RAJEEV MAHESHWARI Vs. INDU KOCHER

JUDGEMENT

(1.) THE application is by the first three defendants under Section 8 of the Arbitration and Conciliation Act, 1996 seeking reference of the disputes to arbitration in terms of an arbitration agreement contained in a deed of partnership. THE reliefs claimed in the suit include a declaration that the defendants do not have any right, title or interest in respect of the dissolved partnership firm by the name of Bharat Industries and Commercial Corporation including the assets specified in paragraph 10 of the plaint and the consequential injunction relating to such properties. THE plaintiffs are the sons of one Mohanlal Maheshwari who, along with Mohanlal Kocher, the predecessor-in-interest of the defendants other than the defendant no.5, commenced a partnership business under a deed of December 23, 1972. Senior Maheshwari died in December, 1984 and senior Kocher died in March, 1992. THE fifth defendant is described in the plaint as the assignee of a purported agreement for sale of senior Kocher's interest in the firm.

(2.) THE plaint claims that disputes and differences arose between the two partners of the firm which were referred to two arbitrators in August, 1984 and the arbitrators appointed an umpire. According to the plaint, by reason of the death of partner Maheshwari, the firm stood dissolved and no effective steps were taken in the arbitral reference. THE plaintiffs claim that on the expiry of three years from the date of such dissolution of the firm, "the claim of the defendants for accounts and a share of the profits of the dissolved partnership firm, if any, arising out of or concerning the erstwhile partnership business came to an end and became barred by limitation." THE plaint proceeds to record that in 1985 the first plaintiff and the third defendant made "some infructuous attempts" to wind up the partnership business but nothing came out of the endeavour though an agreement was entered into on February 4, 1985. However, this subsequent agreement appears to have been executed by the then heirs of senior Maheshwari and Mohanlal Kocher. THE plaintiffs suggest that on December 26, 1990 senior Kocher assigned his share in the assets and liabilities of the firm in favour of one Om Prakash and such Om Prakash has apparently transferred such beneficial interest by a deed of transfer of May, 1991 in favour of the fifth defendant. Paragraph 8 of the plaint records that the fifth defendant, Kishan Mimani, has filed a suit in this Court for specific performance of "the said agreement for sale." In the same breath the plaintiffs contend that the agreement relied upon by Mimani is "wrongful and void." THE plaint narrates that in 1995, about three years after senior Kocher's death, his heirs applied in this Court under Section 20 of the Arbitration Act which was allowed in September, 2007 by directing filing of the arbitration agreement. That arbitration agreement is the same which has been cited by the applying defendants in support of the present application. THE plaintiffs herein have preferred an appeal against the order made in the Section 20 proceedings and the operation thereof has been stayed though the appeal remains pending. At paragraph 10 of the plaint certain immovable properties have been referred to which the plaintiffs claim to be exclusively under their possession. THE claim is founded on Section 27 of the Limitation Act, 1963 on the plaintiffs' assertion that since the period prescribed by the Limitation Act for seeking possession of any of the properties has expired, the defendants' right to such property has been extinguished.

(3.) SEVERAL grounds of defence have been adopted by the plaintiffs. To begin with, they say that the arbitration agreement itself is of restricted application. They suggest - though the submission in such regard is at variance with the pleadings - that the 1985 agreement superseded the arbitration clause contained in the partnership deed of 1972. They indicate that the application is not maintainable since neither the original agreement nor a duly certified copy thereof has been appended thereto. They also cite their independent cause of action against the fifth defendant, who is not a party to the arbitration agreement, as the final plank to resist the effective scuttling of the present action.