Bateman Engineering (India) Pvt. Ltd. v. Pushpa Enterprises
2017-07-10
A.K.RATH
body2017
DigiLaw.ai
JUDGMENT : A.K.Rath, J. The sole question that hinges for consideration of this Court is as to whether the learned Civil Judge (Sr.Division), Rayagada after referring the matter to the arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 has jurisdiction to pass order under Order 38 Rule 5 C.P.C. for attachment before judgment. 2. Since the dispute lies in a narrow compass, it is not necessary to recount in detail the case of the parties. Suffice it to say that the opposite party as plaintiff instituted C.S.No.8 of 2015 in the court of the learned Civil Judge (Sr.Division), Rayagada for rendition of accounts impleading the petitioner as defendant. Pursuant to issuance of summons, the petitioner entered appearance and filed an application under Section 8 of the Arbitration and Conciliation Act (hereinafter referred to as “the Act”) to refer the dispute to arbitration. It was stated that the agreement between the parties provides for arbitration. The plaintiff filed objection. By order dated 6.8.2015, the learned trial court referred the matter to the arbitration. Cursorily on the same day, the learned trial court passed an order under Order 38 Rule 5 C.P.C. and directed the defendant to furnish security deposit of Rs.1,38,45,896/-. This petition under Article 227 of the Constitution of India seeks to laciniate the said order. 3. Heard Mr.B.P.Das, learned Advocate for the petitioner. None appeared for the opposite party. 4. Mr.Das, learned Advocate for the petitioner submitted that agreement between the parties provides an arbitration clause. In view of the same, the defendant filed an application under Section 8 of the Act to refer the matter to the arbitration. The learned trial court allowed the same. Thus, the court has no jurisdiction to pass interim order after referring the matter to the arbitration. He relied on a decision of the Hon’ble Apex Court in the case of State of Orissa Vrs. Madan Gopal Rungta, AIR 1952 SC 12 . 5. In Madan Gopal Rungta (supra), the respondent filed a writ application before this Court assailing the notification dated 8.6.1949 issued by the State of Orissa declaring the lease granted by the Ex-Ruler of Keonjhar in his favour to be void as well as the order cancelling temporary permit and directing to remove the assets appertaining to the mines. Four identical writ applications were also filed.
Four identical writ applications were also filed. A Division Bench of this Court came to a conclusion that the respondents had no alternative legal remedy, equally convenient, beneficial and effectual because the respondents could not file a suit till expiry of the period of sixty days required for the purpose under Section 80 C.P.C. and unless protected by the Court the respondents would undergo irreparable and irremediable loss of possession of the mining leases involving a huge waste of labour, machinery and other resources of equipments of immense value hardly capable of being remedied by payments of money as compensation. Thereafter the Court directed that three months from the date of the order or one week after institution of the suit, whichever is earlier, the State of Orissa should refrain from disturbing the petitioner’s possession over the mining areas in question and that thereafter the order will cease to have effect. The matter went to Apex Court. The Constitution Bench held that this is not a case where the Court before finally disposing of a petition under Article 226 gave directions in the nature of interim relief for the purpose of maintaining the status quo. Article 226 cannot be used for the purpose of giving interim relief as the only and final relief on the application as the High Court has purported to do. The directions have been given only to circumvent the provisions of Section 80 of C.P.C. and that is not within the scope of Article 226. The Constitution Bench of the Apex Court clearly spelt out the counter within which interim relief can be granted. The Apex Court held that an interim relief can be granted only in aid of and as ancillary to the main relief which may be available to the party on final determining of his rights in a suit or proceeding. 6. The ratio in the case of Madan Gopal Rungta (supra) proprio vigore applies to the facts of this case. The Court after referring the matter to arbitration ceases to have any jurisdiction over the matter and becomes functus officio. 7. As a sequel to the above discussions, the order dated 6.8.2015 passed by the learned Civil Judge (Sr.Division), Raygada in I.A.No.8 of 2015 arising out of C.S.No.8 of 2015 is quashed. The petition is allowed. No costs.