Research › Search › Judgment

Calcutta High Court · body

2003 DIGILAW 492 (CAL)

SUDHENDU KUMAR DUTTA v. ARATI DHAR

2003-09-18

ALOK KUMAR BASU, ALTAMAS KABIR

body2003
Altamas Kabir, Alok Kumar Basu ( 1 ) THIS appeal is directed against the judgment and order dated 12th March, 2002, passed by the learned Single Judge on an application under section 34 of the Arbitration and Conciliation Act, 1996 filed by one Smt. Arati dhar, who had entered into an agreement with one Smt. Madhabi Chatterjee, represented by her constituted attorney, Mr. Sudhendu Kumar Dutta, the appellant herein, on 13th July, 1996, whereunder she agreed to purchase a flat measuring 650 sq. ft. in premises No. 131/37. Netaji Subash Chandra Bose road, Calcutta-700 040 together with the proportionate share in plot No. 37, regent Park comprising the said premises. As will appear from the judgment under appeal, the said construction was to be undertaken by the appellant herein and under the terms of the agreement the appellant was to make over possession of the flat to Smt. Arati Dhar within two months from the date of execution of the agreement. dated 13th July, 1996. Inasmuch as, the said two months expired on 13th September, 1996, within which time the flat could not be completed, the appellant entered into another agreement with Smt. Arati dhar on 19th September, 1996, agreeing to provide her with alternative accommodation in a flat measuring about 1000 sq. ft. on the ground floor of premises No. 5b, Greek Church Row, Calcutta-700 026. ( 2 ) IN the second agreement, it was mentioned that after completion of the flat at Regent Park, Smt. Arati Dhar would make over possession of the alternative accommodation at Greek Church Row within a period of one month from the date of completion of the said flat at Regent Park. ( 3 ) ADMITTEDLY, there was an arbitration clause in the first of the two agreements dated 13th July, 1996, but the second agreement did not contain such clause. ( 4 ) DISPUTES having arisen between the parties, the appellant herein filed an application in this Court under section 11 of the Arbitration and Conciliation act, 1996, praying for appointment of an Arbitrator for adjudicating his claim against Smt. Arati Dhar. The said application was at the first instance taken up for consideration by Basudeb Panigrahi. J. (as His Lordship then was) and by his order dated 28th January, 2000 upon reference to the first of the two agreements which contained an arbitration clause. The said application was at the first instance taken up for consideration by Basudeb Panigrahi. J. (as His Lordship then was) and by his order dated 28th January, 2000 upon reference to the first of the two agreements which contained an arbitration clause. His Lordship was of the view that an Arbitrator should be appointed as prayed for. The matter was thereafter placed before the Hon'ble Chief Justice who by his order dated 4th may, 2000, appointed Pabitra Kumar Ghosh, J. , a retired Judge of this Court, as sole Arbitrator. ( 5 ) AS will appear from the materials on record and as pointed out by Mr. Manibhusan Sarkar appearing for the appellant an application was filed on behalf of Smt. Arati Dhar before the Hon'ble Chief Justice for recalling the order of appointment of Arbitrator. Admittedly, the said application was dismissed as withdrawn on 29th June, 2000. Instead, on behalf of Smt. Dhar a plea was raised before the learned Arbitrator on 14th June, 2000, even before the statement of defence had been filed, questioning the jurisdiction of the learned Arbitrator to enter upon reference and to conduct the arbitration proceedings. The said stand was also repeated in the counter statement of defence which was ultimately filed before the learned Arbitrator on behalf of smt. Dhar. ( 6 ) AFTER considering the said objection, the learned Arbitrator hold that the order of his appointment by the Hon'ble Chief Justice having become final upon withdrawal of the application for recalling of the order, the respondent herein must be deemed to have acquiesced in the appointment and waived her right to raise the question relating to jurisdiction under section 16 of the aforesaid Act. The learned Arbitrator was also of the view that the respondent stood estopped by her conduct and thereafter the learned Arbitrator proceeded with the arbitration proceedings and ultimately passed his award. The said award was challenged before this Court by Smt. Dhar under section 34 of the aforesaid Act. ( 7 ) WHILE considering the objection taken on behalf of the respondent that the learned Arbitrator did not have jurisdiction to enter upon the reference in view of the fact that while the award was related to the second agreement dated 19. 9. ( 7 ) WHILE considering the objection taken on behalf of the respondent that the learned Arbitrator did not have jurisdiction to enter upon the reference in view of the fact that while the award was related to the second agreement dated 19. 9. 1996, the said agreement did not contain any arbitration agreement and was an agreement which was independent to the earlier agreement dated 13th July, 1996, the attention of the learned Single Judge appears to have been drawn to the provisions of section 16 of the aforesaid Act which empowers the Arbitrator on an Arbitral Tribunal to decide upon its own jurisdiction. Particular reference was made to section 16 (2) which indicates that a party shall not be precluded from raising the plea of jurisdiction merely because either he had appointed the Arbitrator or had participated in the appointment of an arbitrator. On such consideration the learned Single Judge came to a finding that the objection taken on behalf of Smt. Dhar regarding the jurisdiction of the learned Arbitrator was valid and in keeping with the provisions of section 16 (2) of the Act. ( 8 ) THEREAFTER, taking into consideration the provisions of section 34 (2) (a) (iv)of the above Act which provides for setting aside of an award if the Arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, the learned Single Judge upon holding that the later agreement not having provided for an arbitration clause, must be held to come squarely within the aforesaid provision and on such basis held that since the award was without jurisdiction, the same was liable to be set aside. ( 9 ) MR. Sarkar appearing in support of the appeal tried to convince us that once the question of jurisdiction had been decided by this Court and an application for recalling the said order had been dismissed, it was no longer within the authority and/or power of the Arbitral Tribunal to reopen a question on the objection taken before it by the respondent. Mr. Sarkar urged that in the proceeding under section 11 the Hon'ble Chief Justice was entitled to go into the question of jurisdiction in order to appoint an Arbitrator on the said application. In support of his submission Mr. Mr. Sarkar urged that in the proceeding under section 11 the Hon'ble Chief Justice was entitled to go into the question of jurisdiction in order to appoint an Arbitrator on the said application. In support of his submission Mr. Sarkar referred to a decision of the Supreme Court in the case of Wellington Associate Ltd. vs. Kirti Mehta, reported in AIR 2000 SC 1379 , wherein it was held that the provisions of section 16 did not exclude the jurisdiction of the Hon'ble Chief Justice to decide the question of jurisdiction in a proceeding under section 11 of the aforesaid Act. ( 10 ) APART from the above, Mr. Sarkar also pointed out that since the learned arbitrator had decided to proceed with the arbitration proceedings, it must also be held that by implication the learned Arbitrator had decided the question relating to his jurisdiction to entertain the matter and the learned Single Judge had erred in holding that the learned Arbitrator had failed to do so which in fact was one of the grounds for interference with the award. ( 11 ) MR. Sarkar submitted that the learned Single Judge had erred in holding that the matter had not been decided by the learned Arbitrator and accordingly the order setting aside the award was itself liable to be set aside. ( 12 ) APPEARING on behalf of Smt. Dhar, Mr. Jishnu Saha submitted that the provisions of section 16 (2) of the aforesaid Act clearly entitled a party to raise the question of the jurisdiction of the Arbitral Tribunal even if the party had participated in the appointment of an Arbitrator under section 11 of the aforesaid act. Mr. Saha submitted that the learned Single Judge had rightly held on an interpretation of the aforesaid provisions that it was competent for the learned arbitrator to go into the said question particularly when the said objection had been taken even before the submission of the statement of defence in the arbitration proceeding. Mr. Mr. Saha submitted that the learned Single Judge had rightly held on an interpretation of the aforesaid provisions that it was competent for the learned arbitrator to go into the said question particularly when the said objection had been taken even before the submission of the statement of defence in the arbitration proceeding. Mr. Saha also urged that, as would be evident from the initial order passed by Basudev Panigrahi J, as His Lordship then was, and the subsequent order passed by the Hon'ble Chief Justice appointing the learned arbitrator, there was really no decision as such regarding the question as to whether an Arbitrator could be appointed in respect of the second agreement which dealt with a premises which is quite different from that involved in the first agreement. Mr. Saha submitted that there was no obstacle for the learned arbitrator to consider the question as raised on behalf of Smt. Dhar. ( 13 ) MR. Saha urged that the order of the learned Single Judge was based on the relevant provisions of the Arbitration and Conciliation Act, 1996 and did not warrant any interference in appeal. ( 14 ) WE have carefully considered the submissions made on behalf of the respective parties and we should note at this stage that the award was set aside by the learned Single Judge only on the question of jurisdiction and not on merits. The learned Single Judge came to a definite finding that since the arbitral award was concerned with the premises forming part of the second agreement dated 19th September, 1996 and, there being, no provision for arbitration in the said agreement, the learned Arbitrator had, in fact, no jurisdiction to enter upon the reference notwithstanding the fact that he had been appointed to do so. The learned Single Judge observed that the learned arbitrator had no jurisdiction to pass the award in respect of the licence fee for occupation of the flat at No. 5b, Greek Church Row, Calcutta-700 026 which forms a part of the second agreement. The learned Single Judge observed that the learned arbitrator had no jurisdiction to pass the award in respect of the licence fee for occupation of the flat at No. 5b, Greek Church Row, Calcutta-700 026 which forms a part of the second agreement. ( 15 ) HAVING considered the contents of the two agreements and after perusing the order passed by Justice Panigrahi, as His Lordship then was, we are inclined to agree with the learned Single Judge that while the appointment of the arbitrator had been made keeping in mind the provisions of the first agreement, which involved the flat at Regent Park, the award was made in respect of the flat at No. 5b, Greek Church Row which forms part of the second agreement, which vitiated the award. ( 16 ) WE, therefore, see no reason to disagree with the finding arrived at by the learned Single Judge and the appeal is, accordingly, dismissed. There will be no order as to costs. ( 17 ) IT will, however be open to the appellant to pursue his remedy under both the agreements before such other forum as may be available to him in law. ( 18 ) ALL parties are to act on a xerox certified copy of this judgment on the usual undertaking. Appeal dismissed.