High Court of Judicature at Calcutta
JYOTIRMAY BHATTACHARYA
East Bengal Club & Others
Versus
Sekhar Ghosh & Others
C.O. No. 1441 of 2010
Decided On : 23-07-2010
ARBITRATION - REFERENCE - CLUB RULES - DISPUTE RESOLUTION MECHANISM - ELECTION DISPUTE - STATUS OF EXECUTIVE COMMITTEE MEMBERS - DOMESTIC APPELLATE TRIBUNAL - CLUB RULES NOT AN AGREEMENT - NO REFERENCE UNDER SECTION 8 OF THE ARBITRATION AND CONCILIATION ACT, 1996.
Fact of the Case:
Plaintiffs, members of East Bengal Club, filed a suit challenging the election process of the Executive Committee members and seeking various reliefs, including a declaration that the election was invalid and an injunction restraining the defendants from acting as Executive Committee members. The defendants filed an application under Section 8 of the Arbitration and Conciliation Act, 1996, seeking to refer the dispute to arbitration as per clause 11(e) of the Club Rules.
Finding of the Court:
The court held that the dispute involved in the suit could not be resolved by arbitration under clause 11(e) of the Club Rules as the said rule provided for a mechanism for deciding an appeal against an act or decision of the club and not for resolving an original dispute. The court further held that the club rules were not a product of an agreement between the club and its members and could not be construed as an agreement as contemplated under Section 7 of the Arbitration and Conciliation Act, 1996.
Issues: 1. Whether the dispute involved in the suit could be resolved by arbitration under clause 11(e) of the Club Rules? 2. Whether the club rules could be construed as an agreement as contemplated under Section 7 of the Arbitration and Conciliation Act, 1996?
Ratio Decidendi: 1. Clause 11(e) of the Club Rules provided for a mechanism for deciding an appeal against an act or decision of the club and not for resolving an original dispute. The dispute involved in the suit was an original dispute and could not be resolved by arbitration under clause 11(e). 2. The club rules were framed by the club for smooth functioning and were not a product of an agreement between the club and its members. Therefore, the club rules could not be construed as an agreement as contemplated under Section 7 of the Arbitration and Conciliation Act, 1996.
Final Decision: The court rejected the defendants' application under Section 8 of the Arbitration and Conciliation Act, 1996, and held that the learned Trial Judge did not commit any illegality in rejecting the petitioner’s application.
1. By the impugned order being No.16 dated 17th April, 2010 passed by the learned Judge, Sixth Bench, City Civil Court at Calcutta in Title Suit No. 4442 of 2008, the defendant’s application for reference under Section 8 of the Arbitration and Conciliation Act of 1996 was rejected on contest. The defendant is aggrieved by the said order. Hence the defendant has come before this court with this application under Article 227 of the Constitution of India. The learned Trial Judge held that the dispute which is involved in the suit is not covered by the arbitration agreement which is contained in clause 11(e) of the Club Rules and as such no reference can be made to arbitrator for arbitration of the dispute involved in the suit as per the provision of the Arbitration and Conciliation Act, 1996.
Let me now consider as to how far the learned Trial Judge was justified in rejecting the defendant’s said application in the facts of the instant case. Heard Mr. Ajoy Krishna Chatterjee, learned Senior Counsel, appearing for the petitioner and Mr. Aniruddha Chatterjee, learned Counsel, appearing for the opposite party. Considered the materials of record including the order impugned. The plaintiffs who are members of the defendant No.1 viz. East Bengal Club, an unregistered club, filed a suit against the club and its office bearers claiming following reliefs:
“a) A decree for declaration that the entire election process of the Executive Committee members of the East Bengal Club including the process of counting of Ballots are bad, illegal and has not been done in accordance with the procedures and norms laid down in the CLUB RULES for conducting such election as mentioned in the Constitution of East Bengal Club and accordingly the entire election of the Executive Committee members of the East Bengal Club is vitiated one and as such not binding on any of the plaintiffs and it may be declared as void ab-initio;
b) A decree for declaration that since the plaintiffs has got every right to obtain necessary details pertaining to this election to know the details about (i) Booth wise number of ballot polled, (ii) Both wise number of ballot cancelled, (iii) Booth wise number of ballot valid, (iv) Booth wise, on valid ballot, number of vote casted in favour of the individual candidate, (v) Booth wise, on valid ballot, number of vote cancelled in favour of the individual candidate, the defendants are under legal obligation to provide detail information as claimed by the plaintiffs;
c) A decree of perpetual injunction restraining the defendant nos. 2 to 31 from in any way or manner representing themselves and/or holding themselves out as the members of the Executive Committee of the East Bengal Club;
d) A decree for permanent injunction restraining the defendants from giving any effect and/or further effect and/or to act in furtherance thereof and/or to take any decisions and/or steps by them in aid of the results of the election of the Executive Committee members of the East Bengal Club and to proceed and/or take further steps on the basis of the said results and/or to cancel and deliver up al the proceedings in the meetings subsequent to the appointment of the new committee;
e) A decree for perpetual injunction restraining the defendant nos. 2 to 31 from in any way, holding themselves out are office bearers and/or executive committee members of the East Bengal Club from participating in the Management and administration of the club or interfering with the management and administration of the said club or creating any hindrance to the smooth and efficacious management and administration thereof in any manner whatsoever;
f) For the interests of justice an Administrator(s)/Special Officer/be appointed over and/or in respect the affairs of the East Bengal Club with a direction to take charge of the management and administration of the said club including control over the finances of the said club with immediate effect;
g) A neutral independ
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