Research › Search › Judgment

Bombay High Court · body

2014 DIGILAW 1156 (BOM)

Ajit B. Kerkar v. Shailendra P. Mittal

2014-05-08

U.V.BAKRE

body2014
Judgment : 1. Heard Mr. Dessai, learned Senior Counsel appearing on behalf of the petitioners and Mr. Jagtiyani, learned Senior Counsel appearing on behalf of the respondents. 2. By this revision application, the petitioners have taken exception to the order dated 23/05/2012, passed by the learned Civil Judge, Senior Division, Vasco-da-Gama, Goa ('trial Court'), on an application under Section 8 of the Arbitration and Conciliation Act, 1996 ('the Arbitration Act', for short), filed by the petitioners, in Special Civil Suit No. 07/2007/A. 3. A Memorandum of Understanding dated 26/04/2000 (MOU, for short) was executed between the petitioner no. 2-Company (THPL, for short) represented by the petitioner no.1 (ABK, for short) and respondent no.1 (SM, for short) whereby it was proposed to incorporate a Private Limited Company i.e. Joint Venture Company (JVCO, for short) for the purpose of managing and running Bogmolo Beach Resort (BBR, for short) belonging to the respondent no. 3Company (TWHL, for short) and for operating the resorts of THPL and all other hotels (both resorts and city hotels) which SM may introduce to JVCO for operation, for a minimum period of 10 years. Inter alia, 50 % equity shares in the TWHL were agreed to be sold to THPL or its nominee. Subsequently, a Shareholders' Agreement dated 09/06/2000 (SHA, for short) was entered into between the petitioners (ABK and THPL) on one side and the respondent no. 1(SM), respondent no. 2 (TWL, for short) and TWHL, on the other side, inter alia, for transfer of said 50% shareholding in the TWHL, in favour of THPL. The SHA contained an arbitration clause being clause no. 19. The MOU was referred to in the said SHA. 4. The petitioners claim that on 15/06/2000, they took over the possession, control and management of BBR and that on 27/01/2007, SM, TWL and TWHL tried to dispossess them from BBR. Disputes arose between the parties with regard to the management of BBR governed by MOU and sale of shares of TWHL, under the SHA. Some of the disputes related to the SHA with regard to non-transfer of 50% shareholding in THWL in favour of THPL. Other disputes related to the management of BBR covered by MOU. Some incidental and consequential disputes were also there relating to accounts, etc.. 5. Some of the disputes related to the SHA with regard to non-transfer of 50% shareholding in THWL in favour of THPL. Other disputes related to the management of BBR covered by MOU. Some incidental and consequential disputes were also there relating to accounts, etc.. 5. The petitioners applied for interim relief under Section 9 of the Arbitration Act by filing an application dated 07/02/2007 before the Principal District Judge, South Goa, Margao, which came to be registered as Arbitration Application No. 3/2007. By order dated 26/11/2007, the learned Principal District Judge, South Goa, Margao allowed the Arbitration Application No. 3/2007. Some clarifications were sought from the learned District Judge which were issued subsequently by order dated 17/01/2008. The respondents no. 1 to 3 challenged the said orders of the Principal District Judge before this Court and by order dated 05/08/2013, passed in Appeal Under Arbitration No. 4 of 2007, a learned single Judge of this Court, in view of the order dated 23/09/2010 passed by the Apex Court in Civil Appeal No. 9165 of 2010, quashed and set aside both the said orders of the District Judge and restored the Arbitration Application No. 3 of 2007 to the file of the learned District Judge, South-Goa, Margao. The undertaking of the learned counsel for the present respondents no. 1 to 3 recorded in the said Appeal Under Arbitration No. 4/2007, on 07/02/2007, has been ordered to continue to be in operation until the disposal of the Arbitration Application No. 3/2007. It appears that the said Arbitration Application No. 3/2007 is still pending. 6. On 08/02/2007, the respondents no.1, 2 and 3 filed Special Civil Suit No. 07/2007 against the petitioners and the respondents no. It appears that the said Arbitration Application No. 3/2007 is still pending. 6. On 08/02/2007, the respondents no.1, 2 and 3 filed Special Civil Suit No. 07/2007 against the petitioners and the respondents no. 4 to 7 for following reliefs: (a) for a declaration that the Memorandum of Understanding dated 26/04/2000 stood terminated and rendered inoperative with effect from 01/11/2006; (b) for a direction to the defendants to surrender the MOU dated 26/04/2000, Shareholders Agreement dated 09/06/2000 and all documents/agreements entered in relation to time share scheme; (c) for a direction to the defendants to render full and complete accounts of all amounts received by them from the time share agreements entered in respect of BBR; and (d) for a permanent injunction restraining defendants from entering into any further time share agreements in regard to BBR or entering upon the premises of BBR or representing themselves to be the owners or persons having any proprietary interest in BBR. 7. In the said Special Suit No. 07/2007, the petitioners herein filed the said application under Section 8 of the Arbitration Act for referring the parties for arbitration. By reply dated 01/03/2007, the respondents no.1, 2 and 3 opposed the said application. On 26/03/2007, the petitioners filed rejoinder to the reply filed by the said respondents. 8. In the mean time, the petitioners filed an application dated 27/06/2007 under Section 11 of the Arbitration Act, before the High Court of Bombay at Goa (Designate) for appointment of arbitrator. By order dated 19/3/2008, the said Application for Appointment of Arbitrator No. 4/2007 was rejected by the learned Single Judge of this Court, as premature. The petitioners in September 2008 again approached the High Court for appointment of Arbitrator. The disputes that led to the filing of the application under Section 11 of the Arbitration Act were as under: (a) Disputes concerning the rights, liabilities and obligations arising under MOU. (b) Disputes concerning the rights, liabilities and obligations arising under SHA. (c) Disputes concerning the rights of appellants (petitioners) to the management, possession and control of BBR and the right to conduct business therefrom for a period of 10 years with effect from 09/06/2000. (d) Disputes concerning the transfer of 50% of shares of TWHL to THPL, the price/consideration payable thereof, including the calculation of the interest thereof. (c) Disputes concerning the rights of appellants (petitioners) to the management, possession and control of BBR and the right to conduct business therefrom for a period of 10 years with effect from 09/06/2000. (d) Disputes concerning the transfer of 50% of shares of TWHL to THPL, the price/consideration payable thereof, including the calculation of the interest thereof. (e) Disputes concerning clearing of balance sheet of TWHL before the transfer of 50% shares of TWHL to THPL. (f) Disputes concerning the interference by respondents (respondents no. 1 to 3) with the conduct of business by appellants (petitioners) of BBR as well as with the possession, management and control of BBR of the appellants (petitioners). (g) All such other disputes incidental/ancillary and arising out of/connecting with the aforesaid disputes. 9. By order dated 14/08/2009, the learned single Judge of this Court dismissed the said Application for Appointment of Arbitrator No. 10/2008. The petitioners approached the Hon'ble Supreme Court against the said order dated 14/08/2008 and by order dated 23/09/2010, passed in Civil Appeal No. 9165/2010 arising out of SLP (C) No. 26567/2009, the Apex Court allowed the said appeal and set aside the order dated 14/08/2009 of the learned Designate and allowed the petition filed by the petitioners under Section 11 of the Arbitration Act, for appointment of an Arbitrator, in respect of only those disputed falling under the SHA, subject to the clarifications made in the said order. 