LexPRABHU SHANKAR JAISWAL versus SRI SHEO NARAIN JAISWAL
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A PRABHU SHANKAR JAISWAL v. SRI SHEO NARAIN JAISWAL OCTOBER 29, 1996 B [A.M. AHMADI, CJ. AND SUJATA V. MANOHAR, J.] Indian Partnership Act, 1932: Section (69) sub-section (3) (a)- Partnership Firm-Unregistered-Right of partner to sue for dissolution and for accounts-Whether barred> Held: No, though a partnership firm may be unregistered, one partner could sue another partner for dissolution C of firm and for accounts. Arbitration Act, 1940: Section (8)-Maintainability of suit for dissolution and for accounts-Held, application/petition under the Arbitration Act by a partner of an unregistered firm for the purpose of D enforcing right to secure dissolution and accounts is maintainable. The appellant and respondents were partners in an unregistered partnership firm. A suit for dissolution of the firm and accounts was tiled by respondent no.I before Sub Judge. The appellant's application under Section 34 of the Arbitration Act for stay of the suit granted. E High Court upheld the stay order. Appellant filed Misc. Case for appointment of Arbitrator. Respondent no.I raised preliminary objections that partnership firm was unregistered and the petition under Arbitration Act was not maintainable. The sub-Judge held that the petition was maintainable. However, the High Court in Revision, held that by reason of Section 69 of Partnership Act, a petition under F Section 8 of the Arbitration Act was not maintainable. Hence this appeal. Allowing the appeal, this court G HELD : l.J. The bar under Section (69)(a) of Partnership Act 1932 will not affectthe enforcement ofany right to sue for the dissolution of a firm or for account or to realise the property of a dissolved firm. The partners.hip firm may be unregistered, yet one partner can sue the other partner for dissolution and accounts. 147-GJ H J.2. The words "to sue" in sub-section (3) (a) of S.69 of the Act 44 ~. .~ . - P.S.JAISWALv. S.N.JAISWAL[MRS. SUJATA V.MANOHAR,J.] 45 cannot be taken to refer only to suits for dissolution of partnership A and accounts. It must be understood as applying to any proceedings 1' for dissolution of partnership or for accounts or to realise the property of a dissolved firm. The proceedings may be either by way of suit or it can be through Arbitration. (47-H, 48-A) 2. Where arbitration is sought under the arbitration clause in a B partnership deed of an unregistered firm for the purpose of dissolution and accounts of the partnership firm, the partners can maintain all applications/petitions under the Arbitration Act for the purpose of enforcing their right to secure dissolution and accounts of the partnership firm through arbitration, In fact, in the present case the suit for dissolution and accounts of the partnership firm has been C stayed under Section 34 of the Arbitration Act at the instance of respondent no.I. The petition of the appellant, therefore, under Section 8 of the Arbitration Act is maintainable. (48-E-F) Prem Lata (Smt) and Anr. v. Mis. Ishar Dass Chaman Lal and Ors., [19951 2 sec 145, relied on. D Jagdish Chandra Gupta v. Kajaria Traders (India) Ltd., AIR (1964) SC 1883, distinguished. · CIVIL APPELLATE JURISDICTION : Civil Appeal No. 13362 of E 1996. From the Judgment and Order dated 6.8.93 of the Patna High Court in C.R. No.190 of 1993 (R) Vikas Singh for L.R. Singh for the Appellant. V.A. Mohta, A.K. Choudhary and M. Mukherjee for Manoj Prasad for the Respondents. The Judgment of the Court was delivered by MRS. SUJATA V. MANOHAR, J. Leave granted. F G The appellant and respondents 1 to 5 were partners in an unregistered partnership firm by the name of Mis. Lakshmi Narain and Sons which H 46 SUPREME COURT REPORTS [1996] SUPP. 8 S.C.R. A was constituted under a deed of partnership dated 4/6.11.1967. The first respondent brought Title Suit No. 71 of 1991 against the appellant and respondents 2 to 5 for dissolution of the partnership firm and for accounts in the Court of the Sub-Judge, Ranchi. As the deed of partnership contained an arbitration clause, the appellant made an application before the Sub- Judge under Section 34 of the Arbitration Act for stay of the Title Suit B No.71 of 1991. This application was granted. In appeal before the High Court being Misc. Appeal No. I 3 of I 992, the High Court has ultimately by its order dated 16.12.1992 upheld the order of the Sub-Judge granting a stay under Section 34 of the Arbitration Act. The appella
Excerpt shown. Read the full judgment & AI analysis in Lexace.