Madhya Pradesh High Court
M/S Masterpoint (Partnership Firm) ... vs Smt. Sandhya Chauhan on 5 February, 2026
NEUTRAL CITATION NO. 2026:MPHC-IND:3820
1 MP-4880-2025
IN THE HIGH COURT OF MADHYA PRADESH
AT INDORE
BEFORE
HON'BLE SHRI JUSTICE ALOK AWASTHI
MISC. PETITION No. 4880 of 2025
M/S MASTERPOINT (PARTNERSHIP FIRM) THROUGH PARTNER
JAGDISH CHAUHAN AND OTHERS
Versus
SMT. SANDHYA CHAUHAN
Appearance:
Shri Neeraj Kumar Soni, learned counsel for the petitioner.
Shri Ravindra Patel and Shri Paresh Joshi, learned counsel for the
respondent.
Reserved on : 17.12.2025
Pronounced on : 05.02.2026
ORDER
The petitioner has filed present petition under Article 227 of the Constitution of India being disgruntled by the order dated 25.07.2025 passed by the Commercial Court, Indore wherein, an application filed under Section 36(2) and 36(3) of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as "A & C Act, 1996") for stay of effect and operation of impugned arbitral award dated 12.12.2024 was dismissed.
02. The facts of the case, in nutshell, are that the respondent/claimant and petitioner/defendant entered into a partnership firm, namely M/s Marter Point, through Partner Jagdish Chouhan and Sandhya Chouhan in the year 2005, and under the partnership, constructed plot No. Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00 NEUTRAL CITATION NO. 2026:MPHC-IND:3820 2 MP-4880-2025 140, Readymade Complex, Pardeshi Pura, Dist. Indore was purchased, thereafter, a lease deed was executed with regard to the said plot, wherein the shed was constructed. Thereafter, the petitioner was carrying on its business since 2005. The claimant/respondent could not get her share of 49% of profit and loss, if any, from the petitioner's firm. The petitioner is brother-in-law of the respondent/claimant.
03. The husband of the respondent and the petitioner planned to start their own business of readymade garments and showed their willingness to enter into a partnership with the petitioner in the name and style of the partnership firm M/s Master Point in the year 2005.
04. Further, to carry out the business of readymade garments, the above said partnership firm purchased an under-construction shed situated at plot No. 140, Readymade Complex, Pardeshi Pura, Indore and the entire consideration amount of Rs. 3,18,000/- to purchase the above said property, was paid by the respondent. Thereafter, to set up the entire business, the respondent invested an amount of Rs. 7,56,107/- and the petitioner invested the amount of Rs. 1,08,794/- in total Rs. 8,65,101/- in the account of firm till 21.08.2005.
05. The respondent filed her arbitral claim according to her plaint and the petitioner submitted his reply. During the arbitral claim, the petitioner challenged the proceedings on four following issues :-
(a) the claim has been submitted on the basis of the photocopy of the partnership deed which was not duly stamped.
(b) The LD arbitrator has no right to decide the claim, which having the dispute of the forged documents, which was part of the matter, therefore, the jurisdiction of the Sole arbitrator is barred.Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00
NEUTRAL CITATION NO. 2026:MPHC-IND:3820 3 MP-4880-2025
(c) The original deed of partnership was not produced.
(d) Assessment of award passed on fictitious and false ground during the pendency of the arbitration claim, the petitioner raised the legal issue on the validity of the photocopy and the deed was not duly stamped and subject to the jurisdiction of the sole arbitrator by the different applications, which was decided by the sole arbitrator by orders dated 28.07.2023, 08.08.2023 & 25.04.2024.
06. The petitioner filed a Writ Petition No. 15848/2023 for challenging the order dated 30.06.2023, whereby the application filed by the petitioner under Section 16(3) read with Section 32 of the A & C Act, 1996, contending that as per the respondent, the entire case is based on the alleged fraud and forged deed of dissolution of partnership dated 27.04.2017, therefore, the matter was non-arbitrable in nature. The Division Bench vide order dated 24.01.2024.
07. The petitioner had filed Writ Petition No. 15848 of 2023 challenging the order dated 30.06.2023 passed by the learned Arbitral Tribunal, whereby the application of the petitioner under Section 16(3) read with Section 32 of the Arbitration and Conciliation Act, 1996, in which the petitioner contended that since the entire claim of the respondent was founded upon an alleged fraud and a forged Deed of Dissolution of Partnership dated 27.04.2017, the same was dismissed by Division Bench vide order dated 24.01.2024.
