M/S UMESH GOELversusHIMACHAL PRADESH COOPERATIVE GROUP HOUSING SOCIETY LTD.

                        [2016] 6 S.C.R. 703



                       MIS UMESH GOEL                                   A
                                 v.
  HIMACHAL PRADESH COOPERATIVE GROUP HOUSING
                 SOCIETY LTD.
                   (Civil Appeal No.79f6 of2009)                        B
                          JUNE-29, 2016
  [FAKKIR MOHAMED IBRAHIM KALIFULLA AND C.
               NAGAPPAN, JJ.]
      Partnership Act, 1932 - s.69(3) - Scope and ambit of -
Whether the ban imposed u!s.69 against an unregistered firm can
                                                                        c
operate in the matter of arbitral proceedings by interpreting that
the expression "other proceedings" in sub-section (3) of s.69 will
include arbitral proceedings by equating the arbitral proceeding
to a suit filed in a Court - Held: The ban imposed u!s.69 can have.
no application to arbitral proceedings or arbitration award - Such      D
proceeding will not come under the expression "other proceedings"
in sub-section (3) of s.69 - Expressions couched in sub-section (3)
cannot have independent existence - The "other proceedings"
should be intrinsically connected with the "suit"which are banned
under sub-sections (1) and (2) of s.69 - The provisions of sub-
                                                                        E
sections (1) and (2) have been impliedly incorporated in sub-section
(3) - The arbitral proceedings cannot be treated as civil
proceedings/suit for the purpose of s.69(3) by takii1g a cue from
Limitation Act, Arbitration and Conciliation Act or Interest Act -
Arbitration and Conciliation Act, 1996 - ss. 35 and 36 - Limitation
Act, 1963 - s.14 - Interest Act, 1978 - s. 2(a).                        F
      Interpretation of Statutes - A statutory provision has to be
interpreted from the words that are expressly used - Court should
not add or substitute any word to it.
      Words and Phrases - 'Court' - Meaning of
                                                                        G
      Allowing the appeal, the Court
      HELD: 1.1 While under sub-section (1) of s. 69 of
Partnership Act, the ban imposed operates against the firm itself
or any of its partners, under sub-section (2) the ban operate against
any third party. The provisions of sub-sections (1) and (2) have        H
                                 703
704            SUPREME COURT REPORTS                         [2016) 6 S.C.R.


A     been impliedly incorporated in sub-section (3) of of s.69. When
      the opening set of expression in sub-section (3) states that the
      provisions of sub-sections (1) and (2) shall apply, the entirety of
      sub-sections (1) and (2) should be held to be bodily lifted and
      incorporated in sub-section (3). It is difficult to state that any one
      part of sub-sections ,(1) and (2) alone should be held to be
B
      incorporated for the purpose of sub-sec.tion (3). [Paras 10 and
      UJ [713-A-B; 714-A]
            1.2 Having regard to the manner in which the expressions
      are couched in sub-section (3), a claim of set off or other
      proceedings c.annot have independent existence. In other words,
c     the foundation for the application of the said sub-section should
      be the initiation of a suit in which a claim of set off or other
      proceedings which intrinsically connected with the suit arise and
      not otherwise. [Para 20] (717-A-B]
             1.3 The condition precedent for the operation of ban under
D     sub-section (3) is that the launching of a suit in a Court of law
      should be present and it should be by an unregistered firm or by
      a person claiming to be partner of an unregistered firm either to
      a claim for set off in the said suit or any other proceedings
      intrinsically connected with the said suit. In the event, the above
E     ingredients set out under sub-sections (1), (2) and (3) being
      fulfilled then and then alone the ban prescribed against an
      unregistered firm under Section 69(1), (2) and (3) would operate
      and not otherwise. [Paras 13 and 14) (714-F-H)
        , 1.4 When under sub-section (3) which also relates to a ban
F.    concerning 'other proceedings', the law makers wanted to
      specifically exclude from such ban, such of those proceedings
      which also likely to arise in a suit, but yet the imposition of ban of
      an unregistered firm need not be imposed. Keeping the said intent
      of the law makers in mind, when sub-clauses (a) and (b) of
      sub-section (3) are read, it can be understood that even though
G     such other proceedings may be for the enforcement of any right
      to sue but yet if it is for the dissolution of a firm or for accounts of
      a dissolved firm or any right or power to realize the property of a
      dissolved firm, the same can be worked out by way of a suit in a
      Court or by way of other proceedings in that suit and the same
H     will not be affected by the ban imposed under sub-section (3).
 M/S UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE                           705
           GROUP HOUSING SOCIETY LTD.

Similarly, any steps initiated at the instance of an official assignee,   A
a receiver 'Or Court under the Presidency-Towns Insolvency Act
of 1909 (3 of 1909) or the Provincial Insolvency Act of 1920 (5 of
1920) to realize the property of an insolvent partner in a pending
suit of a Court also stand excluded from the ban imposed under
sub-section (3). The specific exclusions contained in clauses (a)
                                                                           B
and {b) of sub-section (3) therefore .makes the position clear to
the effect that even though such proceedings may fall under the
expression "other proceedings" and may be intrinsically
connected with a suit in a Court, yet the ban would not operate
against such proceedings. [Para 15) [715-B-E]
      ·1.5 Sub-clause (b) of sub-section (4) also gives a vivid            c
picture as to the position that the 'other proceeding' specified in
the said sub-section can only relate to a pending suit in a Court
and not to any other different proceeding which ca1.1 be categorized
                           .
as 'other proceedings'. [Para 16) [715-G-H)
                             .
                                                                           D
      Kamal Pushp Enterprises v. D.R. Construction Co.
       (2000) 6 SCC 659:2000 (2) Suppl. SCR 20 - relied
       on.
      Jagdish Chander Gupta.. v. Kajaria Traders (India) Ltd
      1964 (8) SCR 50 - distinguished.
                                                                           E
      2. Under the Partnership Act, the expression "Court" is
not defined. In Section 2(e) of the said Act though it is stated that
the expressions used but not defined,- the definition in the
Contract Act, 1872 can be applied. In. the Contract Act also there
is no specific definition set out for the expression "Court".
However, a definition of the "Court" is found in Section 2(l)(e)           F
of the Arbitration and Conciliation Act, 1996. The scope and
ambit of the power and jurisdiction of 'Court' defined under
Section 2(e) of the 1996 Act is circumscribed to certain specified
extent as set out in Sections 8, 9, 14, 21; 34, 36, 37, 39, 42, 43,
47, 48, 49, 50, 56, 58 and 59. [Paras 21 and 26) (717-C; 720-F-G)          G
       3. A reading of Section 69 as a whole does not permit of
any interpretation that would cover Arbitral proceedings, de llors,
filing of a suit in a Court and that too in respect of a right under a
contract governed by the provisions of the Indian Partnership
Act, especially after the coming into force of the 1996 Act and
                                                                           H
706            SUPREME COURT REPORTS                      [2016] 6 S.C.R.


