Mr. Ashok Parbanda vs Mr. Vipin Kumar Parbanda
2006 Latest Caselaw 1712 Del

JUDGMENT

Reva Khetrapal, J.

1. This is a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 filed by the petitioner for appointment of an arbitrator for settlement of all disputes and differences between him and the respondent.

2. The facts leading to the filing of the petition are as follows:

The petitioner and the respondent were the partners of the partnership firm named M/s. Academia Books International Ltd., which was formed in terms of partnership deed dated 27th June, 1994 ( Annexure P-1 to the petition). The said partnership firm was a registered firm, and both the partners had agreed to act on the terms and conditions embodied in the partnership agreement. Disputes and differences arose between the petitioner and the respondent in the year 2001 and eventually the firm became non-functional. On 28th August, 2004 the petitioner sent a dissolution notice to the respondent through UPC, registered post, fax, e.mail and courier. A copy of the dissolution notice, postal receipt and courier receipt are collectively enclosed as Annexure P-2 to the petition. The petitioner desired that the respondent should agree to the appointment of an arbitrator for settlement of disputes which had arisen between the parties, but the respondent neither agreed to the appointment of arbitrator nor for any settlement. Eventually, on 22nd September, 2004, the petitioner invoked the arbitration clause, being Clause-20 of the agreement (Annexure P-1) by serving notice and calling upon the respondent to agree to the appointment of arbitrator for settlement of all disputes. The said notice was dispatched to the respondent by UPC, registered post, fax, e.mail and courier. The respondent not having sent any reply to the aforesaid notice, on the passing of 30 clear days the present petition for appointment of arbitrator was instituted by the petitioner. A copy of the arbitration notice, postal and courier receipts are enclosed with the petition and collectively marked ANNEXURE P-3.

3. On receipt of the notice of the institution of petition, counsel for the respondent though he did not file reply to the petition, took objection by way of oral submission that M/s. Vipin Kumar Parbanda (HUF) was the partner of the partnership firm named M/s. Academia Books International and hence was a necessary party for the proper adjudication of disputes in these proceedings and also before the arbitrator. The petitioner thereupon moved an application under Order 6 Rule 17 read with Section 151 of the Code of Civil Procedure for addition of the name of M/s. Vipin Kumar Parbanda (HUF). The petitioner submitted that though Shri Vipin Kumar Parbanda in his individual capacity was the partner of the dissolved partnership firm and M/s. Vipin Kumar Parbanda (HUF) did not have any concern with the partnership firm, by way of abundant caution, the petitioner was praying for impleadment of M/s. Vipin Kumar Parbanda (HUF) as respondent No. 2. Notice of the above application was issued to the respondent. Counsel for respondent accepted notice and submitted that he did not want to file any reply to the said application. Accordingly, by order dated 18th August, 2005 M/s. Vipin Kumar Parbanda (HUF) was imp leaded as respondent No. 2 in his capacity as partner of the partnership firm named M/s. Academia Books International.

4. Subsequent to the impleadment of M/s. Vipin Kumar Parbanda (HUF) as respondent No. 2, counsel for the respondent sought time for filing reply to the main petition. But instead of filing reply to the main petition, the respondent moved an application, being I.A. No. 6882/2005, under Order 1 Rule-10(2) read with Section 151 CPC on behalf of respondent No. 1 Mr. Vipin Kumar Parbanda, contending that a bare perusal of the partnership deed filed by the petitioner would show that the partnership was in fact between the petitioner and M/s. Vipin Kumar Parbanda (HUF) and not between the petitioner and Mr. Vipin Kumar Parbanda in his individual capacity. It was accordingly prayed that the petition be rejected as against the applicant and the name of the applicant, i.e., respondent No. 1 be struck out from the array of parties.

