Arbitration referral in partnership disputes fails where Section 8 requirements are unmet and factual issues need civil adjudication.

A partnership dispute was examined for referral to arbitration under the arbitration clause and Section 8 of the Arbitration and Conciliation Act, 1996. The clause applied only where the partners mutually agreed to resolve disputes before a sole arbitrator, and the request was made after suit filing and after expulsion and reconstitution of the firm. Because the suit sought declaratory and injunctive reliefs requiring detailed factual inquiry, and the applicant did not file the original arbitration agreement or a duly certified copy as required by Section 8(2), the controversy was found unsuitable for compulsory arbitration and fit for civil court adjudication.

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Issues: Whether the dispute arising out of the partnership arrangement was required to be referred to arbitration under the arbitration clause and Section 8 of the Arbitration and Conciliation Act, 1996.

Analysis: The arbitration clause contemplated reference only where the partners agreed to resolve differences by a sole arbitrator. The request for arbitration was made after the suit was filed and after the petitioner had already been expelled and the firm reconstituted. The suit sought declaratory and consequential injunctive reliefs, which required adjudication of the circumstances leading to expulsion and reconstitution of the partnership, including issues involving detailed evidence. The petitioner also failed to comply with Section 8(2) by filing the original arbitration agreement or a duly certified copy. In these circumstances, the dispute was held to be outside the scope of compulsory reference under Section 8 and fit for civil court adjudication.

Conclusion: The application for reference to arbitration was rightly rejected, and the revision was liable to be dismissed.

Final Conclusion: The civil court's refusal to refer the matter to arbitration was upheld because the controversy required judicial determination of substantive partnership disputes and the statutory requirements for invoking Section 8 were not satisfied.

Ratio Decidendi: A dispute will not be referred to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 where the statutory prerequisites are unmet and the controversy involves declaratory relief and fact-intensive issues requiring civil court adjudication.

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