BUREAU OF INDIAN STANDARD v. WESTERN INDIA ENGINEERING COMPANY
1998-11-03
Y.B.BHATT
body1998
DigiLaw.ai
Y. B. BHATT, J. ( 1 ) ). Heard the learned Counsel for the appellant. ( 2 ) ). This is an appeal under Sec. 37 of the Arbitration and Conciliation Act, 1996 (the Act for short), challenging the order passed by the City Civil Court appointing a Sole Arbitrator to enter into arbitration for the resolution of the dispute, as nominated by respondent original-plaintiff. ( 3 ) ). The Supreme Court has laid down the principles to be kept in mind by a court dealing with Appeal From Orders under Order 43, Rule 1 and in this context, in the case of Wander Ltd. v. Antox India (P) Ltd. , reported at 1990 (Supp) SCC 727, and particularly in paragraphs 9 and 14 of the said decision, had occasion to observe that an appeal against exercise of discretion is said to be an appeal on principle. The Appellate Court will not re-assess the evidence independently, if the assessment of evidence and the conclusions thereon arrived at by the trial Court are reasonable. The above principle laid down by the Supreme Court has also been followed by the Supreme Court in the subsequent case of N. R. Dongre v. Whirlpool corpn. . reported at. 1996 (5) SCC 714 . ( 4 ) I have no doubt that the said principle also applies to appeals under Sec. 37 of the said Act. ( 5 ) ). On the facts of the case I find that the trial Court has appreciated the evidentiary material on record on a prima facie basis in a reasonable manner, and that the findings of fact recorded and the conclusions drawn therefrom are just and reasonable. ( 6 ) ). However, a few salient points sought to be raised require to be noted. Learned counsel for the appellant first sought to contend that the original applicant had failed to produce the Arbitration Agreement as contemplated by sub-sec. (2) of Sec. 8 of the said Act. It was his contention that the application referred to in sub-sec. (1) of Sec. 8 could not have been entertained by the Court unless it was "accompanied by the original Arbitration Agreement of a duly certified copy thereof. In this context, learned Counsel for the appellant has failed to take note of sub-secs. (2) and (5) of Sec. 7 of the said Act. Sub-sec.
(1) of Sec. 8 could not have been entertained by the Court unless it was "accompanied by the original Arbitration Agreement of a duly certified copy thereof. In this context, learned Counsel for the appellant has failed to take note of sub-secs. (2) and (5) of Sec. 7 of the said Act. Sub-sec. (2) specifically contemplates that an arbitration clause forming part of the contract between the parties is also to be construed as an arbitration agreement. Sub-sec. (5) contemplates that even if, within a contract, there is a reference to another document containing an arbitration clause, the same would also constitute an arbitration agreement if the contract is in writing, and the reference is such as to make that arbitration clause part of the contract. On the facts of the instant case, there is no dispute that clause 18 of the contract between the parties is an arbitration clause, and that the original applicant has in fact produced a copy of the contract. In fact, the copy produced by the applicant is the original so far as the applicant is concerned. This contention, therefore, has no merit. ( 7 ) ). Furthermore, the phrase "arbitration agreement" is defined in Sec. 2 (1 ) (b), and invokes the interpretation of Sec. 7, dealt with by me above. ( 8 ) ). Learned Counsel for the appellant then sought to contend that the application filed by the applicant under Secs. 8 and 9 of the said Act is incompetent by virtue of the fact that it was filed beyond the period of limitation, as contemplated by sec. 43 of the said Act. A plain perusal of Sec. 43 of the said Act indicates, vide sub-sec. (2), that for the purposes of this section and the Limitation Act, 1963, an arbitration shall be deemed to have commenced on the date referred to in Sec. 21. In this context. Sec. 21 merely contemplates that the arbitral proceedings in respect of a particular dispute commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent, unless otherwise agreed by The parties. On the facts of the case, it is found that Clause 18 of the contract, which constitutes the arbitration agreement; does not contemplate any period of limitation whatsoever, for the purpose of initiating the procedure for appointment of joint arbitrators.
On the facts of the case, it is found that Clause 18 of the contract, which constitutes the arbitration agreement; does not contemplate any period of limitation whatsoever, for the purpose of initiating the procedure for appointment of joint arbitrators. In this context note may also be taken of sub-sec. (3) of Sec. 43, which encompasses the concept that even where an arbitration agreement contemplates or constitutes an outer time-limit, "unless some step to commence arbitral proceedings is taken within a time fixed by the agreement", the Court has the power to extend the time for such period as it thinks proper, on such terms as the justice of the case may require. It is, therefore, clear that the statute does contemplate a period of limitation for initiating the arbitration proceedings, but such limitation is not a specific period laid down by Sec. 43 itself, but is dependent upon the period determined by the parties themselves, if any. As aforesaid, on the facts of the case. Clause 18 of the contract does not contemplate any such period. This contention, therefore, does not survive. ( 9 ) ). It was also sought to be urged by the learned Counsel for the appellant that the City Civil Court at Ahmedabad had no jurisdiction to entertain the application, and that the said Court was incompetent to make any appointment of an arbitrator, which could only have been done by the Chief Justice of the High Court. For the purpose of supporting this contention a reference was made to the definition of "court" contained in Sec. 2, sub-sec. (1), Clause (e ). A plain reading of this definition indicates that the Court having jurisdiction would mean "the principal civil Court of original jurisdiction in a district, and includes the High Court in exercise of its original civil jurisdiction. . . . . . . . ". To my mind, the meaning is plain and clear. The City Civil Court at Ahmedabad is without dispute the civil Court of original jurisdiction so far as the district of Ahmedabad (City) is concerned. The fact that under the very same definition the High Court in exercise of its original civil jurisdiction may also have concurrent jurisdiction, would not deprive the City civil Court at Ahmedabad of the jurisdiction conferred by Sec. 2 (1 ) (e) of the said act. ( 10 ) ).
The fact that under the very same definition the High Court in exercise of its original civil jurisdiction may also have concurrent jurisdiction, would not deprive the City civil Court at Ahmedabad of the jurisdiction conferred by Sec. 2 (1 ) (e) of the said act. ( 10 ) ). It was in the context of the aforesaid contention that learned Counsel for the appellant also sought to rely upon Sec. 11, sub-secs. (5) and (10 ). of the said act. ( 11 ) ). In the context of sub-sec. (5) he sought to contend that the appointment of an arbitrator upon a request of a party, where the parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from She other party, could only be made by the Chief Justice or any person or institution designated by him. In the context of sub-sec. (10) of Sec. 11, learned Counsel for the appellant also sought to urge that subsequent action for appointment of an, arbitrator could only be taken by the Chief Justice, in accordance with the Scheme which may have been framed by the Chief Justice for the said purpose. This submission also has no merit for the simple reason that sub-sec. (5) as also sub-sec. (10) of Sec. 11 are consequential to sub-secs. (2) and (3) of the said Sec. . 11. Obviously, sub-sec. (2) .