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Madhya Pradesh High Court · body

2013 DIGILAW 995 (MP)

Preeti Jain v. Paras Jain

2013-08-22

Shantanu Kemkar

body2013
ORDER 1. This review petition has been filed by the petitioners, who were respondents No.1 to 5 in Arbitration Case No.18/2008 decided vide order passed by this Court on 22.12.2009, of which review / recall has been sought. 2. The first respondent herein (one of the partner of the partnership firm M/s. Vimal Garden) had filed an application under section 11(5) of the Arbitration and Conciliation Act, 1996 (for short, the Act) seeking appointment of Arbitrator for the dispute between the partners on the basis of arbitration clause No.14 in the partnership deed dated 12.10.2000 said to have been entered into between the parties. 3. In the aforesaid arbitration case, the petitioners herein had raised an objection and denied of execution of partnership deed by them. 4. This Court, after dealing with the rival submissions and taking into consideration the various documents filed along with Arbitration Case No.18/2008, including the deed of partnership, Clause No.14 of it, the return filed on behalf of the partnership firm (Annexure A/2), allowed the application by holding thus: - “10. In the present matter from the averments and the arguments raised by the parties I find that the only question which requires consideration is that as to whether there exists an arbitration agreement or not. The respondent No.1 to 5 have challenged the execution of the partnership deed (Annexure A/1) itself containing the arbitration clause. The applicant has stated that the partnership deed (Annexure A/1) was executed between him and the respondents. According to him the partnership deed (Annexure A/1) bears signature of the applicant and the respondents on each and every page. The stand of the respondent No.1 to 5 is that the sixth respondent got this document signed by them on false pretext. From the various documents filed by the applicant including the Income Tax Returns of the respondents themselves, Bank Account Statement of the Partnership Firm, Electricity Bills and Income Tax Returns of Sanjay Jain it is amply clear that property Vimal Garden is of partnership Firm M/s. Vimal Garden. It is also revealed that after execution of the partnership deed (Annexure A/1) it was through out acted upon by the parties including respondents No.1 to 5. It is also revealed that after execution of the partnership deed (Annexure A/1) it was through out acted upon by the parties including respondents No.1 to 5. The challenge to the Income Tax Returns has been made by the respondents no.1 to 5 on the ground that sixth respondent being son of the applicant had submitted Income Tax Returns taking advantage of relationship. To my mind this plea cannot be accepted for the reason that it is not the case of the respondents No.1 to 5 that they are not income tax payee or that the Returns submitted the applicant with this application are not their Income Tax Returns and are concocted one. The respondents No.1 to 5 have also not produced copy of their Income Tax Return to demolish the Income Tax Returns filed by the applicant nor they have filed any Income Tax Return of the said Sanjay Jain who according to them is proprietor of the Firm M/s. Vimal Garden. In the circumstances from the Income Tax Returns of the respondents No.1 to 5 in which their income /investment has been shown from and in the partnership Firm M/s. Vimal Garden it is established that the partnership deed (Annexure A/1) is a validly executed document by the parties. The case of the respondent No.1 to 5 that M/s. Vimal Garden is owned by Sanjay Jain and is a proprietory Firm has no force in view of the Income Tax Return of the said Sanjay Jain himself in which he has not claimed his income from the said Firm either as a proprietor or in any other capacity. Similarly non mention of the denomination of stamp of Rs.1,000/- in the entry of the register of stamp vendor and instead mention of entry of selling of stamp worth Rs.50/- would not render the partnership deed itself to be a forged or concocted document more particularly when its execution by the parties is found to be proved. Thus, on the basis of overwhelming documentary evidence submitted by the applicant the execution of the partnership deed (Annexure A/1) containing an arbitration clause is found to be proved. The said partnership deed contains an arbitration clause No.14. Thus, on the basis of overwhelming documentary evidence submitted by the applicant the execution of the partnership deed (Annexure A/1) containing an arbitration clause is found to be proved. The said partnership deed contains an arbitration clause No.14. In the circumstances, I have no hesitation to hold that there is a valid arbitration agreement and inspite of notice (Annexure A/3) being served as per postal receipts (Annexure A/4) upon the respondents they have failed to act upon it. 11. Accordingly this application for appointment of Arbitrator is allowed Hon’ble Shri Justice P.D. Muley a retired Judge of this Court is appointed as a Sole Arbitrator for deciding the dispute between the parties. Registry to send a copy of this order to Hon’ble Shri Justice P.D. Muley for information and necessary action. 