TaxTMI 
TaxTMI 
1949 (8) TMI 28
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....6 maunds. The time for delivery was further extended till 25th August 1918. Yet the petitioner failed and neglected to give delivery. According to the petitioner there was a frustration of the contract. But the respondent alleged that the real reason for non-delivery was that the market had gone against the petitioner and he wanted to avoid delivery. 5. On 19th October 1948, the respondent referred the disputes to the arbitration of the Bengal Chamber of Commerce. An award was made on 8th April 1949 by that Chamber which was filed in Court on 9th July 1949. Under the award the petitioner who carried on business under the name and style of Jhowla Prosad Babulal was directed to pay to the respondent Gauttam & Co., a sum of RS. 18,480 8-9 together with interest and costs as mentioned therein. 6. The ground on which the petitioner seeks to set aside the award is that the respondent is not a registered firm and in any event was not registered under the Indian Partnership Act at the material time. The letter dated 6th May 1949 from the Registrar of firms addressed to the petitioner's attorney shows that Gauttam & Co. was not registered in the office of the Registrar under the P....
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..... Basu contends that on the date the reference was made, which was admittedly 19th October 1948, the firm was not registered and, therefore, the reference to arbitration was bad and the arbitrators had no authority to decide the alleged disputes referred to them. He argues that the reference to the Bengal Chamber of Commerce means the enforcement of an arbitration agreement between the parties and therefore it was-really enforcing a right arising from a contract between the parties. 10. The question, I have to determine, is whether the reference to arbitration in this case meant a proceeding to enforce a right arising from a contract within the meaning of Section 69(3), Partnership Act. 11. Section 69 contains one of the most vital provisions introduced by the Partnership Act of 1932. It was suggested in some quarters that it was desirable to make the registration of a firm compulsory but that suggestion was not acceded to. Yet the practical effect of section 69 is to make the registration of a firm compulsory. That section forbids the institution of certain suits in respect of a partnership which has not been registered under the Act. 12. Under Sub-section (1) a partner c....
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....ed that Section 69 shall not apply to any proceeding in execution. Another case cited is Satish Chandra v. P. N. Das & Co. 16 Pat. 742 : (A. I. R. 1938 Pat. 231): Objection was taken to the enforceability of an award in favour of an unregistered firm under Section 69(1), Partnership Act. It was held that there was no illegality on the face of the award within Clause (c) of para, 14 of Sch. 2 to the Code. No argument was advanced on the basis of Section 69(3), Partnership Act. 17. In my view the word 'proceeding' in Section 69(3) means something in the nature of a suit that is a proceeding which is instituted or initiated in a Court, Mr. Bachawat, learned counsel for the respondent, has drawn my attention to Hood Barrs v. Cathcart (1894) 3 ch. D. 376. In that case the words "action or proceeding instituted" in Section 2, Married Women's Property Act, 1893 were held to mean some action, or proceeding in the nature of an action, initiated by a married woman as a plaintiff, and do not include a motion or step taken by a married woman in an action in which she is defendant. Davey L. J. observed as follows : "It must be borne in mind that an appeal is in reality i....
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.... on a reference out of Court, and the opening words require the Court to be satisfied that the matter has been referred to arbitration. There are no such words in Section 16." Section 21 dealt with the filing and enforcement of an award on a reference without the intervention of Court and in such a case the Court must be satisfied that there was a valid reference to arbitration. It is urged by Mr. Basu that the Privy Council judgment is an authority only for the proposition that when a reference has been made by an order of Court in a suit the validity of the award cannot be questioned on an application for setting aside the award. Really such reference by Court presupposes a valid agreement for arbitration judicially recognised as binding on the parties. 21. My attention has been drawn to E. D. Sassoon and Co. v. Ramdutt Ramkissendas 49 I. A. 366 : (A. I. R. 1922 P. C. 874). The Judicial Committee held that where an award is objected to on the ground of want of jurisdiction in the arbitrator, suit can be instituted and also an application can be filed under Section 14, Arbitration Act, 1899 for setting aside the award. How far the present Arbitration Act 1940 reproduces the ....