2012 (11) TMI 1237 - HC - Companies Law

Summary

Issues involved:
Seeking ad interim relief u/s 9 of the Arbitration & Conciliation Act, 1996 due to deadlock between partners of a firm, pending appointment of arbitrator u/s 11.

Summary:

Issue 1:
The petitioner sought relief under section 9 of the Arbitration & Conciliation Act, 1996 due to a deadlock between partners of a firm operating under a partnership deed. The petitioner highlighted non-payment of salaries and bonuses to staff, leading to hampered business operations. The petitioner requested permission to withdraw a specified amount from the firm's account to clear these dues, with a commitment to return the amount if no arbitration agreement is found.

Issue 2:
The respondents argued that the arbitration agreement no longer existed following an award by the arbitrator in earlier proceedings. They claimed that the firm was being run based on a Memorandum of Understanding (MOU) without an arbitration clause, making the petition under section 9 not maintainable. They opposed granting ad interim relief.

Judgment:
After considering the arguments, the court scheduled the matter for a final hearing on a specific date. In the interim, the court allowed the petitioner to withdraw a specified sum from the firm's account to disburse salaries, bonuses, and outstanding expenses. The respondents were directed to sign the necessary cheques for withdrawal from specific bank accounts within a week, ensuring no prejudice to either party's rights and contentions.