A     the proceedings governed by the special features contained in
      the said Act. Therefore, any interpretation made under the
      Limitation Act while construing Section 14 to treat Arbitral
      proceedings on par with civil proceedings cannot be applied to
      the present case. [Para 32) [724-F-H)
B           Mis. Consolidated Engg. Enterprises v. Principal Secy.
            Irrigation Dept!. and Ors. 2008 (6) SCALE 748;
            P. Sarathy v. State Bank of India (2000) 5 SCC 355:
            2000     (1) Suppl. SCR 402 - held inapplicable.
            4. It will not be appropriate to import the definition clause
c     under Section 2(a) of the Interest Act 'Court' whereby 'Court'
      has been defined to include a Tribunal and an Arbitrator to the
      Partnership Act in order to apply Section 69(3) of the Partnership
      Act. (Para 331 (725-Dl                  ·
             5. By re'ferring to Sections 35 and 36 of the 1996 Act, it is
D     difficult to draw an inference that based on the deeming provision
      specifically meant for the enforcement and execution of an Award,
      the Arbitral Proceedings can be equated to a Civil Court
      proceedings. Section 36 only creates a statutory fiction which is
      limited for the purpose of enforcement oft he Award. The deeming
      fiction is specifically restricted to treat the Award as a decree of
E     a Court, exclusively for the purpose of execution, though as a
      matter of fact, it is only an Award of Arbitral proceeding. It is a
      settled proposition, that a statutory provision will have to be
      construed from the words that are expressly used and it is not
      for the Court to add or substitute any word to it. Therefore,
F     going by Sections 35 and 36 it cannot be held that the entire
      Arbitral proceeding is a Civil Court proceedings for the purpose
      of applicability of Section 69(3) of the Partnership Act. (Para 34)
      [725-G-H; 726-A-B)
            State of W.B. v. Sadan K.Bormal and Am: (2004) 6 SCC
G           59; Paramjeet Singh Patheja v. /CDS Ltd. (2006) 13
            SCC 322: 2006 (8) Suppl. SCR 178 - relied on.
            The Bharat 4ank, Ltd., Delhi v. The Employees of the
            Bharat Bank Ltd., Delhi and the Bharat Bank Employees'
            Union, Delhi AIR 1950 SC 188: 1950 SCR 459;Firm
            Ashok Traders and Anr. v. Gurumukh Das Saluja and
H
M/S UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE                           707
          GROUP HOUSING SOCIETY LTD.

     Ors. (2004) 3 SCC 155: 2004 (1) SCR 404; Panchu                     A
     Gopal Bose v. Board of Trustees for Port of Calcutta
     (1993) 4 SCC 338: 1993 (3) SCR 361; Sumtibai and
     Ors. v. Paras Finance Co. Regd. Partnership Firm,
     Beawer (Raj.) Through Mankanwar (Smt.) Wlo
     Parasmal Chordia (Dead) and Ors. (2007) 10 SCC 82:
                                                                         B
     2007 (10) SCR 543; Raj Kumar Khurana v. State of
     (NCT of Delhi) and Anr. (2009) 6 SCC 72: 2009 (7)
     SCR 434; Mis. Indian Oil Cmporation Limited Rep. by
     Its Chief LPG Manager (Engg.) S. Chandran v. Mis.
     Devi Constructions, Engineering Contractors & Anr.
     2009 (2) Law Weekly 849; Delhi Development                           c
     Authority v. Kochhar Construction Work and Anr.
     (1998) 8 sec 559 - referred to.
                     Case Law Reference
1964 (8) SCR 50                 distinguished           Para 7
                                                                          D
2000 (2) Suppl. SCR 20          relied on               Para7
1950 SCR 459                    referred to             Para7
2004 (1) SCR 404                referred to             Para 7
2007 (10) SCR 543               referred to             Para7
                                                                          E
1993 (3) SCR 361                referred to             Para7
2008 (6) SCALE 748              held inapplicable       Para7
(2004) 6 sec 59                 relied on               Para7
                                   I

2009 (7) SCR 434                referred to             Para 7
                                                                          F
2009 (2) Law Weekly 849         referred to             Para 7
(1998) 8 sec 559                referred to             Para 7
2000 (1) Suppl. SCR 402         held inapplicable       Para7
2006 (8) Suppl. SCR 178         relied on               Para35            G
     CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7916
of2009.
      From the Judgment and Order dated 20.1 I .2007 of the High Court
of Delhi at New Delhi in FAO (OS) No. 376 of2005.
      Dhruv Mehta, Sr. Adv., Vikas Sharma, Ms. Devyani Sharma, (For       H
708              SUPREME COURT REPORTS                          [2016] 6 S.C.R.


A     Amber Qamaruddin, Advs. for the Appellant.
               Amrender Saran, Sr.Adv., PuneetTaneja,Adv. for the Respondent.
               The Judgment of the Court was delivered by
             FAKKIR MOHAMED IBRAHIM KALIFULLA, J. I. An
B     interesting but very important legal question arises for consideration in
      this appeal relating to interpretation of Section 69(3) of the Indian
      Partnership Act with reference to its applicability toArbitral proceedings.
               2. The facts are not in controversy which can be briefly stated as
      under:
c
               The respondent which is a Cooperative Group Housing Society
      invited tenders for construction of 102 dwelling units with basement at
      Plot No. 21 Sector 5, Dwarka New Delhi. The tenders were invited in
      May 1998. The appellant, an unregistered partnership firm submitted its
      bid in response to the said tender on 06.05 .1998. The appellant was the
D     successful bidder and the contract was awarded to the appellant at an
      estimated cost of Rs.9.80 crores. The appellant was issued a letter of
      intent. On 09.08.1998 the appellant submitted its first bill for the
      construction of the compound wall etc. The agreement for the
      construction of I 02 dwelling units with basement was entered into
E     between the appellant and the respondent on 02.02.1999. It is stated
      that there was some delay in getting the plan sanctioned, which according
      to the appellant, he was not responsible for the delay. A dispute arose as
      between the appellant and the respondent which necessitated the appellant
      to move the High Court of Delhi by way of an application under Section
      9 of the Arbitration and Conciliation Act 1996 (for short" 1996 Act") to
F     restrain the respondent from dispossessing the appellant from the worksite
      till the work executed by the appellant is measured by the Commissioner
      to be appointed by the Court. It was filed on 22.05.2005. A Commissioner
      was also appointed by the High Court. The appellant filed another
      application under Section 9 of the 1996 Act to restrain the respondent
G     from operating its bank accounts and from dispossessing the appellant
      on 29.01.2003.
            3. With reference to the dispute which arose as between the
      appellant and the respondent an arbitrator/an advocate by name Smt.
      Sangeeta Tomar was appointed by the respondent to adjudicate the dispute
      between them. As the appointment came to be made on 17.03.2003 by
H
  MIS UMESH GOEL v. HIMACHALPRADESH COOPERATIVE GROUP                        709
HOUSING SOCIETY LTD.[FAKKIR MOHAMED IBRAHIM KALIFULLA, f.]

