IN THE HIGH COURT OF JUDICATURE AT PATNA
SANDEEP KUMAR, J.
Civil Misc. Jur. No.43 of 2022
(29.11.2024)
State of Bihar ... Petitioner
vs.
M/s Tantia Construction Ltd. ... Respondent
Arbitration and Conciliation Act, 1996 – Section 20 – Place of Arbitration – If the parties fail to determinatively and expressly agree for a seal of arbitration under Section 20(1) then the place where the arbitral tribunal holds the arbitration proceedings would, by default, be the venue of arbitration and consequently the seat of arbitration – Section 20(2) in such cases would assume significance – In the present case, the award in question was passed and delivered at Patna – From the records of the case, it appears that no subsequent mutual consent was reached between the parties subsequent to entering the work agreement and before the award was finally passed to change the seat of arbitration – Applying the law laid down by the Supreme Court in BBR (India) case, it would be clear that the jurisdictional seat would be at Patna since even assuming the work agreement did not expressly designate Patna as seat of arbitration, yet the arbitration was held at Patna and the award was also delivered at Patna – In the present case, as has also been recorded by the learned District Judge, Patna in the impugned order, that the Calcutta High Court had considered the issue of jurisdictional maintainability of the petition and for reasons recorded in the order had assumed jurisdiction – Once the Calcutta High Court has assumed jurisdiction by which the petitioner – State is aggrieved, the relief sought cannot merely be camouflaged by the prayer made by the petitioner – State invoking supervisory jurisdiction of this court to quash and set aside the impugned order of the learned District Judge, Patna – It is a settled proposition of law that Quando aliquid prohibetur ex directo, prohibetur et per obliqum i.e. one cannot do indirectly, what one cannot do directly – It would create judicial anarchy if this court would in effect set in review/appeal over the order passed by the Calcutta High Court, which has attained finality – It is not in dispute that the order passed by the Calcutta H.C. is still in force and has not been set aside or modified either in intra-court appeal or by the Hon'ble S.C. – Impugned judgment and order passed by the learned D.J. Patna affirmed – application dismissed. (Paras 61, 63, 64 & 66)
BGS SGS Soma JV Vs. NHPC Ltd., (2020) 4 SCC 224; BBR (INDIA) Pvt. Ltd. Vs. S.P. Singla Constructions Pvt. Ltd., (2023) 1 SCC 693 (3) – Relied.
Indus Mobile Distribution Pvt. Ltd. Vs. Datawind Innovation Pvt. Ltd., (2017) 7 SCC 678; Brahmani River Pellets Ltd. Vs. Kamachi Industries Ltd, (2019) 5 BLJ 92 (SC): 2020 (5) SCC 462; Emkay Global Financial Services Ltd. Vs. Giridhar Sondhi, AIR 2018 SC 3894; State of West Bengal Vs. Associated Contractors, (2015) 1 SCC 32; S.P. Chengalvaraya Naidu (Dead) by Lrs. Vs. Jagannath (Dead) by Lrs., 1994(1) SCC 1; Rajasthan State Road Transport Corporation Vs. Zakir Hussain, (2005) 7 SCC 447; Kunhayammed Vs. State of Kerela, (2000) 6 SCC 359; Khoday Distilleries Ltd. (Khoday India Ltd.) Vs. Sri Mahadeshwara Sahakara Karkhane Ltd., Kollegal, 2019 (2) BLJ 265 (SC) : (2019) 4 SCC 376; Board of Control of Cricket in India Vs. Kochhi Cricket Pvt. Ltd., (2018) 6 SCC 287; Hindustan Construction Co. Ltd. Vs. Union of India, (2019) SCC online SC 1520; M/s Kelkar and Kelkar Vs. M/s Hotel Pride Executive Pvt. Ltd., (2022) 18 SCC 348; A.B.C Laminart Pvt. Ltd. Vs. A.P. Agencies, Salem, AIR 1989 SC 1239; R.S.D.V. Finance Co. Pvt. Ltd Vs. Shree Vallabh Glass Works Ltd., AIR 1993 SC 2094 – Referred.
Sandeep Kumar, J.—Heard Mr. P.K. Shahi, learned Advocate General for the petitioner and Mr. Prafull Chandra Jha, learned counsel for the respondent.
