JUDGMENT (1) This is an appeal under Section 39 of the Indian Arbitration Act, read with section 10 of the Delhi High Court act, against the judgment and order of H. R., Khanna, J., dated 17-7-1967, in Original Suit NO. 108 of 1966 (application) under Section 20 of the Arbitration Act, whereby arbitration agreement into Court for reference of the dispute between the parties to an arbitrator.
(2) The appellant herein, Jiwan Lal and Mohan Lal, and the respondent herein, Radhe Lal Seth executed on 7-4-1956, a deed of partnership in respect of a partnership business to be carried on by them under the name and style of Rama Ice Factory and Cold Storage. We are concerned in this appeal only with clauses 19 and 20 of the said document. The said clauses are as under:-
"19. That in the eventuality of any difference between the parties hereto regarding any partnership affair, the issue at difference will be transferred to the arbitration of one arbitrator to be jointly appointed, failing that to the arbitration of two arbitrators, one to be appointed by the party of the 1st part hereto and second to be appointed by the parties of the second and third parts hereto. In the eventuality of any difference of opinion between arbitrators so appointed relating to the issue of arbitration the decision of the Umpire to be appointed by the said arbitrators regarding that issue shall be binding."
20. That in eventuality of any party hereto desiring to retire from the partnership, any party hereto can call on the remaining parties and failing that any party hereto shall have the option to take his share in that eventuality the partnership provided herein shall e reconstituted accordingly."
On 31-5-1966, the respondent herein served the following ntoice on the two appellants herein:-
"Reference our partnership deed dated 7-4-1956: it is brought to your ntoice that differences amongst the partners have arisen and it has become difficult to continue the business of the partnership i.e. business of Rama Ice Factory & Cold Storage and for the last many years the concern has been managed by your and I have nto been shown the accounts and the distribution of the profits. Hence I wish to retire from the partnership.
In pursuance of clause 19 of the partnership deed, I hereby call upon you to nominate an arbitrator who should be known to btoh the parties, who should go into the accounts of the partnership, divide the assets and liabilities, dissolve the firm and separate my share.
In case the partners cannto consent to a common arbitrator, you are hereby called upon to nominate your arbitrator and on receipt of the reply from you. I shall nominate my arbitrator and these btoh arbitrators shall go into the accounts and divide the property.
The two arbitrators shall nominate their Sarpanch who shall give his award in case of difference between the two arbitrators appointed by the parties.
This letter should be complied with within 15 days of its receipt and within 15 days common arbitrators or your arbitrator should be appointed, failing which please take ntoice that legal steps shall be taken to dissolve the firm. I hope you will comply with this within this stipulated period."
(3) To the above ntoice, the 1st appellant herein, Jiwan Lal, sent the following reply to the respondent on 22-6-1966:-
"In reply to your letter, dated 31-5-1966, received by me on 8-6-1966. I am sorry; to ntoe that you want to retire from the partnership business of Rama Ice Factory & Cold Storage. I can have no objection to this.
It is however, incorrect to say that I have been conducting the affairs of the partnership. As a matter of fact, you along had been managing the partnership business for the first five years or so and you have never shown me accounts for these years nor taken men into confidence. It was after that I asserted myself and started taking part in the management . Everything now is being done by mutual consent. You have access to the books of accounts as much as I have.
The books are complete and an up-to-date balance-sheet can be prepared.
Since you have ntoified your intention to retire, I exercise my right as contained in clause 20 of the partnership deed to purchase your share.
In view of the above, I do nto think it is necessary to appoint an arbitrator. But if you so desire, please send me a list of persons whom you wish to act as arbitrator. If I do nto find any acceptable name, I would suggest a fresh name or names and send it to you."
(4) In reply to the above, the respondent wrtoe a letter, dated 18-7-1966, to the 1st appellant herein which runs as follows:-
"Surprised to receive your letter, dated 22-6-1966, on 25th June, containing false insinuations.
In fact, you are conducting all the business of M/s Rama Ice Factory & Cold Storage, signing and maintaining bank accounts, (nto a single cheque has been signed by me since last many years, when your are maintaining accounts in the banks) writing cash books and ledgers, preparing balance-sheets and profit & loss accounts.
Since you maintain the accounts, the Income-Tax Officer, BXVII(3) has done two assessments i.e. 1961-62 and 1962-63 and in btoh he has nto believed your books.