the respondent, though, the appellant earlier moved the High Court by        A
way of an Arbitration Application No.145 of2003 on 09.07.2003 under·
Section I 1(5)ofthe 1996Actforappointmentofan independent arbitrator,
the same was subsequently withdrawn. The appellant participated in the
arbitration proceedings before the arbitrator appointed by the respondent.
Claims and counter claims were made by the appellant as well as the
                                                                              B '
respondent before the arbitrator. The arbitrator passed the award on
05.05.2005 wherein the claim of the appellant was allowed to the extent
of Rs. 1,36,24,886.08 along with interest at the rate of 12% from
01.06.2002 till the date of the award and further interest from the date
of award till its payment at the rate of 18% per annum. While resisting
the claim of the appellant, the respondent did not specifically raise any     c
plea under Section 69 of the Partnership Act.
       4. The respondent challenged the award dated 05.05.2005 under
Section 34 of the 1996 Act before the Delhi High Court which was
registered as A.A. No.188 of 2005. The said application was filed on
02.08.2005. The respondent's application was dismissed by the learned         D
Single Judge by an order dated 01.09.2005. The respondent filed Review
Application No.26 of 2005 which was also dismissed by the learned
Single Judge by an order dated 03.10.2005. As against the orders dated
01.09.2005 and 03.10.2005, the respondent preferred appeals in FAO
(OS) No.376 of 2005 on 14.11.2005. Pending disposal of the appeals,
an interim order was passed on 21.07 .2006 directing the respondent to        E
deposit 50% of the decretal amount within six weeks and by subsequent
order dated 18.08.2006 the time was extended by another four weeks.
By the impugned order dated 20.11.2007 the Division Bench having
allowed the FAO(OS) No.376 of2005, the appellant is before us.
         5. We heard Mr. Dhruv Mehta, learned Senior Counsel for the          F
appellant and Mr.Amarendra Saran, learned Senior Counsel for the
respondent. Mr. Dhruv Mehta, learned Senior Counsel in his submissions
after drawing our attention to Section 69 and in particular Section 69(3)
of the Partnership Act contended that when sub sections ( 1) and (2) are
read in to sub section (3) of Section 69, the expression "other               G
proceedings" mentioned in the said sub section (3) should be with
reference to other proceedings connected with a suit in a Court and
cannot be read in isolation. The learned Senior Counsel contented that if
it is read in that sense the expression "other proceedings" in sub section
(3) can have no relevance nor referable to Arbitral proceedings in
                                                                              H
710             SUPREME COURT REPORTS                           [2016) 6 S.C.R.



A     isolation. The learned Senior Counsel further contended that going by
      the plain reading of the Statute and ifthe golden rule of construction is
      applied, an arbitrator by himself is not a court for the purpose of Section
      69 of the Statute. The learned Senior Counsel then submitted that there
      is a vast difference between an arbitrator and the Court, that though an
      arbitrator may exercise judicial powers, he does not derive such powers
8     from the State but by the agreement of the parties under a contract and,
      therefore, he cannot be held to be a Court for the purpose of Section 69
      of the Partnership Act. While referring to Section 36 of the 1996 Act,
      the learned Senior Counsel submitted that it is only a statutory fiction by
      which for the purpose of enforcement, the award is deemed to be a
c     decree and it cannot be enlarged to an extent to mean that by virtue of
      the said award to be deemed as a decree, the arbitrator can be held to
      be a Court. Lastly, it was contended by him that in order to invoke Section
      69(3), three mandatory conditions are required to be fulfilled, namely,
      that (a) there should be a suit and the other proceedings should be
      intrinsically connected to the suit, (b) such suit should have been laid to
D
      enforce a right arising from the contract and (c) such a suit should have
      been filed in a Court o.flaw.
              6. As against the above submissions Mr. Saran, learned Senior
      Counsel for the respondent submitted that the expression "other
      proceedings" will include arbitral proceedings and that the foundation
E     for it must only be based on a right in a contract. In support of the said
      submission, learned senior counsel contended that this Court has held
      while interpreting Section 14 ofthe Limitation Act that arbitral proceedings
      are to be treated on par with civil proceedings. The learned Senior Counsel
      also submitted that under Section 2(a) of the Interest Act, arbitral
F     proceedings have been equated to regular suits and, therefore, the
      expression "other proceedings" in Section 69(3) of the Partnership Act
      should be held to include an Arbitral Proceeding on par with a suit. The
      learned counsel, therefore, contented that the arbitrator should be held
      to be a Court and the proceedings pending before it are to be treated as
      a suit and consequently other proceedings. By referring to Sections 35
G     and 36 of the 1996 Act where an award of the arbitrator has been equated
      to a decree of the Court and applicability of Civil Procedure Code for
      the purpose of execution has been prescribed, the learned Senior Counsel
      contended that the arbitral proceedings should be held to be civil
      proceedings before a Court.
H
  M/S UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                         711
HOUSING SOCIETY LTD.[FAKKIR MOHAMED IBRAHIM KALIFULLA, J.]

        7. Mr. Dhruv Mehta, learned Senior Counsel for the appellant A
relied upon the decisions reported in Jagdish Chander Gupta v. Kajaria
Traders (India) Ltd. 1964 (8) SCR 50, Kamal Pushp Enterprises v.
D.R. Construction Co. (2000) 6 SCC 659, The Bharat Bank, Ltd.,
Delhi v. The Employees of the Bharat Bank Ltd., Delhi and the
Bharat Bank Employees' Union, Delhi - AIR 1950 SC 188, Firm
                                                                       B
Ashok Traders and another v. Gurumukh Das Saluja and others -
(2004) 3 SCC 155, Sumtibai and Ors. v. Paras Finance Co. Regd.
Partnership Firm, Beawer (Raj.) Through Mankanwar (Smt.) WI
o Parasmal Chordia (Dead) and Ors.- (2007) I 0 SCC 82, Panchu
Go pal Bose v. Board of Trustees for Port of Calcutta - ( 1993) 4
SCC 338, Mis. Consolidated Engg. Enterprises v. Principal Secy. . C
Irrigation Deptt. and Ors. - 2008 (6) SCALE 748, State of W.B. v.
Sadan K. Bormal and Anr. - (2004) 6 SCC 59, Raj Kumar Khurana
v. State of (NCT of Delhi} and Anr. - (2009) 6 SCC 72 and M/s.
Indian Oil Corporation Limited Rep. by Its Chief LPG Manager
(Engg.) S. Chandran v. M/s. Devi Constructions, Engineering
                                                                       D
Contractors & another - 2009 (2) Law Weekly 849. Mr. Saran,
learned Senior Counsel for the respondent relied upon the decisions
reported in Firm Ashok Traders (supra), Delhi Development
Authority v. Kochhar Construction Work and Anr. ( 1998) 8 SCC
559, Panchu Gopal Bose (supra) and P. Sarathy v. State Bank of
India - (2000) 5 sec 355.                                              E
      8. Having heard learned counsel for the appellant as well the
respondent and having bestowed our serious consideration to the
respective submissions, the various decisions relied upon and the
provisions contained in the Partnership Act, the Interest Act, Civil
Procedure Code and Arbitration Act, we are of the view that the                 F
submissions of Mr. Dhruv Mehta, learned Senior Counsel for the appellant
merit acceptance.
      9. To appreciate the respective submissions and in support ofour
conclusion, at the very outset Section 69 requires to be noted, which
~M~~:                                                                           G
      "69. Effect of non-registration.-( 1) No suit to enforce a right
      arising from a contract or conferred by this Act sh al I be instituted
      in any court by or on behalf of any person suing as a partner in a
      firm against the firm or any person alleged to be or to have been
      a partner in the firm unless the firm is registered and the person        H
712            SUPREME COURT.REPORTS                           [2016) 6 S.C.R.


