Sri. Shivappa Dhulappa Hulkunde vs Sri L Narasimhaiah
2024 Latest Caselaw 5699 Kant

Karnataka High Court

Sri. Shivappa Dhulappa Hulkunde vs Sri L Narasimhaiah on 23 February, 2024

Author: P.S. Dinesh Kumar

Bench: P.S. Dinesh Kumar

                                              COMAP No.3/2024

                                1

        IN THE HIGH COURT OF KARNATAKA AT BENGALURU

         DATED THIS THE 23RD DAY OF FEBRUARY, 2024

                           PRESENT

      THE HON'BLE MR. P.S. DINESH KUMAR, CHIEF JUSTICE

                               AND

     THE HON'BLE MR. JUSTICE T.G. SHIVASHANKARE GOWDA

            COMMERCIAL APPEAL NO. 3 OF 2024

BETWEEN:

1.     SRI. SHIVAPPA DHULAPPA HULKUNDE
       NO. 27-7, TEMPLE ROAD
       BASAVAKALYANA, BIDAR
       GULBARGA DIST.

       SINCE DEAD, REPRESENTED BY HIS LEGAL
       REPRESENTATIVES

1(A). DR. MAMTA PATIL
      W/O C.K. PATIL
      D/O LATE SHIVAPPA HOLKUNDE
      AGED ABOUT 49 YEARS
      NO.26, LAXMI LAYOUT
      BASAVESHWARANAGARA
      HUBBALLI, DARWAD DIST                       ...APPELLANT

(BY SHRI. VISHWANATH SABARAD, ADVOCATE)

AND:

SRI. L. NARASIMHAIAH
S/O LATE LAXMIPATHAIAH
AGED ABOUT 76 YEARS
NO.193, 47TH CROSS, 2ND MAIN
6TH BLOCK JAYANAGAR
BENGALURU-82                                    ...RESPONDENT

(BY SHRI. L. NARASIMHAIAH, PARTY-IN-PERSON)
                                                       COMAP No.3/2024

                                 2



      THIS COMMERCIAL APPEAL IS FILED UNDER SECTION 13(1A) OF
COMMERCIAL COURTS ACT R/W SECTION 37(1)(c) OF THE
ARBITRATION AND CONCILIATION ACT, 1996, PRAYING TO ISSUE
NOTICE / SUMMONS TO RESPONDENT, CALL FOR RECORDS, HEAR THE
PARTIES AND SET ASIDE THE IMPUGNED JUDGMENT AND ORDER
DATED 16.12.2023 PASSED IN COM.A.P.NO.09/2023 ON THE FILE OF
COURT OF THE LXXXIII ADDL. CITY CIVIL AND SESSIONS JUDGE AT
BENGALURU CITY (CCH NO.84) CONFIRMING THE AWARD DATED
20.08.2010 IN ARBITRATION CASE ON THE FILE OF ARBITRAL
TRIBUNAL OF SRI. SANGOLLI, RETIRED DISTRICT JUDGE AND SOLE
ARBITRATOR BENGALURU AND ALLOW THE ABOVE APPEAL IN THE
INTEREST OF JUSTICE AND EQUITY.

     THIS COMMERCIAL APPEAL, HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT ON 14.02.2024, COMING ON FOR
PRONOUNCEMENT OF JUDGMENT THIS DAY, CHIEF JUSTICE
PRONOUNCED THE FOLLOWING:-


                          JUDGMENT

This appeal by the plaintiff is directed against the

judgment dated December 16, 2023 in COM.A.P.No.09/2023

passed by the LXXXIII Additional City Civil and Sessions

Judge (CCH-84), Bangalore.

2. We have heard Shri. Vishwanath Sabarad,

learned Advocate for the appellant/plaintiff and

Shri. L. Narasimhaiah, Party-in-person for

respondent/defendant.

3. For the sake of convenience, the parties shall be

referred to as per their status in the Trial Court.

4. The instant petition arises from the order dated

20.08.2010 passed by the Sole Arbitrator,

Shri. N.S. Sangolli, whereby the Arbitral Tribunal has partly

allowed the petition filed by respondent (Claimant therein).

The Arbitral Award reads as follows:

"Claims petition partly allowed R1-to supply to the Claimant profit and loss accounts and all other relevant books of accounts pertaining to the business run as per the partnership agreement Ex.C11 and pay ₹.12,500/- per month from February 2003 till 28.11.2008 with interest at 9% p.a.,

R-2 is directed to release ₹.2,00,000/- deposited as security deposit by the claimant following their rules governing the refund of security deposit within 6 months from the date of the receipt of the copy of this Award.

Award to be drawn up accordingly."

5. Respondent's case before the Tribunal is that,

North East Karnataka Road Transport Corporation 1 had

allotted tender to respondent to run buses on hire from

'NEKRTC' for short

20.04.2001 to 19.09.2006 and he had deposited

Rs.2,00,000/- as security deposit with NEKRTC. In

meanwhile, Late Shivappa-plaintiff and respondent entered

into a partnership deed dated 29.12.2001 under the name

and style 'M/s. Kalyan Travels'. He had invested

Rs.6,75,000/- as opening capital. It was agreed that

respondent would be entitled for 51% share out of the

payments received from the NEKRTC. The NEKRTC made

payments in name of the partnership firm as agreed

between the partners. However, plaintiff was withholding the

amounts legitimately due and payable to the respondent.

