Karnataka High Court
Union Of India (Uoi) And Ors. vs C. Subba Reddy on 6 February, 2004
Equivalent citations: AIR2004KANT210, 2004(2)ARBLR271(KAR), 2004(3)KARLJ479, AIR 2004 KARNATAKA 210, 2004 AIR - KANT. H. C. R. 785, (2004) 2 ARBILR 271, (2004) 3 KANT LJ 479, (2004) 2 KCCR 1007
ORDER R.V. Raveendran, J.
1. Petitioners have filed this civil petition under Section 34 of the Arbitration and Conciliation Act, 1996 (for short, the Act) for setting aside the award dated 28-7-2003. The Registry has raised an objection about maintainability of the petition.
2. Petitioners rely on Section 42 of the Act to contend that a petition under Section 34 of the Act is maintainable before the High Court. Section 42 reads as under :
42. Jurisdiction :-- Notwithstanding anything contained elsewhere in this Part or in any other law for the time being in force, where with respect to an Arbitration agreement any application under this Part has been made In a Court, that Court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that Court and in no other Court."
Section 34 of the Act provides for recourse to a Court against an arbitral award. The term 'Court' has been defined in Section 2(e) of the Act, which reads thus :
2.(e) "Court" means the principal Civil Court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary original civil Jurisdiction, having Jurisdiction to decide the questions forming the subject-matter of the Arbitration if the same had been the subject-matter of a suit, but does not include any civil Court of a grade inferior to such principal Civil Court, or any Court of Small Causes :
Therefore, any petition under Section 34 will have to be filed in the Court of Principal Civil Court of original jurisdiction. In fact, the Registry has, while raising the objection, pointed out that in Kongarar Spinner Ltd., v. Maharashtra Apex Corporation Ltd. (CMP No. 13 of 2000, decided on 3-3-2000), it is held that the remedy under Section 34 should be availed by approaching Civil Court. Be that as it may.
3. The petitioners contend that as an application for appointment of an arbitrator had been filed under Section 11 of the Act, in CMP 36 of 2000 before the High Court, all subsequent applications arising out of the said agreement and arbitral proceedings will have to be filed only before the High Court, having regard to Section 42 of the Act. It is contended that therefore the petitioners have filed the petition under Section 34 before the High Court. It is no doubt true that Section 42 provides that where with respect to an Arbitration agreement any application under that Part has been made in a 'Court', that Court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall have to be made in that Court and in no other Court. The word 'Court' referred in the said Section is 'Court' defined in Section 2(e) of the Act, exercising adjudicatory or judicial power.
4. The power exercised under Section 11 of the Act is administrative in nature and the order that is passed is not an adjudicatory order in exercise of judicial power. The Chief Justice or his designate does not function as 'Court' or 'Tribunal' while exercising the power under Section 11 of the Act (vide --Konkan Railway Corporation Limited v. Rani Construction Private Limited, and Konkan Railway Corporation Limited v. Mehul Construction Company, . CMP 36 of 2000 was filed under Section 11 of the Act not before the 'High Court of Karnataka' but before designate of Chief Justice of High Court of Karnataka. The said petition under Section 11, was considered and disposed of by the designate of the Chief Justice, in exercise of administrative power's conferred under Section 11, and not by exercising adjudicatory power as a Judge of the High Court of Karnataka. Therefore, the designate of the Hon'ble Chief Justice is not a 'Court' referred to in Section 42 of the Act. Therefore, Section 42 will not enable a party wanting to challenge an award of the Arbitrator, to file a petition under Section 34 in the High Court, on the ground that an application in regard to the Arbitration agreement had been filed earlier in the High Court under Section 11 of the Act.
5. In view of the above, this petition is ordered to be returned for being presented before the proper Court. Learned counsel for the petitioner submitted that the petitioner proposes to present the petition before the City Civil Court, Bangalore and sought two weeks time to represent the petition. The petitioner is granted two weeks time to take return of the petition and represent it before the City Civil Court.
6. To avoid any confusion, henceforth, the Registry may ensure that in the applications filed under Section 11 of the Act and the orders made therein, the cause title is shown as : "Before the Designate of Hon'ble Chief Justice, High Court of Karnataka, Bangalore" instead of : "In the High Court of Karnataka, Bangalore".