A           suing is or has been shown in the register of firms as a partner in
            the firm.
            (2) No suit to enforce a right arising from a contract shall be
            instituted in any court by or on behalf of a firm against any third
            party unless the firm is registered and the persons suing are or
B           have been shown in the register of firms as partners in the firm.
            (3) The provisions of sub-sections (I) and (2) shall apply also to a
            claim of set-off or other proceedings to enforce a right arising
            from a contract, but shall not effect -
                (a) The enforcement of any right to sue forthe dissolution ofa
c                   firm or for accounts of a dissolved firm, or any right or
                    power to realize the property of a dissolved firm, or
                (b) the powers of an official assignee, receiver or court under
                   the Presidency-towns Insolvency Act, 1909 (3 of 1909) or
                   the Provincial Insolvency Act, 1920 (5 of 1920) to realize
D                  the property of an insolvent partner.
            (4) This section shall not apply-
                ( a) to firms or to partners in firms which have no place of
                business in the territories to which this Act extends, or whose
                places of business in the said territories, are situated in areas
E
                to which, by notification under section 56, this Chapter does
                not apply, or
                (b) to any suit or claim of set-off not exceeding one hundred
                rupees in value which, in the Presidency-towns, is not of a
                kind specified in section 19 of the Presidency Small Cause
F
                Courts Act, 1882 (5of1882), or, outside the Presidency-towns,
                is not of a kind specified in Schedule II to the Provincial Small
               ·Cause Courts Act, 1887 (9 of 1887), or to any proceeding in
                execution or other proceeding incidental to or arising from any
                such suit or claim."
G
             10. Though, some of the decisions which were cited before us
      dealt with Section 69(3) of the Partnership Act, in the instance we wish
      to analyze the said sub-section along with the other components of the
      said Section 69. When we read sub-section (3) of Section 69 carefully,
      we find that as rightly contended by Mr. Dhruv Mehta, learned Senior
H     Counsel for the appellant, the provisions of sub-sections (1) and (2) have
  MIS UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                           713
HOUSING SOCIETY LTD.[FAKKIRMOHAMED IBRAHIM KALIFULLA, J.]

been impliedly incorporated in sub-section (3). When the opening set of          A
expression in sub-section (3) states that the provisions of sub-sections
(I) and (2) shall apply, there is no difficulty in accepting the said
submission of learned Senior Counsel for the appellant that the entirety
of the said two sub-sections should be held to be bodily lifted and
incorporated in sub-section (3). It is difficult to state that any one part of
                                                                                  B
sub-sections (l)and (2) alone should be held to be incorporated forthe
purpose of sub-section (3 ). Therefore, we are convinced that when we
read sub-section (3) it is imperative that all the ingredients contained in
sub-sections (I) and (2) should be read into sub-section (3) and thereafter
apply the said sub-section when such application is called for in any
matter.                                                                          c
       11. Once we steer clear of the said position it will be necessary to
note what are the specific ingredients contained in sub-sections (I) and
(2). When we read sub-section (1) of Section 69 the said sub-section
primarily imposes a ban on any person as a partner ofa firm from filing
any suit to enforce a right arising from a contract or a right conferred          D
under the Partnership Act in any Court by or on behalf ofan unregistered
firm or a person suing as a partner of a firm against the said firm or
against any person alleged to be or to have been a partner in that firm.
To put it in nut-shell the ban imposed under sub-section (I) of Section 69
is on any person in his capacity as the Partner of an unregistered firm
                                                                                  E
against the said firm or any of its partners, in the matteroffiling a suit to
enforce a right arising from a contract or conferred by the provisions of
the Partnership Act. In effect, the ban is in respect of filing a suit against
that unregistered firm itself or any of its partners by way of a suit under
a contract or under the Partnership Act. Under sub-section (2) the very
same ban is imposed on an unregistered firm or on its behalf by any of            F
its partners against any third party by way of a suit to enforce a right
arising from a contract in any Court. A close reading of sub-Sections (I)
and (2) therefore shows that while under sub-section (I) the ban is as
against filing a suit in a Court by any person as a partner of an unregistered
firm against the firm itself or any of its partner, under sub-section (2)
                                                                                  G
such a ban in the same form of a suit in the Court will also operate
against any third party at the instance of such an unregistered firm. The
common feature in both the sub-sections are filing of a suit, in a Court
for the enforcement of a right arising from a contract or conferred by
the Partnership Act either on behalf of an unregistered firm or by the
                                                                                 H
714             SUPREME COURT REPORTS                            [2016] 6 S.C.R.



A     firm itself or by anyone representing as partners of such an unregistered
      finn. While under sub-section (I) the ban imposed would operate against
      the finn itself or any of its partners, under sub-section (2) the ban would
      operate against any third party.
               12. The question for our consideration is by virtue of sub-section
B     (3) whether the expression "other proceedings" contained therein will
      includeArbitral proceedings and can be equated to a suit filed in a Court
      and thereby the ban imposed against an unregistered firm can operate in
      the matter ofarbitral proceedings. If sub-sections (I) and (2) are virtually
      lifted whole hog and incorporated in sub-section (3), it must be stated
      that it is not the mere ban that is imposed in sub-sections (I) and (2) that
c     alone is contemplated for the application of sub-section (3). In other
      words, when the whole of the ingredients contained in sub-sections (I)
      and (2) are wholly incorporated in sub-section (3), the resultant position
      would be that the ban can operate in respect of an unregistered firm
      even relating to a set off or other proceedings only when such claim of
D     set off or other proceedings are intrinsically connected with the suit that
      is pending in,a Court. To put it differently, in order to invoke sub-section
      (3) of Section 69 and forthe ban to operate either the firm should be an
      unregistered one or the person who wants to sue should be a partner of
      an unregistered finn, that its I his endeavour should be to file a suit in a
      Court, in which event even if it pertains to a claim of set off or in respect
E
      of'other proceedings' connected with any right arising from a contract
      or conferred by the Partnership Act which is sought to be enforced
      through a Court by way of a suit then and then alone the said sub-
      section can operate to its full extent.
              13. As far as the construction of the said sub-section (3) ofS~ction
F
      69 is concerned, we are able to discern the above legal position without
      any scope of ambiguity. To be more precise, the condition precedent for
      the operation of ban under sub-section (3) is that the launching of a suit
      in a Court of law should be present and it should be by an unregistered
      firm or by a person claiming to be partner of an unregistered firm either
G     to a claim for set off in the said suit or any other proceedings intrinsically
      connected with the said suit.
             14. In the event of the above ingredients set out under sub-sections
      (I), (2) and (3) being fulfilled then and then alone the ban prescribed
      against an unregistered firm under Section 69(1), (2) and (3) would
H     operate and not otherwise.
  MIS UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                           71 5
HOUSING SOCIETY LTD.[FAKKIR MOHAMED IBRAHIM KALIFULLA, J.]


