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Delhi HC stays Saraf’s ouster by Rajiv Luthra for violating deed & Act by Friday • Delhi offices also shut 4 days for fumigation [UPDATE-2]

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Stay by Delhi HC

The Delhi high court has “prima facie” and “tentative[ly]” stayed the termination of senior partner Mohit Saraf’s termination from L&L Partners, the partnership he had co-founded, by managing partner Rajiv Luthra.

Delhi high court Justice V Kameswar Rao ordered the following relief:

72. In view of my above discussion, prima facie the termination of the petitioner from partnership by the respondent in terms of email dated October 13, 2020 being in violation of the Deed and the Partnership Act, keeping in view the mandate of Section 12 of the Partnership Act, where a partner has the right to take part in the conduct of the business and also keeping away the petitioner from the partnership business shall be to his prejudice, if he finally succeeds in the prospective arbitration proceedings, I direct that there shall be a stay of the operation of the email dated October 13, 2020 issued by the respondent terminating the petitioner from the partnership till the conclusion of the prospective arbitration proceedings.

The court added:

73. It is made clear that the aforesaid is a tentative / prima facie view.

74. The petition is disposed of. No costs.

Update 13:40: We understand that Rao orally also noted in court that the judgment would be kept in abeyance until Friday (presumably to allow the filing of an appeal).

Update 19:14: The order staying the operation of the judgment until 22 January 2021, on request of Luthra’s lawyers, has been uploaded now. It notes:

Vide the judgment pronounced today, I have decided OMP (I) (COMM) 339/2020 whereby I have stayed the operation of the email dated October 13, 2020 issued by the respondent.

After I pronounced the judgment, a request is made by Ms.Pooja Dhar, learned Counsel for the respondent, for staying the operation of the impugned judgment for a period of one week.

Learned counsel appearing for the petitioner has opposed the said request.

Noting the submissions, it is directed that the operation of the direction, given in the judgment, shall remain in abeyance till January 22, 2021.

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Amending operation of judgment

Delhi office sealed

In may be perhaps a coincidence but could turn out to potentially be a strategically valuable one, late yesterday (Sunday, 17 January), just before 6pm, the firm’s vice president of administration sent an email to all staff of the Delhi headquarters, noting:

Dear All,

Happy New Year to you and your families.

This is to inform you that our offices were inspected earlier today and we have been advised that it is extremely important to completely Sanitize and Fumigate the premises before we plan to open our offices at the permitted capacity.

Therefore, a thorough Sanitization & Fumigation is being carried out in all our offices on the 1st, 8th and 9th floors today, after which the premises will be sealed for 3 days, starting tomorrow, Monday, January 18 to Wedesday, January 20, 2021.

Thereafter on Thursday, January 21, the office boys will carry out a deep cleaning exercise of the entire office, to make ready for full operations w.e.f. Friday, January 2021.

All are hereby, therefore, informed to kindly work from home for the next 3 days i.e., Monday, January 18 to Wednesday, January 20, 2021, and partially resume office form Thursday, January 21 onwards.

So, while the Delhi high court has ordered arbitration, this might give Luthra an additional three to four days in which to approach the Supreme Court for a challenge of this order.

That said, the order would require Saraf to re-gain access to his email.

We have reached out to Rajiv Luthra yesterday evening for comment whether the timing was related to the expected judgment.

Saraf v Luthra, read full judgment

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