Supreme Court of India

BHAGWAN DAS GOEL (DEAD) THROUGH HIS LRS. & ORS. versus PYARE KISHAN AGARWAL on 4 April 2019

Cites 1, Cited by 0

[2019] 6 S.C.R. 457

BHAGWAN DAS GOEL (DEAD) THROUGH

HIS LRS. & ORS.

v.

PYARE KISHAN AGARWAL

(Civil Appeal No.3399 of 2019)

APRIL 04, 2019

[ABHAY MANOHAR SAPRE ANDDINESH MAHESHWARI, JJ.]

Arbitration Act, 1940:

s. 20 – Application for appointment of arbitrator – In termsof arbitration clause in the partnership deed – Preliminaryobjection as to maintainability of the application on the groundthat the same was barred u/s. 69(3) of Partnership Act as it was anunregistered partnership – Courts below held that the applicationwas maintainable – On appeal, held: Matter remitted to High Courtfor deciding the issue keeping in view law laid down in *KrishnaMotor Service case – Partnership Act, 1932 – s.69(3).

Allowing the appeal, the Court

HELD: High Court did not decide the issue, which was thesubject matter of the writ petition, keeping in view the law laiddown by this Court in the case of *Krishna Motor Service case.Therefore, the matter should be remitted to the High Court fordeciding the writ petition afresh on merits keeping in view thelaw laid down by this Court in the case of *Krishna Motor Ser-vice. [Paras 12 and 14][459-E; G]

Krishna Motor Service by its Partners v. H.B. VittalaKamath (1996) 10 SCC 88 : [1996] 1 Suppl. SCR 594

– referred to.

Case Law Reference

[1996] 1 Suppl. SCR 594 referred toPara 12

457

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ACIVIL APPELLATE JURISDICTION: Civil Appeal No. 3399

of 2019

From the Judgment and Order dated 14.05.2012 of the High Courtof Judicature at Allahabad in Writ C. No. 14839 of 1993.

Rishi Malhotra, Utkarsh Singh, Advs. for the Appellants.BMrs. Rani Chhabra, Advs. for the Respondent.

The Judgment of the Court was delivered by ABHAY MANOHAR SAPRE, J.

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1. Leave granted.

2. This appeal is directed against the final judgment and orderCdated 14.05.2012 passed by the High Court of Judicature at Allahabadin Writ C. No.14839/1993 whereby the High Court dismissed the writpetition filed by the appellants herein and upheld the order dated18.03.1993 passed by the Civil Judge, Jhansi in O.S. No.140/1992.

3. A few facts need mention hereinbelow for the disposal of thisDappeal, which involves a short point.

4. The appellants are the legal representatives of the originaldefendants and the respondent herein is the plaintiff of the suit out ofwhich this appeal arises.

5. The respondent filed an application under Section 20 of theEArbitration Act, 1940 (since repealed) against the appellants’predecessors-in-title. The application was founded on the allegationsinter alia that there was a partnership between the appellants’predecessors-in-title with the respondent on 05.07.1960 by name “GuptaBus Service”.F6. However, the disputes arose between the partners of this F6. However, the disputes arose between the partners of thisfirm(Gupta Bus Service), which resulted in its dissolution. It was allegedthat Clause 11 of the Partnership Deed provides for resolution of disputesarising out of the partnership between the parties by an Arbitrator. Therespondent, therefore, prayed that an Arbitrator be appointed in terms ofClause 11 of the Partnership Deed for deciding the disputes, which haveGarisen between the parties relating to the partnership.

7. The appellants (defendants) on being served raised a preliminaryobjection contending therein that since the partnership in question onwhich the application under Section 20 of the Arbitration Act, 1940 wasfounded was an “unregistered partnership”, therefore, in the light of the H

bar contained under Section 69 (3) of the Partnership Act, the applicationfiled by the respondent was not maintainable, therefore, it was liable tobe dismissed as such.

8. The Civil Judge by order dated 18.03.1993 overruled theobjection raised by the appellants (defendants) and held that theapplication filed by the respondent (plaintiff) is maintainable. Theappellants (defendants) felt aggrieved and filed writ petition in the HighCourt at Allahabad under Article 227 of the Constitution of India.

9. By impugned order, the High Court dismissed the writ petitionand upheld the order of the Civil Judge, which has given rise to filing ofthis appeal by way of special leave by the defendants in this Court.

10. So, the short question, which arises for consideration in thisappeal, is whether the High Court was justified in dismissing theappellants’ writ petition.

11. Having heard the learned counsel for the parties and on perusalof the record of the case, we are inclined to allow this appeal and whilesetting aside the impugned order remand the case to the High Court fordeciding the writ petition afresh on merits in the light of the observationsmade infra.

12. In our considered view, the need to remand the case hasoccasioned because we find that the High Court did not decide the issue,which was the subject matter of the writ petition, keeping in view thelaw laid down by this Court in the case of Krishna Motor Service byits Partners vs. H.B. Vittala Kamath, 1996 (10) SCC 88.

13. In our view, the High Court should have noticed theaforementioned decision and decided the question accordingly in thelight of law laid down therein. The High Court unfortunately did not takenote of the said decision and has thus committed an error requiringinterference of this Court.

14. It is for this reason, we are of the considered view that thematter should be remitted to the High Court for deciding the writ petitionafresh on merits keeping in view the law laid down by this Court in thecase of Krishna Motor Service (supra).

15. In view of the foregoing discussion, the appeal succeeds andis accordingly allowed. The impugned order is set aside. The case is A

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Aremanded to the High Court for deciding the writ petition, out of whichthis appeal arises, afresh on merits as observed above.

16. Since we have formed an opinion to remand the case to theHigh Court instead of deciding the issue for the first time in this appealon facts, we refrain ourselves from exercising the issue on merits. TheBHigh Court will, therefore, decide the matter strictly in accordance withlaw uninfluenced by any observations made in the impugned order andthis order.

17. Since the matter is quite old, we request the High Court todispose of the writ petition as expeditiously as possible preferably withinCsix months.

Kalpana K. Tripathy

Appeal allowed.

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