        15. Keeping the above outcome of the legal position that can be A
derived from a reading of sub-sections (I), (2) and (3) of Section 69 in
mind we can draw further conclusions by making specific reference to
sub-clauses (a) and (b) of sub-section (3) as well as the exceptions set
out in sub-clauses (a) and (b) of sub-section (4) as well. When under
sub-section (3) which also relates to a ban concerning 'other proceedings',
                                                                               B
the law makers wanted to specifically exclude from such ban such of
those proceedings which also likely to arise in a suit, but yet the imposition
of ban of an unregistered firm need not be imposed. Keeping the said
intent of the law makers in mind, when we read sub-clauses (a) and (b)
of sub-section (3), it can be understood that even though such other
proceedings may be for the enforcement of any right to sue but yet if it c
is for the dissolution of a firm or for accounts of a dissolved firm or any
right or power to realize the property of a dissolved firm, the same can
be worked out by way ofa suit in a Court or by way of other proceedings
in that suit and the same will not be affected by the ban imposed under
sub-section (3). Similarly, any steps initiated at the instance of an official
                                                                               D
assignee, a receiver or Court under the Presidency-Towns Insolvency
Act of 1909 (3 of 1909) or the Provincial Insolvency Act of 1920 (5 of
1920) to realize the property of an insolvent partner in a pending suit of
a Court also stand excluded from the ban imposed under sub-section
(3). The specific exclusions contained in clauses (a) and (b) of sub-
section (3) therefore makes the position clear to the effect that even · E
though such proceedings may fall under the expression "other
proceedings" and may be intrinsically connected with a suit in a Court,
yet the ban would not operate against such proceedings.
        16. When we read sub-section (4), the ban imposed under sub-
sections (I), (2) and (3) will have no application to any of those proceedings    F
set out in sub-clauses (a) and (b) of the said sub-section (4). A specific
reference to sub-clause (b) of sub-section (4) disclose that in the last
part of the said sub-clause it is specifically provided that other proceedings
incidental to or arising from any suit or claim of set off not exceeding
Rs. I 00 in value under those specific statute referred to in the said sub-
clause can also be launched without any ban being operated as provided            G
under sub-sections (I), (2) and (3). The said part of sub-clause (b) of
sub-section (4) thus gives a vivid picture as to the position that the 'other
proceeding' specified in the said sub-section can only relate to a pending
suit in a Court and not to any other different proceeding which can be
categorized as 'other proceedings'.                                               H
716            SUPREME COURT REPORTS                            (2016] 6 S.C.R.


A            17. We are thus able to arrive at a definite conclusion as to the
      scope and ambit of Section 69 in particular about Section 69(3). Having
      thus analyzed the provision in such minute details and its implication, we
      can now apply the said provision to the case on hand and find out whether
      Section 69(3) is attracted to the Arbitral Proceedings and the ultimate
      award passed therein by construing the same as falling under the
B
      expression "other proceedings".
             18. In the case on hand, the contract between the parties contained
      an Arbitration Clause. The respondent invoked the said clause and an
      Arbitrator came to be appointed. After the respondent filed its statement
      of claim, the appellant filed its reply and also its counter claim dated
c     30.08.2003. Before the Arbitrator, in the course of oral arguments, a
      faint attempt was made contending that, the appellant-firm being an
      unregistered one, by virtue of Section 69 of the Partnership Act, the
      proceedings insofar as the counter claim was concerned, the same was
      not maintainable and should be rejected. The Arbitrator took the correct
D     view that Section 69 has no application to the proceedings of the Arbitrator
      and held that the objection of the respondent was not sustainable. The
      Arbitrator allowed the counter claim to the extent of Rs.1,36,24,886/-
      (Rupees One crore thirty six lacs twenty four thousand eight hundred
      eighty six only). When the award.of the Arbitrator was challenged by
      the respondent under Section 34 of the Act, the very same objection
E
      was raised as a ground ofattack. The learned Single Judge of the High
      Court also found no merit in the said contention and upheld the a~ard of
      counter claim.
             19. By the impugned judgment, the Division Bench in the appeal
      filed under Section 37 of the Act took a contrary view and held that the
F     counter claim in an Arbitral Proceedings is covered by the expression
      "other proceedings" contained in Section 69(3) of the Partnership Act
      and the appellant being an unregistered firm at the relevant point of time
      was hit by the embargo contained therein and consequently the award
      of counter claim in the award as confirmed by the learned Judge was
.G    reversed as not justiciable by virtue of Section 69 of the Partnership
      Act:
              20. Based on the close analysis of Section 69 in its different parts,
      we are able to discern and hold that in order to attract the said Section,
      first and foremost the pending proceeding must be a suit instituted in a
H     Court and in that suit a claim of set off or other proceedings will also be
  MIS UM ESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                         717
HOUSING SOCIETY LTD.(FAKKIRMOHAMED IBRAHIM KALIFULLA, J.]


barred by virtue of the provision set out in sub-sections (I) and (2) of        A
Section 69 as specifically stipulated in sub-section (3) of the said Section.
Having regard to the manner in which the expressions are couched in
sub-section (3), a claim of set off or other proceedings cannot have
independent existence. In other words, the foundation for the application
of the said sub-section should be the initiation ofa suit in which a claim
                                                                                B
of set off or other proceedings which intrinsically connected with the
suit arise and not otherwise.
        21. Under the Partnership Act, the expression "Court" is not
defined. In Section 2( e) of the said Act though it is stated that the
expressions used but not defined, the definition in the Indian Contract
Act, 1872 can be applied, in the Contract Act also there is no specific
                                                                                 c
definition set out forthe expression "Court". However, we find a definition
of the "Court" in Section 2(l)(e) of the 1996Act, which reads as under:
       "2. Definitions.-(!) In this Part, unless the context otherwise
       requires,-
              ·''                                                                D
       (a)          xxx   xxx      xxx
       (b)          xxx   xxx      xxx

       (c)          xxx   xxx      xxx
       (d)          xxx   xxx      xxx                                           E
       (e)        "Court" means the principal Civil Court of original
       jurisdiction in a district, and includes the High Court in exercise of
       its ordinary original civil jurisdiction, havingjurisdiction to decide
       the questions forming the subject-matter of the arbitration if the
       same had been the subject-matter of a suit, but does not include          F
       any civil court ofa grade inferior to such principal Civil Court, or
       any Court of Small Causes;"
        22. Mr. Amrender Saran, learned Senior Counsel for the respondent
in his submissions contended that under Section 36 of the 1996 Act since
it has been provided that the award of an Arbitrator can be enforced             G
under the Code of Civil Procedure in the same manner as if it were a
decree of the Court, it should be held that the role played by the Arbitrator
should also be deemed to be that of a Court and on that footing hold that
Arbitral Proceedings are also akin to Court proceedings before the Court
by equating the Arbitral Tribunal as a Court.
                                                                                 H
718            SUPREME COURT REPORTS                            [2016] 6 S.C.R..


