Western Coalfields Limited, Nagpur and another v. V. P. groverand Co. Jabalpur.
1980-12-19
M.S.JAMDAR
body1980
DigiLaw.ai
JUDGMENT - Jamdar M.S. J.-This revisionl”application raises two interesting questions; one relating to the jurisdiction of the Joint Judge to exercise the power of transfer conferred on the District Court by section 24 of the Code of Civil Procedure, and second r,;lating to the interpretation of section 31(4) of the Arbitration Act 2. The non-applicant M /s V. P. Grover and Company entered into an agreement with revision applicant No. 1 M/s Western Coalfields Limited for construction of road in Bfsrampur of Surguja district in Madhya Pradesh. The contract between the parties contained an arbitration clause, which, inter alia, provided that any dispute or question of controversy between the parties shall be referred to an Arbitrator nominated by the Managing Director of the Coal Mines Authority Limited, Westf'rn Division, and the award of such Arbitrator shall be final and binding on the parties. As the non-applicant did not complete the work as agreed, and comply with the provisions of the agreement, the contract was terminated on 30th April 1976. The non-applicant Company, therefore, filed an application under section 8 read with section 20 of the Arbitration Act in the Court of the Civil Judge, Senior Division, Nagpur, for calling upon the revision applicants to file the arbitration agreement in Court and requesting the Court to appoint an Arbitrator, if the revision applicants fail to do so. This application was numbered as Civil Suit No. 160 of 1977. This suit was assigned by the Civil Judge, Senior Division, Nagpur, to the Joint Civil Judge, Senior Division, Nagpur, and is pending on his file. 2A. By the order dated 17th April, 1978, the Joint Civil Judge, Senior Division, appointed Shri N. V. Shrinivas of Jabalpur as an Arbitrator. The Arbitrator passed an Award on 22nd January 1979 and handed over the same to the counsel appearing for the parties for filing it in Court It appears that though Civil Suit No. 160 of 1977 was not disposed of, the record and proceedings thereof were sent to the Record Room and on that ground the Reader of the Joint Civil Judge, Senior Division, Nagpur, refused to accept the Award. The Award, therefore, came to be filed in the Court of the Civil Judge, Senior Division, Nagpur, on 1st September 1979. It was registered as a separate suit and was numbered as Civil Suit No. 36 of 1979.
The Award, therefore, came to be filed in the Court of the Civil Judge, Senior Division, Nagpur, on 1st September 1979. It was registered as a separate suit and was numbered as Civil Suit No. 36 of 1979. The Civil Judge, Senior Division, Nagpur, on whose file this suit was placed, issued notices to the respective parties. The non-applicant, therefore, filed Misc. Civil Application No. 137 of 1979 under section 24 read with section 151 of the Code of Civil Procedure in the District Court, Nagpur, for transfer of Civil Suit No. 36 of 1979 from the file of the Civil Judge, Senior Division, Nagpur, to the file of the Joint Civil Judge, Senior Division, Nagpur, as a part and parcel of Civil Suit No. 160 of 1977. The application was opposed on the grounds that the Joint Judge has no jurisdiction under section 24 of the Code of Civil Procedure to transfer proceedings und,er the Indian Arbitration Act from one Court to another, and that Civil Suit No. 36 of 1979 cannot be transferred because the Court entertaining it, viz., Civil Judge, Senior Division, had no jurisdiction to do so. The learned Joint Judge, Nagpur, to whom the transfer application was assigned by the District Judge, overruled the objections and allowed the transfer application, directing that Civil Suit No. 36 of 1979 stands transferred to the Court of the Joint Civil Judge, Senior Division, Nagpur, as part and parcel of Civil Suit No. 160 of 1977. He, however, left open the question as to from what date the limitation for filing objection to the Award would start and directed that th~question would be decided by the Joint Civil Judge Senior Division, Nagpur. It is this order which is challenged by the revision applicant. 3. Shri Nayar, learned advocate for the revr~on applicants, contended that the Joint Judge cannot exercise the power conferred on the District.464 Court by section 24 of the Cede of Civil Procedure; that in view of section 31 read with section 41 of the Arbitration Act, provisions o( section 24 of the Code of Civil Procedure are not applicable to a proceeding under the Arbitration Act; and that the direction that the proceedings of Civil Suit No. 36 of 1979 shall be transferred as part and parcel of Civil Suit No. 160 of 1977, is without jurisdiction. 4.
