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TMI Blog2001 (11) TMI 932X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned Single Judge was that the respondent was not a registered firm and, in any event, was not registered under the Indian Partnership Act, 1932 at the material time and, therefore, could not make any claim in the arbitration proceedings and, therefore, the reference as well as the award are void. It was also contended that one of the arbitrators, viz., Mr. Justice D.B. Deshpande was not a member of the Stock Exchange and under the relevant bye-laws of the Stock Exchange, a non-member could not have been an arbitrator and, therefore, the award was invalid. A contention was also raised that the claim which was referred to the arbitration was barred by time. The learned Single Judge rejected all these contentions and upheld the award. 2. Mr. Thakkar, the learned counsel appearing for the appellant, has contended that the effect of non-registration is fatal to the validity of the reference and the award. The contention is based on section 69 of the Indian Partnership Act as amended by the State of Maharashtra. The provisions of section 69 are set out below : "69. Effect of non-registration . (1) No suit to enforce a right arising from a contract or conferred by this Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akkar relied upon the decisions of the Supreme Court in Jagdish Chandra Gupta v. Kajaria Traders (India) Ltd. AIR 1964 SC 1882, and Delhi Development Authority v. Kochhar Construction Work [1998] 8 SCC 559. He also relied upon the decision of the Division Bench of this Court in Hemendra V. Shah v. Stock Exchange [1996] 1 Bom. CR 270. 4. The short question which falls for determination is whether reference to arbitration without recourse to Court is barred by section 69(3). Section 69 makes registration of a firm compulsory and the said section forbids the institution of certain suits and proceedings in respect of the partnership which has not been registered under the Act. Under sub-section (1), a partner cannot institute a suit to enforce a right arising from a contract or conferred by the Act against the firm or his co-partner unless the firm is registered. Sub-section (2) lays down that the firm which has been registered shall not be competent to institute a suit by or on behalf of a firm against any third-party unless the registration of the firm is effected. Sub-section (3) extends the provisions of sub-sections (1) and (2) to claim of set-off or other proceedi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... way and a new obligation or penalty ought not to be imposed on him so as to bar the exercise of his right in the absence of explicit language in the statute compelling the Court to decide against such reference to arbitration." (p. 394) 6. In Meghraj Sampatlal v. Raghunath Son AIR 1955 Cal. 278, the view taken by the learned Single Judge was approved by the Division Bench of the Calcutta High Court. Chakravartti, CJ. speaking for the Bench observed: "(8) Quite apart from the reasons given by the learned Judge, it appears to me to be implicit in the terms of section 69 itself that the proceedings contemplated by it are proceedings in Court. Those contemplated by sub-sections (1) and (2) are expressly so. Sub-section (3) begins with a reference to the provisions of sub-sections (1) and (2) and says significantly that they shall apply also to a claim to set-off or other proceeding to enforce a right arising from a contract. It appears to me than when sub-section (3) draws in the provisions of sub-sections (1) and (2), it draws in the whole of those provisions, including the reference to proceedings in Court, and when it says that the provisions of the earlier two-sections ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the defendants. . . ." [Emphasis supplied] (p. 20) 8. In the light of the above, it is clearly seen that the bar under section 69 is not attracted to arbitration proceedings without intervention of the Court and the reference and the award cannot be impinged on the ground of non-registration of the firm. 9. The cases relied upon by Mr. Thakkar have no assistance since the question as to whether the reference to arbitration without intervention of the court is hit by section 69 does not call for consideration in those cases. In the case of Jagdish Chandra Gupta ( supra ), the Supreme Court was dealing with an application under section 8 of the Arbitration Act, 1940. The Court observed that sub-section (3) of section 69 provides for the application of the provisions of sub-sections (1) and (2) to claims of set off and also to other proceedings of any kind which can properly be said to be for enforcement of any right arising from contract except those expressly mentioned as exceptions in sub-section (3) and sub-section (4). It was held that the expression other proceeding which follow must, therefore, receive their full meaning untrammeled by the words a claim of set off ..... X X X X Extracts X X X X X X X X Extracts X X X X
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