08. The present petitioner filed the petition bearing M.P. No.2880/2024 for challenging the order dated 20.05.2024 passed by the learned Arbitrator in Arbitration Case No. 02/2022, wherein the application filed by the petitioner under Section 32(2)(c) of the A & C Act, 1996 was Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00 NEUTRAL CITATION NO. 2026:MPHC-IND:3820 4 MP-4880-2025 dismissed and award was passed in favour of the respondent vide order dated 12.12.2024.
09. The petitioner challenged the order of the Arbitrator by way of appeal under Section 34 of the Act and sought to stay the execution of the award by filing an application under Section 36(2) and (3) of the Act. Learned Commercial Court passed the impugned order against the petitioner, hence, the present miscellaneous petition is before this Court.
10. It is contended by learned counsel for the petitioner that the claimant/respondent Smt. Sandhya Chouhan has submitted a photocopy of the partnership deed dated 07.01.2010, which is not duly stamped, therefore, this document has no validity as well as admissibility as evidence in light of Sections 33 and 35 of the Stamp Act, 1899 (in short "the Act, 1899"). The partnership deed has been drawn upon the stamp paper of Rs. 100/-, whereas as per Article 49 (b) of the Act, 1899 it requires stamp duty of his part. The learned Arbitrator has held that the partnership deed insufficiently stamped and its copy cannot be admitted as the evidence.
11. To buttress his submissions, learned counsel has taken the reference of the judgment rendered by the Apex Court in the cases of N.N. Global Vs. Indo Unique reported in (2023) SCC online SC 1666 , Hariom Agrawal vs Prakash Chandra Malviya, AIR 2008 SC 166, Kalyan Singh, London Trained Cutter, Zohari Bazar, Jaipur Vs. Smt. Chhoti and Others reported in AIR 1990 SC 396 and judgment passed by Co-ordinate Bench of this Court in the case of Narendra Kumar Vs. Deepchand i n M.P. No. 1971/2022 on 06.09.2022.
Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00NEUTRAL CITATION NO. 2026:MPHC-IND:3820 5 MP-4880-2025
12. It is further contended that in the impugned award it has been observed that since the partnership was resolved on dated 27.04.2017 with the help of an expert, therefore the value of the above profit can be assessed after accounting the rate of inflation up to 2017. Despite this finding, the learned Arbitrator has granted the claim to the claimant amounting to Rs.7,56,107/- from the year 2005 till 2022.
13. The document dated 26.09.2018 filed before the General Manager of MP Trade and Investment Facilitation Corporation Ltd. Bhopal regarding termination of the partnership of M/s Master Point working on plot No. 140 and in para 2 of the said document, it has been stated that the document dated 27.04.2017 was forged by the petitioner Jagdish Chouhan, therefore the present matter is alleged subject matter of fraudulent act of the petitioner. Hence, there is a violation of Section 16 of A & C Act. The petitioner raised the allegation during the pendency of the arbitration proceeding that the respondent has used the forged document and further the jurisdiction of the Arbitrator is barred by section 16 of the Act, 1996. The said contention is clarified by Hon'ble Apex Court in the case of Vidya Drolia and Ors. Vs. Durga Trading Corporation (2021) 2 SCC 1.
14. He has also contended that the learned Arbitrator has passed the award beyond his jurisdiction and the entire claim has been calculated erroneously in the arbitrary manner as well as the self-contradictory orders regarding the photocopy of the agreement was passed, thus, the Arbitral award is full of illegality and without jurisdiction. On the aforesaid grounds, present petition deserves to be allowed by quashing the impugned orders.
Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00NEUTRAL CITATION NO. 2026:MPHC-IND:3820 6 MP-4880-2025 1 5 . Per contra, learned counsel for the respondent has vehemently opposed the prayer by submitting that all the above grounds have been considered by the Commercial Court in Case No. MJC AV No. 10/2025 under Section 34 of the Arbitration and Conciliation Act, 1996 while deciding the application filed by the petitioner. The High Court's jurisdiction in the present petition is limited only to the legal point whether the Commercial Court abused its jurisdiction or committed a clear legal error in passing the order dated 25.07.2025. This Court has no jurisdiction to consider the above points of the petitioner. On the above point, the judgment passed by the Hon'ble Apex Court in the case of (2022) 1 SCC 75 Bhaven Constructions Vs. Executive Engineer Sardar Sarovar Narmada Nigam Ltd. is worth observing. It has also been submitted that the petitioner has not pleaded any of the above mentioned arguments/grounds under Section 36(2) and 36(3) of the Arbitration and Conciliation Act, 1996 in the application filed before the Commercial Court and even at this stage when the order dated 25.07.2025 has been challenged by the petitioner before this Court, the petitioner is barred from raising the said arguments/grounds in the light of the doctrine of "Estoppel by conduct". It is pertinent to mention that the award passed in favor of the respondent is a money decree and it is a well- established principle of law that the execution of a money decree can be stayed only in exceptional circumstances.