4. Sub-section (1) of section 24 of the Code of Civil Procedure em-powers the District Court to withdraw any suit, appeal or other proceeding pending in any Court, subordinate to it, and try or dispose of the same, or transfer the same for trial or disposal to any Court subordinate to it and competent to try or dispose of the same, or retransfer the same for trial and disposal to the Court from which it was withdrawn. Clause (a) of sub-section (3) of section 24 lays down that for the purposes of section 24, the Courts of Additional or Assistant Judge shall be deemed to be subordinate to the District Court. Shri Nayar submitted that the phrase “District Court” used in section 24 means the Presiding Officer of a Principal Civil Court of original jurisdiction, and hence a Joint Judge, though having concurrent jurisdiction of the District Judge, cannot exercise the powers conferred by the said section. He also urged that as Additional Judges and Assistant Judge are considered to be subordinate to the District Judge for the purposes of section 24, these officers cannot exercise the powers under section 24. It is difficult to accept these submissions. It appears that while making the first submission Shri Nayar is confusing the phrases “District Court” and “'District Judge”. Reading sub-sections (4) and (8) of section 2 of the Code of Civil Procedure, it is clear that District Court means principal Civil Court of original jurisdiction, while District Judge means Presiding Officer of such a Court. As the Joint Judge is not a Presiding Officer of the District Court, he cannot be styled as District Judge. But he certainly is a Judge of the District Court. As rightly urged by Shri Joharapurkar, by virtue of section 12 of the Bombay Civil Courts Act, a Joint Judge is invested with co-extensive powers and concurrent jurisdiction with the District Judge except that he shall not keep the files of civil suit and shall transact only such civil business as he may receive from the District Judge, or as may have been referred to the Joint Judge by order of the High Court.
Hence when a matter is assigned by r.the District Judge to the Joint Judge, the latter can exercise the same powers which the District Judge can exercise and, therefore, in respect of the transfer application assigned to Joint Judge by the District Judge, the former would be District Court within the meaning of section 24 of the Code of Civil Procedure and would be competent to pass all the orders conteplplated by the said provision; 5. The next contention urged by Shri Nayar is that section 24 of the Code of Civil Procedure is inconsistent with section 31 of the Arbitration Act and hence in view of section 41 of the Arbitration Act, provisions of section 24 are not applicable to the proceedings under the Arbitration Act. Section 41 of the Arbitration Act lays down as follows: “Subject to the provisions of this Act and of rules,made thereunder- (a) the provisions of the Code of Civil Procedure, 1908, shall apply to all proceedings before the Court and to all appeals, under this Act; and (b) the Court shall have, for the purpose of, and in relation to, arbitration proceedings, the same power of making orders in respect of any of the matters set out in the second Schedule as it has for the purpose of, and in reJation to, any proceedings before the Court.” Section 44 of the Arbitration Act empowers the High Court to make rules consistent with the Act as to- “(a) the filing of awards and all proceedings consequent thereon or incidental thereto; (aa) the fees and other charges payable to an arbitrator or an umpire; (b) the filing and hearing of special cases and all proceedings conse-quent thereon or incidental thereto; (c) the staying of any suit or proceedings in contravention of an arbitration agreement; (d) the forms to be used for the purpose of this Act; (e) generally, all proceedings in Court under this Act.” There is nothing inconsistent with section 24 of the Code of Civil Procedure in the rules framed by the Bombay High Court on the Appellate side in exercise of the powers conferred by section 24 of the Arbitration Act. 5A.
