A partner’s reimbursement claim for discharging firm debt falls within the partnership arbitration clause.

M/s Nova Electro World, a partnership firm, obtained a cash-credit facility from Union Bank of India.

The Appellant, a partner and guarantor, paid ₹23,90,000 towards settlement of the firm’s dues and sought contribution from the other partners, deducting his own 10% share.

On 11.12.2023, the parties stated before the arbitrator that an award could be passed only on the Appellant’s claim concerning the Bank payment.

The arbitrator awarded ₹21,51,000 against the other partners, with interest, and did not decide the remaining claims.

The District Judge set aside the award under Section 34 of the Arbitration and Conciliation Act, 1996, holding that the arbitrator had left other claims undecided and that the Bank-payment claim fell outside the arbitration agreement.

The Appellant appealed.

1. Whether the arbitrator erred by not adjudicating the other reliefs originally pleaded, in light of the parties’ statement dated 11.12.2023.

2. Whether the Appellant’s claim for contribution from his co-partners, after paying the firm’s Bank liability as guarantor, fell within the scope of the arbitration agreement.

Section 34 of the Arbitration and Conciliation Act, 1996 permits a court to set aside an arbitral award only on the statutory grounds; a court’s different view of the evidence, by itself, does not justify setting aside an award.

Clause 15 of the Partnership Deed referred disputes concerning the deed or the books of accounts to arbitration.

Order XIV Rule 2 of the Code of Civil Procedure, 1908 reflects the general principle that an adjudicator should decide disputes that remain live for determination; whether a claim remains live depends on the proceedings and the parties’ position.

The Court distinguished S.N. Prasad v. Monnet Finance Ltd. & Ors., noting that the present claim concerned a partner’s claim against co-partners for payment of the firm’s liability, rather than a claim arising from a loan agreement with an arbitration clause.

The order-sheet recorded that the parties agreed to proceed only on the Appellant’s claim, and the arbitrator’s award identified that claim as the Bank-payment claim; the District Judge therefore erred in treating the other pleaded reliefs as still requiring adjudication.

The Bank’s settlement certificate showed that the account belonged to the firm and that the payment settled the firm’s dues.

The Appellant’s subsequent claim was against his co-partners, not the Bank, and the award apportioned the amount according to the partners’ shares after deducting the Appellant’s own share.

The claim thus concerned the inter se financial liability of the partners and fell within the partnership arbitration clause; the Appellant’s status as guarantor and lack of prior consultation did not, by themselves, make it a personal, non-arbitrable claim.

The arbitrator’s factual findings were supported by the evidence, and the District Judge could not set aside the award merely for viewing the payment differently.

The appeal was allowed, the District Judge’s order dated 28.11.2025 was set aside, and the arbitral award dated 23.12.2023 was restored; the pending application was also disposed of.