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2007 Supreme(SC) 91

A.K. MATHUR AND P.K. BALASUBRAMANYAN, JJ.
GARHWAL MANDAL VIKAS NIGAM LTD. – Petitioner
Versus
KRISHNA TRAVEL AGENCY – Respondent
IAs Nos. 1 and 2 in SLP (C) No. 18344 of 2004,
Decided on January 24, 2007

ADVOCATES APPEARED:
L.N. Rao, Senior Advocate (Dinesh Kr. Garg, Advocate) for the Petitioner;
S.B. Upadhyay, Senior Advocate (D.K. Goswami and Anil Kr. Jha, Advocates) for the Respondent.

The appropriate forum for challenging an arbitration award under Section 34 of the Arbitration and Conciliation Act, 1996 is the Principal Civil Court of Original Jurisdiction as defined under the Act, irrespective of whether the arbitrator is appointed by the High Court or the Supreme Court.

Headnote:

Arbitration - Jurisdiction - Arbitration and Conciliation Act, 1996 - Section 34, Section 2(1)(e) - State of M.P. v. Saith and Skeleton (P) Ltd., Guru Nanak Foundation v. Rattan Singh, National Aluminium Co. Ltd. v. Pressteel & Fabrications (P) Ltd., State of Goa v. Western Builders - The court held that the Principal Civil Court of Original Jurisdiction remains the same as contemplated under Section 2(1)(e) of the 1996 Act, irrespective of whether the arbitrator is appointed by the High Court or the Supreme Court. Therefore, the objections to the award should be filed before the Principal Civil Court of Original Jurisdiction, and the appropriate forum for challenging the award under Section 34 is the Principal Civil Court of Original Jurisdiction as defined under the Act.

Fact of the Case:

A dispute arose between M/s Krishna Travel Agency and Garhwal Mandai Vikas Nigam Ltd. regarding conducting tours and payments. The matter reached the Supreme Court, which appointed an arbitrator. The award was filed before the District Judge, Dehradun, and an application under Section 34 of the Arbitration and Conciliation Act, 1996 was filed for setting aside the award. M/s Krishna Travel Agency filed applications seeking directions from the Supreme Court.

Finding of the Court:

The Supreme Court held that the objections to the award should be filed before the Principal Civil Court of Original Jurisdiction, and the appropriate forum for challenging the award under Section 34 is the Principal Civil Court of Original Jurisdiction as defined under the Act. The Court directed the District Judge, Dehradun, to hear and dispose of the matter expeditiously within six months.

Issues: Jurisdiction of the Supreme Court to entertain objections to the award and the appropriate forum for challenging the award under Section 34 of the Arbitration and Conciliation Act, 1996.

Ratio Decidendi: The Principal Civil Court of Original Jurisdiction remains the same as contemplated under Section 2(1)(e) of the 1996 Act, irrespective of whether the arbitrator is appointed by the High Court or the Supreme Court. Therefore, the objections to the award should be filed before the Principal Civil Court of Original Jurisdiction, and the appropriate forum for challenging the award under Section 34 is the Principal Civil Court of Original Jurisdiction as defined under the Act.

Final Decision: The Supreme Court rejected the plea to entertain the award and objections and directed the District Judge, Dehradun, to hear and dispose of the matter expeditiously within six months.

ORDER

1. These applications have been filed by the respondent applicant, namely, M/s Krishna Travel Agency in a matter disposed of by this Court on 17-12-2004 for the following directions:

(i) to withdraw the objections and reply thereto filed by the parties being Suit No. 232 of 2005 against the award dated 27-10-2005 in the Court of learned District Judge, Dehradun and to decide the objections and in alternative;

(ii) direct the learned District Judge, Dehradun to decide the objections being Suit No. 232 of 2005 within a period of 3 months from the date of the order.

2. In order to dispose of these IAs Nos. 1 and 2, it may be relevant to refer to a few facts. A dispute arose between the applicant and the Garhwal Mandai Vikas Nigam Ltd. with regard to conducting tours and certain payments being not made. Therefore, the matter was taken by M/s Krishna Travel Agency, the respondent applicant before a competent court. Ultimately, the matter reached this Court and this Court by the order dated e 17-12-2004 appointed Shri VA. Mohta, Senior Advocate, as arbitrator in the special leave petition with the consent of both the parties. Shri Mohta gave the award on 27-10-2005. That award was filed before the District Judge, Dehradun and an application under Section 34 of the Arbitration and Conciliation Act, 1996 was filed for setting aside that award. The matter is pending before the District Judge, Dehradun and during its pendency, these applications have been filed by M/s Krishna Travel Agency for certain directions in which the aforesaid prayers are made.

3. We have heard the learned counsel for the parties and perused the record. Learned counsel for the applicant M/s Krishna Travel Agency submits that the award should have been filed before this Court, as appointment of the was made by this Court. Therefore, this Court has jurisdiction to entertain the award and not the District Judge, Dehradun. And secondly, learned counsel submitted that in case, the first prayer is not acceded to, then an appropriate direction may be given to the District Judge, Dehradun to dispose of the proceeding including the objections filed by the applicant under Section 34, expeditiously.

4. Learned counsel for the respondent applicant has submitted that since the arbitrator has been appointed by this Court, this Court alone has the jurisdiction to dispose of the objections filed by the respondent applicant. In this connection, the learned counsel for the respondent applicant has invited our attention to the decision of this Court in State of M.P. v. Saith and Skeleton (P) Ltd. In this case, this Court appointed the arbitrator and it was observed by this Court: (SCC p. 709, para 18)

" 18 .... In the absence of any other court having been invested with such jurisdiction by the order, the only conclusion that is possible is that such a request must be made only to the court which passed that order, namely, this Court."

5. Learned counsel emphasised that the definition of the "court" as given in the Act of 1940 and that in Section 2(1)(e) of the 1996 Act are in pari materia and therefore in view of the decision given by this Court in State of M. pi this Court alone has the jurisdiction to entertain the objections. In another case Guru Nanak Foundation v. Rattan Singh2, SCC para 20, it was observed: (SCC p. 643)

"20 .... In view of the fact that a reference was made by this Court to the 3rd respondent and that this Court gave further direction about the manner and method of conducting the arbitration proceedings and fixed the time for completion of arbitration proceedings, this Court alone would have jurisdiction to entertain the award."

6. On the basis of the observations in these two authorities, learned counsel submitted that since the appointment of Shri Mohta was by this Court, therefore, this Court alone would have jurisdiction to entertain the award and to decide the objections.

7. As against this, learned counsel for the respondent applicant has invite









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