5A. Section 31 of the Arbitration Act, which deals with jurisdiction of the Court in the matter of arbitration proceedings, reads as follows: “(1) Subject to the provisions of this Act, an award may be filed in any Court having jurisdiction in the matter to which the reference relates. (2) Notwithstanding anything contained in any other law for the time being in force and save as otherwise provided in this Act, all questions regarding the validity, effect or existence of an award or an arbitration agreement between the parties to the agreement or persons claiming under them Ehall be decided by the Court in which the award under the agreement has been, or may be, filed, and by no other Court. (3) All applications regarding the conduct of arbitration proceedings or otherwise arising out of such proceedings shall be made to the Court where the award has been, or may be filed, and to no other Court. (4) Notwithstanding anything contained elsewhere in this Act or in any other law for the time being in force, where in any reference, any application under this Act has been made in a Court competent to enter-tain it, that Court a~one shall have jurisdiction over the arbitration pro-ceedings and all subsequent applications arising out of that reference and the arbitration proceedings shall be made in that Court and in no other Court.” Shri Nayar laid special emphasis on sub-section (4) in support of the proposition that the Court in which application under section 20 is filed alone shall have jurisdiction in all matters arising from that application and hence this provision impliedly excludes the operation of section 24 of the Code of Civil Procedure. He also placed reliance on the decision of the Nagpur High Court in tl).e case of Nathulal Khunilal v. Beharilal Bisheshwerlatl.
He also placed reliance on the decision of the Nagpur High Court in tl).e case of Nathulal Khunilal v. Beharilal Bisheshwerlatl. The relevant observations on which reliance is placed appear in para 14 of the judgment and read as follows: “There can be no doubt that Legislature intended to make only one Court as the venue for all matters connected with an arbitration agreement or award and also to make 'applications' (not 'suits') as the vehicle to approach that Court.” It is, however, pertinent to note that the question before the learned Judges of the Nagpur High Court was not whether a proceeding under the Arbitration Act pending in one Civil Court could be transferred by the District Judge under section 24 of the Code of Civil Procedure to some other Court of competent jurisdiction. The question for consideration was whether a suit is maintainable in respect of a claim which is referred to arbitration and which resulted in an award. The observations were made only for the purposes of emphasising that no suit was maintainable when a proceeding relating to arbitration agreement or award is pending in a Court. Hence the proposition laid down by the learned Judges in Nathulal's case cannot be invoked to support the contention that section 24 of the Code of Civil Procedure is not applicable to arbitration proceedings. Reliance is also placed on the decision of the Supreme Court in (Kumbha Mawji v. Dominion of India)2 in which their Lordships explained the Scheme of section 31 while considering the question ~hether sub-section (4) of section 31 applies also to a case where an application is made after the comp!etion of arbitration and making of an award.
Reliance is also placed on the decision of the Supreme Court in (Kumbha Mawji v. Dominion of India)2 in which their Lordships explained the Scheme of section 31 while considering the question ~hether sub-section (4) of section 31 applies also to a case where an application is made after the comp!etion of arbitration and making of an award. Their Lordships observed as follows in para 13 of the judgment: “Thus it will be seen on a comprehensive view of section 31 that while the first sub-section determines the jurisdiction of the Court in which an award can be filed, sub-sections (2), (3) and (4) are intended to make that jurisdiction effective in three different ways, (1) by vesting in one Court the authority to deal with all questions regarding the validity, effect or existence of an award or an arbitration agreement, (2) by casting on the persons concerned the obligation to file all applications regarding the conduct of arbi.tration proceedings or otherwise arising out of such proceedings in one Court, and (3) by vesting exclusive jurisdiction in the Court in which the first application relating to the matter is filed. The context, therefore, of sub-section (4) would seem to indicate that the sub-section was not meant to be confined to applications made during the pendency of an arbitration. The necessity for clothing a single Court with effective and exclusive jurisdiction, and to bring about by the combined operaiion of the::.e three provisions the avoidance of conflict and scramble is equally essential whether the question arises during the pendency of the arbitration or after the arbitration is completed or before thee arbitration is commenced. There is no conceivable reason why the Legislature should have intended to confine the operation of sub-section (4) only to applications made during the pendenGY of an arbitration, if as is contended, the phrase “in any reference” is to be taken as meaning “in the course of a reference”. This decision also has no bearing on the dispute in this case, because, Their Lordships were not required to consider the competence of a District Judge to transfer arbitration proceedings pending in one Court to another Court of competent jurisdiction. 6.
