State Consumer Disputes Redressal Commission
Mr. Prabhakar Balkrishna Vernekar, vs Mr. Madhav V. Joshi, on 27 March, 2014
BEFORE THE GOA STATE CONSUMER DISPUTES REDRESSAL COMMISSION PANAJI GOA RP No. 22/2013 1. Mr. Prabhakar Balkrishna Vernekar, 2. Mrs. Prabhavati Prabhakar Vernekar, Both residents of Dattaprasad Mansion, Xelpem, Duler, Mapusa Goa. Petitioners v/s. Mr. Madhav V. Joshi, Resident of flat No. SF-3, Prabhavati Apartments, Cuchelim, Bardez Goa. . Respondent RP No. 23/2013 1. Mr. Prabhakar Balkrishna Vernekar, 2. Mrs. Prabhavati Prabhakar Vernekar, Both residents of Dattaprasad Mansion, Xelpem, Duler, Mapusa Goa. Petitioners v/s. Mr. Ganesh Chari (expired) Legal heirs i) Smt. Gauri Ganesh Chari ii) Ms. Harshad Ganesh Chari iii) Ms. Santoshi Ganesh Chari iv) Ms. Akshara Ganesh Chari All R/o Flat No. SF-6, Prabhavati Apartments, Cuchelim, Bardez Goa. . Respondent RP No. 24/2013 1. Mr. Prabhakar Balkrishna Vernekar, 2. Mrs. Prabhavati Prabhakar Vernekar, Both residents of Dattaprasad Mansion, Xelpem, Duler, Mapusa Goa. Petitioners v/s. Mr. Dilip Parab, Resident of flat No. G-4, Prabhavati Apartments, Cuchelim, Bardez Goa. . Respondent RP No. 25/2013 1. Mr. Prabhakar Balkrishna Vernekar, 2. Mrs. Prabhavati Prabhakar Vernekar, Both residents of Dattaprasad Mansion, Xelpem, Duler, Mapusa Goa. Petitioners v/s. Mr. Raghunath Madhukar Mandrekar, Resident of flat No. GF-1, Prabhavati Apartments, Cuchelim, Bardez Goa. . Respondent Petitioners/OPs are represented by Adv. Shri. N.G. Kamat. Respondents/Complainants are represented by Adv. Shri. R. Bhaip. Coram: Shri Justice N.A. Britto, President. Smt. Vidhya R. Gurav, Member. Dated: 27/03/2014 ORDER
[Per Shri Justice N.A. Britto, President] These revisions can be conveniently disposed off by this common order as the facts are common and so also the law applicable thereto.
2. The Opposite Parties are the owners of the land surveyed under No. 94/5 of Mapusa City Survey admeasuring about 1875 sq.mtrs and had undertaken the development of the said property by constructing a multi-storeyed building known as Prabhavati Apartments. The complainants had entered into agreements with the OPs for sale of different flats on different dates and at different prices and one of the clauses of the agreements stipulated that the OPs as vendors/builders would execute a deed of conveyance in favour of the purchaser or any other person so assigned by the purchaser after receipt of all dues from the purchaser. Another clause stipulated that in case of any dispute between the parties as regards this agreement and/or interpretation of the same, the dispute shall be referred to the architect of the project appointed by the vendor/builder and such architect would function as arbitrator and shall decide the dispute as per law and the proceedings before him would be governed by the provision of Indian Arbitration Act, 1942. (1996?)
3. The complainants alongwith other residents/flat owners have formed an association known as Prabhavati Apartments Residents Association, as according to them, the OPs neither completed the construction of building in all respects nor formed any co-operative society of the residents of the building but only handed over possession of the respective flats without any transfer documents such as sale deed.
