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Judgment
1] Rule. Rule made returnable forthwith. Heard finally, at the stage of admission itself, by consent of Mr.Ganbavale, learned counsel for the Petitioner, Mr.Kankal, A.G.P. for Respondent Nos.1 and Mr.Singh, learned counsel for Respondent No.5.
2] By this Writ Pe(cid:49)(cid:49)on, filed under Ar(cid:49)cle 227 of the Cons(cid:49)tu(cid:49)on of India, the Pe(cid:49)(cid:49)oner is challenging the order dated 30th November 2017 passed by the Principal District Judge, Satara, below the application at Exhibit-44 in Arbitration Application No. 235 of 2016.
3] The applica(cid:49)on at Exhibit-44 was filed by Respondent Nos.2 to 5, who are opponents before the District Court, under Sec(cid:49)on 15 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (hereina(cid:59)er referred as “Commercial Courts Act”), seeking transfer of 'Arbitra(cid:49)on Pe(cid:49)(cid:49)on' to the “Commercial Court” cons(cid:49)tuted under Sec(cid:49)on 3 of the Commercial Courts Act.
4] The undisputed facts are that, the Pe(cid:49)(cid:49)oner-Company is a successful bidder of the tender process to whom the permission of the project, namely, 'Tarali Hydro Electric Project', has been issued on 1st April 2011. Accordingly, Hydro Project Development Agreement (for short, “HPD Agreement”) was executed between the concerned par(cid:49)es. As per the grievance of the Respondents, despite the sincere efforts and the (cid:49)me bound ac(cid:49)on on the part of the Respondents to materialize the terms and condi(cid:49)ons of the HPD Agreement, the Pe(cid:49)(cid:49)oner has never responded and discharged its responsibilities.
Hence, the Respondents were constrained to issue the no(cid:49)ce dated 2nd November 2016 informing the Pe(cid:49)(cid:49)oner that, if the Pe(cid:49)(cid:49)oner fail to submit the required clearance and fail to deposit the upfront and threshold premiums within 30 days, the Agreement shall be terminated and performance security shall be forfeited.
5] The Pe(cid:49)(cid:49)oner therefore approached the District Court, Satara, under Sec(cid:49)on 9 of the Arbitra(cid:49)on Act and Concilia(cid:49)on Act, 1996 (for short, “Arbitration Act”) seeking the relief of interim injunction restraining the Respondents from terminating the said Agreement.
6] On appearance of the Respondents in the said application, the Respondents had filed this application at Exhibit-44 contending inter-alia that this arbitral dispute between the par(cid:49)es relates to 'commercial dispute' and the subject ma(cid:72)er of the dispute being above the 'specified value', the Arbitra(cid:49)on Applica(cid:49)on is required to be transferred to the specially cons(cid:49)tuted Commercial Court as per Sec(cid:49)on 15 of the Commercial Courts Act.
7] The Pe(cid:49)(cid:49)oner resisted this applica(cid:49)on contending inter- alia that the relief which the Pe(cid:49)(cid:49)oner is claiming is simpliciter of injunc(cid:49)on and no par(cid:49)cular relief is asked, which can be of a 'specified value' as contemplated under Sec(cid:49)on 12 of the Commercial Courts Act; therefore the Civil Court has the jurisdic(cid:49)on to decide the Arbitra(cid:49)on Applica(cid:49)on and it was not at all necessary to transfer the same to the Commercial Court.
8] The trial Court has, vide its impugned order held that, as the dispute pertains to the transac(cid:49)on of commercial nature and it is above the 'specified value', it needs to be tried by the Commercial Court, and accordingly, passed the order of transferring the Arbitra(cid:49)on Applica(cid:49)on to the Commercial Court, namely, District Judge-1, Satara.
9] On the submissions advanced at bar by learned counsel for the par(cid:49)es in this Writ Pe(cid:49)(cid:49)on, some undisputed facts which are to the effect are that the Court of District Judge-1, Satara, is cons(cid:49)tuted as Commercial Court under Sec(cid:49)on 3 of the Commercial Courts Act for judicial District of Satara. Whereas, the Court of Principal District Judge, where this Arbitra(cid:49)on Applica(cid:49)on is filed, is not a Commercial Court; but the “Court” under Part-I of the Arbitra(cid:49)on Act established for the purpose of Arbitra(cid:49)on and Concilia(cid:49)on Act, 1996. The par(cid:49)es have not disputed that the es(cid:49)mated amount of the tender is more than Rs.1 crore. The ques(cid:49)on is whether this amount of the Agreement, in respect of which the applica(cid:49)on for injunc(cid:49)on under Sec(cid:49)on 9 of the Arbitra(cid:49)on Act is filed, is to be considered as the specified value of the subject ma(cid:72)er for transferring the Arbitra(cid:49)on Applica(cid:49)on to the Commercial Court? Sec(cid:49)on 10 of Commercial Courts Act clearly provides for exclusive jurisdic(cid:49)on of the Commercial Courts in respect of Arbitra(cid:49)on ma(cid:72)ers, where the subject ma(cid:72)er of an arbitra(cid:49)on is a Commercial dispute of a 'specified value'.
