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2015 DIGILAW 171 (ORI)

Bhagyalata Das v. East Coast Railway

2015-03-13

SANJU PANDA

body2015
JUDGMENT : Sanju Panda, J. 1. Petitioner in this application has challenged the order dated 9.12.2010 passed by learned Addl. Civil Judge (Sr. Divn.), Puri in C.S. No. 32/226 of 2002/2005 allowing an applications filed by the defendants to stay the suit and to direct the parties to implement Clause-29 of the agreement by referring the matter to the Arbitrator in compliance of the agreement entered into by the parties. The facts narrated in the present case are as follows:-- "Pursuant to the tender floated by the South Eastern Railway the present petitioner entered with an agreement with opposite party No. 2 on 14.8.2000 for mechanical washing, cleaning, drying, pressing and dressing of bed rolls of the South Eastern Railways and South Eastern Hotel, Puri for three years for a consideration amount of Rs. 53,11,440/-. As per the said agreement petitioner deposited the security amount for a sum of Rs. 2,32,836/- and bank guarantee for a sum of Rs. 6,80,000/-. As per the terms of the agreement the bill amount is to be paid to the plaintiff every month after petitioner performed the work. The bill prepared by the contractor was certified by the Station Manager, Puri. While the matter stood thus the dispute arose as the opposite parties failed to pay the washing charges to the petitioner in every month as per the terms and conditions of the agreement. Though the petitioner has submitted the bills regularly in each month and the Station Manager, Puri has given his certificate on the bills without indicating any deficiency of service or any objection on the work the opposite parties failed to pay the bill amount regularly. Before expiry of the agreement period, petitioner made investment towards installation of machine etc. As per the terms of the agreement petitioner requested opposite party No. 3 for extension of the said contract period. She was verbally allowed to perform the work after the expiry of the agreement period. Opposite parties failed to pay her dues despite presentation of bills." 2. Before expiry of the contract i.e. 13.8.2003 petitioner has filed W.P.(C) No. 5325 of 2003 against the opposite parties to allow her to complete five years term instead of three years. In the said writ petition she has filed Misc. Opposite parties failed to pay her dues despite presentation of bills." 2. Before expiry of the contract i.e. 13.8.2003 petitioner has filed W.P.(C) No. 5325 of 2003 against the opposite parties to allow her to complete five years term instead of three years. In the said writ petition she has filed Misc. Case No. 5013 of 2003 to stay issuance of fresh tender call notice for a period of beyond 13.8.2003 wherein this Court has directed to maintain status quo as on date. Thereafter she continued the work beyond the contract period. This Court while disposing of the writ petition on 2.8.2004 directed that what-so-ever the bills are submitted for the work discharged from 14th August, 2003 till the date of disposal of the writ petition shall be considered by the opposite parties and if the petitioner is found to be entitled to any payment there under the same shall be paid to her within a period of two months from the date of communication of the order. Pursuant to the said direction of this Court the bills of the petitioner has been considered after deduction as per the agreement. 3. Being not satisfied with the sanction bill the present petitioner as plaintiff has filed C.S. No. 32/226 of 2002/2005 for recovery of money with other consequential relief. The present opposite parties appeared in the suit and prayed for time to file the written statement. Subsequently defendants were set ex parte and suit was posted to 9.2.2007 for ex parte hearing. On 9.2.2007 defendants have filed a petition to set aside the ex parte order and to accept the written statement filed by the defendants. A separate petition also filed by the defendants to stay the suit and to direct the parties to implement the arbitration clause of the agreement. On the same date defendants have also filed an application to drop the suit as the same is not maintainable in view of Clause 29 of the agreement executed by the parties and the provisions of the Arbitration and Conciliation Act, 1996. Objection was filed by the plaintiff to the aforesaid applications taking a stand that defendants have appeared in the suit and availed several adjournments for filing the written statement. Defendants have not filed the original agreement or its certified copy not being accompanied with the petitions. Objection was filed by the plaintiff to the aforesaid applications taking a stand that defendants have appeared in the suit and availed several adjournments for filing the written statement. Defendants have not filed the original agreement or its certified copy not being accompanied with the petitions. The other ground of objection of the plaintiff was that the cause of action of the suit arose within the jurisdiction of the court. The Arbitration and Conciliation Act, 1996 will not ousted the jurisdiction of the court. It is also contended that plaintiff has not sought for any relief relying on the Arbitration Clause and the alleged Arbitration Clause is illegal, inoperative, inequitable, fraudulent and void which is not binding to the plaintiff. 4. The court below by order dated 9.1.2008 while setting the ex parte order directed for acceptance of the written statement subject to payment of cost of Rs. 500/-. The court below considering the petitions filed by the defendants and its objection allowed the applications filed by the defendants and directed to implement Clause-29 of the agreement regarding to dissolve the dispute by arbitration. 5. Learned counsel for the petitioner submits that the defendants after receiving summons have not choose to appear nor they have filed application to refer the matter at the first instance rather the defendants were set ex parte. Thereafter they have filed an application to set aside the order of ex parte, to accept the written statement and to implement the arbitration clause of the agreement after availing several adjournments for filing the written statement. Therefore the application filed by the defendants for reference as per the arbitration clause is liable to be rejected. In support of his contention he has cited the decision reported in Atul Singh and others V. Sunil Kumar Singh reported in AIR 2008 SC 1016 . Learned counsel appearing for the opposite parties however supports the impugned order and submitted that the petitioner has entered into an agreement knowing fully aware about the arbitration clause and the application was filed by the defendants to drop the suit. In view of the said arbitration clause the court has rightly referred the dispute to the named arbitrator therefore the impugned order need not be interfered with. 6. In view of the said arbitration clause the court has rightly referred the dispute to the named arbitrator therefore the impugned order need not be interfered with. 6. In view of the contention raised by the learned counsel for the parties and after going through the materials available on record the facts narrated in the above paragraphs are not disputed. Admittedly the application was filed at a belated stage by the defendants to refer the dispute as per the arbitration clause. It is also not disputed that the defendants are in a dominant position and they cannot take advantage of such position and force the plaintiff to go to the arbitration proceeding where the arbitrator is to be nominated by the General Manager taking service from the plaintiff. 7. The Apex Court in the case of Atul Singh(supra) held that an application under Section 8(1) shall not be entertained unless it accompanied by the original arbitration agreement or a duly certified copy thereof and Court has to first decide whether there was an agreement between the parties to refer the matter for arbitration before filing of their first statement. In view of the above settled position the court below without considering the same passed the impugned order which is an error apparent on the face of the record. Accordingly this Court sets aside the impugned order in exercising the jurisdiction under Article 227 of the Constitution of India and directs the court below to dispose of the suit as expeditiously as possible preferably by end of July, 2015 since pleadings of the parties completed. Parties shall cooperate with the trial court for early disposal of the suit. Accordingly the writ petition is disposed of.