4. The complainants after several letters, addressed a letter dated 30/03/12 to the OPs requesting them to inform the complainants within 7 days from the date of receipt of the said letter about the amount owed by the complainants and also to inform the date on which the OPs were executing the sale deeds of the flats of the complainants but the OPs did not reply to the same nor executed the sale deeds. The complainants then sent advocatess notice dated 9/5/12 calling upon the OPs to execute the sale deeds within 15 days which was also not replied to nor complied with. According to the complainants, since there was an arbitration clause in the said agreements and the architect of the OPs was appointed to be the arbitrator, to resolve the dispute between the parties, one of the colleagues of the complainant Shri. Raghunath Mandrekar addressed a letter dated 22/06/2012 to the said architect Shri. Sandeep Hari Falari to initiate arbitration proceedings and issue necessary notices to the OPs and to fix a date of hearing in the matter and as the said architect Shri. Sandeep Hari Falari refused to entertain the request of the said Raghunath Mandrekar, all these complainants through their advocate addressed a registered letter dated 28/06/2012 to the said architect Shri. Falari requesting him to initiate arbitration proceedings within 7 days from the receipt of the said letter failing which they would presume that architect Shri. Falari was not interested to act as an arbitrator and the complainants would be compelled to approach the appropriate court of law including the District Forum for appropriate reliefs, and, although the said advocates notice was received by architect Shri. Falari on 29/06/2012, architect Shri. Falari refused to initiate arbitration proceedings and therefore it has to be presumed that architect Shri. Falari is not interested to act as an arbitrator.
5. The complainants, therefore, filed a common complaint before the Lr. District Forum, but the same was withdrawn on 1/10/12 with liberty to file fresh complaints and the complainants claim that after the withdrawal of the said common complaint, the OPs executed a sale deed on 24/11/11 in favour of Shri. Krishnanada Rama Nayak and since the OPs had failed and neglected to execute sale deeds in their favour, the complainants filed the present complaint/s on or about 21/12/12 for a direction to the OPs for execution of sale deeds, for damages, etc.
6. We have referred only to bare avernments in the complaints, just necessary to dispose of these revisions.
7. The OPs being served with notice of the complaints, filed an application dated 12/04/13, under Section 8 of the Arbitration and Conciliation Act, 1996 seeking reference of the dispute to arbitration which came to be dismissed by the impugned order/s which say:
It is seen that complainant had indeed made efforts to invoke provisions of Arbitration proceedings under the Agreement and that the Arbitrator specified in the Agreement had failed to respond/live up to his duties and obligations.
Even otherwise, a consumer is not debarred from approaching Consumer Fora for resolution of his grievance if he so chooses to do so.
8. We have heard Lr. Adv. Shri. N.G. Kamat and Shri. R. Bhaip.
9. Shri. N.G. Kamat, the lr. advocate of the OPs, would submit that the application under Section 8 of the Arbitration and Conciliation Act, 1996 (Act of 1996, for short) has been dismissed by the Lr. District Forum without assigning any reasons and inspite of the fact that the agreement between the parties by virtue of Clause 27 thereof, had provided for the dispute between the parties to be settled by reference to the architect of the project. Lr. advocate would submit that the complainants did invoke the arbitration clause by letter dated 22/06/12 requesting him to initiate arbitration proceedings by issuing necessary notices to the OPs and fixing the date for hearing but the said architect Shri. Falari did not react to the same. Lr. advocate would submit that the OPs had also filed written submissions in support of their said application under Section 8 of the Act of 1996 and had placed reliance on the decision of this State Commission in the case of Prasad K. Amonkar vs. S.K. Land Developers and ors., 2012 (4) CPR 15, but the Lr. District Forum chose to pass a cryptic order without reference to the said decision and without giving any reasons. Lr. advocate would submit that Section 3 of the C.P. Act, 1986 would not come in the way of the OPs in view of Section 8 of the Act of 1996.
Reliance has been placed by Shri. Kamat on the decision of the National Commission in case of S. Balwant Singh vs. Kanpur Development Authority, III 2007 CPJ 425.
10. On the other hand, Shri. R. Bhaip, the lr. advocate of the complainants would submit that the complainants initially met personally the said architect Shri. Falari and then wrote the said letter dated 22/06/12, copy of which was sent to the OPs by ordinary post. Lr. Adv. Shri. Bhaip also submits that thereafter a legal notice was sent to the said architect Shri. Falari on 28/06/12 and in the light of the submissions made on behalf of the OPs, the complainants may have to consider of taking recourse to the provision of the Act of 1996.
