National Company Ltd v. Biseswarilal — 1962 DIGILAW 142 (CAL)

JUDGMENT 1. THIS is an application for an order that Title Suit No. 235 of 1961 in the City Civil Court be stayed under section 34 of the Arbitration Act. The other order prayed for is that the respondent, its agents and servants be restrained from proceeding further or taking any steps in the said title suit pending in the City Civil Court. Counsel for the, petitioner abandoned the application in so far as it related to the prayer for injunction. 2. THE only point in this application is whether there can be an order under section 34 of the Arbitration Act. The suit is pending in the City Civil Court. Counsel for the petitioner contended that the City Civil Court Act shows that the City Civil Court has no jurisdiction in Arbitration Acts and it will appear from the objects and reasons of City Civil Court Act that one of the reasons for that enactment is relief of congestion in the High Court, and therefore this court would exercise jurisdiction in matters which are not specifically conferred upon the City Civil Court by the City Civil Court Act. In other words the contention is that in so far as the Arbitration Act is concerned, since the High Court has jurisdiction in Arbitration matters' this Court will exercise jurisdiction in suits which are pending in the City Civil Court. Counsel for the petitioner referred to some decisions of v. the Supreme Court, Poppatlal Shah v. The State of Madras (1) A. I. R. 1953 S. C. 274 on the observations appearing at p. 276 of the report that all parts of a statute are to be read together, State of W. B. v. Subodh Gopal Bose and Ors., (2) A. I. R. 1954 S. C. 92 that the objects and reasons of a statute can be looked at and Rajkrishna Bose v. Binod Kanungo (3) A. I. R. 1954 S. C. 202 that the court should attempt a harmonious construction of the statute. These principles are well settled. On the other hand it is equally well settled that if the clear words of a statute point to a conclusion or construction, then that construction has to be accepted. These principles are well settled. On the other hand it is equally well settled that if the clear words of a statute point to a conclusion or construction, then that construction has to be accepted. In the present case the language of section 34 of the Arbitration Act lays down in unmistakable terms that the jurisdiction under section 34 is in the court before which the proceedings are pending. As to whether the City Civil Court has or has no jurisdiction under section 34 of the Arbitration Act, counsel for the respondent contended that the question was not free from difficulty and I do not express any views on the question. In Kamal Brothers and Ors. v. Hansraj Kapur, (4) A. I. R. 1959 Cal. 583 an application was made for an injunction restraining the respondent from proceeding with a suit pending in the City Civil Court. In Kamal Brothers' case the suit was instituted in the City Civil Court and an application was made in this court for stay of the suit. The respondent there had earlier filed a suit in the High Court which was stayed under section 34. Pursuant to the order the disputes were referred to arbitration and a counsel of this court was appointed as an Umpire. During the pendency of the proceedings before the Umpire the respondent instituted the suit in the City Civil Court. In the facts and circumstances of this case it was held that the arbitration agreement had not been superseded and on the contrary by an order of this court the Umpire was proceeding with the reference and the arbitration proceedings were prior in point of time and the suit in the City Civil Court was instituted to take out the question of the tenancy right being adjudicated by the Umpire. Under those circumstances it was held that a case for injunction for a limited period had been made out. There it was ordered that in the interest of justice the proper order in that was to issue an injunction from proceeding with the suit in the City Civil Court for a period of four months. The peculiar circumstances and facts of that case are entirely inappropriate to the present case. There it was ordered that in the interest of justice the proper order in that was to issue an injunction from proceeding with the suit in the City Civil Court for a period of four months. The peculiar circumstances and facts of that case are entirely inappropriate to the present case. Furthermore, as counsel for the respondent in my view rightly contended, Kamal Brothers' case is not an authority for the proposition that the suit in the City Civil Court can be stayed under section 34. In the case of Radhakissen Dhannka v. Bombay C. Ltd., (5) I. L. R. 56 Cal. 755 Lort Williams, J. held that the small Causes Court has no jurisdiction to grant a stay of suit under the provisions of section 19 of the then Arbitration Act. Under the old Act the language of section 19 corresponding to the present section 34 was different. Under section 19 of the old Arbitration Act where a party to a submission commenced legal proceedings, any party to such proceedings could apply to the court to stay the proceedings. The court in the old Act was to mean in the Presidency Towns the High Court. Therefore under the old Act the High Court was the proper court for exercising power of stay under the Arbitration though the suit was instituted in the Small Causes Court, Calcutta. The language of section 34 is entirely different and to my mind it is indisputable that the court where the proceeding is instituted is the only court to exercise power under section 34. If section 34 does not apply to the City Civil Court I can not interpret section 34 in the manner suggested, for that would be engrafting on the statute words entirely opposed to the words used in the statute. The question came up for consideration in another decision of this court: Basanti Cotton Mills Ltd. v. Dhingra Bros., (6) I. L. R. 1950 (I) Cal 546. It was held there that on the language of the present section 34 the conclusion which had been reached in Dhanuka's case (5) could not apply. 