2010 Supreme(SC) 5

Supreme Court of India
THE HONOURABLE MR. JUSTICE R.V. RAVEENDRAN & THE HONOURABLE MR. JUSTICE K.S. RADHAKRISHNAN
Vijay Kumar Sharma @ Manju
Versus
Raghunandan Sharma @ Baburam & Others
C.A.No.89 of 2010
Decided on : 05-01-2010

Headnote:(a) Arbitration and Conciliation Act, 1996 – Section 8(3) – Pendency of an application u/s 8(1) not a bar for arbitration being commenced or continued – Such application will not bar an application for appointment of an Arbitrator u/s 11 or Section 15(2) of the Act – Pendency of an appeal from an order dismissing the Suit under Order 7, Rule 11, C.P.C. – Not a bar for appointment of an Arbitrator under Section 11 read with Section 15(2). (Para 9)

       (b) Arbitration and Conciliation Act, 1996 – Section 7 – Respondent relying on Will of father – Appellant disputing existence of the Will – Alleged Will not containing provision for arbitration – Designate of Chief Justice erroneously assuming such provision in the Will – Even if a Will provides for arbitration, it would be merely an expression of a wish by the testator – Cannot be considered as an Arbitrator agreement among the legatees – Unilateral declaration by a father that any future disputes among the sons should be settled by an Arbitrator named by him, cannot be considered as an arbitration agreement among his children – Such a wish expressed in a declaration by a father, even if proved, cannot be construed as an agreement in writing between the parties to the dispute agreeing to refer their disputes to arbitration. (Para 14)

       Facts of the case:

       The first respondent and appellant are brothers. The first respondent filed a Suit against the appellant alleging that their father Durganarayan Sharma died on 20.10.2005 leaving a Will dated 21.10.2003 bequeathing portions of property bearing No.B-133, Bapu Nagar, Jaipur (the suit premises) to him, and that the appellant who was in possession of the said portions, was liable to deliver possession thereof to the first respondent on the basis of the said Will. The Executors of the said Will were impleaded as defendants 2 and 3 (respondents 2 and 3 herein).

       The appellant herein, in turn filed a Civil Suit No.53 of 2007 for partition and separate possession of his one-sixth in the ancestral properties. He also sought a declaration that the Will dated 21.10.2003 propounded by the first respondent was fabricated, null and void. In the said partition Suit, first respondent and his son were impleaded as defendants 1 and 6; appellant’s another brother and three sisters were impleaded as defendants 2 to 5; the son of another brother who had been given away in adoption was impleaded as defendant No.7; and the executors under the Will were impleaded as defendants 8 and 9.

       The two Suits were consolidated for trial.

       Respondents 2 and 3 claiming to be the executors of the Will of Durganarayan Sharma filed an Application under Section 8 of the Arbitration and Conciliation Act, 1996 in the said Suits alleging that the deceased Durganarayan Sharma had made a declaration on 15.10.2005, shortly before his death, that if there was any dispute in connection with the Will, the same should be decided by Shri U.N. Bhandari, Advocate; that the parties to the two Suits being children and grandchildren of Durganarayan Sharma were bound by the said declaration and the disputes which were the subject matter of the two Suits should therefore be decided by arbitration. The Trial Court held that in view of the said provision for resolution of disputes by arbitration, its jurisdiction was barred by the provisions of the Act. The Trial Court dismissed both the Suits, under Order 7, Rule 11 of the Code of Civil Procedure.

       The appellant herein filed an appeal contending that there was no agreement for arbitration and that there was no ground for dismissal of his Suit and a Division Bench of the High Court stayed the order passed by the Trial Court.

       The first respondent accepted the decision of the Trial Court and filed a claim statement before Shri U.N. Bhandari, the sole Arbitrator named in the declarations of his father. The appellant appeared before Shri U.N. Bhandari, and objected to his jurisdiction.

       Shri Bhandari withdrew himself from the Arbitration.

       The first respondent filed an Application under Section 11(6) read with Section 14(1)(b) and 15(2) of the Act for appointment of an independent Arbitrator. The designate of the Chief Justice who heard the matter appointed an Arbitrator to resolve the disputes.

       Finding of the Court:

       There is no arbitration agreement between the parties.

       Result:

       Appeal allowed.