11. Admittedly, the C.P. Act, 1986 could be said to have been conceived if we may used that expression, in the resolution of the General Assembly of the United Nations passed on 9th April 1985, adopting a set of general guidelines for consumer protection, with the Secretary General of the United Nations being authorized to persuade the member countries to adopt the guidelines either through policy changes or by law. The Indian Parliament, then enacted the C.P. Act, 1986 which received the assent of the President of India on 24/12/1986.
Section 3 of the C.P. Act, 1986, provides that the provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.
12. Admittedly, the Arbitration Act, 1940 (Act of 1940) was in force at the time when the C.P. Act, 1986 came in force.)
13. Likewise, the Act of 1996 was also conceived after the United Nations Commission on International Trade had adopted a model law on International Commercial Arbitration and the General Assembly of the United Nations had recommended that all countries give due consideration to the said Model Law and use the conciliation rules in cases where the disputes arise in the context of international commercial relations. Initially, the President of India on 16/01/1996 promulgated the Arbitration and Conciliation Ordinance, 1996 which was revised on 26/03/1996 and again on 21/06/1996, as the ordinances could not be replaced by law, as Parliament was not in session, and ultimately the Act of 1996 was passed by both the Houses of Parliament and received the assent of the President of India on 16/08/1996.
It has inter alia, Section 8 which gives power to judicial authorities to refer parties to arbitration where there is an arbitration agreement. Sub-section (1) of Section 8 of the Act of 1996 provides that a judicial authority before which an action is brought in a matter which is the 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.
Sub-section (2) thereof provides that the application referred to in Sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof, and, Sub-section (3) further provides that notwithstanding that an application has been made under Sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and arbitral award made.
14. Admittedly, the agreement between both the parties to the complaint/s had an arbitration clause by virtue of which the parties had chosen to appoint a named arbitrator, namely architect Shri. Falari, the architect of the project of the OPs. Admittedly, also the complainant had taken recourse to the said arbitration clause and called upon the said arbitrator to enter reference and decide the dispute raised by the complainants. The named arbitrator, for reasons best known to him, chose to ignore the oral request and the written letters of the complainants, and, because of that the complainants thereafter approached the Lr. District Forum, with their complaints.
The first question, therefore, is whether the complainants having invoked the arbitration clause and resorted to arbitration, were entitled to abandoned the same and then invoke the jurisdiction of the Lr. District Forum? This of course, assuming the complainants had a choice.
15. In our view, the complainants having invoked the jurisdiction of the arbitrator, in the first instance, had to proceed in that direction and in case the arbitrator had not entertained their request, they had to invoke the other provisions of the Act of 1996 and compel him to do so.
The complainants having invoked the arbitrators jurisdiction could not have abandoned the same and filed complaints before the District Forum. There appears to be preponderance of judicial authority in support of this view.
(a) The National Commission in S. Balwant Singh vs. Kanpur Development Authority (supra) has held that once a consumer has invoked the jurisdiction of the arbitrator he cannot file a complaint against the order of the arbitrator before a Consumer Fora. Section 3 of the C.P. Act, 1986 does provide for additional remedy but it is for the person to decide as to which Forum to opt for. If the petitioner and his predecessor in his interest had invoked the provisions of arbitration, then Section 3 of the C.P. Act, 1986 will not help the consumer. If the complainant was not satisfied with the award of the arbitrator then the remedy does not lie by way of filing a complaint before the Consumer Forum. Forum hopping is not envisaged under the provisions of C.P. Act, 1986.
