SARSWATI DEVI Vs. ZORAWAR SINGH AND OTHERS

JUDGEMENT

(1.) This revision petition is directed against the order of the Additional District Judge, Ferozepur, dated 27th April, 1988, whereby the order of the trial Court dated 21st Jan., 1986, dismissing the application under section 34, Arbitration Act, (hereinafter called the Act), was set aside and an arbitrator was appointed in appeal.

(2.) Shrimati Saraswati Devi and others filed a suit for dissolution of the partnership and rendition of accounts. In that suit, an application was' filed on behalf of the defendants under section 34 of the Act for staying the proceedings in the suit as there was an arbitration clause in the partnership deed. The said application was contested on behalf of the plaintiffs. The learned Subordinate Judge came to the conclusion that as the plaintiffs had not admitted their voluntary retirement from the partnership business with effect from 31st Aug., 1982, as alleged by the defer dants. no straight forward conclusion can be arrived at in this regard. Or the contrary, the plaintiffs having raised their counter-version that the partnership had been dissolved through registered notice served on 15th July 1985, the dispute between the parties cannot be considered such winch may be covered under clause 21 of the partnership agreement. The scope of the arbitration is very much limited, i.e., to determine money payable to the retiring partner or partners or the dispute regarding the division of the assets of the partnership firm. Since both the parties have put up their respective claim, the dispute as such can only be determined through evidence to be led by both the sides. It was therefore concluded that the spirit of clause 21 does not include such like disputes for reference to the arbitration. Consequently, the application under section 31 of the Act was dismissed. In appeal, the learned Additional District Judge found in paragraph 4 of the judgment :

(3.) The learned counsel for the plaintiff-petitioner submitted that after having found that the partnership had been dissolved, it was the civil Court which could go into the matter and the arbitration clause was no more available to the partners. In support of the contention, the learned counsel relied upon Narinder Singh Randhawa Vs. Hardial Singh Dhillon, 1985 (2) PLR 422. He also submitted that under no circumstances, the arbitrator could be appointed by the lower appellate Court. Arbitrator, if, any, was to be appointed in accordance with the agreement and with the counsel of the parties.