10. By order dated 23/05/2012, the learned trial Court rejected the said application filed by the petitioners under Section 8 of the Arbitration Act in Special Civil Suit No. 07/2007/A. It has been observed by the trial Court that the petitioners had filed an application, under Section 11 of the Arbitration Act, before the High Court of Bombay at Goa for appointment of arbitrator bearing No. 10/2008 which was dismissed by the High Court by order dated 14/08/2009 and the petitioners had preferred Special Leave Petition (C) No. 26567/2009 before the Hon'ble Supreme Court against the said judgment and order dated 14/08/2009 and the said appeal before the Supreme Court was registered as Civil Appeal No. 9165/2010. The learned trial Court further observed that by judgment and order dated 23/09/2010, the Hon'ble Supreme Court set aside the said order dated 14/08/2009 passed by the High Court. The learned trial Court further observed that by judgment and order dated 23/09/2010, the Hon'ble Supreme Court set aside the said order dated 14/08/2009 passed by the High Court. The trial Court held that the said order dated 23/09/2010 of the Apex Court brought out that the petitioners had clarified before the Apex Court that the petition under Section 11 of the Arbitration Act was intended to be only with regard to the disputes arising in respect of the SHA and not beyond that. The trial Court held that a perusal of the judgment dated 23/09/2010 of the Apex Court brought out that the Hon'ble Supreme Court had come to the categorical finding in paragraph 8 that the issue of transfer of shares under the SHA was distinct and different from the issue of management of BBR under the MOU. The trial Court observed that in view of the clarification made by the petitioners, the Apex Court observed that the disputes concerning the rights, liabilities, and obligations arising under MOU; disputes concerning the rights of the petitioners to the management, possession and control of BBR and right to conduct business therefrom for a period of 10 years with effect from 09/06/2000 and disputes concerning the interference of the plaintiffs with the conduct of business by the petitioners of BBR as well as with the possession, management and control of BBR by the petitioners, will not be amenable to arbitration as they relate to the MOU and the pending Special Civil Suit No. 07/2007/A. The trial Court held that the Apex Court had given finding that insofar as the disputes which fall under the Agreement dated 09/06/2000, are concerned, the same will be amenable for arbitration and not the disputes which are outside the SHA. The trial Court held that the said findings of the Hon'ble Apex Court were binding on it and hence, the disputes which were outside the SHA and were the subject matter of the suit, could not be referred to arbitration. The trial Court held that the learned Counsel for the petitioners had submitted before the Apex Court upon instructions that the petitioners will not seek arbitration with regard to disputes relating to management of BBR arisen with regard to the MOU. The trial Court held that the learned Counsel for the petitioners had submitted before the Apex Court upon instructions that the petitioners will not seek arbitration with regard to disputes relating to management of BBR arisen with regard to the MOU. The trial Court, therefore, held that the petitioners were bound by the said undertaking and it could be concluded that the said statement was a concession on point of law. The trial Court further held that though it was true that the order dated 14/08/2009 of the High Court in the Application for Appointment of Arbitrator No. 10/2008, thereby dismissing the said application, had merged into the order dated 23/09/2010 passed by the Hon'ble Supreme Court, however, the conclusions of the High Court arrived at, after appreciating all the facts and circumstances of the case, were of great persuasive value while deciding the application under Section 8 of the Act specially in view of the fact that the Apex Court did not reserve the said observations of this Court, but on the contrary, concluded that they would be relevant, if the Court was considering an application under Section 8 of the Arbitration Act. The trial Court, therefore, held that the disputes in the said suit no. 07/2007/A relating to management of BBR and those which arose with regard to MOU as well as relating to liability of defendants no. 4 to 6 to the reliefs sought for in the suit, were beyond arbitration agreement and could not be referred to arbitration. He further observed that the parties even otherwise could not be referred to arbitration since the defendants no. 4 to 6 were not parties to the arbitration agreement. Consequently, the application filed by the petitioners under Section 8 of the Arbitration Act came to be dismissed. The said order dated 23/05/2012 is impugned in the present revision application. 11. Mr. Dessai, learned Senior Counsel appearing on behalf of the petitioners, contended that the MOU was made a part and parcel of the said SHA. Counsel took me through the clauses of the MOU and submitted that the essence of this MOU was that the respondent no.1 would cause TWL, the holder of the entire share capital of TWHL, to sell and THPL through itself or its nominees to buy 50% of the equity capital of TWHL within 90 days of the management of BBR coming into the JVCO. If THPL was not able to get a buyer within said period of 90 days, then it will cause Tulip Star Hotels Ltd., a sister company of THPL, to purchase 50% of the equity capital of TWHL, within 45 days from the date of expiry of the period of 90 days, on the basis of 100% equity share capital of TWHL. He urged that recital clause (F) of the SHA refers to the MOU and states that the MOU is annexed to it as Annexure 'A'. Counsel pointed to recital clause (H) of SHA and submitted that the same thing which was agreed upon in the MOU was finalized by means of SHA. Counsel further showed that in terms of interpretation clause no. 1.1, 'completion date' means 07/09/2000 being the expiry of 135 days referred to in the MOU. He invited my attention to capital contribution clause no. 2.1 which refers to MOU. He also drew my attention to consideration clause no. 3 which speaks of MOU. He urged that the completion of sale and purchase of shares by TWL, in terms of completion clause no. 4 was conditional being subject to five conditions mentioned in this clause. He submitted that condition no. 1 has been fulfilled since SM has terminated the existing Hotel management Agreement dated 01/07/1994 with Sarovar Park Plaza Hotels and Resorts Pvt. Ltd.. Counsel submitted that the conditions no. 2 3 and 4 i.e. (i) execution of Hotel Management Agreement with respect to BBR in favour of JVCO as mentioned in the MOU; (ii) THPL assigning the Hotel Management Agreement entered into by THPL as mentioned in Annexure 1' of MOU to JVCO for consideration of Rs. 1,00,000/- to be paid by JVCO to THPL; and (iii) the SHA being executed by and between SM and/or his nominee/s and THPL and/or its nominee/s in the JVCO, have not happened since JVCO has not been yet constituted. He contended that this shows that the MOU never took effect in the manner contemplated. Insofar as condition no. 5 is concerned, learned Counsel urged that the consideration has been agreed to be paid in cash for transfer of shares of the company and the shares are to be hand delivered. He contended that this shows that the MOU never took effect in the manner contemplated. Insofar as condition no. 5 is concerned, learned Counsel urged that the consideration has been agreed to be paid in cash for transfer of shares of the company and the shares are to be hand delivered. He pointed out from clause 12 of the SHA that there is no automatic termination of said SHA and that it can happen by mutual consent and in the event of transfer of shares. He urged that in terms of clause no. 17.4 of SHA, MOU is a document contemporaneously executed or referred to in SHA and hence MOU and SHA constituted the entire agreement. He then took me to clause 19 which is the arbitration clause. In short, according to the learned Counsel whatever was there in MOU was transcribed in the SHA. He submitted that MOU stands incorporated into SHA. According to the learned Counsel, the management of BBR has been handed over to the petitioners on 15/06/2000. He urged that any dispute regarding management of this Hotel is part of arbitration clause. Learned Senior Counsel further submitted that though in MOU, there was no arbitration clause however, clause 19 of SHA was the Arbitration clause and clause 19.1 was the Arbitration Agreement between the parties. He read out the said clauses of SHA. Counsel alleged that the JVCO was supposed to manage the BBR for a minimum period of 10 years in terms of clause 5 and this period would have expired on or before 25/07/2010. According to the learned Counsel, the arbitration clause was not confined to SHA and that it extended to MOU also. He contended that the management of the Hotel and sale of 50% of shareholding, both are subject matter of MOU as well as SHA. He tried to explain by saying that the management of the Hotel is specifically dealt with in the MOU and therefore it can be classified as dispute arising out of MOU. He submitted that 50% shares in TWHL are still intact though the order on Section 9 application has been set aside. Learned Senior Counsel, thus, urged that there cannot be any dispute that arbitration clause applies to MOU. In this regard, learned Counsel relied upon the judgment in the case of “M. R. Engineers and Contractors Private Limited Vs. He submitted that 50% shares in TWHL are still intact though the order on Section 9 application has been set aside. Learned Senior Counsel, thus, urged that there cannot be any dispute that arbitration clause applies to MOU. In this regard, learned Counsel relied upon the judgment in the case of “M. R. Engineers and Contractors Private Limited Vs. Som Datt Builders Limited”, [ (2009) 7 SCC 696 ], wherein the Honourable supreme Court has held thus: “16. There is a difference between reference to another document in a contract and incorporation of another document in a contract, by reference. In the first case, the parties intend to adopt only specific portions or part of the referred document for the purposes of the contract. In the second case, the parties intend to incorporate the referred document in entirety, into the contract. Therefore when there is a reference to a document in a contract, the court has to consider whether the reference to the document is with the intention of incorporating the contents of that document in entirety into the contract, or with the intention of adopting or borrowing specific portions of the said document for application to the contract. 