(b) This Commission in CC. No. 24/12 filed by M/s. Sardessai Engg. Works and anr. vs. Electricity Department of Goa and ors., by unreported order dated 4/4/13 has held that the Complainant having chosen, opted and elected to approach the Fora under the Electricity Act, 2003, his quest for justice has to end or rather has ended via that route with the Order of the Consumer Grievances Redressal Forum and the Ombudsman. The Complainant cannot be allowed to change that route now and come before the Fora under C.P. Act, 1986. This is nothing but Forum hopping which is not contemplated under the C.P. Act, 1986, or any other law. The doctrine of election says that where, either of two alternative tribunals are open to a litigant, each having jurisdiction over the matters in dispute and he resorts for his remedy to one of such tribunals in preference to the other, he is precluded, as against his opponent, from any subsequent recourse to the latter (see 2013(1)CCC 176).
This doctrine is also recognized in para 52(V)(v) of Accounts Officer, Jharkhand, supra. Therefore, the complainant having approached the Consumer Grievances Redressal Forum established under Section 42(5) of the Electricity Act, 2003, is now precluded from coming back to the Fora under the C.P. Act,1986.
(c) The Apex Court in para 29, in National Seeds Corporation Ltd. vs. M. Madhusudhan Reddy, 2013 (4) CPR 345, has held that the remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He could either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for remedy of arbitration then it may be possible to say that he cannot, subsequently, file complaint under Consumer Act.
(d) In Balwant Singhs case, (supra), the complainant consumer had invoked the jurisdiction of the arbitrator and had obtained an award but that would not dilute the principle in any manner. What is important to be noted is that the complainant had invoked the jurisdiction of the arbitrator and therefore had to proceed in that direction assuming of course he had a choice of remedies like in the case of M/s. Sardessai Engg. Works & anr. vs. Electricity Department of Goa & ors.
16. The Lr. North Goa District Forum, time and again, has been reminded that they are required not to pass cryptic orders and are required to give reasons in support of the orders passed. In RP No. 3/11 filed by HDFC Bank Ltd., against one Mr. Mohamad Younus, this Commission by order dated 20/01/12 has held as follows:
6. There can be no dispute that the orders passed by the Fora under C.P. Act, 1986, are expected to be short and precise as practicable, but they are not certainly expected to be cryptic, reflecting non application of mind to the facts of the case. The impugned order suffers from that vice. The Impugned Order is cryptic and shows non application of mind.
7. It is now well settled that a quasi judicial authority must record reasons in support of the order passed. As observed by the Apex Court, insistence of recording of reasons is meant to serve a wider principle of justice that justice must not only be done but also appear to have been done. Reasons reassure that discretion has been exercised by the decision maker on relevant grounds and by disregarding extraneous considerations. Reasons facilitate the process of judicial review by superior courts. Insistence of reasons is a requirement of both judicial accountability and transparency (See Kranti Associates Pvt. Ltd., V/s. Masood Ahmed Khan and others) (2010) 9 SSC
496).
17. Again, in New India Assurance Co. Ltd., vs. Shyam Umakant Naik 2012(4) CPR 22, this Commission has held that:
14. The Fora under the Act are not expected to go against reason and against law. No doubt, their orders are expected to be short and precise, as precise as practible but not opposed to reason and the law. The Consumer Courts, if we may use that expression, were created to supplement and not to supplant the jurisdiction of the Civil Courts. They were meant to provide a simple, summary, less expensive and more expeditious remedy to settle consumer grievance.
As observed by the Apex Court in Vishwa Bharati House Building Co-operative Society (2003(2) All M.R. 1091, it is one of the postulates of such a body that it should arrive at a decision based on reason. Ours is a country governed by rule of law and when points of law were urged by one of the parties it was expected of the Lr. District Forum to answer the same. The words of Thomas Fuller Be you ever so high, the law is above you have now become our judicial dictum. By way of illustration we may refer to Marine Contract Services South Pvt. Ltd. (AIR 1999 SC 80) wherein the Apex Court showed a little surprise when the National Commission held that the provisions of Contract Act were not applicable to complaints filed under the Consumer Protection Act and held that the Contract Act applied to all.
18. Yet again, in Charan Singh vs. Healing Touch Hospital, 2000 (7) SCC 668, the Apex Court has held that one of the postulates of the Forum is that it should arrive at a conclusion based on reason. The necessity to provide reasons, howsoever brief in support of its conclusion by such Forum, is too obvious to be reiterated and needs no emphasizing. Obligation to give reasons not only introduces clarity but it also excludes, or at any rate minimizes, the chances of arbitrariness and the higher Forum can test the correctness of those reasons.
