FOOD CORPORATION OF INDIA, BARAH KHAMBA ROAD, NEW DELHI Vs. M/S RAMA MILLS SHAHBAD MARKANDA, TEHSIL TANESAR

JUDGEMENT

(1.) THIS judgment will dispose of two petitions (C.R. Nos. 144 and 800 of 1987) which have arisen out of similar circumstances and are between the same parties.

(2.) THE Respondents filed suit for rendition of accounts against the Petitioner concerning an agreement of paddy shelling entered into on behalf of the Respondents by Rakesh, one of the partners. The Petitioner on appearance filed an application under Section 34 of the Indian Arbitration Act that there was an arbitration agreement existing between the parties relating to the dispute, subject matter of the suit and so the suit was liable to be stayed. One of the objections raised in reply by the Respondents was that the alleged arbitration agreement would not bind the firm and the partners other than Rakesh as he had no authority to enter into the said agreement. The Petitioner to controvert the plea replied on Exhibit A.4 the power of attorney executed by the six partners in favour of four persons Ram Kishore, Sham Kishore, Aaaad Kishore and Rakesh. This power of attorney has no legal value to sustain the plea that Rakesh had the power to enter into arbitration agreement on behalf of the other partners. The power of attorney had been executed in favour of four persons. It is not stated that they could act severally.