Respondent issued a legal notice. In response, plaintiff paid

₹1,50,000/- on 11.02.2003, thereafter, plaintiff did not pay

any amount. On 28.11.2009, respondent issued notice

calling upon plaintiff to give consent to appoint one

Sri.Prof.M.Narayana Reddy as sole Arbitrator and the

plaintiff did not accede to the same. Respondent filed a

Company Petition2, wherein this Court directed to appoint

Arbitrators to adjudicate the dispute between plaintiff-Late

Shivappa and the respondent. Hence, respondent

approached the Arbitral Tribunal.

6. Plaintiff's case is that, Late Shivappa entered into

a Partnership Deed dated 29.12.2001 and it was named

'M/s. Kalyan Travels'. The investment made by Late

Shivappa was Rs. 6,00,000/- and respondent invested Rs.

75,000/- and the total investment was Rs.6,75,000/-. Due

to loss in the business, a Deed of Dissolution was executed

on 17.03.2002 with effect from 05.01.2002. The partnership

firm was in existence only for 7 days. Late Shivappa was

not keeping well and taking advantage of the same,

respondent filed a C.M.P. No. 07/2009 before this Court.

Respondent obtained an ex-parte Arbitral Award dated

18.02.2010. Aggrieved by the Arbitral Award, plaintiff filed

the instant petition under Section 34 of the Arbitral and

Conciliation Act, 1996 and the same was dismissed. Hence,

this appeal.

7. Based on the above pleadings, the Commercial

Court has framed following points for consideration:

(1) Whether the Plaintiff has made out any grounds as set out under Section 34 of Arbitration & Conciliation Act, 1996 so as to set aside the Award dated:20th August 2010 passed by the learned Arbitral Tribunal in Arbitratin Case between Sri. L. Narasimhaiah and Sri. Shivappa Dhulappa Hulkunde and NEKRTC?

(2) Whether the Plaintiff has made out any grounds as set out under Section 34 of Arbitration & Conciliation Act, 1966 so as to set Arbitration Case between Sri.L.Narasimhaih and Sri. Shivappa Dhulappa Hulkunde and NEKRTC?

(3) What Order?

8. Answering point No. (1) and (2) in the negative,

the Commercial Court has dismissed plaintiff's petition.

9. Shri. Sabarad, for the plaintiff, mainly submitted

that respondent has suppressed the fact about the Deed of

Dissolution and obtained the ex-parte Arbitral Tribunal by

playing fraud; that the notice/ summons issued to the late

Shivappa were not duly served; and the learned Arbitrator

has not given any proper reasoning.

10. Shri. L. Narasimhaiah, appearing as party

in-person, argued in support of the impugned petition.

11. We have carefully heard the rival contentions

and perused the records.

12. Based on the submissions made on both the

sides, the point that arises for our consideration is:

Whether the impugned order calls for any

interference?

13. Undisputed fact of the case is, Late Shivappa

entered into a Partnership Deed dated 29.12.2001 and it

was named 'M/s. Kalyan Travels'.

14. Plaintiff has urged two main contentions. Firstly,

the partnership firm was dissolved vide Dissolution Deed

dated 17.03.2002 with effect from 05.01.2002. The

partnership firm was in existence only for seven days i.e.,

from 29.12.2001 to 05.01.2002. On this aspect, the learned

Trial Judge has recorded his finding as follows:

"41. The plaintiff is contending that the partnership between the Claimant and Shivappa Dhulappa Holkunde was dissolved by virtue of dissolution deed dated 17.03.2002 with effect from 05.01.2002. The partnership was in force for a period of seven days only. It is not possible to conceive that how the parties could come to the conclusion that their partnership business is making loss within a span of seven days. Dr.Prashanth Holkunde the brother of the plaintiff herein in his objections statement filed in Ex.No.681/2011 has stated that the partnership was in force till 17.03.2012, the date of dissolution. The Plaintiff is contending that Shivappa Dhulappa Holunde passed away on 28.03.2017. She has not furnished copy of death or any other documents to support the date of death of Shiva Dhulappa Holkunde."

15. Secondly, that the summons was not served on

plaintiff. We have perused the Arbitral Award dated

20.08.2010. We may record that the Sole Arbitrator has

noted thus:

"Though notices were sent to the respondents by RPAD they did not appear. It is clear that claimant sent a copy of the claim petition to R-1 by RPAD he did not respond. So the proceedings were conducted in his absence."

16. In view of the aforementioned findings recorded

by the Trial Court and the Sole Arbitrator, in our opinion, the

contentions urged on behalf of plaintiff are untenable and we

are at one with the view taken by the learned Trial Judge.

Hence, we answer the point for consideration in the

negative.

17. Resultantly, this appeal does not merit

consideration and accordingly, it is dismissed.

No costs.

Sd/-

CHIEF JUSTICE

Sd/-

JUDGE

SPS