19. However, these are cases where the complainants had no choice or option but a mandate of law to be complied with, in view of Section 8 of the Act of 1996. It appears that the complainants were well aware of this position when they called upon the named arbitrator to enter reference. When Parliament enacted the C.P. Act, 1986, Parliament wanted to give prominence to C.P. Act over the then existing laws in force. Thats why it enacted Section 3. A decade later, when Parliament enacted the Act of 1996, Parliament gave prominence to arbitration as one of methods of dispute resolution (and later incorporated it in Section 89 of C.P.C. w.e.f. 1/7/2002) and for that reason created a mandate by way of Section 8 thereof. Arbitration proceeding were never meant to be cumbersome. That some of our retired judges and lawyers have made them cumbersome is entirely a different matter. The object of the Act of 1996, as stated by the Apex Court in P.V.G. Raju (died) and ors (infra) was to encourage resolution of disputes expeditiously and less expensively, when there is an arbitration agreement. Not that the object of C.P. Act, 86 was different but Parliament intented that arbitration had to be given more prominence. Hence Parliament created a mandate by enacting Section 8.
20. Coming to the case of Prasad K. Amonkar vs. S.K. Land Developers and ors., 2012(4) CPR 15 decided by this Commission we are of the opinion that the view expressed therein should still hold the field, notwithstanding the view expressed by the Apex Court in National Seeds Corporation Ltd., vs. Madhusudhan Reddy & anr. (supra) to the effect that if a consumer chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking by Section 8 of the Arbitration and Conciliation Act, 1996 as the plain language of Section 3 of the C.P. Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force.
Coming to the said conclusion, the Apex Court had referred to its earlier decisions in Fair Air Engineers Pvt. Ltd., vs. N.K. Modi, 1996 (4) CTJ 749, Skypak Couriers Ltd., vs. Tata Chemicals Ltd., 2000 CTJ 321, and Trans Mediterranean Airways vs. Universal Exports, 2011 (2) CCC 281. It may be noted here, that the case of Fair Air Engineers Pvt. Ltd., vs. N.K. Modi, had dealt with Section 3 of the C.P. Act, 1986 in relation to Section 34 of the Act of 1940 which was very much in force when the C.P. Act was brought in force. Likewise, in the case of Skypak Couriers Ltd., vs. Tata Chemicals Ltd., (supra) the Apex Court noted that the National Commission was referring the matters to the third persons for consensual adjudication dehors the Arbitration Act and then making those awards the rule of the Court by passing orders based on the award and the Commission was not applying its own mind for adjudication of the disputes and thereby abdicating their own functions and duties, procedure which was unwarranted and unjustified. The Apex Court presumed, without laying down any law, in that behalf, that the National Commission could even refer disputes to Arbitration/Conciliation. However, such reference to arbitration could only be under the provisions of Arbitration Act, 1940 or the Arbitration or Conciliation Act, 1996 and proceeded to treat the award as an award made by an arbitrator by giving option to the parties to file objections and a direction to the National Commission consider the said objections and give its own decision. In Trans Mediterranean Airways vs. Universal Exports (supra), the Apex Court held that the National Commission under the C.P. Act had jurisdiction to entertain and decide a complaint filed by the consignor claiming compensation for deficiency of service by the carrier, in view of the provisions of the Carriage by Air Act, 1972 read with the Warsaw Convention, as the National Commission could be considered a Court within the territory of a High Contracting Party for the purpose of Rule 29 of the second schedule to the Carriage by Air Act and the Warsaw Convention. It may also be noted that none of the aforesaid three decisions specifically dealt with Section 8 of the Act of 1996 which came in force almost a decade later after the C.P. Act, 1986 was enforced. The Hon. Supreme Court, with greatest respect, has made the observation referred to hereinabove in National Seeds Corporation, supra, assuming that the Act of 1996 was in force within the meaning of Section 3 of the C.P. Act 1986. It was not.
