Decided on June 29,2016

M/S Umesh Goel Appellant
Himachal Pradesh Cooperative Group Housing Society Ltd. Respondents


- (1.) An interesting but very important legal question arises for consideration in this appeal relating to interpretation of Section 69(3) of the Indian Partnership Act with reference to its applicability to Arbitral proceedings.
(2.) The facts are not in controversy which can be briefly stated as under: The respondent which is a Cooperative Group Housing Society invited tenders for construction of 102 dwelling units with basement at Plot No. 21 Sector 5, Dwarka New Delhi. The tenders were invited in May 1998. The appellant, an unregistered partnership firm submitted its bid in response to the said tender on 06.05.1998. The appellant was the successful bidder and the contract was awarded to the appellant at an estimated cost of Rs.9.80 crores. The appellant was issued a letter of intent. On 09.08.1998 the appellant submitted its first bill for the construction of the compound wall etc. The agreement for the construction of 102 dwelling units with basement was entered into between the appellant and the respondent on 02.02.1999. It is stated that there was some delay in getting the plan sanctioned, which according to the appellant, he was not responsible for the delay. A dispute arose as between the appellant and the respondent which necessitated the appellant to move the High Court of Delhi by way of an application under Section 9 of the Arbitration and Conciliation Act 1996 (for short "1996 Act") to restrain the respondent from dispossessing the appellant from the worksite till the work executed by the appellant is measured by the Commissioner to be appointed by the Court. It was filed on 22.05.2005. A Commissioner was also appointed by the High Court. The appellant filed another application under Section 9 of the 1996 Act to restrain the respondent from operating its bank accounts and from dispossessing the appellant on 29.01.2003.
(3.) With reference to the dispute which arose as between the appellant and the respondent an arbitrator/an advocate by name Smt. Sangeeta Tomar was appointed by the respondent to adjudicate the dispute between them. As the appointment came to be made on 17.03.2003 by the respondent, though, the appellant earlier moved the High Court by way of an Arbitration Application No.145 of 2003 on 09.07.2003 under Section 11(5) of the 1996 Act for appointment of an independent arbitrator, the same was subsequently withdrawn. The appellant participated in the arbitration proceedings before the arbitrator appointed by the respondent. Claims and counter claims were made by the appellant as well as the respondent before the arbitrator. The arbitrator passed the award on 05.05.2005 wherein the claim of the appellant was allowed to the extent of Rs. 1,36,24,886.08 along with interest at the rate of 12% from 01.06.2002 till the date of the award and further interest from the date of award till its payment at the rate of 18% per annum. While resisting the claim of the appellant, the respondent did not specifically raise any plea under Section 69 of the Partnership Act.;

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.