The Delhi High Court is hearing Rajiv Luthra's appeal against order staying the termination of Mohit Saraf from L&L Partnership .Live updates feature here. .Senior Advocate Abhishek Manu Singhvi begins submissions on behalf of Luthra before a Bench of Justices RS Endlaw and Sanjeev Narula.Your Lordships are empowered to tailor the relief to give a temporary solution. A person called Saraf cannot run a firm called Luthra & Luthra. Rajiv Luthra cannot run a separate firm called Luthra & Luthra: Singhvi.What can be a lasting solution? L&L should be run by Rajiv Luthra. Saraf should have a clean exit, and can take anyone who wants to go with him. Money to be paid to Saraf can be decided by arbitrators. Court can give order for interim amount to be paid. .If Your Lordships give an order, either I or he will appeal. By the time the appellate process is done, nothing will be left of the firm: Singhvi.The firm is already having high attrition. Please have a parting. It will be honourable for all sides: Singhvi.There is no question of master-servant relationship between Luthra and Saraf. Luthra has additional rights in the partnership. For example, right to appraise and right to terminate: Singhvi.One person having more rights over the other does not dilute the partnership: Singhvi cites a judgment.Single Judge held that Luthra has the power to terminate a partner. But order contradicts itself by saying that this power only applies to people other than Saraf, those who have been inducted into equity partnership by Luthra: Singhvi.Single Judge said that Partnership Act contemplates only expulsion but not termination. When the partnership deed uses the word 'termination', how can you say the Act does not contemplate it? Singhvi.So there is no difference between expulsion and termination? Justice Narula asks .Senior Advocate Vikas Singh objects to Singhvi's submissions. Says that arguments which were not made initially are being made in rejoinder. .Singhvi: This will go on till 1:30 pm .Single Judge held that deed neither gives power to expel or terminate. But expressly, clause 7A and clause 8 of the deed says there is power to terminate. The judgment is riddled with contradictions: Singhvi.You cannot say that power of termination becomes bad in law if it is exercised as a counterblast: Singhvi.Termination of Saraf was on several grounds. Single Judge erroneously links it solely to Rajiv Luthra's purported retirement: Singhvi .On October 12, 2020, he retires me and inducts 23 new equity partners into the firm. And he questions my bona fides? He has blown the word 'bona fides' to smithereens: Singhvi .Single Judge found that there is no implied power to terminate. Section 33 of the Partnership Act gives primacy to the contract. By the contract, Luthra has the power the terminate. If someone apart from Luthra exercises termination, it would be contrary to contract: Singhvi.If Luthra had consulted other partners of L&L before terminating Saraf, it would have been in violation of the contract and Section 33: Singhvi.The two partners happily lived with the contract till now. Now, when it hits one of them, he says it is wrong: Singhvi.Clause 8 of deed speaks of termination due to material breach. Clause 9 speaks of a surviving party after termination. Such surviving party retains the name, employees, assets of the firm. Deed would be dissolved only if the firm gets dissolved: Singhvi.Termination of partner does not result in dissolution of partnership deed: Singhvi.In Saraf's October 12 notice, he himself talks of Clause 8 and being a surviving partner after Luthra leaves. How can he then claim that the partnership deed is dissolved after a partner is removed? Singhvi .Under Clause 8, one 90-day notice is provided for after termination. The Clause says that Luthra can at his discretion give another 90-day period for amicable resolution. This cannot be read as two mandatory 90-day notice periods: Singhvi.Counsel for Saraf had argued that the termination was invalid as the two 90-day periods were not followed .Saraf has himself admitted to criticising Luthra before third parties: Singhvi .We can go on and on, but we need to come up with a solution. Confine your submissions to preservation of the law firm: Justice Endlaw .Look at my dilemna. The findings of the Single Judge are erroneous and are against me: Singhvi.Singhvi continues. Section 41 applies to proceedings under Section 9 of the Arbitration Act (which is