FIRM ASHOK TRADERS AND ANR. ETC. versus GURUMUKH DAS SALUJA AND ORS. ETC.

Citation: [2004] 1 S.C.R. 404 · Decided: 09-01-2004 · Supreme Court of India · Bench: R.C. LAHOTI, ASHOK BHAN · Disposal: Disposed off

Cited by 4 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
FIRM ASHOK TRADERS AND ANR. ETC. 
"'>--; 
V. 
GURUMUKH DAS SALUJA AND ORS. ETC. 
JANUARY 9, 2004 
B 
[R.C. LAHOTI AND ASHOK BHAN, JJ.] 
Arbitration and Conciliation Act, 1996: 
s. 9--Application for interim measures by court-Unregistered 
c partnership firm in liquor trade-Application by one of the partners for 
appointment of receiver to take charge of business of the firm-Trial court 
dismissing the application on the ground that name of the applicant does not 
figure in the register of firms as partner of the firm-High Court allowed the 
application holding that s.69(3) of the Partnership Act is not attracted to an 
D application uls 9 of the Act-High Court further directed that the partners 
who were running the business would run the business as receivers till 
31.12 .. 2003 and from 1./.2004 to 31.3.2004 the applicant and two other 
,, 
~ 
partners of his group would run the business as receivers-Held, order passed 
by court should fall within the meaning of expression 'an interim measure of 
E 
protection' as distinguished from an all time of permanent protection-ft is a 
serious matter to appoint a receiver on a running business-This is not a case 
of oppression of minority by majority-A better course would have been to 
allow the conduct of the business continuing in the hands of the persons who 
were doing so but at the same time issuing such directions and/or devising 
such arrangement as would protect and take care of the interest of those who 
F are not actually running the business-Purpose of enacting s. 9 is to provide 
'interim measures of protection '-Though order of High Court appointing a 
'\ . 
receiver on the partnership business is maintained, the rest of the order is set 
aside-Directions given inter alia, for running the business by the group of 
partners who were running it prior to interim order of High Court under their 
control but as receivers, and for appointment of an official as observer-
G Interim order-Partnership Act, 1932-s.69(3). 
s. 9-Unregistered partnership firm-Application by one of the partners 
! 
for directions to appoint receiver-Maintainability of-Held, Court uls 9 is 
only formulating interim measures so as to protect the right under adjudication 
H 
before the arbitral tribunal from beingfrustrated-Primafacie, the bar enacted 
404 
FIRM ASHOK TRADERS v.GURUMUKH DAS SALUJA 
405 
by s.69 of Partnership Act does no/affect the maintainability of an application A 
under s.9 of the Act-s. 69 of Partnership Act has no bearing on the right of 
a party to an arbitration clause to file an application under s. 9 of the Act. 
s. 9- .. party"-Jnvoking s.9-An application u!s. 9 is not a suit-'Parity' 
is defined ins. 2(/)(h) to mean a party to an arbitration agreement-So right 
conferred by s. 9 is on a party to an arbitration agreement-Right conferred B 
by s.9 cannot be said to be one arising out of a contract-Filing of an 
application zt!s 9 by a party by virtue of its being a party to,an arbitration 
agreement is for securing a relief which the court has power to grant before, 
during or after arbitral proceedings by virtue of s.9 of the Act-The relief 
sought for in an application uls 9 is neither in a suit nor a right arising from C 
a contract-Party invoking s. 9 may not have actually commenced arbitral 
proceedings but must be able to satisfy the court that the ar~itral proceedings 
are actuaily contemplated or manifestly intended. 
Mis. Sundaram Finance Ltd v. Mis. NEPC India Ltd., AIR 1999 SC 
565, relied on. 
Kamal Pushpa Enterprises v. DR Construction Company, AIR (2000) 
SC 2676; Jagdish Chandra v. Kajaria Traders (Ind.) Ltd., AIR (1964) SC 
1882 and Delhi Development Authority v. Kochhar Construction Work and 
Anr., (1998] 8 SCC 559, referred to. 
Mis. Shreeram Finance Corporation Ltd. v. Yasin Khan ar.d Ors., (1989( 
3 sec 476, cited. 
Words and phrases: Word 'before' ins. 9 of Arbitration and Conciliation 
Act, 1996-Connotation of 
' /' 
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 132 and 
131 of 2004. 
From the Judgment and Order dated 18.12.2003 of the Madhya Pradesh 
High Court in M.A. No.2484 of 2003. 
Harish N. Salve, Dr. A.M. Singhvi, Kapil Sibal, P. Chidambaram, R.F. 
Nariman, Vivek Tankha, Rohit Arya, C. Mukhopadhya, Manu Nair, Ms. 
Shalini, Rakesh K. Khanna, Aseem Mehrotra, Kanahaya Singh, Rajeev Singh, 
Rajesh Prasad Singh, Akshay Arora, P.K. Bansal, Pankaj Kr. Singh, K.L. 
Janjani and Ms. Abha R. Sharma for the appearing parties. 
D 
E 
F 
G 
H 
406

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