The question of my retiring from the partnership does nto mean that I am to go out of the business of Rama Ice Factory & Cold Storage . That only means that the partnership is required to be dissolved immediately. The question of purchasing the share of the partners arises only when the property is disposed of by some means acceptable to me, after going into accounts.
You even on my request are neither supplying balance-sheets for 1966-67 and 1967-68 assessment years up to date under some plea. You are once again asked to supply me with the balance-sheets up to date immediately, along with profit & loss accounts.
You are once again asked to supply the names of arbitrators acceptable to you. The fact that the books of accounts are open to inspection by me is wrong. You have nto allowed access to them for the last so many years.
However, if it is true whatever you say, I would like to examine the books of accounts since 1962 at the premises of Dewan Purshtotam Nath Chopra, Advocate, on 56th August at 10 A.M. As regards my mentioning the name of arbitrators, I suggest the following:-
1. Dewan Purshtoam Nath Chopra, Advocate.
2. Shri K. G. Chopra, Superintending Engineer, Cpwd (5) On 4-8-1966, the 1st appellant wrtoe a reply to the respondent herein as follows:
"This has reference to your letter dated 18th July, 1966.
The allegations made in paragraphs nos. 1 to 5 of your letter ttoally incorrect and are denied.
You have already retired from the partnership of Rama Ice Factory & Cold Storage and now it is a settled fact. This is concluded by the offer made, acceptance given and option exercise.
Accounts for the period ending 31st March 1956 have already have prepared and balance-sheets signed by all the partners year after year. There is no going back on these accounts.
As to the accounts for the period subsequent to 1st April, 1965 the same can be inspected by you during working hours by previous appointment at the premises of the factory. In actual state of affairs, this will be more than unnecessary because all that now you are entitled to is the money value of your share in the partnership, which I have to pay you as a result of my giving accepted your offer and having expressed my willingness to purchase your share in the partnership assets. You may now mention the amount at which you appraise your share and if I find it reasonable and proper; I will pay the same, but if there is any disagreement on this specific point, then this specific point alone shall have to be referred to arbitration.
No tohers alleged disputed can form the subject of reference.
Kindly write back giving your confirmation to the above, so that appropriate steps may be taken."
(6) To the said letter, the respondent wrtoe in reply as follows on 31-8-1966:-
"It has reference to your letter dated 4th of August, 1966.
The premises contained in Paras 1 to 5 of my letter dated 18th July 1966 are correct and denial thereof only on the allegations that they are incorrect is nto accepted.
It is wrong to allege that I have retired form the partnership of M/s .Rama Ice Factory & cold storage by you or any toher action by you on that assumption would be at your risk and nto acceptable to me.
In my letter dated 31-8-1966, in terms of Para 2, I have clearly invoked clause 19 of the partnership governing the partnership calling upon you to appoint an arbitrator for investigation into accounts, and dissolution division of assets and liabilities; and dissolution of the firm. I have nto given you any option therein independently of the dissolution of the firm to purchase my share. As such the question of your having exercised the option to purchase my share and having my consequent retirement of the partnership does nto arise. Your interpretation of clause 20 is nto correct, well founded and as such is nto acceptable to me.
I continue to be in partnership till the firm is mutually dissolved and the accounts are gone into.
I have never expressed my wish to retire form the partnership independently of the dissolution of the partnership. The text the of my letter dated 22-5 1966. Does nto warrant the conclusion that I have retired form the partnership or that you are entitled to invoke clause 20 of the partnership deed.
In the context of the facts, neither clause 20 of the partnership deed can be invoked nor your allegation that you have invoked its provisions and exercised the option to purchase my share is accepted.
For purposes of the dissolution of the firm, I have already mentioned the names of the arbitrators as desired by you in your letter dated 22-6-1966. Accordingly either own names in terms of clause 20 for dissolution of the partnership."
(7) On 10-10-1996, the 1st appellant wrtoe his reply to the above letter as follows:-
"I acknowledge receipt of your letter dated 31st August 1966 and I am surprised to read its contents. The contents of the letter are incorrect and are denied by me.
Please finally ntoe that your offer to retire from the partnership was accepted by me and this is a concluded matter. The interpretations which you are now trying to put are incorrect and do nto affect my rights. You have ceased to be a partner in M/s Rama Ice Factory & Cold Storage as from 31st March 1966.
As written to you in my letter dated 4th August 1966, you should intimate me the amount at which you appraise your share. If the amount is reasonable and proper I shall pay; the same. If, however, there is disagreement about the amount payable to you as such, then that point will be referred to arbitration.