17. We will give a few instances of incorporation and mere reference to explain the position (illustrative and not exhaustive). If a contract refers to a document and provides that the said document shall form part and parcel of the contract, or that all terms and conditions of the said document shall be read or treated as a part of the contract, or that the contract will be governed by the provisions of the said document, or that the terms and conditions of the said document shall be incorporated into the contract, the terms and conditions of the document in entirety will get bodily lifted and incorporated into the contract. When there is such incorporation of the terms and conditions of a document, every term of such document, (except to the extent it is inconsistent with any specific provision in the contract) will apply to the contract. If the document so incorporated contains a provision for settlement of disputes by arbitration, the said arbitration clause also will apply to the contract.” 12. If the document so incorporated contains a provision for settlement of disputes by arbitration, the said arbitration clause also will apply to the contract.” 12. Learned Counsel appearing on behalf of the petitioners urged that Section 8 of the Arbitration Act is mandatory and covers all disputes and differences between the parties in respect of any matters excepting the fundamental matters which are mentioned in clause 8 of SHA and therefore under clause 19 of SHA, the disputes regarding MOU are referable to Arbitrator as arbitration clause also applies to MOU. He contended that Section 8 of the Arbitration Act is wider than Section 11 of the Act and the jurisdiction under Section 8 permits the Court to pronounce on arbitrability of a dispute or existence of arbitration clause. Learned Counsel for the petitioners urged that therefore, whether MOU is part of SHA or not can be decided by this Court in the exercise of jurisdiction under Section 8 of the Arbitration Act which is not permissible under Section 11. In this regard, learned Counsel relied upon the judgments in following cases: (i) Booz Allen and Hamilton INC Vs. SBI Home Finance Limited and Others” [ (2011) 5 SCC 532 ], (ii) P. Anand Gajapathi Raju and others Vs. P. V. G. Raju (dead) and others, [ (2000) 4 SCC 539 ] (iii) Hindustan Petroleum Corporation Ltd. Vs. Pinkcity Midway Petroleums, [ (2003) 6 SCC 503 ] (iv) AgriGold Exims Ltd. Vs. Shri Lakshmi Knits and Wovens and others, [ (2007) 3 SCC 686 ]. (iv) SBP and Company Vs. Patel Engineering Ltd and another, [ (2005) 8 SCC 618 ]. 13. (A). In the case of “Booz Allen and Hamilton INC” (supra) it has been held thus: “32. The nature and scope of issues arising for consideration in an application under Section 11 of the Act for appointment of arbitrators, are far narrower than those arising in an application under Section 8 of the Act, seeking reference of the parties to a suit to arbitration. While considering an application under section 11 of the Act, the Chief Justice or his designate would not embark upon an examination of the issue of “arbitrability” or appropriateness of adjudication by a private forum, once he finds that there was an arbitration agreement between or among the parties, and would leave the issue of arbitrability for the decision of the Arbitral Tribunal. If the arbitrator wrongly holds that the dispute is arbitrable, the aggrieved party will have to challenge the award by filing an application under Section 34 of the Act, relying upon sub-section 2(b)(i) of that section. 33. But where the issue of “arbitrability” arises in the context of an application under Section 8 of the Act in a pending suit, all aspects of arbitrability will have to be decided by the court seized of the suit, and cannot be left to the decision of the arbitrator. Even if there is an arbitration agreement between the parties, and even if the dispute is covered by the arbitration agreement, the court where the civil suit is pending, will refuse an application under Section 8 of the Act, to refer the parties to arbitration, if the subject-matter of the suit is capable of adjudication only by a public forum or the relief claimed can only be granted by a special court or Tribunal.” (B). In the case of “P. Anand Gajapati Raju” (supra), it has been held thus: “The conditions which are required to be satisfied under Sections 8(1) and 8(2) of the Arbitration and Conciliation Act, 1996 before the Court can exercise its powers are: (1) there is an arbitration agreement; (2) a party to the agreement brings an action in the Court against the other party; (3) subject-matter of the action is the same as the subject-matter of the arbitration agreement; (4) the other party moves the Court for referring the parties to arbitration before it submits his first statement on the substance of the dispute. This last provision creates a right in the person bringing the action to have the dispute adjudicated by the Court, once the other party has submitted his first statement of defence. But if the party, who wants the matter to be referred to arbitration applies to the Court after submission of his statement and the party who has brought the action does not object, as is the case before us, there is no bar on the Court referring the parties to arbitration. The phrase “which is the subject of an arbitration agreement” does not, in the context, necessarily require that the agreement must be already in existence before the action is brought in the Court. The phrase also connotes an arbitration agreement being brought into existence while the action is pending. The phrase “which is the subject of an arbitration agreement” does not, in the context, necessarily require that the agreement must be already in existence before the action is brought in the Court. The phrase also connotes an arbitration agreement being brought into existence while the action is pending. The language of Section 8 is peremptory. It is, therefore, obligatory for the Court to refer the parties to arbitration in terms of their arbitration agreement. Nothing remains to be decided in the original action or the appeal arising therefrom. There is no question of stay of the proceedings till the arbitration proceedings conclude and the award becomes final in terms of the provisions of the new Act. All the rights, obligations and remedies of the parties would now be governed by the new Act including the right to challenge the award. The Court to which the party shall have recourse to challenge the award would be the Court as defined in clause (e) of Section 2 of the new Act and not the Court to which an application under Section 8 of the new Act is made. An application before a Court under Section 8 merely brings to the Court's notice that the subject-matter of the action before it is the subject-matter of an arbitration agreement. This would not be such an application as contemplated under Section 42 of the Act as the Court trying the action may or may not have had jurisdiction to try the suit to start with or be the competent Court within the meaning of Section 2(e) of the new Act.” 14. Same thing as is held in the case of “P. Anand Gajapathi Raju” (supra) has been reiterated in paragraph 14 of the Judgment in the case of “Hindustan Petroleum Corpn. Ltd.” (supra), and it has been further observed that when an argument is raised that such an arbitration clause does not apply to the facts of the case in hand, then the same will have to be raised before the Arbitral Tribunal concerned, since Section 16 of the Arbitration Act makes it clear that if there is objection as to the applicability of the arbitration clause to the facts of the case, the same will have to be raised before the Arbitral Tribunal concerned. The principle laid down in the above cases has also been reiterated in paragraph 22 of the judgment in the case of “Agri Gold Exims Ltd.” (supra), wherein further it is observed that the term ”dispute” must be given its general meaning, since one man could be said to be indisputably right and the other indisputably wrong, that did not necessarily mean that there had never been any dispute between them. In the case of “SBP & Co.” (supra), the Apex Court has observed thus: “16. We may at this stage notice the complementary nature of Sections 8 and 11. Where there is an arbitration agreement between the parties and one of the parties, ignoring it, files an action before a judicial authority and the other party raises the objection that there is an arbitration clause, the judicial authority has to consider that objection and if the objection is found sustainable to refer the parties to arbitration. The expression used in this Section is 'shall' and this Court in P. Anand Gajapathi Raju Vs. P.V. G. Raju [ (2000) 4 SCC 539 and in Hindustan Petroleum Corporation Ltd. Vs. Pink City Midway Petroleum [ (2003) 6 SCC 503 ] has held that the judicial authority is bound to refer the matter to arbitration once the existence of a valid arbitration clause is established. Thus, the judicial authority is entitled to, has to and bound to decide the jurisdictional issue raised before it, before making or declining to make a reference. Section 11 only covers another situation. Where one of the parties has refused to act in terms of the arbitration agreement, the other party moves the Chief Justice under Section 11 of the Act to have an arbitrator appointed and the first party objects, it would be incongruous to hold that the Chief Justice cannot decide the question of his own jurisdiction to appoint an arbitrator when in a parallel situation, the judicial authority can do so. Obviously, the highest judicial authority has to decide that question and his competence to decide cannot be questioned. Obviously, the highest judicial authority has to decide that question and his competence to decide cannot be questioned. If it is held that the Chief Justice has no right or duty to decide the question or cannot decide the question, it will lead to an anomalous situation in that a judicial authority under Section 8 can decide, but not a Chief Justice under Section 11, though the nature of the objection is the same and the consequence of accepting the objection in one case and rejecting it in the other, is also the same, namely, sending the parties to arbitration. The interpretation of Section 11 that we have adopted would not give room for such an anomaly.” 