A          23. Having thus noted the facts involved in the case on hand and
    before dealing with the contentions of Mr. Saran, learned Senior Counsel
  . for the respondent on the interpretation of Section 69(3), we wish to
    note the earliest decision on this very question dealt with in Jagdish
    Chander case (supra). Justice Hidayatullah, speaking for the Bench
    has made a critical analysis of this very provision, namely, Section 69(3)
B
    and has stated as under in paragraphs 7 and 9: ·
            "7. Mr. Justice Naik asked the question that if all proceedings
            were to be excluded why was it not considered sufficient to speak
            of proceedings along with suits in sub-Sections (I) and (2) instead
            of framing a separate sub-section about proceedings and coupling
c           "other proceeding" with "a claim of set-off? The question is a
            proper one to ask but the search for the answer in the scheme of
            the section itself gives the clue. The section things in terms of(a)
            suits and (b) claims of set-off which are in a sense of the nature
            of suits and (c) suits and other proceedings. The section first
D           provides for exclusion of suits in sub-sections (I) and (2). Then it
            says .that the same ban applies to a claim of set-off and other
          · proceeding to enforce a right arising from a contract. Next it
            excludes the ban in respect of the right to sue (a) for the dissolution
            of a firm, (b) for accounts of a dissolved firm and (c) for the
            realization of the property of a dissolved firm. The emphasis in
E           each case is on dissolution of the firm. Then follows a general
            exclusion of the section. The fourth sub-section says that the
            section as a whole, is not to apply to firms or to partners and firms
            which have no place ofbusiness in the territories oflndia or whose
            places of business are situated in the territories of India but in
F           areas to which Chapter VII is not to apply and to suits or claims
            of set-off not exceeding Rs. I 00 in value. Here there is no insistence
            on the dissolution of the firm. It is significant that in the latter part
            of clause (b) of that section the words are "or to any proceeding
            in execution or other proceeding incidental to or arising from any
            such suit or claim" and this clearly shows that the word
G           "proceeding" is not limited to a proceeding in the nature of a suit .
            or a: claim of set-off. Sub-section (4) combines suits and a claim
            of set-off and then speaks of"any proceeding in execution" and
            "other proceeding incidental to or arising from any such suit or
            claim" as being outside the ban of the main section. It would
H
  MIS UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                         719
HOUSING SOCIETY LTD.[FAKKJR MOHAMED IBRAHIM KALIFULLA, J.)


      hardly have been necessary to be so explicit if the words "other         A
      proceeding" in the main section had a meaning as restricted as is
      suggested by the respondent. It is possible that the draftsman
      wishing to make exceptions of different kinds in respect of suits,
      claims of set-off and other proceedings grouped suits in sub-
      sections (I) and (2), set-off and other proceedings in sub-section
                                                                               B
      (3) made some special exceptions in respect of them in sub-section
      (3) in respect of dissolved firms and then viewed them all together
      in sub-section (4) providing for a complete exclusion of the section
      in respect of suits of particular classes. For convenience of
      drafting this scheme was probably followed and nothing can be
      spelled out from the manner in which the section is sub-divided.         c
      9. Jn our judgment, the words "other proceeding" in sub-section
      (3) must receive their full meaning untrammeled by the words "a
      claim of set-off'. The latter words neither intend nor can be
      construed to cut down the generality of the words "other
      proceeding". The sub-section provides for the application of the          D
      provisions of sub~sections (1) and (2) to claims of set-off and also
      to other proceedings of any kind which can properly be said to be
      for enforcement of any right arising from contract except those
      expressly mentioned as exceptions in sub-section (3) and sub-
      section (4)."
                                                  (Underlining is ours)         E
       24. In the first blush, when we read paragraph 7, one is likely to
gain an impression as though the expression 'other proceedings' is
disjunctive of a suit as specifically prescribed in sub-sections (I) and (2)
of Section 69. But on a deeper scrutiny of the judgment, we find that in
the light of the special features involved in the said case, it was laid        F
down that 'other proceedings' would be referable to Arbitration as well.
We will right now note and state as to those intricate factors which
weighed with the learned Judges to state the law in such terms. First
and foremost, it will have to be noted that in the said case, the Arbitral
proceedings arose under the Indian Arbitration Act of 1940 and in
                                                                                G
particular in relation to a proceeding which emanated under Section 8 of
the said Act. Under Section 8 of the 1940 Act, the power of Court to
appoint Arbitrator or umpire is specified. Sub-sections (l)(a) to (c) and
(2) of Section 8 details the situations under which the said power of
appointment of Arbitrator or umpire can be made. Under Section 2(c),
                                                                               H
720             SUPREME COURT REPORTS                            [2016] 6 S.C.R.


A     the expression 'Court' is defined to mean a Civil Court havingjurisdiction
      to decide the questions framing the subject matter of a suit excluding a
      Small Causes Court. Under the said definition, an exception is carved
      out even for a Small Causes Court to fall under the definition of Court
      when the said Court is called upon to exercise its jurisdiction in situations,
      which are set out in Section 21 of the Act.
B
              25. The definition of'Court' under Section 2(c) read along with
      Sections 8 and 21 of the 1940 Act, therefore, indicates thatthe proceedings
      initiated under the said Sections are virtually in the nature of a suit in a
      Civil Court havingjurisdiction, though such proceedings are relating to
      initiation as well as superintendence of Arbitration proceedings such as
c     appointment of an Arbitrator or umpire or inaction or neglect on the part
      of Arbitrator or umpire or the incapacity of the Arbitrator or umpire,
      death of an Arbitrator or umpire or even in situations where the agreement
      has not provided for or not intended to supply the vacancy or the parties
      or the Arbitrator fail to supply the vacancy or the parties or the Arbitrator
D     who are required to appoint an umpire and they fail to carry out their
      obligation. Under Section 21 of the 1940 Act even in the absence of an
      agreement providing for Arbitration, by consent of all parties to any suit
      can seek for a reference to Arbitration before the judgment is pronounced.
      Equally a reference to Sections 11, 12, 14, I 5, 16, 17, 18, 19, 20, 21, 23,
      24, 25, 28, 29, 30, 31, 32, 33, 34, 36, 37, 38, 39, 40, 41, 43 and 47 of! 940
E     Act disclose that the whole scheme of the Act in effect invested the
      Civil Court and under cc'lllain specified situations even with the Small
      Causes Court to exercise all the powers that a Civil Court having
      jurisdiction in a civil suit mutatis mutandis in relation to an Arbitration
      apply, unlike the Arbitration and Conciliation Act of 1996 (hereinafter
F     called the "1996 Act").
              26. The scope and ambit of the powerand jurisdiction of 'Court'
      defined under Section 2(e) of the 1996 Act is circumscribed to certain
      specified extent as set out in Sections 8, 9, 14, 27, 34, 36, 37, 39, 42, 43,
      47, 48, 49, SO, 56, 58 and 59. A comparative consideration of the 1940
G     Act and 1996 Act disclose the extent of control and operation of a Court
      under the former Act was far more intensive and elaborate than the
      latter Act. The more significant distinction as between the 1940 Act and
      the 1996 Act is clear to the position that the former Act does not merely
      stop with the initiation and enforcement of an Arbitration and its award,
      but effectively provides for intervention at every stage of the Arbitral
H
  M/S UM ESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                         721
HOUSING SOCIETY LTD.[FAKKIR MOHAMED IBRAHIM KALIFULLA, J.]


