Karnataka High Court
Sri S Dayananda vs Ramananda S on 26 November, 2020
Author: S R.Krishna Kumar
Bench: S.R.Krishna Kumar
1
IN THE HIGH COURT OF KARNATAKA, BENGALURU
DATED THIS THE 26TH DAY OF NOVEMBER 2020
BEFORE
THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR
CIVIL MISCELLANEOUS PETITION No.201 OF 2018
BETWEEN:
SRI. S. DAYANANDA
S/O SADANANDA P.
AGED ABOUT 60 YEARS
R/AT NO.151, 1ST BLOCK
ANIKETHANA ROAD
KUVEMPUNAGAR
MYSORE - 570 004 ... PETITIONER
(BY SRI. GIRISH N. R., ADV.)
AND:
RAMANANDA S.
S/O SADANANDA P.
AGED ABOUT 52 YEARS
R/AT NO.1, EAST OR
BED COLLEGE ROAD
SARASWATHIPURAM
MYSORE - 570 009 ... RESPONDENT
(BY SRI. SUSHANT VENKATESH PAI, ADV.)
THIS C.M.P. IS FILED UNDER SECTION 11(6) OF
ARBITRATION AND CONCILIATION ACT 1996 PRAYING TO
APPOINT A SOLE ARBITRATOR AT MYSORE TO RESOLVE THE
DISPUTE BETWEEN THE PETITIONER AND THE RESPONDENT
AS PER PARTNERSHIP DEED DATED 18.08.2003 VIDE
ANNEXURE-A AND PERMITTING THE PETITIONER TO MAKE THE
RESPECTIVE CLAIM BEFORE THE SOLE ARBITRATOR
THROUGH APPOINTED BY THIS HON'BLE COURT IN THE
INTEREST OF JUSTICE AND EQUITY.
THIS C.M.P. COMING ON FOR ADMISSION THIS DAY, THE
COURT MADE THE FOLLOWING:-
2
ORDER
Heard learned counsel for the petitioner and learned counsel for the respondent and perused the material on record.
2. The present petition under Section 11 of the Arbitration and Conciliation Act, 1996 (for short "the Act") has been filed by the petitioner-Sri. S. Dayananda, against the respondent - Ramananda S., seeking an appointment of the Sole Arbitrator in pursuance of Clause-20 of the Partnership Deed vide Annexure-A dated 18.08.2003.
3. Clause-20 of the said agreement, which is an Arbitration clause reads as under:-
"20. ARBITRATIONS: if there were to be any disputes among partners, it shall be settled amicably by the partners themselves, if not it shall be referred to the arbitration of arbitrators, each partner nomination one arbitrator, decision of majority of arbitrators shall be binding on all the partners.
4. In addition to reiterating various contentions urged in the petition and referring to various documents produced by the petitioner, learned counsel for the petitioner submits 3 that subsequent to issuance of notice at Annexure-B dated 02.04.2006, negotiations took place between the petitioner and respondent, due to which the matter was not referred to arbitration. This aspect has been stated by the petitioner in the notice dated 03.05.2018. In the said notice, it is also stated that subsequent to aforesaid notice dated 11.04.2006, a family dispute arose between the petitioner and the respondent and their sisters in O.S.No.430.2012, which was settled in the year 2015. The petitioner has also stated that immediately after settlement of the family dispute, the respondent intimated the petitioner that the present dispute would also be settled but the said assurance given by the respondent was not complied with by him. It is further stated that subsequently the respondent kept promising that the dispute would be resolved, in particular, during January-18 to April-2018. Under these circumstances, learned counsel submits that the cause of action for seeking reference to arbitration as pleaded in the notice dated 02.04.2006 is completely different from the cause of action for reference to arbitration pleaded in the notice dated 03.05.2018, in the light of the subsequent 4 events that had transpired during the said period and as such, it cannot be said that the present petition is barred by limitation under Article 137 of the Limitation Act.
5. Per contra, learned counsel for the respondent in addition to reiterating various contentions urged in the Statement of Objections, submits that a perusal of the notice dated 02.04.2006 as well as the subsequent notice dated 03.05.2018, will clearly indicate that the cause of action for reference of dispute between the parties in both the notices are one and the same. In this context, learned counsel submits that the cause of action for seeking reference to Arbitration under Section 11(5) of the Act would commence upon receipt of notice dated 02.04.2006 and the present petition filed in the year 2018, beyond the period of three years, as provided under Article 137 of the Limitation Act, is not maintainable and that the same is liable to be dismissed. Learned counsel also submits that mere occurrence of subsequent events will not extend the period of limitation and give raise to a fresh cause of action. 5 In support of his submissions, learned counsel for the respondent places reliance on the following decisions:
i. SBP & Co. Vs. Patel engineering Ltd. Another -
(2005) 8 SCC 618.
ii. S. Ranjan Vs. State of Kerala and Another -
(1992) 3 SCC 608.
iii. Golden Chariot Recreations Pvt. Ltd Vs. Mukesh Panika & Anr. - 2018 SCC Online Del 10050 : (2018) 253 DLT 219.
