Mahesh Kumar Gupta and Others vs Suresh Chander Gupta and Others

Mukul Mudgal, J.—It is not in dispute that both the present appeals were disposed of on 13th September, 2007 by a common order, referring the disputes to arbitration in the following terms:

with the consent of the appellants and respondents and their respective Advocates, we had dictated the order, referring the disputes, which were subject matter of the appeal and matters incidental thereto, to the sole arbitration of Ms. Kamal Inder, Former District & Sessions Judge. We notice that inadvertently the statement of the appellants and respondents or their Advocates was not recorded for referring the matter to arbitration in this appeal proceedings. We, therefore, consider it appropriate to list the matter for directions on 20th September, 2007. We further direct that notices be issued to the appellants and respondents to be personally present in Court on 20th September, 2007.

Subsequent to the above order, the Arbitrator pronounced her award on 27th January 2008. The appellants have preferred objections to the said award.

The issue required to be determined in the present proceedings is as to whether the aggrieved party should be permitted to file objections in this Court as is being pleaded by the appellants or should they be directed to appear before the competent court as per the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the "Act") to file their objections. It is not in dispute that the original dispute arose before the learned Additional District and Sessions Judge and the judgment of the learned Additional District and Sessions Judge dated 15th December, 2004 was the subject matter of the appeals in which order dated 13th September, 2007. The aforesaid judgment disposed of Suit No. 336/2003 and 337/2003.

Section 2(e) of the Act reads as follows:

2(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, having jurisdiction 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 any civil court of a grade inferior to such principal Civil Court, or any Court of Small Causes;

(emphasis supplied)

Further, Section 42 of the Act reads as follows:

Jurisdiction - Notwithstanding anything contained elsewhere in this Part or in any other law for the time being in force, where with respect to an arbitration agreement any application under this Part has been made in a court, that court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that court and in no other court

(emphasis supplied)

In view of the import of Section 2(e) read with Section 42 of the Act, it is evident that the arbitral proceedings and all subsequent applications arising out of the agreement should be made in the Court where the proceedings originally commenced and in no other court if the same is the subject matter of the same suit. The proceedings originally commenced in the Court of the learned Additional District and Sessions Judge, and the reference to the arbitration was made by this Court only in appellate proceedings.

In this view of the matter, it is directed that the objections shall be transferred in the Court of the learned Additional District and Sessions Judge on 1st December, 2008 and wherefrom the same may be marked to the appropriate court. The Registry of this Court is directed to ensure that both the cases are transmitted to the Court of the learned Additional and District Sessions Judge on or before 20th November, 2008.

With the above directions, the objections filed by the Appellant to the Award stand transferred to the court of learned Additional District Judge.

We record our appreciation for the assistance rendered to this Court by the learned Amicus Curiae Mr. Arvind Verma, Advocate.