16. He has placed reliance over the judgments passed by Hon'ble Apex Court in Civil Appeal No. 6789/2022 (Arising out of SLP (C) No.4511 of 2021) Sepco Electric Power Construction Corporation Vs. Power Mech Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00 NEUTRAL CITATION NO. 2026:MPHC-IND:3820 7 MP-4880-2025 Projects Ltd. & Pam Developments Pvt. Ltd. Vs. State of West Bengal reported in (2019) 8 SCC 112 a n d Shalini Shyam Shetty Vs. Rajendra Shankar Patil reported in (2010) 8 SCC 229 . Hence, it is prayed that the present petition be dismissed.
17. Having considered the submissions advanced by learned counsel for the parties and perusing the the record available, the following questions arise for determination of the issue involved in this petition:-
1] Whether the learned Commercial Court committed a jurisdictional error in dismissing the petitioner's application under Sections 36(2) and 36(3) of the Arbitration and Conciliation Act, 1996, despite the arbitral award being founded upon a photocopy of a partnership deed ?
2] Whether a photocopy of an insufficiently stamped partnership deed could be admitted and relied upon as secondary evidence in arbitral proceedings, in light of Sections 33 and 35 of the Act, 1899 ?
18. So far as questions No. 1 & 2 are concerned, both are being decided in a parallel manner. The answer is in the affirmative.
19. By minutely perusing the record, it is apparent that arbitral award was founded upon a photocopy of the partnership deed, which was neither the original document nor duly stamped as required under the Act, 1899. It has also not been properly stamped as prescribed under the provisions of the Act, 1899
20. In view of Sections 33 and 35 of the Act, 1899, an instrument which is insufficiently stamped is inadmissible in evidence for any purpose.
21. On this aspect, following ratio rendered by Hon'ble Apex Court in the case of N.N. Global Mercantile Pvt. Ltd. (Supra) is relevant to be Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00 NEUTRAL CITATION NO. 2026:MPHC-IND:3820 8 MP-4880-2025 referred as under :-
"I am also concurring with the view that what is permissible to be produced as secondary evidence i.e., other than the original document in terms of Section 2(a) of the scheme framed under Section 11(10) of the Act, is nothing but certified copy as mentioned earlier. But such a certified copy, would not be available to be proceeded with under Section 33 of the Stamp Act if it is unstamped or insufficiently stamped. In such circumstances, such certified copy shall not be acted upon."
22. Further, Hon'ble Apex Court in the case of Hariom Agrawal (Supra) has made observations, which is to be mentioned as follows :-
"It is clear from the decisions of this Court and a plain reading of Sections 33, 35 and 2(14) of the Act that an instrument which is not duly stamped can be impounded and when the required fee and penalty has been paid for such instrument it can be taken in evidence under Section 35 of the Stamp Act. Sections 33 or 35 are not concerned with any copy of the instrument and party can only be allowed to rely on the document which is an instrument within the meaning of Section 2(14). There is no scope for the inclusion of the copy of the document for the purposes of the Indian Stamp Act. Law is now no doubt well settled that copy of the instrument cannot be validated by impounding and this cannot be admitted as secondary evidence under the Indian Stamp Act, 1899"
23. Likewise, following excerpt rendered in the case of Kalyan Singh (Supra) by Hon'ble Apex Court, is worth to be quoted, as under :-
"The High Court said, and in our opinion very rightly, that Ex. 3 could not be regarded as secondary evidence.Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00
NEUTRAL CITATION NO. 2026:MPHC-IND:3820 9 MP-4880-2025 Section 63 of the Evidence Act mentions five kinds of sec- ondary evidences. Clause (1), (2) and (3) refer to copies of documents; clause (4) refers to counterparts of documents and clause (5) refers to oral accounts of the contents of documents. Correctness of certified copies referred to in clause (1) is presumed under Section 79; but that of other copies must be proved by proper evidence. A certified copy of a registered sale deed may be produced as secondary evidence in the absence of the original. But in the present case Ex. 3 is not a certified copy. It is just an ordinary copy. There is also no evidence regarding contents of the original sale deed. Ex. 3 cannot, therefore, be considered as secondary evidence. The appellate Court has a right and duty to exclude such evidence."