15. It was the contention of the learned Senior counsel for the petitioners that the Counsel for petitioners had only made a concession before the Supreme Court with reference to Section 11 application that the petitioners will not seek arbitration in respect of MOU. Learned Senior Counsel submitted that the second application for appointment of arbitrator under No. 10/2008 was confined to the disputes under SHA, on clarification given by the Counsel for the petitioners in the Hon'ble Supreme Court. He urged that such clarification was made having regard to the fact of limited jurisdiction under section 11 of the Arbitration Act and since the application under section 8 of the Act was already pending before the Civil Judge. He pointed out that in the order dated 23/09/2010, the Apex Court has mentioned about the pendency of the application under Section 8 of the Arbitration Act and has not held that there is no arbitration clause to MOU. He urged that the said Civil Appeal No 9165/2010 was disposed of on concession and hence the order passed by the Apex Court is not a binding precedent. He relied upon “Director of Settlements, A. P. and others Vs. M. R. Apparao and another, [(2002) 4 SCC 638], in which the Apex Court has held that disposal of a point on concession does not amount to declaration of law, but if after an alleged concession the Court observes that “We are also of the view”, then it would be a determination by the Court itself. Learned Counsel also relied upon “Nadia Distt. Primary School Council and another Vs. Learned Counsel also relied upon “Nadia Distt. Primary School Council and another Vs. Sristidhar Biswas and others”, [ (2007) 12 SCC 779 ], wherein the Apex Court had held that an order passed by Court on concession followed by clarification that the order shall not be treated as a precedent, cannot be followed as a precedent. 16. Learned Counsel for the petitioners further canvassed that the Honourable Supreme Court in order dated 23/09/2010 did not lay down any ratio but has restricted the scope of the application under Section 11 of the Arbitration Act to the disputes under the SHA as per the clarification/concession made, in this regard, by the Counsel for the petitioners, on instructions. According to the learned Senior counsel, the Apex Court has not decided whether MOU constitutes a part of SHA or not and further has not decided about the arbitrability of the disputes raised under MOU with reference to the Arbitration Clause in SHA. Counsel urged that the clarification made before the supreme Court was that the application under Section 11 was intended to be only confined to the disputes arising out of SHA. He contended that what is arbitrable is a point of law and there is no estoppel against law. He relied upon the case of “M/s. Elson Machines Pvt. Ltd. Vs. Collector of Central Excise”, [1989 Supp (1) SCC 671], wherein the Apex Court has held that there is no estoppel against law. He urged that a decision of a Court which does not give finding on an issue before it but disposes of the matter only on clarification or concession does not declare law in terms of article 141 of the Constitution of India. Reliance was placed in the case of “State of U.P. And Another Vs. Synthetics And Chemicals Ltd. And Another”, [ (1991) 4 SCC 139 ], wherein the Hon'ble Supreme Court has held that a decision which is not express and is not founded on reasons nor it proceeds on consideration of issue cannot be deemed to be a law declared to have a binding effect as is contemplated by Article 141 of the Constitution. Reliance was also placed on the judgment of the Honourable Supreme Court in the case of “Natural Resources Allocation, In Re, Special Reference No. 1 of 2012”, [ (2012) 10 SCC 1 ], wherein the Apex Court has, inter alia, held that the “law declared” is the principle culled out on the reading of a judgment as a whole in light of the questions raised, upon which the case is decided. In other words, the “law declared” in a judgment, which is binding upon courts, is the ratio decidendi of the judgment. It is the essence of a decision and the principle upon which the case is decided which has to be ascertained in relation to the subject-matter of the decision. Each case entails a different set of facts and a decision is a precedent on its own facts and not everything said by a judge while giving a judgment can be ascribed precedential value. The essence of a decision that binds the parties to the case is the principle upon which the case is decided and for this reason it is important to analyze a decision and cull out from it the ratio decidendi. It is further held that a decision is an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically flows from the various observations made in the judgment. 17. Learned Counsel for the petitioners invited my attention to the arbitration clause. He submitted that the said clause need not necessarily confine itself to the agreement i.e. SHA containing that clause and that it applies to all disputes and differences between the parties and hence it also applies to MOU. He urged that mere termination of the MOU will not render the arbitration clause inoperative. He relied upon the case of “Branch Manager, Magma Leasing and Finance Limited and another Vs. Potluri Madhavilata and another”, [ (2009) 10 SCC 103 ], in which the Apex Court has held that merely because the contract has come to an end by its termination due to breach, the arbitration clause does not perish nor is rendered inoperative and that it survives for resolution of disputes arising “in respect of” or “with regard to” or “under” the contract. Here also it is held that Section 8 of the Arbitration Act is in the form of legislative command and once the conditions required for referring the parties to arbitration, as mentioned in section 8 are fulfilled, court has no option except to refer the parties to arbitration. 18. Learned counsel for the petitioners submitted that the respondents no. 4 to 7 (defendants no. 3 to 6 in the Special Suit No. 7/2007) have nothing to do with the Hotel and that they have no individual stakes and are employees or ex-directors appointed on the recommendation of the petitioners. He submitted that the petitioners are the actual parties ought to have been added. According to him, the respondents no 4 to 7 have been added as parties only to defeat the arbitration agreement. Learned Senior Counsel invited my attention to the impugned order and showed that the trial judge relied upon the judgment dated 14/08/2009, passed in the Application for Appointment of Arbitrator No. 10/2008, and held that the defendants no 3 to 6 were necessary parties. He submitted that the said judgment dated 18/08/2009 of the Designate Court was set aside by the Apex Court had thus merged in the Apex Court order. He relied upon the Judgment of “M. R. Apparao and Another” (supra), wherein it has been held that where the Supreme Court decides a principle, it would be the duty of the High Court or a Subordinate Court to follow the decision of the Supreme Court and a judgment of the High Court which refuses to follow the decision and directions of the Supreme Court or seeks to revive a decision of the High Court which had been set aside by the Supreme court, is nullity. Learned Counsel submitted that even otherwise reference to arbitrator could have been made only with respect to the parties to the arbitration agreement by keeping the respondents no. 3 to 6 out. In this regard, he relied upon the judgment of the Supreme Court in the case of “S. N. Prasad, Hitek Industries (Bihar) Ltd. Vs. Monnet Finance Ltd. and others”, [ (2011) 1 SCC 320 ]. In paragraph 8 of the judgment supra, the Apex Court has observed thus: “8. Thus there can be reference to arbitration only if there is an arbitration agreement between the parties. Monnet Finance Ltd. and others”, [ (2011) 1 SCC 320 ]. In paragraph 8 of the judgment supra, the Apex Court has observed thus: “8. Thus there can be reference to arbitration only if there is an arbitration agreement between the parties. The Act makes it clear that an arbitrator can be appointed under the Act at the instance of a party to an arbitration agreement only in respect of disputes with another party to an arbitration agreement. If there is a dispute between a party to an arbitration agreement, with other parties to the arbitration agreement as also non-parties to the arbitration agreement, reference to arbitration or appointment of arbitrator can be only with respect to the parties to the arbitration agreement and not the non-parties.” 