The last para of your letter under reference is wrong and is denied. There is no question of dissolution of the firm. The question of appointing arbitrators for the same does nto arise and I never referred to it in my letter dated 22nd June 1966. The arbitrators can be appointed only for the purpose of valuing your share and that is what I meant when I referred to arbitrators in my letter dated 22nd June 1966.
I hope you will appreciate the correct position of the case and intimate me the amount at which you appraise your share."
(8) Thereafter, on 22-11-1966, the respondent herein filed an application under Section 20 of the Arbitration Act, out of which this present appeal has arisen,. The appellants filed their objections, and the respondent file his replication. The appellant also filed a further rejoinder to the replication. In his replication the respondent alleged that he was entitled to get the dissolution of the partnership firm and to have his half share separated from the appellants herein, and submitted that as differences had arisen between the parties, the matter might be referred to two arbitrators, one to be nominated by the respondent and the toher to be appointed by the appellants, and that in case of a difference between the arbitrators, (they?) might appoint a Umpire. The appellants, on the toher hand stated in their objections, that the arbitration clause in the deed of partnership was of a limited nature, that the differences that had arisen between the parties were nto matters which would fall within the arbitration clause, and that, therefore, the matter should nto be referred to arbitration. It was further contended by them that the respondent had retired from the partnership and was no longer a partner, and as such he had no right to claim dissolution of partnership, and that all that the respondent could claim was only the payment of the value of his share in the partnership.
(9) The application was heard by Khanna, J. The learned Judge, by his judgment, dated 17-7-1967, held that clause 19 of the deed of partnership was couched in a comprehensive language and covered within its ambit all disputes relating to the partnership, that the respondent claimed dissolution of partnership, rendition of accounts and separation of his shares, while the appellants herein claimed that the respondent had already retired from the partnership and as such was nto entitled to the dissolution of the partnership and separation of his share, that all the said matters were essentially related to the affairs of the partnership, and that in accordance with clause 19 of the deed of partnership, they will have to be decided in arbitration by the domestic forum chosen by the parties.
(10) It was contended before the learned Judge by the appellants herein.
(i) that it was for the Court to decide as to whether the petitioner had retired from the partnership and whether he could ask for dissolution of the partnership;
(ii) that a partnership could be dissolved only y ntoice and in the absence of such ntoice, the respondent could nto seek the relief of the dissolution in arbitration proceedings; and
(iii) that new agreement came into existence between the parties as soon as the 1st appellant sent his letter dated 22-6-1966 in reply to the respondent's letter dated 31-5-1966, the effect of the same being that the arbitration clause contained in the partnership deed was superseded and ceased to be operative, and that, therefore, the Court should nto refer the matter to arbitration under Section 20 of the Act. (11) The learned Judge took the view that contentions (i) and (ii) mentioned above involved matters which fell within the scope of the arbitration clause, and that as observed by the Supreme Court A. M. Mair & Co, v. Govardhandas Sagarmull, , once the disputes were found to be within the scope of the arbitration clause, it was no part of the province of the Court to enter into the merits of the dispute, and that the said matters were all to be decided by the arbitrators. As regards the 3rd contention, namely, that a new agreement came into existence, the learned Judge held that all that the respondent did when he sent the letter, dated 31-5-1966, was to assert the rights with which he was cltohed under the deed of partnership, that the 1st appellant in sending his reply, dated 22-2-1966, claimed to exercise the right of purchase of respondent's share, that the effect of the said letters was nto to obliterate the deed of partnership and create a new agreement between the parties, that in any case he could nto infer from the said letters an intention of the parties to supersede the arbitration clause to which they had agreed in the deed of partnership for settling their disputes relating to the partnership by arbitration, and that the decision of the Supreme Court in Union of India v. Kishori Lal Gupta, , could nto afford any assistance to the appellants, as in the instant case there was ntohing to show that the original contract of partnership was void ab initio. In the result, the learned Judge accepted the application filed by the respondent, and directed that the arbitration agreement contained in the deed of partnership should be filed in Court and that the parties should give the names of the persons whom they want to nominate as arbitrators within 15 days It is against that judgment that the present appeal has been preferred under Section 39 of the Indian Arbitration Act.
(12) Shri B. Sen, the learned counsel for the appellant, submitted that 4 questions arise for determination in this appeal, namely:-
(1) Whether the arbitration clause includes the disputes that arose between the parties in the present case?
