The Commercial Court, however, rejected the plea for an interim injunction, holding that the reliefs sought were in the nature of final reliefs and could not be granted at an interim stage. It further found that the appellant had failed to demonstrate a prima facie case, balance of convenience, or irreparable loss, three essential conditions for the grant of interim relief.
The Division Bench noted the absence of any explanation for the appellant’s prolonged silence since 1996 and her failure to produce any records indicating participation in the firm’s business or receipt of profits. Referring to Supreme Court precedents, including Dalpat Kumar and Anr. v. Prahlad Singh and Ors., the Court reiterated that interim relief is an equitable remedy dependent on timely action and a credible prima facie case.
The Bench observed that while there were competing claims over the genuineness of the partnership deeds, it was unnecessary at this stage to determine which deed was valid. “A deep slumber of 27 years on the part of the appellant to either know about the profits in the business or raise any claim in that regard, is germane to the claim for interim relief,” the Court stated, further holding that the appellant’s sudden appearance when certain properties were allegedly being transferred did not tilt the balance of convenience in her favour.
While dismissing the appeal, the Bench remarked that "The law will take its own recourse in relation to the proceedings pending or which may be instituted". It clarified that it was not deciding the validity of the rival partnership deeds or the substantive rights of the parties, which could still be pursued, including through the application under Section 11 of the Arbitration and Conciliation Act, 1996, for the appointment of an arbitrator.
Case Title: - Messrs Law Publishers and Anr. Vs. Sri Virender Sagar and Ors.
Case No.: Appeal Under Section 37 Of Arbitration And Conciliation Act 1996 Defective No. 302 of 2024
Coram: Chief Justice Arun Bhansali, Justice Kshitij Shailendra
Advocate for Appellant: Advs. Abhishek Ghosh, Kartikeya Saran, Priyanka Midha, Ram M. Kaushik, Saurabh Raj Srivastava
Advocate for Respondent: Sr. Adv. Vinod Kumar Singh, Advs. Vinay Kumar Mishra, Ankur Azad, Mayank Singh, Prem Shanker Mishra, Shashwat Anand, Vinay Kumar Mishra