this case before the High Court) .If Luthra is guilty of any breach, despite the breach, there is no question of specific performance under the Specific Relief Act: Singhvi.You cannot restore someone to partnership in proceedings under Section 9. But that is what the Single Judge has done: Singhvi.Single Judge held that every partnership, in order for it to be terminable, has to be a partnership at will. This is not feasible: Singhvi .From the correspondence, there is no love lost between the two for a long time. What is the solution? Justice Endlaw asks .Singhvi calls for a 'clean break'. The findings of the Single Judge must go. The exit must be honourable, and he may take any employees who want to go. .Suppose the arbitrators say that he is entitled to come back, are we empowered to make such a ruling? Justice Endlaw.Once the arbitration is on, does it make sense for him (Saraf) to start a new outfit?.Till such time the proceedings are going on, the two can run their separate firms. If Court lets the Single Judge order operate, it will be worst: Singhvi .Senior Advocate Sidharth Luthra invites Bench's attention to an email saying that Rajiv Luthra is looking for a space at the Leela Palace, New Delhi for 6 months .The possible fear that the arbitral award will cause problems two years from now is not reason to not implement the arrangement I have suggested: Singhvi .How many caveats can the Court issue for an arrangement that involves Saraf continuing at L&L? There will be several contempt actions initiated: Singhvi .Even after the final arbitral award, can Saraf run a firm called Luthra & Luthra? Better solution is honourable exit after Saraf is given a payment: Singhvi .If mediation didn't work, how can they work together? My view is that a clean break is the only solution: Singhvi.Singhvi cites IRCTC, Cox and Kings cases. "Catering companies have contributed more to jurisprudence than catering".In conclusion, Your Lordships must correct the Single Judge order, which is wrong in fact and law. Singhvi reiterates his solution for a clean break. .Do not try to join the unjoinable by using the Specific Relief Act, Singhvi concludes.Senior Advocate Sidharth Luthra supplements Singhvi's submissions. "I'm wondering why these parties are quarrelling over my name!" .There is no hiring going on. Clearly the two cannot function together. There is no billing since Saraf re-joined: Luthra.We have lost a number of people. 23 have left since Saraf re-joined. People are hit by COVID-19. Clients, employees are worried about future of the firm: Luthra .He will be paid money due to him. Retainer clients can go with him, employees who want to go can go with him: Luthra.Our proposal is this - at least let hiring go one. Rajiv Luthra will pay from his own share: Luthra .Balancing of equities must be done. We can't have a situation with him in and wanting Luthra out. Only yesterday, another person left the firm: Luthra .There is no hiring going on. Clearly the two cannot function together. There is no billing since Saraf re-joined: Luthra .We have lost a number of people. 23 have left since Saraf re-joined. People are hit by COVID-19. Clients, employees are worried about future of the firm: Luthra.He will be paid money due to him. Retainer clients can go with him, employees who want to go can go with him: Luthra.Our proposal is this - at least let hiring go one. Rajiv Luthra will pay from his own share: Luthra.Saraf on one hand concedes that there is power of termination, and on the other hand, that he holds such power: Luthra says after referring to communication between the two.Senior Advocate Vikas Singh for Saraf seeks five minutes to suggest a solution.The billing of the firm for six months after the termination of Saraf is 45% less than what it was when Saraf was there: Singh.In the deed itself, Luthra kept diluting his powers. After 2011, the only way a division could take place was that the firm would be retained by remaining partners once Luthra retires: Singh .Singh reads out provisions of deed pointing out what happens if Rajiv Luthra leaves the firm. He is not leaving: Luthra interjects..Senior Parag Tripathi for Saraf: They cannot be given benefit for their own wrongs. I should be given full freedom to work. I am the driving force of the firm..Rajiv Luthra has been killing the firm for these six months: Tripathi and Singh .Saraf has not even filed a worksheet in this time: Luthra .Hearing concludes.