NARINDER SINGH RANDHAWA Vs. HARDIAL SINGH DHILLON

JUDGEMENT

(1.) Narinder Singh and Smt. Harprit Randhawa filed a suit for dissolution of partnership and rendition of accounts of Messrs Janta Rice Mills, Mehta, District Amritsar. On receipt of the notice of the suit, Hardial Singh Dhillon filed an application under S.34 of the Arbitration Act for staying the suit on the pleas that the firm had already been dissolved and in the partnership deed it was agreed between the parties that they would get their disputes settled through arbitrators and hence, the dispute in the present suit should be referred to the arbitrators and the suit be stayed. The plaintiffs contested the suit. The trial Court framed the following issues:-

(2.) After hearing the learned counsel for the parties I am of the view that this appeal deserves to succeed. In the plaint, the plaintiffs have clearly prayed that the facts of the case are such which render it just and equitable that the partnership should be dissolved. In this respect S.44(g) of the Partnership Act is clearly attracted. The learned counsel for the plaintiffs has urged that whenever dissolution of partnership is sought under S.44(g), then it is for the Court to decide, whether it would be just and equitable to dissolve the partnership or not and such a matter cannot be left to be gone into and decided by the arbitrator in pursuance of the arbitration clause contained in the partnership deed. In support of his argument, reliance is placed on Dwarka Nath Kapur v. Rameshwar Nath (1966) 68 Pun LR (Delhi) 91 and Nitya Kumar Chatterjee v. Sukhendu Chandra, AIR 1977 Cal 130. On going through the aforesaid decisions, I am of the view that they fully support the contention of the learned counsel for the plaintiffs. Before this matter is finally decided in favour of the plaintiffs, it will have to be seen, whether the partnership stood dissolved by filing the suit as held by the Court below, because in case the partnership stood dissolved by filing the suit, the question, whether it would be just and equitable to dissolve the partnership, would not survive for consideration.

(3.) The Court below relied on certain observations in ManoharLal v. Moti Lal, 1974 Cur LJ 423 by R. S. Narula, J., in coming to the conclusion that the moment a suit is filed for dissolution of partnership, a partnership at will stands dissolved merely by filing of the suit. Since the instant partnership was a partnership at will, the trial Court followed the observations in the aforesaid judgment and held that by filing of the suit, the partnership stood dissolved and, therefore, S.44(g) of the Partnership Act could not be relied upon by the plaintiffs to seek dissolution of partnership through Court on just and equitable grounds. Firstly, the learned counsel for the plaintiffs urged that the facts of the aforesaid decision were distinguishable and secondly, he argued that it was not a correct decision in view of the judgment of the Supreme Court in Banarsi Das v. Kanshi Ram, AIR 1963 SC 1165 and Khushi Ram Beharilal and Co. v. State of Punjab, 1971 Rev LR 253. In Banarsi Das's case (supra) it was ruled by the Supreme Court as follows :