12. No other point urged.” 5. To seek review of the aforesaid order dated 22.12.2009, the petitioners’, who were respondents No.1 to 5 in the said Arbitration Case, have raised a plea that with the Tax Return of the partnership firm filed by the first respondent herein, a deed of dissolution of partnership dated 31.3.2003 was also filed before the Income Tax Department, but it was deliberately not filed by the first respondent in the Arbitration Case. Although a further plea has been raised that even the said deed of dissolution is a forged document, but according to the petitioners, had the said dissolution deed been filed on record in the Arbitration Case, this Court would not have passed the order of appointment of Arbitration. In the circumstances, on the ground of fraud being played by the first respondent, the petitioners have sought review / recall of the order dated 22.12.2009. In support of the petitioners’ case Shri G.M. Chaphekar, learned Senior Counsel has placed reliance on the judgment passed by the Supreme Court in the case of Indian Bank v. Satyam Fibers (India) Private Limited (1996) 5 SCC 550 . 6. Shri Vishal Baheti, learned counsel, on the other hand, argued that under the Act, there is no provision of review of the order passed under the Act, and as such, review petition filed at the instance of the petitioners to seek review of order of appointment of Arbitrator, is not maintainable. In support of this contention, he placed reliance on Kalabharti Advertising v. Hemant Vimalnath Narichania and others ( AIR 2010 SC 3745 ). In support of this contention, he placed reliance on Kalabharti Advertising v. Hemant Vimalnath Narichania and others ( AIR 2010 SC 3745 ). He disputed that along with the return submitted before the Income Tax Department, the dissolution deed of partnership was ever submitted. He, however, in the alternative, submitted that in view of the arbitration clause contained in the partnership deed, even after the dissolution of the firm, the matter can be referred for arbitration. 7. The Supreme Court in the case of Kalabharti Advertising v. Hemant Vimalnath Narichania and others (supra) taking note of its various earlier pronouncements has held that unless statute / rules permit, a review application is not maintainable in the case of judicial / quasi judicial orders. In absence of any provision in the Act granting express powers to review, it is manifest that a review could not be made and the order in review, if passed is ultra vires, illegal and without jurisdiction. It further held that power to review is not an inherent power. It must be conferred by law, either expressly / specifically or by necessary implication. In the absence of any statutory provision providing for review, entertaining an application for review or under the garb of clarification / modification / correction is not permissible. 8. Shri G.M. Chaphekar, learned senior counsel did not dispute that under the Act there is no provision for remedy of review. He, however, stressed upon his contention that as the first respondent has played fraud by not filing copy of the return along with the dissolution deed in the Arbitration Case, as was filed in the Income Tax Department, the order needs to be reviewed, as the same has been obtained on the basis of fraud. 9. The contention of the learned senior counsel appearing for the petitioners that the first respondent having played fraud, in the circumstances in view of the law laid down by the Supreme Court in Indian Bank v. Satyam Fibers (India) Limited (supra), the order, which has been passed in the arbitration case vitiates as there is always inherent powers with the Court to recall its judgment and order, if found to be obtained by fraud / forgery, cannot be accepted for the simple reason that this Court is not finding any fraud being played with it by the first respondent in obtaining the order in the arbitration case. This Court has very clearly held that in the view of clause 14, as extracted in the order dated 22.12.2009; the matter requires to be referred to the Arbitrator. Since no case of fraud being played by respondent No.1 is made out and even if the dissolution deed would have been filed, I am of the opinion that in view of clause 14 of the partnership deed, there would not have been any different order than the order which has been passed in the Arbitration Case. Therefore, the law laid down in the case of Indian Bank v. Hemant Vimalnath Narichania and others (supra) has no applicability to the facts of the present case. 10. In the circumstances, the review petition being wholly misconceived, the same deserves to be and is hereby dismissed with costs of Rs.10,000/- (rupees ten thousand).