Broad partnership arbitration clauses can cover property disputes among common partners and support reference to arbitration.

Broad partnership arbitration clauses covering disputes relating to the firm or its business supported reference of a suit to arbitration. The absence of the original or a certified copy of the arbitration agreement did not defeat the application because copies of the partnership deeds containing the clauses were already on record and their existence and terms were undisputed. The Court further held that, although the parties were arrayed in different capacities across three partnership firms, they remained bound by arbitration agreements capable of covering the dispute. A claim that properties purchased in one partner's name ly belonged to the firms was held to fall within the clauses, and allegations of fraud on the pleaded facts did not exclude arbitration. The refusal to refer the matter was set aside.

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Issues: (i) whether the revision could be dismissed for want of filing the original or certified copy of the arbitration agreement; (ii) whether an arbitration agreement existed between all the parties to the suit so as to justify reference of the dispute to arbitration; (iii) whether the subject matter of the suit was covered by the arbitration agreements.

Issue (i): whether the revision could be dismissed for want of filing the original or certified copy of the arbitration agreement

Analysis: Copies of the partnership deeds containing the arbitration clauses were already on record through both sides, and there was no dispute about the existence or terms of the arbitration agreements. In such circumstances, the mere absence of the original or a certified copy did not justify rejection of the application.

Conclusion: The objection failed and was decided against the respondent.

Issue (ii): whether an arbitration agreement existed between all the parties to the suit so as to justify reference of the dispute to arbitration

Analysis: The parties to the suit were all partners in one or more of the three partnership firms, and each firm contained an arbitration clause covering disputes touching the business of the firm or otherwise relating to the firm and its business. The Court treated the suit as a dispute arising out of the partnership arrangements among the common partners, and held that the fact that the suit arrayed the parties in different capacities did not destroy the existence of arbitration agreements covering them. Reference was placed on the principle that a single arbitration is permissible where claims against different parties are independently referable to arbitration and a common adjudication avoids conflicting decisions.

Conclusion: The arbitration agreement existed between the parties in a manner sufficient to permit reference to arbitration, and this issue was decided in favour of the petitioner.

Issue (iii): whether the subject matter of the suit was covered by the arbitration agreements

Analysis: The suit sought a declaration that properties purchased in the name of one partner were in substance assets of the partnership firms because partnership funds were allegedly withdrawn and invested in those properties. The arbitration clauses were wide, extending to disputes touching the business of the firm or otherwise relating to the firm and its business. The Court held that the dispute was not one requiring a partition of causes of action into arbitrable and non-arbitrable parts, and that allegations of fraud in the pleaded context did not take the matter outside arbitration. The reference to the 1940 Act in the clauses was treated as a mistake because the agreements were executed after the commencement of the 1996 Act.

Conclusion: The subject matter of the suit fell within the scope of the arbitration agreements, and the issue was decided in favour of the petitioner.

Final Conclusion: The trial court's refusal to refer the dispute to arbitration was set aside, and the parties were directed to proceed before the agreed arbitral tribunal.

Ratio Decidendi: Where partnership deeds contain broad arbitration clauses covering disputes relating to the firm or its business, a suit asserting that properties acquired by one partner belong to the firms can be referred to arbitration even if different firm-wise clauses exist, provided all parties are partners bound by the agreements and the dispute is capable of joint arbitral determination without impermissible bifurcation.

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