This decision also has no bearing on the dispute in this case, because, Their Lordships were not required to consider the competence of a District Judge to transfer arbitration proceedings pending in one Court to another Court of competent jurisdiction. 6. The question whether the expression “Court” used in section 31 includes the Court to which the suit in which a reference is made to arbitration or any other proceeding under the Arbitration Act may have been transferred under section 24 of the Code of Civil Procedure was considered in (Nand Kishore and others v. Mool Chandra and others)3, (Union of India v. Rup Kishore and another)4 and Prof Bhagwandas Bhargave v. Durga Prosad Rastogi5. In Nand Kishore's case, the question for consideration of the learned Judge of the AUahabad High Court was whether sect ion 31 prevents the District Judge from transferring an arbitration proceeding from one Court to another under section 24 of the Code of Civil Procedure or section 13 of the Bengal, Agra and Assam Civil Courts Act. In answering this question in the negative, the learned Judge observed that the idea underlying section 31 of the Arbitration Act is that questions relating to validity and existence of an award ought not to be agitated in independent or coUateral proceedings and that this provision does not prevent a District Judge from exercising the power of transfer under section 24 of the Code of Civil Procedure or under section 13 of the Bengal, Agra and Assam Civil Courts Act. The same learned Judge reiterated this view in R'up Kishore's- case (citation supra). The learned Judge also held that there is no indication in section 31 or section 41 of the Arbitration Act that section 24 of the Code of Civil Procedure should not apply to proceedings under the Arbitration Act, an,d held that the expres~ion 'that Court' appearing in section 31(4) should be ]iberally construed so as to include any Court to which proceedings have been va]idly transferred under section 24 of the Code of Civil Procedure. The learned Judge after explaining the decision of the Supreme Court in Khumba Mawji v. Dominion of India explained the necessity of liberal construction (If the phrase 'that Court' appearing in sub-section (4) of section 31 of the Arbitration Act, as follows: “Sub-section (4) of section 31 requires that a single Court should deal with arbitration proceedings at different stages.
The learned Judge after explaining the decision of the Supreme Court in Khumba Mawji v. Dominion of India explained the necessity of liberal construction (If the phrase 'that Court' appearing in sub-section (4) of section 31 of the Arbitration Act, as follows: “Sub-section (4) of section 31 requires that a single Court should deal with arbitration proceedings at different stages. If the strict interpretation suggested by Mr. Sanyal is accepted, serious difficulties would arise in practice. Suppose, an additional Court dealing with a case under the Act is abolished; or the Presiding Officer ota certain Court becomes personally disqualified on account of bias or some other reason. It would be impossible to conclude the proceedings under the Act. I do not think that the Legislature intended that section 3](4) should have such a curious result. Such a result can be avoided by giving a libera] interpretation to sub-section (4) of section 31 of the Act. On this liberal interprelation, the expression “that Court” would include any Court to which proceedings have been validly transferred under the provisions of section 24, Civil Procedure Code. There is no clear indication either in section 31 or sec-tion 41 of the Act that section 24 of the Code of Civil Procedure should not apply to proceedings under the Act.” 7. Fo1lowing the decision of the Supreme Court in A.I.R. 1953 S.C. 313 and the above-mentioned two decisions of Allahabad High Court, a single Judge of the Rajasthan High Court has also taken the same view in the case of Prof. Bhagwandas Bhargave (dtat ion supra). I am in respectful agreement with the view expressed by Allahabad and Ralasthan High Courts, that view being based on the view taken by the Supreme Court in respect of the purpose behind section 31 of the Arbitration Act. The Joint Judge exercising powers of the District Court under section 24 of the Code of Civil Procedure, therefore, was competent to pass the impugned order. 7A. The most material question, however, is whether the direction that Civil Suit No. 36 of 1979 stands transferred to the Court of the Joint Civil Judge, Senior Division, Nagpur, as a part ar.d parcel of Civil Suit No. 160 of 1977, is valid. If this direction is held 10 be valid, then the logical result that would fo1low would be that the objections filed.
