Himachal Pradesh High Court
Chaggan Lal vs Nand Lal Sharma S/O Chajju on 5 April, 2022
Author: Vivek Singh Thakur
Bench: Vivek Singh Thakur
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
ON THE 5th DAY OF APRIL, 2022
BEFORE
.
HON'BLE MR. JUSTICE VIVEK SINGH THAKUR
ORIGINAL MISCELLANEOUS PETITION No. 338 OF 2020 IN ARB.
CASE NO. 11 OF 2020
Between:-
1. CHAGGAN LAL, S/O SH. NARAYAN
RAM, ASA BIOTECH, 124, HPSIDC,
INDUSTRIAL AREA BADDI,
DISTRICT SOLAN, (H.P.)-173205.
2. ANIL KUMAR, S/O SH. RATTAN
CHAND, ASA BIOTECH, 124,
HPSIDC, INDUSTRIAL AREA BADDI,
DISTRICT SOLAN, (H.P.)-173205.
3. M/S CUREHEALTH
PHARMACEUTICAL PVT. LTD. AT
VILLAGE RAIPUR, P.O. DEOTHI,
DISTT. SOLAN (H.P.) THROUGH
APPLICANT NO. 1. ....APPLICANTS
(BY SH. R.K. BAWA, SENIOR ADVOCATE
WITH MR.AJAY KUMAR SHARMA, ADVOCATE.)
AND
1. NAND LAL SHARMA S/O CHAJJU
RAM SHARMA, R/O NAND
BHAWAN, WARD NO. 10, SERI
ROAD, TEHSIL AND DISTRICT
SOLAN (H.P.)-173212.
2. TIRATH RAM S/O SH. CHAIN SUKH,
R/O VILLAGE CHEWA, P.O.
KUMARHATTI, TEHSIL AND
DISTRICT SOLAN (H.P.)-173229.
3. YASH PAL GOEL, S/O SH. BALDEV
KRIHAN GOEL R/O HOUSE NO.
873, SECTOR-2, PANCHKULA
(HARYANA)-134112.
4. DEVI DAYAL GARG S/O SH. PREM
CHAND, R/O HOUSE NO. 50,
GUHLA ROAD, WARD NO. 15,
NEAR PUNJAB NATIONAL BANK,
PROFESSOR COLONY, CHEEKA,
KAITHAL (HARYANA)-136035.
5. VISHAL MITTAL S/O SH. JIA PAL
MITTAL, R/O HOUSE NO. 49,
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2 OMP No. 338 of 2020 in
Arb. Case No. 11 of 2020
GUHLA ROAD, WARD NO. 15,
NEAR PUNJAB NATIONAL BANK,
PROFESSOR COLONY, CHEEKA ,
KAITHAL (HARYANA)-136035.
6. SH. ANAND SHARMA, SR.
.
ADVOCATE, THE SOLE
ARBITRATOR, HIGH COURT OF ....RESPONDENTS
HIMACHAL PRADESH, SHIMLA
(H.P.)-171001.
(BY Sh. B.P. SHARMA, SENIOR
ADVOCATE WITH MR.ARUN KUMAR, ADVOCATE,
FOR RESPONDENTS NO. 1 AND 2.)
(BY SH. SANJAY KUMAR, ADVOCATE,
FOR RESPONDENT NO. 3.)
(RESPONDENTS NO. 4 AND 5 ARE
EX PARTE VIDE ORDER DATED 19.10.2021.)
(RESPONDENT NO. 6 STANDS DELETED
VIDE ORDER DATED 6.3.2020.)
Whether approved for Reporting? Yes.
This application coming on for orders this day, the Court
passed the following:
ORDER
This application has been filed by applicants/respondents No. 1 and 2 for setting aside order dated 28.8.2020 passed by Registrar (Judicial), whereby he has accepted solvent security bond furnished by and on behalf of petitioners No. 1 to 3, on various grounds.
2. Preliminary objection has been taken by non-
applicants/petitioners that in view of Rule 5 of Chapter-II of the High Court of Himachal Pradesh (Original Side) Rules, 1997 (herein after referred to 'Original Side Rules, 1997'), whereby appeal is provided against any such order passed by Registrar (Judicial), present application is not maintainable.
3. Submitting that Registrar (Judicial) has acted under direction passed by the Court, it has been contended on behalf of non-
applicants/petitioners that Rules 3 (16), 3(34) and 3(35) of Chapter-II of ::: Downloaded on - 24/12/2022 09:12:12 :::CIS 3 OMP No. 338 of 2020 in Arb. Case No. 11 of 2020 Original Side Rules, 1997 empower the Registrar to exercise powers of the Court in relation to the matters like present one, against which appeal is available under Rule 5 of Chapter-II of the Original Side Rules, .
1997 to the Judge in Chambers.