(2) Whether, even if the disputes fall within the arbitration clause, the Court should take into consideration toher circumstances like the circumstances that the disputes raise difficult and complicated questions of law, and the Court should decide the said questions itself and nto refer them to the arbitrator?
(3) Whether in the instant case, the deed of partnership along with the arbitration clause therein seems to be operative in view of the circumstances that the offer to retire made by the respondent was accepted by the appellants, and the appellants gave the ntoice in terms of clause 20 of the deed of partnership ? and (4) Whether, having regard to the circumstances that fraud, misappropriation, etc.,, were alleged by the respondent, the Court should exercise its power under Section 20 of the Arbitration Act or whether the parties should be referred to a suit?
As regard the fourth question, it was nto raised as such before Khanna, J., and was raised for the first time before us. We therefore, informed the counsel that the said question cannto be allowed to be raised in this appeal for hte first time.
(13) As regards the 1st question, the disputes between the parties are as to whether the respondent had retired from the partnership, whether he could ask for dissolution of partnership and whether the parties entered into a new agreement which had the effect of extinguishing the existing agreement. The arbitration clause No. 19 refers to the eventuality of any difference between the parties regarding any partnership affair, and provides that such difference shall be referred to arbitration. The words "any partnership affair" are wide and comprehensive, and there can be no doubt that the said words include the disputes that had arisen between the parties. We, therefore, agree with the view taken by Khanna. J, that the disputes between the parties fell within the arbitration clause.
(14) As regards the 2nd question, Shri Sen argued that even if the disputes between the parties fell within the arbitration clause, if they involved difficult and complicated questions of law the Court, in an application under section 20 of the Arbitration act, should decide the said disputes itself, and should nto leave the said questions to be determined by the arbitrator.
(15) In Gannon Dunkerley and Co. v. Union Carbide (India) Ltd., P. C. Mallik, J. ;of the Calcutta High Court observed at paged 367 as follows:- "Holding as I do that the Court has a discretion in the matter of filing the agreement and directing a reference under section 20, even in cases where there is an effective arbitration agreement and the dispute stated in the petition is covered by the arbitration agreement, should such discretion be exercised against making an order in the facts of the instant case? No difficult question of law requires adjudication in the instant arbitration. Nor does this case involve an enquiry as to fraud which would dissuade a Court to refuse stay under Section 34 of the Act if a suit was instituted on the same cause of action. It seems to me that no cause has been shown as to why this Court should nto make an order for filing the agreement and directing a reference."
(16) In Abdul Qadir Shamsuddin v. Madhav Prabhakar Oak, , the Supreme Court observed at page 410 referring to Section 20(4) of the Arbitration Act as follows:- "The words of this sub-Section leave a wide discretion in the Court to consider whether an order for filing the agreement should be made and a reference made accordingly. It is neither necessary nor desirable to lay down in general terms what would be sufficient cause which would entitle a Court to refuse to order the agreement to be filed and thus refuse to make an order of reference. The Court will have to decide on the facts of each case whether sufficient case has been made out for nto ordering the agreement to be filed and nto making the order of reference."
The decision in Bhuwalka Brtohers v. Fateh Chand Muralidhar, , cited by Shri Sen, deals with the discretion of the Court in the matter of revocation of a reference to an arbitrator. This decision does nto deal with the question with which we are concerned in the present case.
(17) In Barnes v. Yongs, 1898-1 Ch 414, 417, Romer, J., in dealing with the question as to stay of proceedings by reason of an agreement to refer to arbitration, observed as follows:- "In matters of this kind - mtoions to stay proceedings by reason of an agreement to refer to arbitration - the Court undoubtedly has discretion - a judicial discretion of course. In the present case looking at the circumstances, I think in exercising my judicial discretion I ought nto to order a stay of proceedings. In the first place, there is to my mind a simple or comparatively simple, preliminary question whether the ntoice given to the plaintiff is good or bad which is much more fit for this Court to decide than an arbitrator, and which, if it had come before an arbitrator he would have probably referred to the Court. It is certainly a question which is now ripe for decision and which, in the interest of btoh parties ought to be decided forthwith."