If this direction is held 10 be valid, then the logical result that would fo1low would be that the objections filed. by the revision applicants to the award would be barred by limitation, because admittedly the objections were not filed within 30 days from the date on which the award was filed in the Court of the Civil Judge. Senior Division, Nagpur. In view of the direction, the question of limitation in respect of filing of objections does not survive and hence the further direction given by the learned Joint Judge to the Joint Civil Judge, Senior Division, Nagpur, to decide the question of limitation is superfluous. The crux of the matter is whether the award was filed in proper Court and whether the proceeding which was treated as a new proceeding and separately numbered as Civil Suit No. 136 of 1979 could be treated as a part and parcel of Civil Suit No. 160 of 1977. 8. As mentioned above, the application under section 20 of the Arbitra-tion Act filed by the non-applicant was numbered as Civil Suit No. 160 of 1977 and came to be assigned to the Joint Civil Judge, Senior Division, Nagpur, who made the order making a reference to the Arbitrator and appointed the Arbitrator. It is an admitted position that Civil Suit No. 160 of 1977 is not disposed of and that 'it continues to be on the file of the Joint Civil Judge, Senior Division, Nagpur, who passed the order of reference. Admittedly the award was not filed in the Court of the Joint Civil Judge, Senior Division, Nagpur, but on refusal by the Reader of that Court to accept the award as the record and proceedings were sent to the record room, it was separately numbered ans! was placed on the 'file of the Civil Judge, Senior Division, Nagpur. Shri Nayar, relying on section 31{4) of the Arbitration Act, emphatically contended that the only Court competent to deal with the matter was the Joint Civil Judge, Senior Division, Nagpur, and no other Court, and hence Civil 'Suit No. 36 of 1979 on the file of the Civil Judge, Senior Division commenced on filing of the award was not comp~tent and cannot be treated as a part and parcel of the proceeding pending on the file of the Joint Civil Judge, Senior Division, Nagpur. 9.
9. Shri Joharapurkar, learned advocate for the non-applicant, urged that the Court of the Civil Judge, Senior Division and Joint Civil Judge, Senior Division are not different Courts. Both the Courts have co-ordinate jurisdiction are constituted at the same place and the Joint Civil Judge, Senior Division, is the Judge of the Court of which the Civil Judge, Senior Division, is the Presiding Officer. In support of this contention, he placed reliance on the decision of this Court in (Varsha Boilers ht. Ltd. v. Yeotmal District Co-operatire Cotton Seed Processing and Allied Industries Factory Ltd). 6. In that case, the limited question before the learned Judge was whether the Civil Judge, Senior Division, while dealing with a civil suit for recovery of Rs. 10,000 could entertain defendant's counter-claim for Rs. 19,000. In considering this question, the learned Judge discussed the Scheme of the Bombay Civil Courts Act relating to Civil Judges and made an observation relying on the decision of this Court in (L. S. Sherlekar v. D. L. Agarwal)7, that the other Judges appointed to assist the Civil Judge, Junior Division, or Civil Judge, Senior Division, as the case may be, do not by themselves constitute independent or separate Courts but are part of the same Court. In Sherlekar's case, an interesting question was raised by a Civil Judge, who was designated as 4th Joint Civil Judge, Junior Division, Nagpur, and who, by an order passed by the District Judge, was placed in charge of the Court of the 5th Joint Civil Judge, Junior Division, who was deputed to Dmrer for a specific period and was asked to deal with urgent, immediate and routine matters of that Court during the period of deputation of the Judge presiding over the Court of the 5th Joint Civil Judge, Junior Division. The Judge who was presiding over the Court of the 4th Joint Civil Judge, Junior Division and was placed ill charge of the Court of the 5th Joint Civil Judge, Junior Division, challenged the validity of the order passed by the District Judge and himself made a reference to the High Court.