6. I have given my anxious consideration to the rival submission and also perused the material on record including the judgments relied upon by learned counsel for the respondent.
7. The material on record indicates that in the notice dated 03.05.2018, the petitioner has specifically pleaded that subsequent to issuance of notice dated 02.04.2006, settlement talks occurred between the parties, but there was no amicable settlement. A suit in O.S.No.430/2012 was filed between the petitioner, respondent and their sisters and though the said suit was settled in the 2015, the respondent subsequently assured the petitioner that the present dispute arising out of the partnership deed would 6 also be settled but, the same was not settled. A reading of notices dated 02.04.2006 and 03.05.2018 will clearly indicate that though the disputes between the parties relate to the partnership deed, the cause of action for seeking reference to arbitration in the notice dated 02.04.2006 and notice dated 03.05.2018 are completely different, in as much as the notice dated 03.05.2018 was issued after several subsequent events that occurred after issuance of the notice dated 02.04.2006. Under these circumstances, in view of the fact that the cause of action for the present petition is based on the averments made in the notice dated 03.05.2018 wherein several subsequent events had occurred subsequent to issuance of the notice dated 02.04.2006, which is not made the basis for the present petition, I am of the considered opinion that the present petition filed on 10.07.2018 based on the notice dated 03.05.2018 and not on the basis of the notice dated 02.04.2006 is clearly not barred by limitation under Article 137 of the Limitation Act, as sought to be contended by the learned counsel for the respondent. Accordingly, the said contention urged by learned counsel cannot be accepted. 7
8. The matter can be examined from yet another angle. Article 58 of the Limitation Act contemplates that the period of limitation to file a suit to obtain any other declaration arises when the right to sue "first accrues". As against this, the words appearing in Article 137 read as, "when the right to apply accrues". It is significant to note that the word 'first' is conspicuously absent in Article 137 of the Limitation Act. There is no gainsaying the fact that both Articles 58 and 137 of the Limitation Act are residuary provisions which are to be invoked in the absence of any specific provisions in relation to the subject matter of lis. The omission of the word 'first' found in Article 58 and not in Article 137 is sufficient to indicate that the issuance of the first notice dated 02.04.2006, by itself without anything else cannot be construed as the starting point of limitation for the purpose of the present petition particularly when additional subsequent events and facts giving rise to a new and fresh cause of action have been pleaded specifically by the petitioner in the notice dated 03.05.2018 which has to be construed as the starting point of limitation for the purpose of the present petition under Article 137 of the 8 Limitation Act. Viewed from this angle also, Article 137 qua the notice dated 02.04.2006 cannot be said to be the starting point of limitation as contended by the learned counsel for the respondent and consequently, the said contention of the learned counsel for the respondent cannot be accepted on this ground also.
9. The aforesaid facts and circumstances clearly indicate that the requisite notice of request for reference to arbitration was given by the petitioner to the respondent vide Annexure-D dated 03.05.2018. Reply notice at Annexure-G dated 09.05.2018 was sent on behalf of the respondent. Subsequently, the parties have somehow failed to mutually agree for the appointment of the Sole Arbitrator in the present case. Hence, the petitioner is before this Court by way of this petition to appoint the Sole Arbitrator to resolve their disputes.
10. In view of the aforesaid facts and circumstances, since the Arbitration clause exists in the Agreement entered into between the parties and an arbitrable dispute also exists, this Court is of the opinion that the present petition 9 deserves to be allowed under Section 11 of the Act and an independent Sole Arbitrator deserves to be appointed.
11. Both the learned counsel have fairly agreed to the appointment of Smt. H. S. Kamala, Retired District Judge, No.41, 'Akshaya', Aniketana South 3rd Cross, Kuvempu Nagar, Mysore-23 (E-mail:
[email protected]), to act as the Sole Arbitrator to resolve the dispute between the parties under the provisions of the Arbitration and Conciliation Act, 1996.
12. Accordingly, this petition under Section 11 of the Act, 1996 is disposed of by appointing Smt. H. S. Kamala, Retired District Judge to enter into the said reference of Arbitration and act as the Sole Arbitrator in the present case at the address mentioned above.
(i) All claims and contentions of any of the parties including jurisdiction, limitation, etc., are left/kept open to be decided by the Arbitral Tribunal.
(ii) A copy of this order be sent forthwith to the aforesaid Sole Arbitrator, Smt. H. S. Kamala, Retired District Judge for proceeding further in the matter. 10
(iii) Registry is directed to return all original documents produced by any of the parties after obtaining Photostat copies of the same.
Sd/-
JUDGE Bmc.