4. Learned counsel for the respondents/applicants has submitted that Arbitration and Conciliation Act, 1996 (herein after referred to as the 'Act') is complete Code in itself, which is a special enactment and for proceedings to be conducted under the Act, no assistance from any other Statute is required. Further that Arbitrator has power to adopt its own procedure and application/petition under Section 34 of the Act is governed neither by the Original Side Rules, 1997 nor by High Court of Himachal Pradesh (Appellate Side) Rules, but it is a statutory proceeding provided under the Special Act and, therefore, General Procedure will be applicable and thus, Original Side Rules 1997, referred on behalf of non-applicants/petitioners, are not applicable in present case for setting aside the order of Registrar (Judicial), whereby he has wrongly accepted the solvent security.
Therefore, it has been canvassed that present application is maintainable.
5. In response, learned counsel for the non-
applicants/petitioners has referred Section 2(e)(i) of the Act, wherein High Court has been included as Principal Civil Court of original civil jurisdiction to decide the question forming the subject matter of arbitration. Referring Section 34 of the Act, it has been pointed out that it provides recourse to a Court against an arbitral award by filing an application for setting aside such award in accordance with the ::: Downloaded on - 24/12/2022 09:12:12 :::CIS 4 OMP No. 338 of 2020 in Arb. Case No. 11 of 2020 provisions contained in this Section. It has been contended that before filing application under Section 34 of the Act, there is no role of the court except appointing the Arbitrator and arbitration proceedings are .
conducted by an Arbitrator who does not act as a Civil Court and, therefore, it has been submitted that petition under Section 34 of the Arbitration and Conciliation Act is original side litigation in which Original Side Rules, 1997 are applicable.
6. Rules 3, 3(16), 3(34) and 3(35) of Chapter-II of the Original Side Rules, 1997 read as under:-
"3. Powers of the Registrar.--The power of the Court in relation to the following matters may be exercised by the Registrar:-
(1-15) .... ... ... ... ...
(16) applications for the execution of a document or for the endorsement of a negotiable instrument under O. CCI, rule 34 of the Code;
(17-33) .... .... ... ...
(34) other interlocutory applications directed by the Judge hearing the case to be placed for disposal before the Registrar; and such other applications as by these rules are directed to be so disposed of but not included in this rule;
(35) Any matter which in accordance with orders or directions issued by the court is required to be dealt with by the Registrar;
7. Rule 5 of Chapter-II of Original Side Rules, 1997 reads as under:-
"Appeal against the Registrar's orders.--- Any person aggrieved by any order made by the Registrar under Rule 3 above or Rule 2(b) of Chapter IV of thee Rules may, within fifteen days of the making of such order, appeal against to the Judge in Chambers. The appeal shall be in the form of a petition bearing Court fee stamp of the value of Rs.2.65 Ps."
8. Section 2(e)(i) of the Arbitration and Conciliation Act, 1996 reads as under:-
::: Downloaded on - 24/12/2022 09:12:12 :::CIS 5 OMP No. 338 of 2020 in Arb. Case No. 11 of 2020"(i) in the case of an arbitration other than international commercial arbitration, 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;
9. Relevant portion of Section 34 of the Act, reads as under:
"34. Application for setting aside arbitral award.--(1) Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub-section (3).
(2)... ... ... ... .. .."
10. Arbitration Act provides resolution of dispute through arbitration to be conducted by the Arbitrator(s). Arbitrator is not a Court, but is an adjudicatory authority, as provided under the Act. Section 34 of the Act provides that arbitral award may be set aside on filing an application for setting aside such award to a Court.
11. Section 34 of the Act speaks about filing of an application, but not an appeal or revision and the Court referred in Section 34 is the Court as defined in Section 2(e)(1) of the Act which is Principal Civil Court of original jurisdiction, including the High Court in exercise of its original civil jurisdiction. Application under Section 34 of the Act, depending upon the pecuniary value of the dispute, may be filed either in Principal Civil Court of original jurisdiction, i.e. District Judge in Himachal Pradesh or in the High Court invoking its original side jurisdiction. Therefore, I am of the considered opinion that a petition/application under Section 34 of the Act is to be adjudicated by exercising original side civil jurisdiction of the High Court and, therefore, ::: Downloaded on - 24/12/2022 09:12:12 :::CIS 6 OMP No. 338 of 2020 in Arb. Case No. 11 of 2020 High Court (Original Side) Rules, 1997 are applicable with respect to procedure to be adopted for adjudication of such application/petition.
12. In view of provisions of Rule 5 of Chapter-II of the Original .
Side Rules, 1997, referred supra, instead of present application, an appeal against the order of Registrar shall lie to the Judge in Chambers.
Therefore, this application is dismissed, with liberty to the applicants/respondents to avail appropriate remedy in accordance with law, if advised so.
Application stands disposed of.
(Vivek Singh Thakur), th 5 April, 2022 Judge.
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