The Judge who was presiding over the Court of the 4th Joint Civil Judge, Junior Division and was placed ill charge of the Court of the 5th Joint Civil Judge, Junior Division, challenged the validity of the order passed by the District Judge and himself made a reference to the High Court. One of the contentions raised by the applicant Judge was that inasmuch as his Court was different from that of the 5th Joint Civil Judge, Junior Division, he would not be competent to deal with any suit fixed on the file of the 5th Joint Civil Judge, Junior Division, unless an order of transfer under section 24 of the Code of Civil Procedure is made. Rejecting this contention, the learned Judges of the Division Bench, who dealt with the matter, observed as follows :- “The applicant over-looks the fact that under the provisions of the Bombay Civil Courts Act there is only one Court of the Civil Judge, and all other Judges are attached to that Court to assist the Civil Judge's Court. It is indeed true that once an order assigning a suit is made by the Civil Judge himself, the Civil Judge has no right to withdraw that suit from his file as decided by this Court in (Ajam Ibram Madan v. Bai Hava Bibi)8. Even so, as it is not a different Court but only a part of the same Court, it is impossible to sustain the contention that an order for transfer from one Civil Judge to another under section 24 of the Civil Procedure Court is required to be made by the District Court or by the High Court, in cases governed by section 37 of the Civil Courts Act. The District Judge's power under that section is distinct from that under section 24 of the Civil Procedure Code, and intended to avoid inconvenience to litigants:” The ratio of this decision would not be of any avail to the non-applicant, in view of the context in which the provisions of the Bombay Civil Courts Act that there is only one Court of the Civil Judge and all other Judges are attached to that Court to assist the Civil Judge's Court, were emphasised.
The observations were made for high-lighting the provisions of section 37 of the Bombay Civil Courts Act, which enables a District Judge to empower the Judge of any subordinate Court, in the event of death, suspension or temporary absence of any other subordinate Judge of the same district, to perform duties of the vacated subordinate Court either at the place of such Court or of his own Court. It is significant to note that the learned Judges did recognize the position that once an order assigning the suit to the Joint Civil Judge is made by the Civil Judge himself, the latter has no right to withdraw that suit from the file of the former. To my mind, this aspect of the matter is decisive while interpreting section 31 (4) of the Arbitration Act. The Civil Judge, Senior Division after having assigned the application under section 20 of the Arbitration Act to the Joint Civil Judge, Senior Division, was not competent to deal with that matter unless the matter was transferred to his file by the District Judge under section 24 of the Code of Civil Procedure. He had, therefore, no jurisdiction to deal wiih any application made at any stage of the said proceeding and was not competent to entertain the award. The only Court in which the award could have and should have been filed was the Court of the Joint Civil Judge, Senior Division, who admittedly passed the order of making a reference to an Arbitrator. The fact that the Reader of the Court of the Joint Civil Judge, Senior Division wrongly refused to accept the award or that it was filed in the office of tbe Civil Judge, Senior Division would not make any difference. Unless tbe award is properly placed on tbe file of tbe Joint Civil Judge, Senior Division, it would not be deemed to have been filed in Court. Hence tbe proceeding in the Court of the Civil Judge, Senior Division, consequent to filing of the award in the said Court was not competent and hence the learned Joint Judge was not justified in directing that Civil Suit No. 36 of 1979 should be treated as a part and parcel of Civil Suit No. 160 of 1977, pending on the file of the Joint Civil Judge, Senior Division, Nagpur.
The award would be deemed to have been filed in proper Court only after the relevant papers are received by the Joint Civil Judge, Senior Division, Nagpur, as a consequence of the transfer order and a notice of such receipt is thereafter given to both the parties 10 the proceeding. I am told that even before the recOrd and proceedings of Civil Suit No. 36 of 1979 were received by the Joint Civil Judge, Senior Division, Nagpur, he directed the parties to appear before him on a particular date. In my view, this direction is not legal, because he was not competent to issue such a direction before the date on which award is filed in his Court or would be deemed to have been filed in his Court. As observed by me above, the award will be taken to have been filed in his Court only after the receipt of the record and proceedings of Civil Suit No. 36 of 1979, in view of the transfer order. 10. In the result, the revision application is partly allowed. The directions that Civil Suit No. 36 of 1979 should be part and parcel of Civil Suit No. 160 of 1977 and that the Joint Civil Judge, Senior Division should decide the question of limitation in respect of filing of objections, are quashed. It is declared that the award will be deemed to have been filed in the Court of the Joint Civil Judge, Senior Division, Nagpur on the date on which the record and proceedings of Civil Suit No. 36 of 1979 are received in the Court of the Joint Civil Judge, Senior Division, Nagpur. The Joint Civil Judge, Senior Division, Nagpur is further directed to issue fresh notices to both parties, inviting them to file their objections, if any, to the award. No order as to costs of this revision application. Revision Applrt. partly allowed. -----