S. SIVAGURUNATHAN Vs. R. MENNAN

JUDGEMENT

(1.) This appeal raises an important question of law namely under what circumstances an Arbitration Agreement binds a non-signatory to the said agreement.

(2.) Certain disputes arise between the parties of a registered partnership firm by name Asvini Foundations. Under the Partnership Deed dated 24/4/2000, the Appellant S. Sivagurunathan and the second respondent Aarti Razee were the partners. Thereafter under the Partnership Deed dated 1/6/2006, Narendra Srisrimal and Surendar Srisrimal were inducted as partners. Thereafter, the partnership firm was reconstituted under a Deed of Reconstitution of Partnership dated 1/4/2009 under which, Sandeep Mehta was inducted as a partner. On 1/4/2011, Narendra Srisrimal and Surendar Srisrimal retired from partnership firm under a Retirement Deed dated 1/4/2011 and on the same date, another Deed of Reconstitution of Partnership was executed by the remaining partners namely the Appellant S. Sivagurunathan, the second respondent Aarti Razee and Sandeep Mehta. Thereafter, on 1/10/2016, under an amendment of Partnership Deed, the first respondent R. Mennan was inducted as a partner and Sandeep Mehta retired from partnership. After the execution of the Amendment of Partnership Deed dated 1/10/2016, the Appellant S. Sivagurunathan and the respondents namely R. Mennan and Aarti Razee became the partners of M/s. Asvini Foundations.

(3.) The Amendment of Partnership Deed dated 1/10/2016 under which the first respondent was inducted as a partner does not contain an arbitration clause, whereas the original Partnership Deed dated 24.04.2000, Partnership Deed dated 01.06.2006 under which Narendra Srisrimal, and Surendar Srisrimal were inducted as partners, the Deed of Reconstitution of Partnership dated 01.04.2009 under which Sandeep Mehta was inducted as a partner, the Deed of Reconstitution of Partnership dated 01.04.2011 under which, Narendra Srisrimal and Surendar Srisrimal retired from partnership and the Appellant S. Sivagurunathan, the second respondent Aarti J. Razee and Sandeep Mehta remained as partners contained an arbitration clause.