19. According to learned counsel for the petitioners, the bifurcation of the disputes by the Honourable Supreme Court was founded on concession only. He urged that the disputes under MOU and SHA cannot be said to be distinct and separate. He submitted that the Counsel for the petitioners, on instructions, told the Apex Court to confine the application under Section 11 of the Arbitration Act to SHA and on the basis of such concession the Apex Court bifurcated the disputes. He urged that if the same is held otherwise, then that would be contrary to law laid down by the Apex Court in the case of “SukanyaHoldings (P) Ltd. Vs. Jayesh H. Pandya and another”, [(2003) 5 SC 531] and more particularly to paragraph 17 thereof. In that case, it has been held thus: “12. For interpretation of Section 8, Section 5 would have no bearing because it only contemplates that in matters governed by Part I of the Act, the judicial authority shall not intervene except where so provided in the Act. Except Section 8, there is no other provision in the Act that in a pending suit, the dispute is required to be referred to the arbitrator. Further, the matter is not required to be referred to the Arbitral Tribunal, if: (1) the parties to the arbitration agreement have not filed any such application for referring the dispute to the arbitrator; (2) in a pending suit, such application is not filed before submitting first statement on the substance of the dispute; or (3) such application is not accompanied by the original arbitration agreement or duly certified copy thereof. This would, therefore, mean that Arbitration Act does not oust the jurisdiction of the Civil Court to decide the dispute in a case where parties to the Arbitration Agreement do not take appropriate steps as contemplated under sub-sections (1) and (2) of Section 8 of the Act. 13. Secondly, there is no provision in the Act that when the subject matter of the suit includes subject matter of the arbitration agreement as well as other disputes, the matter is required to be referred to arbitration. There is also no provision for splitting the cause or parties and referring the subject matter of the suit to the arbitrators. 14. Thirdly, there is no provision as to what is required to be done in a case where some parties to the suit are not parties to the arbitration agreement. As against this, under Section 24 of the Arbitration Act, 1940, some of the parties to a suit could apply that the matters in difference between them be referred to arbitrator and the court may refer the same to arbitration provided that the same can be separated from the rest of the subject-matter of the suit. The section also provided that the suit would continue so far as it related to parties who have not joined in such application. 15. The relevant language used in Section 8 is "in a matter which is the subject matter of an arbitration agreement”, the court is required to refer the parties to arbitration. Therefore, the suit should be in respect of 'a matter' which the parties have agreed to refer and which comes within the ambit of arbitration agreement. Where, however, a suit is commenced - "as to a matter" which lies outside the arbitration agreement and is also between some of the parties who are not parties to the arbitration agreement, there is no question of application of Section 8. The words 'a matter' indicate entire subject matter of the suit should be subject to arbitration agreement. 16. The next question which requires consideration is-- even if there is no provision for partly referring the dispute to arbitration, whether such a course is possible under Section 8 of the Act. The words 'a matter' indicate entire subject matter of the suit should be subject to arbitration agreement. 16. The next question which requires consideration is-- even if there is no provision for partly referring the dispute to arbitration, whether such a course is possible under Section 8 of the Act. In our view, it would be difficult to give an interpretation to Section 8 under which bifurcation of the cause of action that is to say the subject matter of the suit or in some cases bifurcation of the suit between parties who are parties to the arbitration agreement and others is possible. This would be laying down a totally new procedure not contemplated under the Act. If bifurcation of the subject-matter of a suit was contemplated, the legislature would have used appropriate language to permit such a course. Since there is no such indication in the language, it follows that bifurcation of the subject-matter of an action brought before a judicial authority is not allowed. 17. Secondly, such bifurcation of suit in two parts, one to be decided by the Arbitral Tribunal and other to be decided by the civil court would inevitably delay the proceedings. The whole purpose of speedy disposal of dispute and decreasing the cost of litigation would be frustrated by such procedure. It would also increase the cost of litigation and harassment to the parties and on occasions there is possibility of conflicting judgments and orders by two different forums. 18. Reliance was placed on Section 89 CPC in support of the argument that the matter should have been referred to arbitration. In our view, Section 89 CPC cannot be resorted to for interpreting Section 8 of the Act as it stands on a different footing and it would be applicable even in cases where there is no arbitration agreement for referring the dispute for arbitration. Further, for that purpose, the Court has to apply its mind to the condition contemplated under Section 89 CPC and even if application under Section 8 of the Act is rejected, the Court is required to follow the procedure prescribed under the said Section. 19. Further, for that purpose, the Court has to apply its mind to the condition contemplated under Section 89 CPC and even if application under Section 8 of the Act is rejected, the Court is required to follow the procedure prescribed under the said Section. 19. Lastly, considering the language used in Section 8, in our view, it is not necessary to refer to the decisions rendered by various High Courts interpreting Section 34 of Indian Arbitration Act, 1940 which gave a discretion to the Court to stay the proceedings in a case where the dispute is required to be referred for arbitration.” 20. Learned Senior Counsel for the petitioners, thus urged that the impugned order is arbitrary and perverse and hence be quashed and set aside and the application filed by the petitioners under Section 8 of the Arbitration Act be allowed. 21. Mr. Jagtiani, learned Senior Counsel appearing on behalf of the respondents, on the other hand, submitted that the Designate of the Chief Justice, by order dated 14/08/2009, passed in Application for Appointment of Arbitrator No. 10/2008, filed by petitioners under Section 11 of the arbitration Act, dismissed the said application, due to which the petitioners approached the Apex Court with Special leave petition and in Civil Appeal No. 9165/2010, the Apex Court has pronounced a judgment setting aside the said High Court order. He pointed out from the judgment of the Apex Court that after some conclusions were arrived at, the Counsel for the appellants i.e. for petitioners herein, under instructions from the petitioners, made clarification that the appointment of arbitrator was sought only with reference to the disputes arising from or referable to SHA and that the petitioners shall not seek arbitration in regard to the disputes relating to management of BBR arising out of MOU. Counsel submitted that the disputes (a), (c) and (f) raised in the Application for Appointment of Arbitrator No. 10/2008, which specifically pertained to MOU, are, thus, not amenable to arbitration and that this has been specifically held by the Apex Court in paragraph 13 of the order dated 23/09/2010. Learned Counsel urged that the arbitrator gets jurisdiction under the agreement. Counsel submitted that the disputes (a), (c) and (f) raised in the Application for Appointment of Arbitrator No. 10/2008, which specifically pertained to MOU, are, thus, not amenable to arbitration and that this has been specifically held by the Apex Court in paragraph 13 of the order dated 23/09/2010. Learned Counsel urged that the arbitrator gets jurisdiction under the agreement. According to the learned senior Counsel, the distinction between amenability and arbitrability has been made in the order dated 23/09/2010 of the Supreme court and there cannot be any casing for anyone and this is culled out from the own letters of the petitioners. He submitted that the Hon'ble Supreme Court appreciated certain facts and gave conclusions. He submitted that the Apex Court has concluded that the disputes pertaining to MOU and pending in the Special Civil Suit No. 7/2007 are not arbitrable. He urged that whatever had to be done under Section 8 of the Arbitration Act was clearly told by the Apex Court. He urged that the MOU was terminated on 27/01/2007 and the clauses of said MOU cannot now be read into SHA. Learned Senior Counsel invited my attention to the points for determination framed by the petitioners in the present Revision Petition and more particularly to point “D' and urged that the petitioners very well knew as to what was meant by an 'undertaking'. Learned Senior Counsel submitted that paragraph 13 of the order dated 23/09/2010 of the Apex Court makes it clear beyond doubt that the petitioners had given an undertaking by way of clarification that they will not seek arbitration in respect of the disputes (a), (c) and (f) and that there was no concession made by the Counsel for the petitioners. He submitted that pre-condition of section 8 of the Arbitration Act is the arbitration agreement, which is not there in the present case. 22. Learned Counsel appearing on behalf of the respondents no. 1 to 3, invited my attention to paragraph 5 of the application filed by the petitioners, under Section 8 of the Arbitration Act and submitted that there is absolutely no reason as to why the respondents no. 4, 5, 6 and 7 are not necessary parties to the Suit. He urged that a perusal of the plaint in the said Special Civil Suit No. 07/2007/A would reveal plausible reasons as to why they are necessary parties. 