(18) Relying on this decision and on Section 34 of the Indian Arbitration Act Shri Sen argued that considerations which should weigh with a Court in considering a mtoion under Section 34 of the Act for stay of proceedings in a civil Court in view of reference to an arbitration, should also weigh with the Court in dealing with an application under section 20. Section 34 of the Arbitration Act confers the power on a Court to stay legal proceedings where there is an arbitration agreement. In the matter of staying legal proceedings in view of an agreement to refer the matter to arbitration and in particular, where difficult and complicated questions of law are involved, the consideration that such questions, if left to the arbitrator, might be referred gain by the arbitrator to the Court for decision thereon, and that, therefore, it would be more fit for the Court to decide the said questions itself rather than to leave them for decision by the arbitrator, assumed importance, and weight, with some Courts in certain cases. But, in an application under Section 20 of the Indian Arbitration Act, the Court is primarily concerned under sub-Section (1) to (3) thereof, with the question as to the existence or the non-existence of the alleged arbitration agreement. Under sub-Section (3) the Court is to give ntoice to all parties to the alleged agreement toher than the applicants, requiring them to show cause why the agreement should nto be filed. Then, sub-Section (4) provides that- "Where no sufficient cause is shown, the Court shall order the agreement to be filed, and shall make an order or reference by the arbitrator appointed by the parties, whether in the agreement or toherwise or, where the parties cannto agree upon an arbitrator to an arbitrator appointed by the Court."
Thus, under sub-section (3), the Court requires the parties to show cause why the agreement should nto be filed, and under sub-Section (4), where no sufficient cause shown why the agreement should nto be filed, the Court shall order the agreement to be filed, and shall make an order of reference to the arbitrator. It is obvious that the words "where no sufficient cause is shown" in sub-Section (4) clearly refer to the cause asked to be shown under sub-Section (4), a discretion on the part of the Court to take into consideration toher factors like the existence of difficult and complicated questions of law and refuse to direct the filing of the arbitration agreement or to make an order of reference to the arbitrator. In our opinion, the situation contemplated by Section 34 of the Indian Arbitration Act, is nto the same as the one envisaged by Section 20 of the Arbitration Act, and it is doubtful whether considerations like the existence of complicated questions of law are open to a Court in dealing with an application under S. 20 of the Act. However, in some English decisions and in some decisions of the Indian Courts, including the decision of the Supreme Court referred to above, it was held that where serious allegations of fraud are made against a party and the party who is charged with fraud, desires that the matter should be tried in open Court, that would be a sufficient cause for the Court nto to order an arbitration agreement to be filed and nto to make a reference. It has to be ntoed that in the above mentioned case, the Supreme Court also observed that- "But it is nto every allegation imputing some king of dishonesty, particularly in matters of accounts, which should be enough to dispose a Court to take the matter out of the forum which the parties themselves have chosen."
(19) In view of the said decisions, we assume without holding in the present case, that if in a given case, the disputes between the parties involve difficult and complicated questions of law, the Court might in its discretion consider the same as sufficient cause nto to order an arbitration agreement to be filed and nto to make the reference. But, it is nto every question of law which would be sufficient cause for the Court nto to order an arbitration agreement to be filed and nto to make the reference. The questions of law involved should be such as can be said to be difficult and complicated questions of law, which require a decision by a Court rather than by an arbitrator Mr. Sen pointed out that one of the questions in the present case is as to whether the respondent could ask for dissolution of the partnership as, according to the appellants, he had retired from the partnership and as there was no prior ntoice for the dissolution of the partnership as required by law. He referred to the decision in Gluer v. Hillier, (1959) All Er 220, in which Roxbourgh, J., in dealing with the question of stay of legal proceedings while there was an arbitration agreement between the parties, observed that in that case, the claim was for dissolution of a partnership, and for the appointment of receiver and manager, that the arbitration clause was very wide and covered the said claim, but that in the exercise of its discretion the Court would permit the action before the Court to continue, having regard especially to the facts that-
(i) The action claimed of a dissolution of the partnership on the ground that it was of just and equitable to dissolve it. The power of deciding which was expressly conferred on the Court by Section 35 of the partnership Act of 1890: and
(ii) the appointment of a receiver and manager was sought. The learned Judge observed that he felt a difficulty in-
"transferring to the arbitrator the power expressly conferred (by Section 35 F)on the Court of deciding, nto what the facts are, but whether on the facts as found it is just and equitable to decree of dissolution." The learned Judge further observed that as follows-
"It appears to me that the dissolution of a partnership which involves the exercise of a judicial discretion under Section 35 F, and which may involves the appointment of a receiver and manager, is again a matter which perhaps is more conveniently left in the hands of the Court.
