Most Section 11 petitions begin with an arbitration clause. This one began with its absence. The LLP agreement of Avighnaa Infra Buildcon LLP said nothing about arbitration; its jurisdiction clause pointed to the courts at Mumbai. Yet on 4 November 2026, in Prashant Vinod Vaghasiya & Anr. v. Vivekanand Dhaneshwar Jha & Ors. (Commercial Arbitration Petition No. 37 of 2026), Justice S.M. Modak of the Bombay High Court appointed a former judge of that court as sole arbitrator — because Section 23(4) of the LLP Act, 2008 reads the First Schedule into every silent LLP agreement, and Entry 14 of that Schedule mandates arbitration of partner disputes.
The dispute
The petitioners and the first respondent had been, at different points, partners of an LLP constituted under an agreement of October 2019, supplemented twice in 2020. The quarrels were classically internal: a claim to accounts stretching back years, the first respondent’s contested expulsion from the LLP, and a disputed “settlement” of 7 December 2025 that one petitioner never signed and which contained blanks. The first petitioner invoked arbitration by notice dated 17 June 2025; when no tribunal emerged, a petition under Section 11(6) of the Arbitration and Conciliation Act followed.
The structural problem: none of the three agreements contained an arbitration clause, and Clause 33 conferred jurisdiction on the courts at Mumbai.
How the statute filled the gap
Objections raised, and where they went
| Objection | Outcome |
|---|---|
| No arbitration clause in the LLP agreement | Irrelevant — Entry 14 of the First Schedule applies by force of Section 23(4) where the agreement is silent. |
| Clause 33 confers exclusive jurisdiction on Mumbai courts | Governs court proceedings under the Arbitration Act; does not exclude arbitration. Seat fixed at Mumbai. |
| Disputes settled — accord and satisfaction | “Even if there is accord/satisfaction it will not bar an arbitration” — especially where the settlement’s validity is itself disputed. |
| Non-signatory seeking impleadment | Left to the tribunal: it “would be full empowered to examine this issue in the first instance.” |
What this means for LLPs and their partners
Frequently Asked Questions
How can there be arbitration without an arbitration agreement?
Through statute. Section 23(4) of the LLP Act provides that where the LLP agreement is silent on any matter, the First Schedule applies. Entry 14 of that Schedule requires disputes between partners arising out of the LLP agreement, which cannot be resolved in terms of the agreement, to be referred to arbitration under the Arbitration and Conciliation Act 1996. The Schedule supplies the clause the parties never wrote.
Did the Mumbai jurisdiction clause exclude arbitration?
No. The court held, following the settled position on exclusive jurisdiction clauses, that the clause conferring jurisdiction on Mumbai courts governs the court proceedings connected with the arbitration — it does not displace the statutory reference itself. It also anchored the seat: the court recorded that the place of the arbitration would be Mumbai.
What happened to the settlement the respondents relied on?
A disputed settlement document of December 2025 — unsigned by one petitioner and containing blanks — was raised as accord and satisfaction. The court held that even an accord and satisfaction does not bar reference to arbitration, particularly where the settlement’s own validity is contested; that dispute itself belongs before the arbitrator.
Can a non-signatory be added to such an arbitration?
The question is for the tribunal in the first instance. An intervenor company sought impleadment, and the court — consistent with current Supreme Court doctrine on non-signatories — left the issue to the arbitral tribunal, recording that the tribunal would be fully empowered to examine it.