SANJIB BANERJEE, J. - (1.) THE application is by the first three defendants under Section 8 of the Arbitration and Conciliation Act, 1996 seeking reference of the disputes to arbitration in terms of an arbitration agreement contained in a deed of partnership. THE reliefs claimed in the suit include a declaration that the defendants do not have any right, title or interest in respect of the dissolved partnership firm by the name of Bharat Industries and Commercial Corporation including the assets specified in paragraph 10 of the plaint and the consequential injunction relating to such properties. THE plaintiffs are the sons of one Mohanlal Maheshwari who, along with Mohanlal Kocher, the predecessor-in-interest of the defendants other than the defendant no.5, commenced a partnership business under a deed of December 23, 1972. Senior Maheshwari died in December, 1984 and senior Kocher died in March, 1992. THE fifth defendant is described in the plaint as the assignee of a purported agreement for sale of senior Kocher's interest in the firm.
(2.) THE plaint claims that disputes and differences arose between the two partners of the firm which were referred to two arbitrators in August, 1984 and the arbitrators appointed an umpire. According to the plaint, by reason of the death of partner Maheshwari, the firm stood dissolved and no effective steps were taken in the arbitral reference. THE plaintiffs claim that on the expiry of three years from the date of such dissolution of the firm, "the claim of the defendants for accounts and a share of the profits of the dissolved partnership firm, if any, arising out of or concerning the erstwhile partnership business came to an end and became barred by limitation." THE plaint proceeds to record that in 1985 the first plaintiff and the third defendant made "some infructuous attempts" to wind up the partnership business but nothing came out of the endeavour though an agreement was entered into on February 4, 1985. However, this subsequent agreement appears to have been executed by the then heirs of senior Maheshwari and Mohanlal Kocher. THE plaintiffs suggest that on December 26, 1990 senior Kocher assigned his share in the assets and liabilities of the firm in favour of one Om Prakash and such Om Prakash has apparently transferred such beneficial interest by a deed of transfer of May, 1991 in favour of the fifth defendant. Paragraph 8 of the plaint records that the fifth defendant, Kishan Mimani, has filed a suit in this Court for specific performance of "the said agreement for sale." In the same breath the plaintiffs contend that the agreement relied upon by Mimani is "wrongful and void." THE plaint narrates that in 1995, about three years after senior Kocher's death, his heirs applied in this Court under Section 20 of the Arbitration Act which was allowed in September, 2007 by directing filing of the arbitration agreement. That arbitration agreement is the same which has been cited by the applying defendants in support of the present application. THE plaintiffs herein have preferred an appeal against the order made in the Section 20 proceedings and the operation thereof has been stayed though the appeal remains pending. At paragraph 10 of the plaint certain immovable properties have been referred to which the plaintiffs claim to be exclusively under their possession. THE claim is founded on Section 27 of the Limitation Act, 1963 on the plaintiffs' assertion that since the period prescribed by the Limitation Act for seeking possession of any of the properties has expired, the defendants' right to such property has been extinguished. The applying defendants say that the substance of the action is covered by the arbitration agreement contained in the partnership deed of 1972 and the institution and continuation of the suit would be in derogation thereof. The arbitration agreement that was contained in the partnership deed of 1985 provides, "13. That if any dispute or difference arises between the partners or between any one of them and the legal representatives of the other or others or between their respective legal representatives in connection with the business of the partnership or regarding the construction of the partnership deed during or after the partnership it shall be referred to the arbitration of two Arbitrators one to be appointed by each partners whose decision shall be conclusive and binding on all parties and such arbitration shall be under the Indian Arbitration Act 1940 and any statutory modification thereof in force for the time being." The applying defendants say that the presence of the fifth defendant in the array of parties is irrelevant since the claim is that the firm stood dissolved at the death of senior Kocher and, upon the expiry of a period of three years therefrom, the Kochers' rights therein have stood extinguished. They contend that since the existence of the partnership deed is not in dispute and has been accepted in the plaint and in the subsequent agreement of 1985 that has also been referred to in the plaint, there is no impediment to the disputes being referred to arbitration in accordance with the arbitration agreement. They point out that the two principal reliefs are not distinct and stem from the same cause of action. The relief of injunction, the applying defendants assert, is only consequential to the principal relief of declaration and the plaint does not carve out any separate basis therefor. The applying defendants say that the fifth defendant is a mere extension, in the legal sense, of the other defendants as, if senior Kocher had no right in 1990 to assign his interest in the firm, the fifth defendant would get no rights in respect thereof. They submit that there is no allegation that the fifth defendant is in possession of any of the assets of the firm or that there has been any transfer of title relating to the assets of the firm in favour of the fifth defendant.
(3.) SEVERAL grounds of defence have been adopted by the plaintiffs. To begin with, they say that the arbitration agreement itself is of restricted application. They suggest - though the submission in such regard is at variance with the pleadings - that the 1985 agreement superseded the arbitration clause contained in the partnership deed of 1972. They indicate that the application is not maintainable since neither the original agreement nor a duly certified copy thereof has been appended thereto. They also cite their independent cause of action against the fifth defendant, who is not a party to the arbitration agreement, as the final plank to resist the effective scuttling of the present action. In support of the contention that the arbitration clause is restricted in its operation, the plaintiffs say that only disputes or differences in connection with the business of the firm or disputes or differences regarding the construction of the deed would be amenable to arbitration. They insist that the "or" between the expressions "in connection with the business of the partnership" and "regarding the construction of the partnership deed" is disjunctive; such that disputes arising out of any third situation would not be covered by the clause. It is the plaintiffs' submission that the word "business" in the relevant phrase would imply the continuing operations of the firm and matters pertaining to the conduct thereof. They say that since the business of the firm came to an end upon the death of their predecessor-in-interest, the entitlement of the partners or their heirs after the business of the firm came to an end cannot be covered by the limited arbitration agreement.;