4, 5, 6 and 7 are not necessary parties to the Suit. He urged that a perusal of the plaint in the said Special Civil Suit No. 07/2007/A would reveal plausible reasons as to why they are necessary parties. He submitted that no application under Order I Rule 10 of Civil Procedure Code has been filed for deletion of the defendants no. 3 to 6 from the Special Suit No. 07/2007. He invited my attention to the memo of appeal, filed before the Principle District Judge, Margao, under Section 37(2) of the Arbitration Act against the order dated 06/07/2013 made by the sole arbitrator, wherein in ground “X' it is stated by the petitioners that the Arbitrator ought to have held that Doctrine of Merger is not applicable in the case of Supreme Court order dated 23/09/2010 inasmuch as the said order was obtained on concession and had not decided the issues involved on merits. Learned Counsel further submitted that the arbitrator appointed by the Apex Court by order dated 23/09/2010, has rejected the application thereby holding that the SHA had come to an end on 07/09/2000 and that the claim was barred by limitation. He therefore urged that section 8 application now must necessarily fail since SHA is dead. 23. Learned Senior Counsel for the respondents no. 1 to 3 invited my attention to paragraph 48 of the application under section 9 of the Arbitration Act filed by the petitioners wherein it is alleged that the cause of action arose on 27/01/2007. He submitted that on 27/01/2007, the MOU and all earlier arrangements were terminated. Learned Senior Counsel, thus, urged that the cause of action emanated from termination of MOU only. He submitted that after 07/09/2005 the respondents no. 1 to 3 never referred to termination of SHA. He urged that the period between 07/09/2005 to 27/01/2007 cannot be covered by Arbitration Clause. He submitted that the Judgment of the Apex court in the case of “Sukanya holdings” still holds ground and has not at all been diluted. Learned counsel contended that the judgment dated 23/09/2010 of the Supreme court is a Judgment and nothing short of that and that it has ratio. He submitted that the Judgment of the Apex court in the case of “Sukanya holdings” still holds ground and has not at all been diluted. Learned counsel contended that the judgment dated 23/09/2010 of the Supreme court is a Judgment and nothing short of that and that it has ratio. He pointed out that in paragraph 8 of the judgment, the Honourable Supreme court has given a finding that the issue of transfer of shares under SHA is distinct and different from the issue of management of BBR. He urged that the Apex court was seized of Section 8 of the Arbitration Act side by side and because of judicial discipline, the Apex Court did not decide the application under Section 8 as it was deciding only the application under section 11 of the Arbitration Act. Learned Senior counsel submitted that paragraphs 11, 12, and 13 of the judgment of the Apex Court make it clear that there is no arbitration agreement in the MOU. Counsel took me through the impugned order passed by the trial Court and contended that the trial court had applied its mind and there was no perversity. In the circumstances above, the learned Senior Counsel appearing on behalf of the respondents no. 1 to 3 urged that the Revision Application deserves to be rejected. 24. I have minutely and carefully perused the material on record. I have considered the submissions advanced by the learned counsel for the parties and the judgments relied upon by them. 25. The questions for consideration are whether there is arbitration agreement for resolution of disputes under the MOU and whether other ingredients of Section 8 of the Arbitration Act have been fulfilled and whether the judgment and order dated 23/09/2010 passed by the Honourable Supreme Court would not constitute a binding precedent while deciding an application under Section 8 of the arbitration Act, by the trial Court. 26. Section 8(1) of the Arbitration Act provides that a judicial authority before which an action is brought in a matter which is subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration. 26. Section 8(1) of the Arbitration Act provides that a judicial authority before which an action is brought in a matter which is subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration. Section 8(2) of the Arbitration Act provides that the application referred to in subsection (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof. Hence, the provision of Section 8 cannot be invoked without an arbitration agreement since the proceedings pursuant to an application for appointment of arbitrator under section 8 have their genesis in the arbitration clause. Thus, once the other party moves the Court for referring the parties to arbitration before it submits its first statement on the substance of the dispute, the Court has no option but to decide whether there is an arbitration agreement and whether the subject-matter of the action brought is the same as subject-matter of an arbitration agreement and if yes to refer the parties to arbitration. It can be understood from the above provision of section 8 of the Arbitration Act that it is a mandatory provision. 27. From the judgments cited by the learned Counsel for the petitioners, in this regard, it is settled that the provision of section 8 of the Arbitration Act is peremptory in nature and where arbitration agreement exists, and if the other ingredients of said Section 8 are fulfilled, Court is obliged to refer the parties to arbitration. Section 8 of the Arbitration Act permits the Court to pronounce on arbitrability of a dispute or existence of arbitration clause. However, the position in the above cases cited by the learned counsel for the petitioners was different in the sense that there were no simultaneous applications filed: one under Section 8 of the Arbitration Act before the trial Court and the other under Section 11 of the Act before the High Court Designate. In the present case, an application for reference of all the disputes to arbitrator has been filed before the trial Court and also an application under section 11 of the Act for appointment of arbitrator for resolution all the same disputes was filed before the High Court. In the present case, an application for reference of all the disputes to arbitrator has been filed before the trial Court and also an application under section 11 of the Act for appointment of arbitrator for resolution all the same disputes was filed before the High Court. During the pendency of Section 8 application before the trial Court, some statements were made by the Counsel for the petitioners, in the Civil Appeal No. 9165/2010, filed before the Honourable Supreme Court, against the order of the High Court Designate refusing to appoint an arbitrator, which led to disposal of the said appeal. 28. Admittedly, there was no arbitration clause in the MOU. The SHA, however, by virtue of clause 19 thereof, had provision for settlement of disputes by arbitration. The dispute regarding the management of BBR was governed by MOU whereas the dispute regarding sale of shares in TWHL was governed by SHA. The SHA does not anywhere, in specific words, says that the MOU shall form part and parcel of the SHA. Only certain portions of the MOU have been borrowed or adopted in the SHA. The SHA nowhere says that the contents of MOU shall be read or treated as part of the SHA or that the SHA shall be governed by the provisions of the MOU. The SHA also does not say that the terms and conditions of the MOU shall be deemed to have been incorporated into it. No doubt, MOU has been referred to in various clauses of the SHA and in clause 17.4 of the SHA, it is stated that the said agreement (together with all agreements and documents executed contemporaneously with it or referred to in it) constitutes the entire agreement between the parties in relation to its subject-matter. The parties to an agreement have the best knowledge of their intention behind execution of the same and interpretation of the contents of the same. The Hon'ble Supreme Court, in paragraph 8 of the order dated 23/09/2010, has held that the issue of transfer of shares under SHA is distinct and different from the issue of management of BBR under MOU. The Hon'ble Supreme Court, in paragraph 8 of the order dated 23/09/2010, has held that the issue of transfer of shares under SHA is distinct and different from the issue of management of BBR under MOU. The Apex Court, in paragraph 11 of the said order, has further held that the appellants (petitioners herein) had referred in the petition under section 11 of the Act, not only to disputes relating to SHA, but also to disputes which did not relate to SHA but related to the MOU which did not contain an Arbitration Agreement. If the MOU was part and parcel of SHA, as if incorporated therein, and covered by the arbitration clause