10] Section 10 sub-clause 3 of the Commercial Courts Act can be reproduced for ready reference as under:
“10. Jurisdic(cid:49)on in respect of arbitra(cid:49)on ma(cid:72)ers — Where the subject-ma(cid:72)er of an arbitra(cid:49)on is a commercial dispute of a Specified Value and-
(1) … … …
(2) … … …
(3) If such arbitra(cid:49)on is other than an interna(cid:49)onal commercial arbitra(cid:49)on, all applica(cid:49)ons or appeals arising out of such arbitra(cid:49)on under the provisions of the Arbitra(cid:49)on and Concilia(cid:49)on Act, 1996 (26 of 1996) that would ordinarily lie before any principal civil court of original jurisdic(cid:49)on in a district (not being a High Court) shall be filed in, and heard and disposed of by the Commercial Court exercising territorial jurisdiction over such arbitration where such Commercial Court has been constituted.”
11] Sec(cid:49)on 15 of the Commercial Courts Act further provides for transfer of pending suits and applica(cid:49)ons, including applica(cid:49)ons under the Arbitration and Conciliation Act, 1996, relating to Commercial disputes of a 'specified value' to the Commercial Court.
Relevant sub-clause of Section 15(2) reads as follows:
“15. Transfer of pending cases -
(1) … …...
(2) All suits and applica(cid:49)ons, including applica(cid:49)ons under the Arbitra(cid:49)on and Concilia(cid:49)on Act, 1996 (26 of 1996), rela(cid:49)ng to a commercial dispute of a Specified Value pending in any civil court in any district or area in respect of which a Commercial Court has been cons(cid:49)tuted, shall be transferred to such Commercial Court:
Provided that no suit or applica(cid:49)on where the final judgment has been reserved by the Court prior to the cons(cid:49)tu(cid:49)on of the Commercial Division or the Commercial Court shall be transferred either under sub-section (1) or subsection (2).”
12] Sec(cid:49)on 12 of the Act is material for the purpose of deciding this Writ Pe(cid:49)(cid:49)on, as it pertains to 'determina(cid:49)on of specified value'. The definition of the 'specified value' as given in Section 2 (i) is also relevant and it reads as follows:
“Specified Value”, in rela(cid:49)on to a commercial dispute, shall mean the value of the subject ma(cid:72)er in respect of a suit as determined in accordance with sec(cid:49)on 12 which shall not be less than one crore rupees or such higher value, as may be no(cid:49)fied by the Central Government.”
13] Section 12 of the Act which lays down 'determination of specified value' reads as follows:
“12. Determina(cid:49)on of Specified Value — (1) The Specified Value of the subject-ma(cid:72)er of the commercial dispute in a suit, appeal or application shall be determined in the following manner:-
(a) where the relief sought in a suit or applica(cid:49)on is for recovery of money, the money sought to be recovered in the suit or applica(cid:49)on inclusive of interest, if any, computed upto the date of filing of the suit or applica(cid:49)on, as the case may be, shall be taken into account for determining such Specified Value;
(b) where the relief sought in a suit, appeal or applica(cid:49)on relates to movable property or to a right therein, the market value of the movable property as on the date of filing of the suit, appeal or applica(cid:49)on, as the case may be, shall be taken into account for determining such Specified Value;
(c) where the relief sought in a suit, appeal or applica(cid:49)on relates to immovable property or to a right therein, the market value of the immovable property, as on the date of filing of the suit, appeal or applica(cid:49)on, as the case may be, shall be taken into account for determining Specified Value;
(d) where the relief sought in a suit, appeal or applica(cid:49)on relates to any other intangible right, the market value of the said rights as es(cid:49)mated by the plaintiff shall be taken into account for determining Specified Value; and
(e) where the counter-claim is raised in any suit, appeal or applica(cid:49)on, the value of the subject ma(cid:72)er of the commercial dispute in such counter-claim as on the date of the counter-claim shall be taken into account.