3. IT is therefore manifest that so far as the High Court is concerned, unless the suit is pending in this Court provisions of section 34 will not apply. It was held there that on the language of the present section 34 the conclusion which had been reached in Dhanuka's case (5) could not apply. 3. IT is therefore manifest that so far as the High Court is concerned, unless the suit is pending in this Court provisions of section 34 will not apply. I have already indicated that the question as to whether section 34 of the Arbitration Act applies in the City Civil Court is left open at the instance of counsel. 4. COUNSEL for the petitioner contended that since the suit was instituted in the City Civil Court if a notice under section 35 of the Arbitration act were delivered before the Arbitrators, the arbitration would not be proceeded with. Sections 34 and 35 are complementary. If section 34 applies section 35 will apply. Conversely, if section 34 does not apply section 35 will not apply. Furthermore, counsel for the respondent in my view rightly contended on the authority of the decision in Rambilas Nandlal v. Imperial oil Mills Ltd., (7) A. I. R. 1960 cal. 304 in support of the proposition that an award is not rendered invalid merely by a notice under section 35 unless the legal proceedings commenced be upon either the whole or part of the subject matter of the reference. Validity or invalidity of the contract, it was held there, was not and could not be referred to arbitration, for the arbitrators had no power and authority to decide upon the question of their own jurisdiction. Therefore if the legal proceedings commenced in a court touch the validity or invalidity of the contract, the subject matter of the legal proceedings could not be one which could ordinarily be stayed under section 34 of the Arbitration Act and section 35 of the Arbitration Act which presupposes a legal proceeding which is capable of being stayed by the court under section 34 equally contemplates that if the legal proceedings do not refer to the subject matter of the reference a notice under section 35 can not obviously render arbitration proceedings ineffective or nugatory. Furthermore, counsel for the respondent contended that there was an injunction granted by the City Civil Court and unless the petitioner could vacate the order of injunction the petitioner could not proceed with the arbitration. Furthermore, counsel for the respondent contended that there was an injunction granted by the City Civil Court and unless the petitioner could vacate the order of injunction the petitioner could not proceed with the arbitration. Therefore the contention of the respondent that a notice under section 35 would render the arbitration ineffective becomes academic unless and until the order for injunction be removed. I am not impressed by the contention of counsel for the petitioner that the arbitration proceedings may be rendered ineffective because counsel for the respondent in my view rightly contended that notice under section 35 will not render the arbitration proceedings invalid because 01 the nature of the suit and secondly as long as the order for injunction lasts a no ace under section 35 is irrelevant. Counsel for the petitioner next contended that under section 21 of the Code of Civil Procedure or under section 9 of the City Civil Court Act I should transfer the suit. The contentions were that either I should do it suo motu or I should do it in the facts and circumstances of the case. I do not see any reason as to why the court suo motu would have to transfer the suit. It is urged that the petitioner will be without any remedy. I cannot accept that contention. The petitioner has various remedies. It is contended that it will be just. I am unable to accept that contention. It will be equally just as counsel for the respondent contended not to transfer the suit, and it might cause injustice to the parties. Furthermore, the language of section 9 of the City Civil Court Act is that a suit is transferred for the purpose of trial. Counsel for the petitioner relied on the decision in Nrisingha Charan Nandy Choudhury v. Rajniti Prasad Singh and Ors., (8) Law Reports 63, I. A. 311 on the observations at p. 324 of the report that the word "trial" does not include jurisdiction to take cognizance of the suit, but includes all the essential matters governing the hearing of a cause including the preliminary matter of the competence of the court to entertain it. If a transfer is sought for trial of the suit here there is no reason for that course of action and no one asks for it. If a transfer is sought for trial of the suit here there is no reason for that course of action and no one asks for it. If on the other hand a transfer is contended for the purpose of bringing the suit here and then applying powers under section 34 of the Arbitration Act such an order will be an indirect attempt to achieve what is directly forbidden by the language of section 34, furthermore this will be a transfer not for trial but for stay of suit and in my opinion that is not the scope and intent of section 9 of the City Civil Court Act or section 24 of the Code. 5. COUNSEL for the respondent also contended that section 24 of the Code of Civil Procedure was not applicable inasmuch as the supervisory jurisdiction of the court was neither attracted nor was there any application in that behalf. Furthermore, counsel for the respondent in my view rightly contended that in the absence of a properly constituted application I should not exercise supervisory jurisdiction. No special reason has been assigned as to why I should exercise supervisory jurisdiction excepting the reason that the petitioner wants an order under section 34. Counsel for the petitioner also relied on the decision reported in (9) A. I. R. (1986) Mad. 55 in support of his contention that the court need not give any reasons for suo motu exercise of jurisdiction. I am not inclined to exercise such power in the present case even if I am called to do so without giving any reasons. Furthermore, such an exercise of power will be in my view abusing the power which this court possesses, for in my view the strength of the power lies in the restraint of its use. I am, therefore, of opinion that the petitioner is not entitled to any order as asked for. This petition is dismissed with costs.