Shriram City Union Finance Ltd. , Kukatpally v. S. Mohan Rao
2012-01-20
C.V.NAGARJUNA REDDY
body2012
DigiLaw.ai
Judgment : 1. This civil revision petition is filed by the defendants in O.S.No.3665 of 2010, which was filed by the respondents for permanent injunction. The petitioners filed I.A.No.54 of 2011 in the Court of X Junior Civil Judge, City Civil Court, Hyderabad, under Order VII, Rule 11 of C.P.C for rejection of plaint in view of the provisions of Sections 5 and 8 of the Arbitration and Conciliation Act, 1996 (for short 'the Act'). The said application having been rejected, the petitioners filed the present civil revision petition. 2. At the hearing, Sri K.Maheswara Rao, learned counsel for the petitioners, submitted that on receipt of notice dated 05-8-2010 of reference of dispute to an arbitral tribunal, the respondents instituted O.S.No.3665 of 2010 for permanent injunction against the petitioners on 17-8-2010 without disclosing pendency of arbitral proceedings. He further submitted that an ex parte award was passed on 20-11-2010 in favour of the petitioners as the respondents failed to participate in the arbitral proceedings. The learned counsel, therefore, submitted that filing of suit itself is impermissible and therefore, the Court below ought to have rejected the plaint under the provisions of Order VII, Rule 11 of C.P.C. 3. I have carefully considered the submissions of the learned counsel for the petitioners. 4. In order to seek rejection of the plaint, the petitioners have placed reliance on Sections 5 and 8 of the Act. Section 5 of the Act bars judicial intervention in matters governed by Part (1) thereof. Section 8 of the Act mandates that if any proceeding is instituted before it, which is subject matter of an arbitration agreement and if a party applies before submitting his first statement of defence for reference of the dispute to arbitration, the judicial authority before which such proceedings are instituted shall refer the dispute to arbitration. 5. In the case on hand, even by the time the petitioners filed I.A.No.54 of 2011 for rejection of the plaint, an ex parte award was passed. Therefore, no arbitral proceedings were pending. Hence, the provisions of Sections 5 and 8 of the Act have no application to the facts of the present case. The petitioners have not pleaded that their case falls in any of Clauses (a) to (f) of Rule 11 of Order VII, C.P.C warranting rejection of the plaint.
Therefore, no arbitral proceedings were pending. Hence, the provisions of Sections 5 and 8 of the Act have no application to the facts of the present case. The petitioners have not pleaded that their case falls in any of Clauses (a) to (f) of Rule 11 of Order VII, C.P.C warranting rejection of the plaint. While the petitioners are entitled to seek dismissal of the suit itself on merits in the face of the ex parte award, on the facts of the present case, they cannot seek rejection of the plaint. 6. Therefore, I do not find any merit in this civil revision petition and the same is accordingly dismissed. No costs. 7. As a sequel to the dismissal of the civil revision petition, C.R.P.M.P.No.6831 of 2011 is also dismissed as infructuous.