RAVI PRAKASH GOEL versus CHANDRA PRAKASH GOEL AND ANR.

Citation: [2007] 4 S.C.R. 295 · Decided: 21-03-2007 · Supreme Court of India · Bench: AR. LAKSHMANAN · Disposal: Appeal(s) allowed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

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RA VI PRAKASH GOEL 
A 
v. 
CHANDRA PRAKASH GOEL AND ANR. 
MARCH 21, 2007 
[DR. AR. LAKSHMANAN AND AL TAMAS KABIR, JJ.) 
B 
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Indian Arbitration and Conciliation Act, 1996: 
Section 11 (5)-Appointment of arbitrator-Application by the legal c 
heir of the deceased partner-Held, maintainable. 
Indian Partnership Act, 1932; 
Section 46-Rendition of accounts-Legal representative of a deceased 
partner-Right to sue-Held, survives on the legal representative. 
D 
-+ 
The Short questions involved in the appeals were: 
.. 
(a) When• right to sue for rendition of accounts survives on the legal 
representative of a deceased partner, are the legal representative not entitled 
to invoke arbitration clause contained in the Partnership Deed? 
E 
(b) Whether the arbitration can be commenced by the heirs after the 
death of partner especially where the dispute had arisen during,the life time 
of the partner? 
., 
(c) Whether in view of section 46 read with section 48 of the Indian 
Partnership Act, 1932 as well as section 40 of the Arbitration Act, 1996. F 
The legal representative of the deceased partner is entitled to claim 
appointment of arbitrator under the arbitration clause of the Partnership 
Deed? 
Answering the questions in the affirmative and allowing the appeal, the G 
Court 
HELD: 1.1. A person who has the right to represent the estate of deceased 
person occupies the status of a legal and as such claiming under the rights 
of a deceased person, he has the right to enforce the award and is also bound 
295 
H 
A 
B 
c 
D 
E 
F 
296 
SUPREME COURT REPORTS 
[2007] 4 S.C.R. 
by it. (Para 14] [304-D-E] 
1.2. A suit relating to the distribution of surplus is generally called a 
suit for an account which means account taken up accordingly. This right to 
a partner to file .a suit for account is not affected by the fact that the retiring 
partner has already inspected the accounts of the firm. [Para 15] [304-G] 
1.3. The arbitration agreement is enforceable by or against the legal 
representative of a deceased party provided the right to sue in respect of the 
cause of action survives. On the dissolution of the firm, the arbitration clause 
does not come to an end and so if a dispute had arisen during the lifetime of 
the deceased partner, his legal representatives would be entitled to continue/ 
initiate proceedings under Section 20 of the Arbitration Act, 1940. 
[Paras 14 and 16] [304-E; 305-D-E] 
2.1. In view of the provisions of Section 46 read with Section 48 of the 
Indian Partnership Act as well as Section 40 of the Arbitration· and 
Conciliation Act, 1996, the application for appointment of an arbitrator under 
the arbitration clause of the partnership deed was liable to be allowed. 
[Para 18] [306-B] 
2.2. Right to sue for rendition of accounts of partnership firm survives 
on the legal representative of a deceased partner who is also entitled to invoke 
the arbitration clause contained in the partnership deed. [Para 18) [306-C] 
3.1. The appellant being the only son of his deceased mother, undisputedly 
a partner in the partnership firm with the respondents, and in view of the 
dispute concerning the partnership affairs having arisen during her life time, 
the appellant has establishable binding, arbitration agreement with the 
respondent. [Para 18] [306-C-D) 
Smt. Premlata and Anr. v. Mis. lshwar Dass Chamanlal and Ors., AIR 
(1955) SC 714, relied upon. 
Sundar Lal Haveliwala v. Smt. Bhagwati Devi, AIR (1967) Allahabad 
G 400, referred to. 
H 
3.2. Non-probate of will is not a germane factor to be considered at the 
time of appointment of arbitrator under Section 11 of the Arbitration Act. In .. 
view of the clear recital in the partnership deed that all the disputes touching 
the affairs of the partnership firm were referable to arbitrator and thus the 
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RA VI PRAKASH GOEL v. CHANDRA PRAKASH GOEL [LAKSHMANAN, J.] 
297 
dispute regarding accounts of the partnership firm is a dispute touching the A 
affairs of the firm. Not legally essential to specifically make a mention that 
the partners included their heirs, representatives, assigns or legatees etc. 
The arbitration clause could be invoked by the appellant as the legatee as 
well as the legal heir/legal representative of the deceased particularly where 
the dispute had arisen during her life time. [Para 18) (306-E-G] 
3.3. The word "party" as used in the partnership deed does not exclude 
inclusion of legal heirs, 

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