On these grounds exercising a discretion - because I think the matter is entirely open me- and exercising it, I hope judicially, I decided nto to grant a stay in this case"
Thus, the decision of the learned Judge was based nto only on the facts that the claim for dissolution of the partnership involved the exercised of a judicial discretion conferred expressly on the Court under Section 35 F of the English partnership Act, but also on the fact that the claim was also for the appointment of a receiver and manager which an arbitrator could nto have granted. Mr. Sen pointed out that Section 44(g) of the Indian partnership Act is similar to section 35 F of the English Act, and that since the dissolution of the partnership in the present case also involves the exercise of a judicial discretion under Section 44 (g), and that, therefore, in the present case also it should be held that matter should be left for decision by a Court in a suit and nto by an arbitrator. We are, however, unable to accept this is contention of Mr. Sen we may point out that there is no provision in the English law- this is conceded by Mr. Sen -similar to the provision in Section 20(4) of the Indian Arbitration Act. We have already indicated our doubt as to whether Section 20(4) gives any discretion to the Court. Even toherwise, i.e., even if the Court has a discretion under Section 20(4) of the Indian Arbitration Act, we consider that the principle of the aforesaid English decision, viz. that because s provision in a statue confers a judicial discretion on the Court in respect of a certain matter, the said matter should nto be referred to an arbitrator, cannto be and should nto be applied by the Court in the exercise of its discretion under Section 20(4) of the Act, as toherwise, all matters in respect of which the Court is given a judicial discretion by a statute, cannto be referred to an arbitrator. This could nto have been the intention of the legislature which codified and enacted a self-contained Act like the Indian Arbitrator Act (X of 1940) and included therein a provision as in Section 20(4) of the said Act, We are, therefore, of the view that merely because the claim of the respondent was for dissolution of the partnership, the Court should nto refuse to direct the filing of the arbitration agreement and to make a reference to the arbitrator.
(20) We are also of the view that the toher questions that are involved in the dispute between the parties, viz. whether the respondent could ask for a dissolution of the partnership without any prior ntoice, and whether he had retired from the partnership and if he had retired, whether he could still claim the dissolution of the partnership, are nto difficult and complicated questions of law which necessitate their decision by a Court rather than by an arbitrator. We accordingly reject this contention of Mr. Sen.
(21) As regard the 3rd question, Mr. Sen argued that the respondent by his letter, dated 31-5-1966, ntoified his desire to retire from the partnership and the appellants accepted the same by their letter, dated 22-6-1966, and also in accordance with clause 20 of the partnership deed, they intimated their option to purchase the respondent's share and that consequently the original partnership deed including the arbitration clause therein ceased to exist or have any operation, and a new agreement came into existence between the parties. In support of his argument, Mr. Sen referred to the passage in "Lindley on Partnership." 12th Edition, at page 448, viz. - "Articles of partnership frequently contain a partner is desirous of retiring, he shall give so many month's ntoice to his co-partner who shall have the option of purchasing the share of the retiring partner. If such a clause is acted on, and a partner ntoifies his desire to retire to his co-partner and the latter exercises his option to purchase the share of the retiring partner, a contract is thereby concluded between them, from which neither can depart without the consent of the toher. Consequently, the retiring partner cannto withdraw his ntoice and dissolve the partnership under some toher clause in the deed."
He also referred to the decisions in Warder v. Stilwell, (1856) 112 R. R. 400, which also cannto be accepted. No doubt, if there was an effective ntoification by the respondent to retire, the legal consequences may be as set out in the aforesaid passage in Lindley on partnership and in the English decision mentioned above. All that is stated in the said passage and the English decision is that the partner who ntoified his desire to retire cannto withdraw his ntoification and the right ton purchase his share would accrue to the toher partner as per the terms in the partnership deed, and a contract is thereby concluded between them, and the retiring partner cannto withdraw his ntoice and dissolve the partnership under some toher clause in the deed. This only means that the retiring partner cannto utilise the original partnership deed in a manner which would be contrary to or inconsistent with the new contract between the parties. And it does nto mean that the original partnership deed was rendered void ab initio, or that it is obliterated thereby in its entirety, and the arbitration clause therein also ceased to exist or become inoperative. The passages in Lindley's book or the English decision cited above do nto lay down any such proposition.
(22) For the above reasons, we are of the view that the judgment of Khanna, J. appealed from is correct. The appeal, therefore, fails, and is dismissed with costs.
SAP/D.V.C.
(23) Appeal dismissed.