R.S.Narula, J. - (1.) THIS is a petition for revision, for setting aside and reversing the order of the Court of Shri G.S. Sandhu, Senior Subordinate Judge, Ludhiana, dated July 19, 1973 whereby he upheld the order of the Court of Shri N.S. Sawaraj, Subordinate Judge First Class, Jagraon, dated March 7, 1973, dismissing the application of Sahib Chand defendant -petitioner for stay of the suit instituted against him and three other persons by Moti Lal respondent under section 34 of the Arbitration Act (hereinafter called the Act) on the allegation that the dispute involved in the suit was covered by an arbitration agreement.
(2.) THE learned Senior Subordinate Judge dismissed the appeal of the present petitioners on four grounds, namely : - - (i) whereas the application for stay under section 34 of the Arbitration Act had been given by Sahib Chand defendant alone, the appeal before him had been filed by one Manohar Lal defendant and not by Sahib Chand ; (ii) the arbitration agreement between the parties covered only such disputes which might have arisen during the existence of the partnership and not after its dissolution, and inasmuch as the firm was not working any more and was not in existence, the disputes between the parties after the firm ceased to work did not come within the ambit of the arbitration agreement ; (iii) the relief under section 34 of the Act for staying a suit being discretionary, this suit could not be stayed as a decree for dissolution had been claimed on the ground that it was just and equitable to order dissolution of the firm and it is primarily for the Court to decide whether it is or it is not just and equitable to do so ; and (iv) the dispute in the instant case is not covered by the arbitration agreement as it is not regarding business of the firm. Whereas the first three out of the above -mentioned four grounds have been clearly mentioned in the order under revision, the fourth ground has merely to be spelt out of it. Mr. M.L. Sarin, learned counsel for the petitioners, submitted that in spite of the fact that relief under section 34 of the Act is discretionary, it is apparent from a perusal of the order under revision that the said discretion has not been exercised judicially by the lower appellate Court, inasmuch as it has gone wrong on facts and has assumed certain things contrary to the record of the case. His first submission is that the observation of the learned Senior Subordinate Judge to the effect that the appeal before him had not been filed by Sahib Chand, but only by one Manohar Lal, was factually wrong. This is not only apparent from the certified copy of the order under revision itself, but has also been verified by me from the record of the lower appellate Court. The record has been shown by me to Mr. G.S. Chawla, learned counsel for the plaintiff -respondent. He also submits that there is a factual error in the appreciation of the facts by the lower appellate Court on this score. Sahib Chand was appellant No. 2 before the Senior Subordinate Judge. The first ground on which relief was refused to the defendant -petitioner must, therefore, be kept out of consideration.
(3.) MR . M.L. Sarin is also on firm ground in submitting that the lower appellate Court has misread and misconstrued the arbitration agreement by confining it to disputes arising during the existence and working of the firm. The arbitration agreement is contained in paragraph 12 of the deed of partnership Exhibit R. 1. That paragraph reads : - - that any dispute regarding the partnership business or the interpretation of this partnership -deed shall be referred to an arbitrator to be chosen by the partners and his decision shall be binding on the partners. Even Mr. G.S. Chawla could not support the argument which found favour with the lower appellate Court in this regard. Mr. Chawla is correct in conceding that the admitted arbitration agreement contained in the above -quoted stipulation in the partnership -deed does not confine the scope of reference to arbitration of dispute arising during the existence and working of the firm. The second basis of the order under revision must also, therefore, be held to be incorrect.;