contained in SHA, as is now sought to be made out, then it was incumbent upon the Petitioners to have submitted the same before the Apex Court. The statement made by the learned Counsel for the petitioners in the said Civil Appeal No. 9165/2010, to the effect that the appellants (petitioners herein) will not seek arbitration in regard to the disputes relating to management of BBR arising in regard to the MOU, makes it abundantly clear that according to the petitioners themselves, the disputes regarding the transfer of shares under SHA are distinct and different from the disputes in respect of management of BBR under MOU, and were not covered under the SHA containing the arbitration clause. It was because of the above clarification of the petitioners that the Honourable Supreme Court observed that it becomes clear that the disputes (a), (c) and (f) as mentioned in the notice dated 11/06/2008 (which pertained to the MOU and management, possession and control of BBR), will not be amenable to arbitration as they relate to the MOU and the pending Special Civil Suit. Hence the petitioners cannot be heard to say otherwise. It is therefore not possible to say that the arbitration clause incorporated in the SHA is applicable to the MOU. 29. A perusal of the application filed by the petitioners, under Section 11 of the Arbitration Act, does reveal that the petitioners had prayed before the learned High Court Designate, for appointment of Arbitrator, not only with regard to the disputes relating to SHA but also to the disputes relating to MOU. 29. A perusal of the application filed by the petitioners, under Section 11 of the Arbitration Act, does reveal that the petitioners had prayed before the learned High Court Designate, for appointment of Arbitrator, not only with regard to the disputes relating to SHA but also to the disputes relating to MOU. Since the learned Designate had dismissed the said application under Section 11 of the Arbitration Act, in toto, the petitioners had preferred the said Civil Appeal No. 9165/2010, before the Apex Court. The Hon'ble Supreme Court, in the order dated 23/09/2010, in the said Civil Appeal, has observed in paragraph 2 that the said MOU did not contain any provision for arbitration. In paragraph 3, the Apex Court has observed that Clause 19 of the SHA contained a provision for settlement of disputes by arbitration. The said clause 19 has been extracted in paragraph 3. In paragraphs 4 and 5 of the order, there is mention of the disputes between the parties; filing of application under section 9 of the Arbitration Act by the petitioners; and filing of Special Civil Suit No. 07/2007/A in the Court of Civil Judge Senior Division, Vasco-da-Gama, Goa, by respondents no. 1 to 3. The reliefs sought by the respondents no. 1 to 3 in the said suit have been quoted. I have incorporated those prayers in paragraph 6 above. At the end of paragraph 5 in the order dated 23/09/2010 of the Apex Court, it is mentioned that the petitioners have filed an application under Section 8 of the Act in the said suit for referring the parties to arbitration. It is further stated that the said suit and the said application are pending. 30. The Hon'ble Supreme Court, in paragraph 8 of the said order dated 23/09/2010, passed in the Civil Appeal No 9165/2010, has observed thus: “8. The relevant facts are therefore short and simple. There was a Memorandum of Understanding between the first appellant and second respondent on 26.4.2000 which did not contain a provision for arbitration. There was a Shareholders Agreement among appellants and respondents dated 9.6.2000 inter alia for transfer of 50% shareholding in the third respondent company and the said agreement contains a provision for arbitration in Clause 19 of the agreement. There was a Shareholders Agreement among appellants and respondents dated 9.6.2000 inter alia for transfer of 50% shareholding in the third respondent company and the said agreement contains a provision for arbitration in Clause 19 of the agreement. Some of the disputes between the parties relate to the Shareholders Agreement dated 9.6.2000 in regard to non-transfer of 50% shareholding in the third respondent company and other disputes relate to the management of the BBR covered by the Memorandum of Understanding dated 26.4.2000. There are certain incidental and consequential disputes relating to Accounts etc. The issue of transfer of shares under Shareholders Agreement dated 9.6.2000 is distinct and different from the issue of management of BBR under MOU dated 26.4.2000.” 31. In paragraph 9 of the said order dated 23/9/2010, of the Apex Court, the disputes that led to the filing of the petition under section 11 of the Arbitration Act have been set out. I have incorporated those disputes in paragraph 8 above. 32. In paragraph 10 of the said order dated 23/09/2010, the Honourable Supreme Court has observed that the learned Designate concluded that disputes relating to the shareholders agreement and the disputes relating to the MOU were inextricably linked and all the parties to the suit not being parties to the shareholders agreement, the petition under section 11 should not be entertained. The Apex Court further observed that what was lost sight of by the learned Designate was the fact that he was not considering an application under Section 8 of the Act as to whether the subject matter of the suit should be referred to Arbitration in view of the existence of the Arbitration Agreement, where probably presence of the parties other than parties of the agreement, would have been relevant. 33. In paragraph 11 of the order dated 23/09/2010, the Apex Court has held that insofar as a petition under Section 11 of the Act is concerned, the issues that arise for consideration are primarily whether there is an arbitration agreement between the petitioners and respondents and whether the parties who applied under Section 11 of the act are parties to such agreement. It is observed that the learned Designate apparently felt constrained to examine the issue with reference to the pending civil suit, as appellants had referred in the petition under Section 11 of the Act not only to disputes relating to Shareholders Agreement, but also to disputes which did not relate to the shareholders agreement but related to the MOU dated 26.4.2000, which did not contain an Arbitration Agreement. 34. In paragraphs 12 and 13 of the order dated 23/09/2010, the Hon'ble Supreme Court has observed thus: “12. In view of it, the learned counsel for the appellants clarified and categorically submitted on instructions, that the appointment of arbitrator was sought only with reference to the disputes arising from or referable to Shareholders Agreement dated 9.6.2000. He stated that the appellants will not seek arbitration in regard to the disputes relating to management of BBR arising in regard to the MOU dated 26.4.2000. In a proceedings under Section 11 of the Act, the Chief Justice or his Designate will be considering the question whether there is an arbitration agreement, and not the question whether the disputes are arbitrable. But if the petition under Section 11 of the Act refers to disputes relating to other agreements which did not have an arbitration agreement, it is open to the learned Chief Justice or his Designate, while appointing the arbitrator in pursuance of the petition under Section 11 of the Act, to make it clear that the appointment was only in pursuance of the Agreement containing the arbitration agreement and was not in regard to the disputes relating to agreement or MOU which did not contain an arbitration. Be that as it may. 13. As the appellants have now clarified that the petition under Section 11 of the Act was intended to be only in regard to the disputes arising in regard to the Shareholders Agreement dated 9.6.2000 and not beyond it, it becomes clear that the disputes (a), (c) and (f) extracted in para 9 above, will not be amenable to arbitration as they relate to the MOU and the pending Special Civil Suit. It also becomes clear that disputes (b), (d) and (e) extracted in para 9 above would survive for consideration with reference to the petition under Section 11 of the Act along with any other matter relating to the Shareholders Agreement dated 9.6.2000. It also becomes clear that disputes (b), (d) and (e) extracted in para 9 above would survive for consideration with reference to the petition under Section 11 of the Act along with any other matter relating to the Shareholders Agreement dated 9.6.2000. In so far as the disputes referred to in notice dated 31.7.2008, it follows that only such of those disputes which will fall under the Agreement dated 9.6.2000 will be amenable for arbitration and not the disputes which are outside the said agreement dated 9.6.2000. The question of arbitrability of the disputes could be raised by the respondents before the arbitrator. The Arbitrator will decide which disputes are arbitrable and then proceed accordingly.” 