21. In Prasad K. Amonkar vs. S.K. Land Developers & ors., (supra) we had referred to our decision in the case of M/s. Alka S. Nayak vs. Shivprasad R. Kakodkar and two ors., 2012 (1) CCC 189, and, held that:
11.
In the case of Mrs. Alka S. Nayak (supra) we had taken note of several later decisions of the Apex Court and that of Calcutta High Court in Indusind Bank Ltd., before coming to the conclusion that the mandate Section 8 of 1996 Act had to be followed, following the ratio of Indusind Bank Ltd. vs. Gadadhar Banerjee (unreported decision dated 1/4/10 in CO. No. 223/2009) and had directed the parties to act in terms of the said agreement between them by referring the present dispute to arbitration.
12. Sub Section (1) of Section 8 of the Arbitration & Conciliation Act, 1996 provides that a judicial authority before which an action is brought in a matter which is the 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.
Sub-Section (2) further provides that the application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.
13. In Branch Manager, Magma Leasing & Finance Ltd., & anr., (2009) 10 SCC 103, the Apex Court has held that Section 8 of 1996 Act is in the form of a legislative command to the court and once the prerequisite conditions are satisfied, the court must refer the parties to arbitration. In Agri Gold Exims Ltd., (2007) 3 SCC 686, the Apex Court has held that Section 8 of 1996 Act is peremptory in nature and in case where there exists an arbitration agreement, the court is under obligation to refer the parties to arbitration in terms of the arbitration agreement.
22. We could add yet two other decisions of the Apex Court in P. Anand Gajapathi Raju & ors. vs. P.V.G. Raju (Died) & ors., 2000 (4) SCC 539 and Smt. Kalpana Kothari vs. Smt. Sudha Yadav and ors., AIR 2001 SC 404 . In P. Anand Gajapathi the Apex Court has held that:
In the matter before us, the arbitration agreement covers all the disputes between the parties in the proceedings before us and even more than that. As already noted, the arbitration agreement satisfies the requirements of Section 7 of the new Act. 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 Courts 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. We, therefore, allow the application and would refer the parties to arbitration. No further orders are required in this appeal and it stands disposed of accordingly. (emphasis supplied)
23. In the case of Smt. Kalpana Kothari vs. Smt. Sudha Yadav & Ors., AIR 2001 SC 404, the Apex Court has held that:
We are of the view that the High Court did not properly appreciate the relevant and respective scope, object and purpose as also the considerations necessary for dealing with and disposing of the respective applications envisaged under Section 34 of the 1940 Act and Section 8 of the 1996 Act. Section 34 of the 1940 Act provided for filing an application to stay legal proceedings instituted by any party to an arbitration agreement against any other party to such agreement, in derogation of the arbitration clause and attempts for settlement of disputes otherwise than in accordance with the arbitration clause by substantiating the existence of an arbitration clause and the judicial authority concerned may stay such proceedings on being satisfied that there is no sufficient reason as to why the matter should not be referred to for decision in accordance with the arbitration agreement, and that the applicant seeking for stay was at the time when the proceedings were commenced and still remained ready and willing to do all things necessary to the proper conduct of the arbitration. This provision under the 1940 Act had nothing to do with actual reference to the arbitration of the disputes and that was left to be taken care of under Sections 8 and 20 of the 1940 Act. In striking contrast to the said scheme underlying the provisions of the 1940 Act, in the new 1996 Act, there is no provision corresponding to Section 34 of the old Act and Section 8 of the 1996 Act mandates that the Judicial Authority before which an action has been brought in respect of a matter, which is the subject matter of an arbitration agreement, shall refer the parties to arbitration, if a party to such an agreement applies not later than when submitting his first statement. The provisions of the 1996 Act do not envisage the specific obtaining of any stay as under the 1940 Act, for the reason that not only the direction to make reference is mandatory but not withstanding the pendency of the proceedings before the Judicial Authority or the making of an application under Section 8 (1) of the 1996 Act, the arbitration proceedings are enabled, under Section 8 (3) of the 1996 Act to be commenced or continued and an arbitral award also made unhampered by such pendency.
