Arun Kumar JUDGMENT
M.B. Shah, J.
1. This appeal by special leave is directed against the judgment and order dated 18.9.2001 passed by the High Court of Bombay in Arbitration Petition No. 500 of 2001.
2. Appellant and respondent Nos. 1 and 2 entered into a partnership agreement on 30th April 1992 for carrying on business in the name and style of M/s. IIetali Construction Company to develop the land belonging to Ms. Jaykirti Mehta who brought the said land as her capital contribution. Land was valued at Rs. 65,51,000/-. A Plan for construction of building was submitted in April 1992 and on 20.1.1993, commencement certificate was issued. It is submitted that till issue of commencement certificate, appellant's contribution in the said partnership was to the extent of Rs. 1,25,00,000/- as capital contribution. By award dated 11.3.1993, Ms. Jaykirti Mehta was directed to stand retired from the partnership firm. It was agreed that after retirement of Ms. Mehta, other partners were to continue with the partnership. It is submitted that the appellant provided a fund of Rs. 60,88,000/- to the said partnership firm for being paid to Ms. Jaykirti Mehta which was paid to her along with the amount of Rs. 5,24,000/- in terms of the Award dated 11.3.1999. Further, a sum of Rs. 47,50,000/- was paid to one Mr. Kirti Desai to settle the suit filed by him. The partnership firm entered into an agreement with M/s. Laxman Commercial and Finance Ltd. and accordingly construction was started. It is contended that from 1996 to 1998, respondents took away some amount from the partnership without contribution to capital construction. On 7.4.1998, five flats were sold to the creditors of the partnership firm in order to repay the loans and excess amount was paid to the firm. In April 1999, M/s. Laxman Commercial and Finance Ltd. sold flats No. 401 to 701 to different purchasers. On 23.6.1999, the partnership firm executed a Deed of Conveyance subject to rights of other parties in favour of M/s. West End Gymkhana Ltd. in respect of disposed of flats. On 1.1.1999, respondent No. 1 wrote to the Income Tax Officer to complete the assessment of the partnership firm. According, assessment order was passed on 30.3.2000.
3. Thereafter, respondent No. 1 filed suit No. 1991 of 2000 in the High Court of Bombay for dissolution of partnership firm and accounts and inter alia challenging the conveyance deed executed by partnership firm in favour of M/s. West End Gymkhana Ltd. Respondent No. 1 also took out a notice of motion No. 1576 of 2000 for various interim reliefs.
4. On the same day, appellant filed an application under Section 8 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as 'the Act'). That application was kept for hearing along with the notice of motion.
5. Subsequently, respondent No. 1 filed fresh suit bearing No. 2812 of 2001 for dissolution of the suit firm, accounts and other reliefs including the relief for setting aside the transfer of suit flats in favo........