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2006 DIGILAW 102 (DEL)

P. S. SUBBU NARASIMMHAN v. YAMAHA MOTOR INDIA (P) LTD

2006-01-17

A.K.SIKRI

body2006
A. K. SIKRI, J. ( 1 ) M/s. Yamaha Motor India (P) Ltd. , the respondent herein had appointed M/s. Pushpak Motors as its agents for sale of its motor cycles in Bangalore. According to the respondent, sum of Rs. 26,23,629. 47 became due and payable by the said partnership firm. Since there was an arbitration clause in the agreement entered into between the parties, the respondent invoked the arbitration clause and referred the matter for Arbitration committee of the Indian Council of Arbitration. Mr. S. S. Sabharwal was appointed as the sole arbitrator who entered the reference and after hearing the parties has returned his award dated 4th February 2005. In these proceedings the respondent, apart from impleading the said partnership firm, also impleaded its partners, as opposite parties. Thus, the petitioner was also impleaded as one of the partners of the said partnership firm. As per the award, the learned arbitrator has held as under:-"that claimant is entitled to recover a sum of Rs. 26,23,629. 47 (Rupees Twenty six lacs twenty three thousand six twenty nine and Forty seven paise) along with interest @ 9% per annum pendente lite and till the recovery of this amount from Respondents No. 1, 3, 4 and 5. The claimant is also entitled to recover C-Form in respect of the sales done by the respondent No. 1 to the tune of Rs. 66,17,753. 58 (Rupees sixty six lacs seventeen thousand seven hundred fifty three and Fifty eight paise) or in the alternative shall be entitled to receive differential amount of Sales Tax at the rate of 6% of the above sales which comes to Rs. 3,97,065. 21. Claim against Respondent No. 2 stands dismissed. "the costs and expenses incidental to this reference are fixed at rs. 50,900/- (Rupees Fifty thousand nine hundred only); Rs. 22,700/- (Rupees twenty two thousand seven hundred only) as arbitrator s fee; Rs. 28,200/- (Rupees Twenty eight thousand two hundred only) as administrative fee. The above payments be made out of the deposit of Rs. 50,900/- (Rupees Fifty thousand nine hundred only) already made by the parties with the Council. " the claimant company is also entitled to get all the expenses of litigation i. e. Rs. 50,900/- (Rupees Fifty thousand nine hundred only) from Respondents No. 1, 3, 4 and 5 in addition to the amount awarded above. 50,900/- (Rupees Fifty thousand nine hundred only) already made by the parties with the Council. " the claimant company is also entitled to get all the expenses of litigation i. e. Rs. 50,900/- (Rupees Fifty thousand nine hundred only) from Respondents No. 1, 3, 4 and 5 in addition to the amount awarded above. Signed this 4th day of February 2005 at new Delhi. " ( 2 ) PETITIONER has filed instant petition under section 34 of the Arbitration and Conciliation act (in short the act ) challenging the said award. Three grounds of challenge are raised by the petitioner which were canvassed before me by the learned counsel for the petitioner. ( 3 ) FIRST ground is that the petitioner had retired from the partnership on 8. 1. 2001 and, therefore, the petitioner had no concern with the partnership firm thereafter and thus, is not liable to make any payment. This argument of the petitioner raised before the learned arbitrator has been rejected by arbitrator by observing as under:-"he has further argued that as the firm is dissolved vide deed of dissolution dated 8. 1. 2001 he is not liable for any claim against the firm. It was Mr. S. Ravi who is fully responsible for the claim of the claimant. To rebut his argument the learned counsel for the claimant has relied upon the Judgments, reported as 2003 (67) DRJ 256 , AIR 1983 Bom. 226, AIR 1999 Ker. 157. In all these judgments it is held if notice of dissolution is not given as prescribed and required under Sections 32 (3), 45, 72 of the Partnership Act then the mere retirement or dissolution of the firm is not sufficient to absolve the partner. Respondent No. 3 has further relied upon Supreme Court Judgment reported as (1985) 2 SCC 14 . The facts and question of law involved in that judgment is different and not relevant to the facts and question of law involved in this case therefore the same is not applicable to this case. I therefore hold that respondent No. 3 is liable for the claim of the claimant. " ( 4 ) IT is clear from the above that only on the ground that the petitioner had retired from the partnership firm petitioner was trying to absolve himself from the liability. I therefore hold that respondent No. 3 is liable for the claim of the claimant. " ( 4 ) IT is clear from the above that only on the ground that the petitioner had retired from the partnership firm petitioner was trying to absolve himself from the liability. However, it was not even pleaded that the petitioner had informed the respondent herein about the dissolution of the firm and/or his retirement from the firm. Learned counsel for the petitioner submitted that information about the retirement of the "petitioner from the partnership firm was given to the respondent on 12. 