5. Subsequent to filing of aforementioned application (I.A. No. 6882/2005), the petitioner placed on record a number of documents to show that the partnership firm comprised of only two partners viz., Mr. Ashok Parbanda and Mr. Vipin Kumar Parbanda, inter alia, being a certificate issued by Syndicate Bank regarding details of partners in Current Account No. 90441240000016; letter dated 20th July, 1994 issued by Academia Books International to the Registrar of Firms; Form No. 1 filed by Academia Books International; Amendment No. 1/95 in partnership deed of M/s. Academia Books International dated 27th June, 1994; letter dated 2nd August, 1995 issued by Academia Books International to the Manager of Syndicate Bank; Memorandum of Understanding dated 29th July, 1995 signed by Mr. Vipin Kumar Parbanda in his individual capacity; an affidavit of Shri Vipin Kumar Parbanda in his individual capacity; letters dated 17th June, 1994 and 28th June, 1994 issued by Academia Books International to the Manager of Syndicate Bank; Application for opening of Savings/Current Account of Academia Books International partnership; etc. Learned Counsel for the petitioner after filing the aforesaid documents, made a statement that she did not wish to file any reply to I.A. No. 6882/2005 (for deletion of name of respondent No. 1 Mr. Vipin Kumar Parbanda) and that she wished instead to argue the matter only on the basis of the aforesaid documents.

6. On being faced with the documents aforesaid, counsel for the respondent contended that he had no objection if an arbitrator was appointed to adjudicate upon the disputes and differences between the parties in accordance with Clause-20 of the arbitration agreement between the parties (Annexure P-1 to the petition) provided that the arbitrator resolved all the disputes between the parties, including the dispute as to whether Mr. Vipin Kumar Parbanda was a partner in M/s. Academia Books International in his individual capacity or as karta of HUF. Learned Counsel for the petitioner Ms. Shanta Devi Raman stated that she has no objection if the said dispute was also referred to arbitration.

7. Clause 20 of the arbitration agreement between the parties reads as under:

20. Any disputes or differences, which may arise among the partners or their legal representatives, with regard to the construction or effects of this Deed or any part thereof or in respect of maintaining accounts, profits and losses of the or the rights and liabilities of the partners unto this Deed or at the time of dissolution or winding up of the business or any matter relating to the firm shall be referred to the arbitrators and the proviso of Arbitration Act, 1940 shall apply.

8. Having heard the parties and perused the documents on record, including the partnership agreement between the parties, I am of the considered opinion that there was a binding arbitration agreement between the parties, as set out in Clause-20 of the partnership deed, whereunder all disputes and differences between the parties with regard to the construction or effects of the partnership deed or any part thereof or in respect of maintaining accounts, profits & losses, rights and liabilities of the partners at the time of dissolution or winding up of the business or any matter relating to the firm were agreed to be referred to arbitration. Since, however, the partnership deed was executed on 27th June, 1994, Clause 20 of the arbitration agreement provided for reference to arbitration under the Arbitration Act, 1940. In the meanwhile, the Arbitration and Conciliation Act, 1996 having been come into force, the present petition has been filed under the new Act. No objection to the filing of the present petition under the new Act has been taken by the respondent and in the course of hearing both parties made a categorical statement that they were agreed that the arbitration proceedings be conducted under the new Act viz., the Arbitration and Conciliation Act, 1996.

9. Learned Counsel for the petitioner as well as respondent also made statement during the course of hearing that any arbitrator appointed by this Court would be acceptable to the parties.

10. In the aforesaid facts and circumstances, I appoint Justice S.S. Chadha, Retired Judge of this Court as the sole Arbitrator to adjudicate upon all the disputes and differences between the parties. It is specifically made clear that the arbitrator shall also adjudicate on all the disputes and differences between the parties, including the dispute as to whether Mr. Vipin Kumar Parbanda is a partner in M/s. Academia Books International in his individual capacity or as Karta of Hindu Undivided Family, that is, as Mr. Vipin Kumar Parbanda (HUF). The arbitrator shall fix his own fees and make the award as expeditiously as possible.

11. Both the petition and I.A. No. 6882/2005 stand disposed of in the above terms.