35. It is true, as seen above, that a Division Bench of the Honourable Supreme Court, in the case of “Sukanya Holdings (P) Ltd” (supra) has held that there is no provision in Section 8 of the arbitration Act for splitting the cause or parties and referring the subject matter of the suit to the arbitrators. Thus, bifurcation of suit in two parts, one to be decided by the Arbitral Tribunal and other to be decided by the civil court, is not possible, under Section 8 of the Arbitration Act, as held by the Apex Court in the case of “Sukanya Holdings (P) Ltd” (supra). But, then, in the appeal which pertained to Section 11 of the Arbitration Act, the Counsel for the petitioners, on instructions, clearly and categorically submitted to the Division Bench of the Hon'ble Supreme Court that the appointment of Arbitrator was sought only with reference to the disputes arising from or referable to SHA and that the petitioners will not seek arbitration in regard to the disputes relating to management of BBR arising in regard to the MOU. Accordingly, a sole arbitrator was appointed for resolution of the disputes arising under SHA. The Sole Arbitrator, by order dated 06/07/2013, has disposed of the arbitration proceedings. He has held that the SHA has come to an end on 07/09/2000 and that the claim is barred by limitation. The learned Sole Arbitrator has rejected all the claims of the petitioners for lack of jurisdiction of the tribunal and/or lack of arbitrability. The Sole Arbitrator, by order dated 06/07/2013, has disposed of the arbitration proceedings. He has held that the SHA has come to an end on 07/09/2000 and that the claim is barred by limitation. The learned Sole Arbitrator has rejected all the claims of the petitioners for lack of jurisdiction of the tribunal and/or lack of arbitrability. An application under Section 37(2) of the Arbitration thereby challenging the order of the Sole Arbitrator has been filed by the petitioners before the Principal District Judge, South-Goa, Margao under Arbitration Application No. 10/2013. If according to the petitioners, the arbitration agreement incorporated in clause 19 of the SHA was applicable to MOU and that the MOU formed integral part and parcel of the SHA, then there was no need to make the statement as above before the Apex Court since the application under Section 11 of the Arbitration Act was filed by the petitioners to refer the disputes relating to SHA as well as to MOU for arbitration and it would have always been better to have all the disputes resolved by one and the same arbitrator, in one proceedings itself. There was absolutely no need to keep the question of deciding the arbitrability of disputes relating to MOU, by the trial Court. There was no sense in contemplating the resolution of disputes under SHA by one arbitrator appointed under Section 11 of the Arbitration Act and the disputes under MOU by another arbitrator, if appointed under Section 8 of the Arbitration Act. If the petitioners were entitled to, all the disputes could have been referred to an arbitrator appointed under Section 11 of the Arbitration Act or to an arbitrator appointed under Section 8 of the said Act. Therefore, it can certainly be said that the petitioners had given an undertaking before the Apex Court, by way of clarification and that also after taking due instructions from the petitioners, as the Counsel for the petitioners was convinced that the disputes under the MOU were not amenable to arbitration since there was no clause for arbitration in the MOU and the clause no. 19 of SHA would not come to their rescue. 19 of SHA would not come to their rescue. The petitioners cannot now be heard to say that merely a concession was made only for disposal of Section 11 application in regard to the disputes pertaining to the SHA with a right, still intact, to claim arbitration regarding the disputes under MOU, from the trial Court under the application under Section 8 of the Arbitration Act which was still pending. Considering the ratio of the judgments on “Concession” and on the meaning of the expression “declaration of law” or “precedent”, cited by the learned Counsel for the petitioners and the clarifications made by the learned Counsel before the Apex Court, I am of the view that the said clarifications cannot be termed as mere concession not binding on the parties. The said statements made by the counsel for the petitioners before the Apex Court contained an undertaking binding on the petitioners that they will not seek arbitration in regard to the disputes relating to management of BBR arising in regard to the MOU. The Honourable Apex Court has expressed its view on the matter and has not observed that the said order was passed by Court on concession and that the order shall not be treated as a precedent. It can be understood that the conclusion of the Apex Court is that the disputes pertaining to the MOU and pending in the Special Civil Suit are not arbitrable. The Honourable Apex Court obviously did not decide the application under Section 8 of the Act as no order passed under it was under challenge before it. The said formality to dispose of the application under Section 8 of the Arbitration Act has been done by the trial court, mainly by placing reliance on the order dated 23/09/2010, of the Apex Court in Civil Appeal No 9165/2010. The trial Court has held that the disputes relating to the management of BBR and those which arise in regard to the MOU are beyond the arbitration agreement and as such cannot be referred to arbitration. The impugned order of the trial Court, wherein reliance has been placed on the order dated 23/09/2010, passed by the Apex Court in Civil Appeal No. 9165/2010, cannot be termed as arbitrary or perverse. 36. The impugned order of the trial Court, wherein reliance has been placed on the order dated 23/09/2010, passed by the Apex Court in Civil Appeal No. 9165/2010, cannot be termed as arbitrary or perverse. 36. The parties have acted upon the order dated 23/09/2010 of the Apex Court and have already submitted to the jurisdiction of the learned Arbitrator in respects of the disputes regarding the transfer of shares under the SHA bifurcated from the disputes regarding the issue of management of BBR under the MOU. The learned Sole Arbitrator has already given his award, which is now challenged before the learned Principal District Judge. If the grievance of the petitioners was that the conclusions arrived at by the Honourable Apex Court and the bifurcation of disputes done by it was contrary to the Judgment in the case of “Sukanya Holdings (P) Ltd” (supra), then it was for the petitioners to have sought appropriate remedy by way of review, if permissible, or otherwise. The petitioners now cannot say that the Judgment and order dated 23/09/2010 of the Apex Court is not a 'declaration of law' and not a binding precedent. 37. Admittedly, the respondents no 4 to 7 who are the defendants no. 3 to 6 in the said Special Civil Suit No. 07/2007, were not parties to the SHA, which contained the arbitration agreement. There are averments with respect to the defendants no. 3 to 6 in paragraphs 3, 9, 12, 13, 14, 16, 17, 18, 19, 20, 21, 25, 27, and 30 of the plaint. In paragraph 25 of the plaint, it is specifically averred that the defendants no. 1, 2, 4, and 6, in breach of their fiduciary duties kept the funds so collected out of reach of the plaintiffs no. 2 and 3 and that the said amounts collected may well be in excess of Rs. 30,00,00,000/-. There are general averments against all the defendants and the prayers are also against all the defendants. In such circumstances, it cannot be said that the said defendants are not necessary parties and have been deliberately added as parties to the suit merely to circumvent the arbitration. The petitioners did not file any application under Order I Rule 10 of C.P.C. to delete the defendants no 3 to 6. In such circumstances, it cannot be said that the said defendants are not necessary parties and have been deliberately added as parties to the suit merely to circumvent the arbitration. The petitioners did not file any application under Order I Rule 10 of C.P.C. to delete the defendants no 3 to 6. Section 8 of the arbitration Act, in clear terms, reveals that only the parties to the arbitration agreement can be referred to arbitration. In the case of “Sukanya Holdings (P) Ltd.” the Apex Court has held that where, however, a suit is commenced - "as to a matter" which lies outside the arbitration agreement and is also between some of the parties who are not parties to the arbitration agreement, there is no question of application of Section 8. Though the judgment in the case of “Sukanya Holdings (P) Ltd.” is before the larger Bench of the Honourable supreme Court for consideration, however, the same has not been stayed and as such it still holds the field. Even in the case of “S. N. Prasad, Hitek Industries (Bihar)” (supra), it has been held that reference to arbitration can be only with respect to parties to arbitration agreement and not the non-parties. In the circumstances above, it cannot be said that the learned trial Court went wrong in holding that the disputes in the suit regarding the liability of the defendants no. 4 to 6 to the reliefs sought for in the suit are beyond the arbitration agreement and as such, cannot be referred to arbitration. 38. In view of the above, it cannot be held that the trial court exercised jurisdiction not vested in it by law or that it failed to exercise a jurisdiction so vested or that it acted in the exercise of its jurisdiction illegally or with material irregularity. The scope of revision under section 115 of C.P.C. is very limited and cannot be exercised except in rarest of rare cases, howsoever, grossly erroneous. It cannot be said that the impugned order would occasion a failure of justice or an irreparable injury would be caused to the petitioners. 39. In the result, there being no merit in the revision petition, the same is dismissed. No order as to costs, in the facts and circumstances of the case.