5. 2001. As mentioned above, it is not the case pleaded before the arbitrator. Even otherwise on specific query put by the Court, the learned counsel for the petitioner conceded that there is no document in support of the submission that any such information was supplied to the defendant and the case now set up is that oral information was given. Thus, not only such a plea is inadmissible which was not taken before the arbitrator, the same is not even substantiated. Therefore, the award of the learned arbitrator deciding this issue is perfectly valid. ( 5 ) IT was further submitted that the petitioner was given illegible copy of the statement of claim on the basis of which, the respondent herein had preferred the claim before the arbitrator. However, the legible copy was not supplied. In spite thereof, in the impugned award the learned arbitrator has observed that correctness of the statement of account is not disputed. This, learned counsel submitted, is contrary to the record. ( 6 ) PERUSAL of the record shows that the petitioner had filed an application for supply of legible copy of the statement of account. Order dated 8. 4. 2004 was passed on this application agreeing with the submission of the petitioner herein that the copy supplied was illegible and direction was given to the respondent herein to supply fresh legible copy of the statement of account as well as C form details to the learned counsel for the petitioner herein within a week. It was also directed that another legible copy may also be sent to the tribunal for its reference. In the impugned award specific observation is made that legible copy of the same was made available to the respondent No. 3 on his written request. It was also directed that another legible copy may also be sent to the tribunal for its reference. In the impugned award specific observation is made that legible copy of the same was made available to the respondent No. 3 on his written request. Learned counsel for the respondent also referred to the proceedings before the arbitrator held on 14. 12. 2004 as per which, the learned arbitrator recorded that pleadings in the case were absolutely complete and nobody wanted to file anything in support of their case further and the matter was fixed on 12. 1. 2005 for arguments. Learned counsel is right in his submission that no objection was raised by the learned counsel for the petitioner herein about alleged non-supply of the legible copy of the statement of account. Therefore, I am not convinced with the plea of the learned counsel that statement of account was not supplied. In these circumstances, observations of the learned arbitrator in the impugned award that in spite of supply of the copy, correctness of the statement of claim is not disputed, are perfectly justified. ( 7 ) LAST submission was that the arbitrator had not followed the terms and conditions of the agreement. It was sought to be contended that as per clause (3) under the head "c. PURCHASE ORDER AND DELIVERY", the order placed by the dealer (partnership firm) on the respondent had to be accompanied for an amount equivalent to 10% of the total price and since this 10% payment was not made, supplies should not have been effected by the respondent. According to the petitioner, in ignoring this clause, the award would be treated as bad in law as it is opposed to the public policy, as held by the Supreme Court in the case of Oil and Natural Gas Corporation Ltd. Vs. SAW pipes Ltd. , 2003 IV AD (S. C.) 254 = AIR 2003 SC 2629 . The plea raised is far-fetched. The petitioner and/or his partnership firm were supplied the motor cycles without even taking 10% advance, which was required to be paid by the petitioner/partnership firm. That does not mean that the petitioner or the partnership firm is not to make any payment whatsoever. The petitioner cannot take advantage of his own wrongs. I do hot find any merit in any of the objections. This petition is accordingly dismissed. .