proceedings upto its final consideration and enforcement as ifit were a         A
regular civil suit, whereas under the I 996 Act, the scope of intervention
is not that of a Civil Court as it could do in the matter of a suit. Such
clear distinction could be discerned from the reading of the various
provisions of both the Acts. Therefore, in the light of such distinctive
features that prevail in respect of an Arbitral proceeding which emanated
                                                                                 B
under the I940 Act, this Com1 held in Jagdish Chander case (supra)
to the effect that an Arbitral proceedings governed by 1940 Act would
squarely fall under the category of 'other proceedings' as specified in
Section 69(3) of the Partnership Act. To be more precise, in Jagdish
Chander case (supra), in as much the initiation of the proceedings
were under Section 8 of the 1940 Act before a Civil Court having                 c
jurisdiction to decide the question forming the subject matter of suit and
the respondent therein being an unregistered Partnership Firm, the
ingredients set out in Section 69( I) to (3) of the Partnership Act applied
in all force and consequently held that the prohibition set out in the said
Section squarely applied.
                                                                                 D
        27. We only wish to add that though in the said decision, this
Court did not specifically mention as to the requirement ofpendency of
a proceeding in the nature of a suit in a Civil Court as the basic ingredient
to be satisfied as stipulated in sub-sections (I) & (2) of Section 69 in
order to extend the specific prohibition even to 'other proceedings' under
sub-section (3), this Court was fully aware of the fulfillment of those          E
mandatory requirement having regard to the nature of proceedings that
existed under the provisions of the 1940 Act. Therefore, our conclusion
based on the interpretation of Section 69 on the whole as set out in
paragraphs 12 to 17 are fully supported by the above decision. We have
therefore no hesitation to hold that the ratio laid down in Jagdish              F
Chander case (supra) does not in anyway conflict with the view which
we have taken herein, having regard to the advent of the 1996 Act,
under which the nature of Arbitration Proceedings underwent a sea
change as compared to the I 940 Act, what is stated in Jagdish Chander
case (supra) can have application in the special facts of that case and
that it can have no application to a proceedings which emanated under            G
the 1996 Act, for which the interpretation to be placed on Section 69(3)
will have to be made independently with specific reference to .the
provisions of the 1996 Act, where the role of the Court is limited as
noted earlier to the extent as specified in Sections 8, 9 etc.
                                                                                 H
722             SUPREME COURT REPORTS                          [2016) 6 S.C.R.


A             28. Having thus noted the distinctive features in Jagdish Chander
      case (supra), we wish to refer to the subsequent decision of this Court
      reported in Kamal Pushp Enterprises (supra). The judgment and
      the ratio in Jagdish Chander (supra) was sought to be applied in all
      force in Kamal Pushp Enterprises (supra), but having noted the
      distinctive feature of Jagdish Chander (supra), this Court has explained
B
      the said judgment and held that it will have no application to a post Award
      situation. Some of the relevant portions of the judgment in Kamal Pushp
      Enterprises (supra) can be quoted to appreciate the ultimate conclusion
      which fully supports our view. The question posed for consideration has
      been noted as under:
c           "5. Mr. Sanjay Parikh, learned counsel for the appellant,
            contended that the Courts below ought to have sustained the
            objection of the appellant based upon Section 69 of the
            Partnership Act holding the proceedings to be barred on
            account of the respondent being an unregistered firm ...... .
D           Strong reliance was placed in this regard upon the decision
            of this Court reported in Jagdish Chander Gupta Vs. Kajaria
            Traders (India) ltd. [AIR 1964 SC 1882]; ..... in addition to
            placing reliance upon some other decisions of the High
            Courts, to substantiate his claim .... "

E           6 . ..... This Court ultimately construed the words .. other
            proceedings" .in sub-section (3) of Section 69 giving them
            their full meaning untrammelled by the words "a claim of set
            off, and held that the generality of the words "other
            proceedings" are not to be cut down by the latter words. The
            said case. being one concerning an a[!.plication before Court
F           under Section 8(2) of the Arbitration Act. 1940 in the light of
            the arbitration agreement, this Court finallv held that since
            the arbitration clause formed part of the agreement
            constituting the partnership the proceeding under Section 8(2)
            was in fact to enforce a right which arose from a contract/
G           agreement of parties. "
             9. The prohibition contained in Section 69 is in respect of
             instituting a proceeding to enforce a right arising from a
             contract in any Court by an unregistered firm, and it had no
             application to the proceedings before an Arbitrator and that
H
   MIS UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                         723
 HOUSING SOCIETY LTD.[FAKKIRMOHAMED IBRAHIM KALIFULLA, J.]

        too when the reference to the Arbitrator was at the instance            A
        of the appellant itself. If the said bar engrafted in Section 69
        is absolute in its terms and is destructive of any and every
        right arising under the contract itself and not confined merely
        to enforcement of a right arising from a contract by an
        unregistered firm by instituting a suit or other proceedings in
                                                                                 B
        Court only, it would become a jurisdictional issue in respect
        of the Arbitrators power, authority and competency its.elf,
        undermining thereby the legal efficacy of the very award,
        and consequently furnish a ground by itself to challenge the
        award when it is sought to be made a rule of Court ... ..... The
        Award in this case cannot either rightly or legitimately said to         c
        be vitiated on account of the prohibition contained in Section
        69 of the partnership Act. 1932 since the same has no
        application to proceetlings before an Arbitrator. At the stage
        of enforcement of the award by passing a decree in terms
        thereof what is enforced is the award itself which crystallise
                                                                                 D
        the rights of parties under the Indian Contract Act and the
        gener{ll law to .be paid for the work executed and not any
        right arising only from the objectionable contract...: ....
        Consequently. the post award proceedings cannot be
        considered by any means. to be a suit or other proceedings to
        enforce any rights arising under a contract. All the more so·.           E
        when, as in this case, at all stages the respondent was only
        on the defence and has not itself instituted any proceedings
        to enforce any rights of the nature prohibited under Section
        69 of the Partnership Act, before any Court as such ....... "
                                                      (Empltasis added)          F
         29. The above passages extracted from the case of Kamal Pushp
' Enterprises (supra), apart from explaining the principles laid down in
  Jagdish Chander case (supra), has thus held in categorical terms as
  to how Section 69 prohibition will have no application to the post award
  proceedings as they do not fall under the expression 'other proceedings'
                                                                                 G
  of the said section. This Court thus having already understood and
  explained Jagdish Chander case (supra) and reiterated the legal
  position on the application of Section 69(3) to the post award proceedings,
  which fully supports our conclusion in the case on hand: we need not
  dilate much on this issue.
                                                                                 H
724             SUPREME COURT REPORTS                           [2016) 6 S.C.R.


