Appointment of Arbitrator qua disputes relating to an unregistered partnership firm, not permissible.
The disputes arose between the partners of this firm (Gupta Bus Service), which resulted in its dissolution. It was alleged that Clause 11 of the Partnership Deed provides for resolution of disputes arising out of the partnership between the parties by an Arbitrator. The respondent, therefore, prayed that an Arbitrator be appointed in terms of Clause 11 of the Partnership Deed for deciding the disputes, which have arisen between the parties relating to the partnership.
The appellants on being served raised a preliminary objection contending therein that since the partnership in question on which the application under Section 20 of the Arbitration Act, 1940 was founded was an “unregistered partnership”, therefore, in the light of the bar contained under Section 69 (3) of the Partnership Act, the application filed by the respondent was not maintainable, therefore, it was liable to be dismissed as such.