(2) The aggregate value of the claim and counter-claim, if any as set out in the statement of claim and the counter-claim, if any, in an arbitra(cid:49)on of a commercial dispute shall be the basis for determining whether such arbitra(cid:49)on is subject to the jurisdic(cid:49)on of a Commercial Division, Commercial Appellate Division or Commercial Court, as the case may.
(3) No appeal or civil revision applica(cid:49)on under sec(cid:49)on 115 of the Code of Civil Procedure, 1908 (5 of 1908), as the case may, shall lie from an order of a Commercial Division or Commercial Court finding that it has jurisdiction to hear a commercial dispute under this Act.”
14] Section 21of the Act then gives the Act an overriding effect and reads thus:
“21. Act to have overriding effect — Save as otherwise provided, the provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the (cid:49)me being in force or in any instrument having effect by virtue of any law for the time being in force other than this Act.”
15] Thus, if Sec(cid:49)on 10 of the Act which pertains to 'jurisdic(cid:49)on in respect of arbitra(cid:49)on ma(cid:72)ers', Sec(cid:49)on 12 of the Act which pertains to 'determina(cid:49)on of specified value', and, Sec(cid:49)on 2(i) of the Act which defines 'specified value', coupled with Sec(cid:49)on 15(2) of the Act are read together, then there remains no spec of doubt that, where the subject ma(cid:72)er of arbitra(cid:49)on is a commercial dispute of a 'specified value', which is not less than Rs.1 crore, then such ma(cid:72)er needs to be transferred and decided by the Commercial Court alone, wherever it is established. The use of the words “all applica(cid:49)ons or appeals arising out of arbitra(cid:49)on under the provisions of Arbitra(cid:49)on and Concilia(cid:49)on Act” in Sec(cid:49)on 10(3) of the Commercial Courts Act makes the inten(cid:49)on of the legislature very clear that such ma(cid:72)ers, which will ordinarily lie before any Principal Civil Court of original jurisdic(cid:49)on shall be filed in and heard and disposed of by the Commercial Court, where such Commercial Court has been established. This sub-sec(cid:49)on 10(3) of the Act is all encompassing and does not exclude from its purview even the applica(cid:49)on under Sec(cid:49)on 9 of the Arbitra(cid:49)on Act in whichever, words it is dra(cid:59)ed and whatever relief, final or interim, claimed therein, whether in the form of injunction or otherwise.
16] Admi(cid:72)edly, in the present case, the dispute pertains to arbitra(cid:49)on ma(cid:72)er. The Pe(cid:49)(cid:49)oner is seeking the relief of injunc(cid:49)on not under any other law but under Sec(cid:49)on 9 of the Arbitra(cid:49)on Act, the subject ma(cid:72)er of the arbitra(cid:49)on is admi(cid:72)edly not less than Rs.1 crore and therefore, the subject matter of arbitration being a 'commercial dispute' of a 'specified value', it has to be held that, Commercial Court will alone have the jurisdiction to entertain this arbitration application.
17] If the submissions advanced by learned counsel for the Pe(cid:49)(cid:49)oner that this being an applica(cid:49)on simpliciter for injunc(cid:49)on, Civil Court alone will have the jurisdic(cid:49)on to entertain it, is to be accepted, then the very object of enac(cid:49)ng Sec(cid:49)on 10(3) and of establishing the Commercial Courts will be frustrated. As a ma(cid:72)er of fact the ingenuity of the legal profession is such that any dispute can be brought under the wide umbrella of the injunc(cid:49)on suit with the claim that the relief claimed is not suscep(cid:49)ble to monetary value. However, the Court has to see the real nature of the relief, which is sought and decide the jurisdiction of the Court accordingly.
18] Here, in the case, the real nature of the dispute is the arbitra(cid:49)on agreement, the subject ma(cid:72)er of which is above Rs.1 crore; it is a dispute of commercial nature. Hence, even if, the relief claimed is simpliciter for injunc(cid:49)on, as the subject ma(cid:72)er of dispute falls within the jurisdic(cid:49)on of Commercial Court, in view of provisions of Sec(cid:49)on 10(3) of the Commercial Courts Act, the learned Principal District Judge, Satara, has rightly transferred the arbitration application to the Commercial Court.
19] The impugned order therefore passed by the District Court being just, legal and correct; no interference is warranted therein.
20] Writ Petition hence stands dismissed.
21] Rule discharged.