Court dismissed the arbitration application for appointment of an arbitrator, holding that after the petitioner's 1989 retirement, no live claim existed to justify adjudication under Section 11. Petitioner may file a suit in the civil court.
Application for appointment of arbitrator dismissed; petitioner allowed to file suit if desired.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
Arb.Appln. 3-2014
(1)
IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD
ARBITREATION APPLICATION No. 3 of 2014
Purnachand S/o Ramcharan Tank, age 70 years occupation business R/o R.M. 30, Veer Savarkar Colony, M.I.D.C., Waluj, Aurangabad.
... PETITIONER
VERSUS
Mr Balbhim R. Kedar, Advocate for petitioner. Mr S.V. Adwant, Advocate for respondents.
CORAM : NITIN .W. SAMBRE, J.
DATE : 2nd November, 2017
ORAL ORDER :
The petitioner is relying this claim on the Arbitration
Agreement dated 29th August 1985, which provides for arbitration clause, which reads thus:
Arb.Appln. 3-2014
(2)
“17. In case of differences of opinion, disputes, and conflicts between the partners regarding the business affairs of the firm or any other matter, the matter shall be referred to the arbitration of one arbitrator or two arbitrators as the Partners may mutually agree upon or decide and the decision of such arbitrator shall be final and binding on all the partners to the disputes. This reference shall be subject to the provisions of the Indian Arbitration Act, (No. X of 1940) or any statutory modification thereof for the time being in force.”
Ludhiana Improvement Trust and another {(2014) 5 Supreme Court Cases 68}, particularly, paragraph No. 13, which reads thus:
Arb.Appln. 3-2014
(3)
“13. We have carefully considered the submissions made on behalf of the respective parties and we are of the view that the learned Designated Judge exceeded the bounds of his jurisdiction, as envisaged in SBP & Co. In our view, the learned Designated Judge was not required to undertake a detailed scrutiny of the merits and demerits of the case, almost as if he was deciding a suit. The learned Judge was only required to decide such preliminary issues such as jurisdiction to entertain the application, the existence of a valid arbitration agreement, whether a live claim existed or not, for the purpose of appointment of an arbitrator. By the impugned order, much more than what is contemplated under Section 11(6) of the 1996 Act was sought to be decided, without any evidence being adduced by the parties. The issue regarding the continued existence of the arbitration agreement, notwithstanding the main agreement itself being declared void, was considered by the seven -Judge Bench in SBP & Co. and it was held that an arbitration agreement could stand independent of the main agreement and did not necessarily become otiose, even if the main agreement, of which it is a part, is declared void.”
Per contra, Shri Adwant, learned Counsel for the
Arb.Appln. 3-2014 (4)
respondents, submits that the Deed of Retirement was executed way back on 9th May 1989, which was duly acted upon, as appropriate intimation was given to the Registrar of Firms. According to him, there is no live claim apparent from the plain reading of submissions of the parties and, as such, he sought dismissal of the application.
Arb.Appln. 3-2014 (5)
any other steps. In the wake of above, in my opinion, it is difficult to accept at this stage on plain reading of the agreement that there exists the live claim, to be adjudicated by the Arbitrator, pursuant to the provision of Section 11 of the Act.
Court.
( NITIN W. SAMBRE, J.)
pjm
2 issues framed by the court
Whether a live claim exists to warrant appointment of an arbitrator under Section 11 of the Arbitration Act after the petitioner executed a Deed of Retirement in 1989.
Whether the arbitration agreement remains operational despite the execution of a retirement deed by the petitioner.
Colour shows how this judgement treated each authority
Today Homes and Infrastructure Private Limited Vs. Ludhiana Improvement Trust and anotherExplained¶21
Today Homes and Infrastructure Private Limited Vs Ludhiana Improvement Trust and another {(2014) 5 Supreme Court Cases 68}
1 provisions across 1 enactments
Purnachand S/o Ramcharan Tank
Vikas S/o Ratanlal Jain
Shantilal S/o Ratanlal Jain
Nitin W. Sambre
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