2. The petitioner-State of Bihar has challenged the judgment and order dated 20.09.2021 passed by the learned District Judge, Patna, in Miscellaneous (Arbitration) Case No.198 of 2017, by which the learned District Judge has not entertained the Misc. (Arbitration) Case and disposed of the same with liberty to the petitioner-State to approach the Calcutta High Court where the proceedings under section 9 of the Arbitration and Conciliation Act, 1996 (for short “1996 Act”) has already been entertained and disposed of.
3. The entire controversy emanates from a work agreement dated 15.12.2006 bearing No.01/SB/2006-07, under which the work for the Patna Town Road Project was allotted to the respondent-company namely M/s. Tantia Construction Limited having its registered office at 25/27 Netaji Subash Road, Kolkata-700001. The date of completion of the project was fixed as 14.08.2008 and the cost of the project was Rs.1,57,74,57,222/-. The petitioner-State alleged infractions and violations on several counts and therefore show cause notices were issued to the respondent-company vide letters dated 24.01.2008 and 28.02.2008. Subsequently, the said agreement was terminated on 30.04.2008 at the risk and cost of the respondent-company. By a subsequent order, the registration of the respondent-company was also cancelled and the company was blacklisted. Against the order of termination of contract, the respondent-company filed a writ petition viz. C.W.J.C. No.7403 of 2008 on 05.05.2008 before this Court. While the aforesaid writ petition was pending before this Court, the respondent-company also preferred an application under Section 9 of the 1996 Act before the Calcutta High Court on 13.05.2008 seeking injunction on invocation of bank guarantee of performance security, which was registered as A.P. No.245 of 2008 and vide order dated 14.05.2008 interim stay was granted on the invocation of bank guarantee of performance security. Thereafter, interim order was extended till 29.08.2008 vide order dated 15.05.2008.
4. During the pendency of C.W.J.C. No.7403 of 2008, the respondent-company filed another petition viz. A.P. No. 379 of 2008 before the Calcutta High Court for appointment of an Arbitrator, which came to be allowed vide order dated 21.0.8.2008 and Hon’ble Mr. Justice N.N. Singh (Retired) was appointed as Arbitrator to adjudicate the contractual dispute.
5. This Court vide order dated 18.09.2009, dismissed the writ petition i.e. C.W.J.C No.7403 of 2008 as withdrawn but strong displeasure was recorded against the conduct of learned counsel for the respondent-company for suppression of material fact i.e. regarding the cases filed before the Calcutta High Court during the pendency of the aforesaid writ petition before this Court.
6. During the pendency of aforesaid C.W.J.C No.7403 of 2008 before this Court, the respondent-company filed yet another petition being A.P. No.470 of 2008 before the Calcutta High Court assailing the order of blacklisting. By an order dated 16.09.2008 interim stay on the order of blacklisting was granted, however, vide order dated 27.11.2008 the said writ petition was disposed with a direction that the stay on the order of blacklisting would remain operative till the disposal of the arbitration proceeding.
7. Another petition vide A.P. No.523 of 2008 was also filed by the respondent-company before the Calcutta High Court with a prayer to restrain the State of Bihar from using plant and machinery as no hire-charge is being paid for the said usage. In the said case, initially the interim stay was granted and a Receiver was also appointed but, subsequently the said case was disposed vide order dated 27.11.2008 with a direction that the interim order of stay shall continue till the disposal of the arbitration proceedings.
8. Before the learned Arbitrator the respondent-company h
BBR (INDIA) Pvt. Ltd. vs. S.P. Singla Constructions Pvt. Ltd.
Indus Mobile Distribution Pvt. Ltd. vs. Datawind Innovation Pvt. Ltd.
Brahmani River Pellets Ltd. vs. Kamachi Industries Ltd
Emkay Global Financial Services Ltd. vs. Giridhar Sondhi
State of West Bengal vs. Associated Contractors
S.P. Chengalvaraya Naidu (Dead) by Lrs. vs. Jagannath (Dead) by Lrs.
Rajasthan State Road Transport Corporation vs. Zakir Hussain
Kunhayammed vs. State of Kerela
Khoday Distilleries Ltd. (Khoday India Ltd.) vs. Sri Mahadeshwara Sahakara Karkhane Ltd., Kollegal
Board of Control of Cricket in India vs. Kochhi Cricket Pvt. Ltd.
A.B.C Laminart Pvt. Ltd. vs. A.P. Agencies, Salem
R.S.D.V. Finance Co. Pvt. Ltd vs. Shree Vallabh Glass Works Ltd.
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