The Apex Court further observed that the fact that the earlier application under the 1940 Act was got dismissed as not pressed in the teeth of the repeal of the said Act cannot, in our view, constitute any legal impediment for having recourse to and avail of the avenues thrown open to parties under the 1996 Act.
Similarly, having regard to the distinct purposes, scope and object of the respective provisions of law in these two Acts, the plea of estoppel can have no application to deprive the appellants of the legitimate right to invoke an all comprehensive provision of mandatory character like Section 8 of the 1996 Act to have the matter relating to the disputes referred to arbitration, in terms of the arbitration agreement. (emphasis supplied)
24. Reverting to Prasad K. Amonkar vs. S.K. Land Developers this Commission held that:
The 1996 Act being a special law and having been enacted later in point of time ought to prevail on the provisions of C.P. Act, 1986. Section 8 of the 1996 Act is peremptory and casts an obligation on the judicial authority to refer the parties to arbitration. The prerequisites of Section 8 are satisfied in this case and the said prerequisites having been satisfied this Commission has no other option but to refer the dispute to arbitration and this may have the effect of ousting the jurisdiction of the Commission, by necessary implication.
15.
The first choice of the parties in the event of dispute, chosen by them, is by way of settlement through an arbitrator. The parties are therefore required to adhere to their first choice.
25. The ratio of Prasad K. Amonkar, supra, is applicable with equal force to the facts of the cases at hand.
26. It has been consistently held by the Apex Court that the Fora under the C.P. Act is a Judicial Authority within the meaning of Section 8 of the Act of 1996 and this position is also reiterated National Seeds Corporation Ltd., (supra). The Legislature is presumed to have been aware of the Contract Act as well as Section 3 of the C.P. Act, 1986 when it enacted Section 8 of the Act of 1996 making it compulsory to get the dispute sorted out by arbitration when the matter is the subject of an arbitration agreement and in case where the party applies to the Judicial Authority for reference to arbitration, before submitting his first statement on the substance of the dispute. There is absolutely no dispute that the OPs had complied with the provisions of Section 8 of the C.P. Act 1996 and therefore the Lr. District Forum ought to have allowed the application filed by the OPs and referred the parties to arbitration.
27. The decision of the Apex Court in M/s. National Seeds Corporation Ltd., supra, was rendered without considering the two decisions referred to in para 13 in the case of Prasad K. Amonkar (supra) and two decisions referred in para 22 hereinabove and without considering the mandate of Section 8 of the Act of 1996 and so also the principle that when there are two special enactments (C.P. Act, 1986 being one of them and the Act of 1996 being the other) the later enactment would prevail, and, as such the decision has got to be considered as per incuriam. In any event, we have a choice to go by the said four decisions of the Apex Court which specifically deal with Section 8 of the Act of 1996 in preference to M/s. National Seeds Corporation Ltd., (supra).
It is well settled that when there is conflict between two judgements (here it is 4:1) delivered by coordinate Benches of the Supreme Court, it is not necessary that the later judgement of the Supreme Court need be followed. We can follow, which in our view, is better in point of law (see Kisan S. Patil vs. Ragho V. Patil, 2007 (4) Mh. L.J. 311). The decision reported in III 2008 CPJ 117 is to the same effect.
28. In view of the above discussion, and following the ratio of Prasad K. Amonkar, supra, we allow these revision petitions, and set aside the impugned orders of the Lr. District Forum. Consequently, we allow the applications for reference filed by the OPs and refer the parties to the named arbitrator Architect Shri. Falari to decide the dispute raised by the complainants. We hope that Shri. Falari will now initiate arbitration proceedings in terms of the request made by both the parties as expeditiously as possible, and, in any event within a period of two months and conclude the same within the next 3 months or so, and thus save time, money and energy of both the parties.
29. With the above observations we dispose off the revisions. With no order as to costs.
[Smt. Vidhya R. Gurav] [Shri. Justice N.A. Britto] (Member) (President) SP/-