A            30. Having reached the above definite conclusion on the application
      of Section 69(3) to the post award proceedings, when we consider the
      submissions of Mr. Amrender Saran, learned senior counsel for the
      respondent, the learned counsel, in the first place, contended that for the
      application of Section 69(3) of the Partnership Act to Arbitral proceedings,
      the foundation must be only based on a right in a contract. As far as the
B
      said contention is concerned, the same has already been dealt with by
      this Court in Kamal Pushp Enterprises (supra) wherein it is held as
      under:
             " ..... The Award in this case cannot either rightly or legitimately
             said to be vitiated on account of the prohibition contained in
c            Section 69 of the partnership Act, 1932 since the same has
             no application to proceedings before an Arbitrator. At the
             stage of enforcement of the award by passing a decree in
             terms thereof what is enforced is the award itself which
             crystallise the rights of parties under the Jndian Contract Act
D            and the general law to be paid for the work executed and not
             any right arising only from the objectionable contract. ....... '
             (Emphasis added)
             31. Therefore, the said contention of the learned senior counsel
      for the respondent has no force.
E             32. The learned senior counsel then contended that while
      interpreting Section 14 of the Limitation Act, it was held that Arbitration
      Proceedings are to be treated on par with civil proceedings. Though, in
      the first blush, the submission looks more attractive, on a deeper scrutiny
      it must be held that it is always well settled that a judgment can be a
      binding precedent on a question of law, which was canvassed before it
F
      and decided. Keeping the said principle in mind when we consider the
      said submission, we have clearly held as to how a reading of Section 69
      as a whole does not permit of any interpretation that would cover Arbitral
      proceedings, de hors, filing of a suit .in a Court and that too in respect of
      a right under a contract governed by the provisions of the Indian
G     Partnership Act, especially after the coming into force of the 1996 Act
      and the proceedings governed by the special features contained in the
      said Act. Therefore, any interpretation made under the Limitation Act
      while construing Section 14 to treat Arbitral proceedings on par with
      civil proceedings cannot be applied to the case on hand. Furtber, the
      decision of this Court in Kamal Pushp having considered the application
H
  MIS UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                           725
HOUSING SOCIETY LTD.[FAKKIR MOHAMED IBRAHIM KAL!FULLA, J.]


to Section 69(3) itself to Arbitral Proceedings and held that the same will      A
not apply to a Post Award Proceedings, we do not find any merit in the
said submission. Therefore, we are not able to apply the principles laid
down in the decision reported in Mis. Consolidated Engg. Enterprises
(supra) and P. Sara thy (supra) relied upon by the learned senior counsel
for the respondent.
                                                                                  B
       33. The next submission of Mr. Saran, learned Senior Counsel
was again by relying upon Section 2(a) of the Interest Act. Under the
said definition section, 'Court' has been defined to include a Tribunal
and an Arbitrator. The learned senior counsel, therefore, contended that
Arbitral Proceedings should be equated to a Court and consequently
make Section 69(3), applicable to it as falling under the expression 'other
                                                                                  c
proceedings'. If such a specific provision has been incorporated in the
Partnership Act, there can be no difficulty in accepting the argument of
the learned senior counsel for the respondent. In the absence of such a
specific provision, it will not be appropriate to import the definition clause
under Section 2(a) of the Interest Act to the Partnership Act in order to         D
apply Section 69(3) of the Partnership Act. Therefore, we do not find
any scope to countenance such a submission of the learned senior counsel
for the respondent.
        34. Lastly, it was contended by Mr. Saran, learned Senior Counsel
 that under Section 36 of the 1996 Act, an Award of the Arbitrator has            E
 been equated to decree of the Court forthe purpose of execution. Under
 Section 35 of the I 996 Act, an Arbitral Award will be final and binding
 on the parties and persons claiming under them subject to the other
 provisions prescribed in the said part of the Act. Under Section 36 it is
 provided that where the time for making an application to set aside the
 arbitral award under Section 34 expired, or such application having been         F
 made and referred, the award can be enforced under the Code of Civil
·Procedure in the same manner as if it were a decree of the Court.
 When we consider the submission of the learned senior counsel for the
 respondent, at the very outset, it must be held that by referring to Sections
 35 and 36, it is difficult to draw an inference that based on the deeming        G
 provision specifically meant for the enforcement and execution of an
 Award, the ArbitraI Proceedings can be equated to a Civil Court
 proceedings. As rightly contended by Mr. Dhruv Mehta, learned senior
 counsel for the appellant, Section 36 only creates a statutory fiction which
 is limited for the purpose of enforcement of the Award. The deeming
                                                                                  H
726            SUPREME COURT REPORTS                           [2016] 6 S.C.R.



A   fiction is specifically restricted to treat the Award as a decree of a Court,
    exclusively for the purpose of execution, though as a matter of fact, it is
    only an Award of Arbitral proceeding. It is a settled proposition, that a
    statutory provision will have to be construed from the words that are
    expressly used and it is not for the Court to add or substitute any word to
    it. Therefore, going by Sections 35 and 36 it cannot be held that the
B
    entire Arbitral proceeding is a Civil Court proceedings for the purpose of
    applicability of Section 69(3) of the Partnership Act. _In this context, we
  · draw support from the decision of this Court reported in Sadan K.
    Bormal (supra), paragraph 25 is relevant for our purpose which reads
    asunder:
c           "25. So far as interpretation of a provision creating a legal
            fiction is concerned, it is trite that the Court must ascertain
            the purpose for which the fiction is created and having done
            so must assume all those facts and consequences which are
            incidental or inevitable corollaries to the giving effect to the
D           fiction. In construing a fiction it must not be extended beyond
            the purpose for which it is c;reated or beyond the language of
            the Section by which it is created. It cannot be extended by
            importing another fiction. These principles are well settled
            and it is not necessary for us to refer to the authorities on this
            subject. The principle has been succinctly stated by Lord
E           Asquith in East End Dwelling Co. Ltd. V. Finsbury Borough
            Council, (1951) 2 ALL ER 587, when he observed:-
               "If you are bidden to treat an imagi'na1y state of affairs as
               real, you must surely, unless prohibited from doing so, also
               imagine as real the consequence and incidents which, if
F              the putative state of affairs had in fact existed, must
               inevitably have flowed from or accompanied it-. The statute
               says that you must imagine a certain state of affairs; it
               does not say that having done so, you musi cause or permit
               your imagination to boggle when it comes to the inevitable
G              corollaries of that state of affairs". "
            35. We also draw support from the decision of this Court reported
      in Paramjeet Singh Patheja Vs. ICDS Ltd. - (2006) 13 SCC 322,
      paragraph 42 is relevant, which reads as under:
            "42. The words "as if" demonstrate that award and decree or
H
  MIS UMESH GOEL v. HIMACHAL PRADESH COOPERATIVE GROUP                       727
HOUSING SOCIETY LTD.[FAKKJRMOHAMED IBRAHIM KALIFULLA, J.]


      order are two different things. The legal fiction created is for       A
      the limited purpose of enforcement as a decree. The fiction is
      not intended to make it a decree for all purposes under all
      statutes, whether State or Central. "
       36. Though the learned senior counsel for the appellant and the
respondent referred to certain other decisions in support of their           B
respective submissions, as we are fortified by our conclusion, based on
the interpretation of Section 69 of the Partnership Act vis-a-vis the 1996
Act and the 1940 Act as well as supported by the decision in Jagdish
Chand~r {supra) and Kamal Pushp Enterprises (supra), we do not
find any necessity to refer to those decisions in detail. Having regard to
our conclusion that Arbitral Proceedings will not come under the
                                                                              c
expression "other proceedings" of Section 69(3) of the Partnership Act,
the ban imposed under the 'said Section 69 can have no application to
Arbitral proceedings as well as the Arbitration Award. Therefore, the
appeal stands allowed, the impugnedjudgment of the Division Bench is
set aside and the judgment of the learned Single Judge stands restored.       D
No costs.
Kiilpana K. T~ipat~y                                       Appeal allowed.