24. In these judgments, it has been held that an instrument which is not duly stamped is inadmissible in evidence for any purpose in view of Sections 33 and 35 of the Act, 1899, and no right or liability can be founded upon such an instrument unless it is duly stamped in accordance with law.
25. The bar created by the Stamp Act applies not only to the original instrument but also to every form of secondary evidence of that instrument. A party cannot be permitted to do indirectly, by producing a copy, what the law prohibits directly in respect of the original.
26. Only a certified copy of a registered document can be considered as secondary evidence, and even such certified copy cannot be acted upon if the original instrument is unstamped or insufficiently stamped. An ordinary photocopy or private copy of an instrument has no evidentiary value and cannot be treated as secondary evidence unless it satisfies the strict requirements of Sections 63 and 65 of the Evidence Act. A copy of an unstamped or insufficiently stamped instrument cannot be validated by impounding, nor stamp duty and penalty can be recovered on a copy. Courts Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00 NEUTRAL CITATION NO. 2026:MPHC-IND:3820 10 MP-4880-2025 and tribunals have a mandatory duty to exclude such documents from consideration, and failure to do so amounts to a jurisdictional error.
27. In the present case, the arbitral proceedings and the award dated 12.12.2024 stand vitiated as they are founded upon an inadmissible document, namely a photocopy of an insufficiently stamped partnership deed. Since the very basis of the claim was legally unenforceable, the award suffers from patent illegality and is rendered without jurisdiction, attracting interference under the supervisory powers of this Court. The learned Arbitrator acted in excess of jurisdiction by proceeding to adjudicate the dispute and granting monetary relief despite having recorded a categorical finding that the partnership deed was insufficiently stamped and that its photocopy was not admissible as evidence. Having reached such a finding, the learned Arbitrator could not have relied upon the said document for granting relief. The approach adopted is self-contradictory and legally unsustainable.
28. While exercising jurisdiction under Section 36 of the Arbitration and Conciliation Act, 1996, the learned Commercial Court failed to consider the patent illegality and material irregularity apparent on the face of the arbitral award. The Commercial Court overlooked the settled legal position that an award founded on an inadmissible and insufficiently stamped document cannot be enforced. Such failure warrants interference by this Court under Article 227 of the Constitution of India, as laid down in the settled principles governing supervisory jurisdiction.
29. On a comprehensive consideration of the pleadings, material on Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00 NEUTRAL CITATION NO. 2026:MPHC-IND:3820 11 MP-4880-2025 record and the settled position of law, this Court finds that the arbitral award dated 12.12.2024 and the consequential order dated 25.07.2025 passed by the learned Commercial Court, Indore, are vitiated by patent illegality and jurisdictional error
30. The Hon'ble Supreme Court in N.N. Global Mercantile Pvt. Ltd. (Supra), Hariom Agrawal (Supra) and Kalyan Singh (Supra) has unequivocally held that an unstamped or insufficiently stamped instrument cannot be acted upon, and a photocopy of such a document is equally inadmissible in law. Therefore, the arbitral tribunal could not have assumed jurisdiction or granted any relief on the basis of such a document.
31. In view of the aforesaid discussion and upon careful consideration of the material available on record, this Court is of the considered opinion that the learned Arbitrator as well as the Commercial Court have committed a manifest error of law in proceeding on the basis of a photocopy of the partnership deed, which admittedly was neither the original document nor duly stamped in accordance with the provisions of the Act, 1899.
32. Despite recording a finding that the partnership deed was insufficiently stamped and that its copy could not be admitted as evidence, the learned Arbitrator proceeded to adjudicate the dispute and passed the impugned award dated 12.12.2024. The Commercial Court, while dismissing the application under Sections 36(2) and 36(3) of the Arbitration and Conciliation Act, 1996, failed to appreciate this fundamental illegality and thereby exercised its jurisdiction with material irregularity.
33. In view of the foregoing analysis, the order dated 25.07.2025 Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00 NEUTRAL CITATION NO. 2026:MPHC-IND:3820 12 MP-4880-2025 passed by the Commercial Court, Indore, as well as the arbitral award dated 12.12.2024 being unsustainable in the eyes of law, are hereby set aside.
34. Ex. consequenti , the present petition is allowed.
35. However, both parties shall be at liberty to file afresh application before the appropriate forum alongwith original documents, if so advised.
No order as to costs.
(ALOK AWASTHI) JUDGE Vindesh Signature Not Verified Signed by: VINDESH RAIKWAR Signing time: 05-02-2026 19:26:00