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2012 Supreme(Cal) 521
IN THE HIGH COURT OF CALCUTTA
MRINAL KANTI SINHA, J.
Smt. Jharna Sarkar
Vs.
Sri Nitish Mohan Sanyal
C.O. No. 1132 OF 2010
Decided on : 20.06.2012
For the petitioner: Mr. Pran Gopal Das
For the opposite party: Mr. Bikash Ranjan Bhattacharya, Mr. Dibyendu Chatterjee.
The power to appoint an arbitrator is vested with the Chief Justice or his designee under Section 11(6) of the Arbitration and Conciliation Act, 1996. A Civil Court has no jurisdiction to appoint an arbitrator under Section 8 of the Arbitration and Conciliation Act, 1996.
Headnote:
ARBITRATION - APPOINTMENT OF ARBITRATOR - JURISDICTION - CHIEF JUSTICE - CIVIL COURT - ARBITRATION AND CONCILIATION ACT, 1996 - SECTIONS 8, 11(2), 11(4), 11(5), 11(6) AND 11(7) - CIVIL PROCEDURE CODE, 1908 - ORDER XLI RULE 27 - POWER TO APPOINT ARBITRATOR VESTED WITH CHIEF JUSTICE OR HIS DESIGNEE - CIVIL COURT HAS NO JURISDICTION TO APPOINT ARBITRATOR - ORDER APPOINTING ARBITRATOR BY CIVIL COURT IS WITHOUT JURISDICTION AND ILLEGAL.
Fact of the Case:
Petitioner filed an application under Section 8 of the Arbitration and Conciliation Act, 1996, for reference of the matter to arbitration. The Court allowed the application and referred the dispute to arbitration. The parties suggested the names of arbitrators, and the Court appointed M/s. A. Rudra and Company as the arbitrator. The petitioner filed an application under Section 2(I)(d) read with Section 16 of the Arbitration and Conciliation Act, 1996, challenging the jurisdiction of the Arbitral Tribunal. During the pendency of the application, Sri S.K. Roy Moulik, a partner of M/s. A. Rudra and Company, filed an application seeking modification of the earlier order by appointing him as the sole arbitrator. The Court allowed the application and modified the order dated 25th March 2008 by appointing Sri S.K. Roy Moulik as the arbitrator.
Finding of the Court:
The Court held that the Civil Court had no jurisdiction to appoint an arbitrator under Section 8 of the Arbitration and Conciliation Act, 1996. The power to appoint an arbitrator is vested with the Chief Justice or his designee under Section 11(6) of the Act. The Civil Court acted without jurisdiction in appointing M/s. A. Rudra and Company as the arbitrator and in modifying the order to appoint Sri S.K. Roy Moulik as the arbitrator.
Issues: 1. Whether the Civil Court has jurisdiction to appoint an arbitrator under Section 8 of the Arbitration and Conciliation Act, 1996? 2. Whether the order appointing M/s. A. Rudra and Company as the arbitrator and the subsequent order modifying the same to appoint Sri S.K. Roy Moulik as the arbitrator are without jurisdiction and illegal?
Ratio Decidendi: 1. The power to appoint an arbitrator is vested with the Chief Justice or his designee under Section 11(6) of the Arbitration and Conciliation Act, 1996. 2. A Civil Court has no jurisdiction to appoint an arbitrator under Section 8 of the Arbitration and Conciliation Act, 1996. 3. An order appointing an arbitrator by a Civil Court is without jurisdiction and illegal.
Final Decision: The Court allowed the revisional application and set aside the impugned order dated 12th January 2010 passed by the Civil Judge (Senior Division), Jalpaiguri, appointing Sri S.K. Roy Moulik as the arbitrator. The Court held that the Civil Court had no jurisdiction to appoint an arbitrator and that the order appointing the arbitrator was without jurisdiction and illegal.
Mrinal Kanti Sinha, J :
1. This application under Article 227 of the Constitution of India has been directed against the order No.25 dated 12th January, 2010 passed by the learned Civil Judge (Senior Division), Jalpaiguri in O.C. Suit No.153 of 2007 by which the learned Civil Judge (Senior Division), Jalpaiguri allowed the petition of Sri S.K. Roy Moulik, a partner of M/s. A. Rudra and Company, on contest and appointed Shri S.K. Roy Moulik, partner of M/s. A Rudra and Company as arbitrator modifying order dated 25.3.2008.
2. It is the case of the petitioner that the opposite party as plaintiff instituted a suit for accounts of a dissolved partnership firm against the petitioner in the Court of learned Civil Judge (Senior Division), Jalpaiguri, bearing O. C. Suit No. 153 of 2007 praying for an order of appointing accounts commissioner to prepare the account of the dues of the plaintiff and defendant, injunction and other reliefs. The petitioner appeared in the said suit as defendant and filed an application under Section 8 of the Arbitration and Conciliation Act, 1996 praying for referring the matter to arbitration as provided by Clause 16 of the alleged agreement and also to direct the parties to submit the names of arbitrator. The opposite party contested the said application under Section 8 of the Arbitration and Conciliation Act, 1996 by filing a written objection denying all material averments made therein.
3. After hearing the parties the learned Court below allowed the said application under Section 8 of the Arbitration and Conciliation Act, 1996, on 2nd February, 2008, and referred the dispute between the parties to arbitration and directed the parties to suggest the names of arbitrators by the next date fixed. On 25th March, 2008, the learned Court below was pleased to appoint an arbitrator namely M/s. A. Rudra and Company, as suggested by both the parties, to resolve the dispute by and between the parties in terms of the deed of partnership and to make a time frame for publishing the award within four months from the date.
4. On 23rd March, 2009, the petitioner filed an application under Section 2 (I) (d) read with Section 16 of the Arbitration and Conciliation Act, 1996, and challenged the jurisdiction of the Arbitral Tribunal to resolve the dispute between the parties, but the said application is still pending before the learned Arbitrator. During pendency of the said application under Section 2 (I) (d) read with Section 16 of the Arbitration and Conciliation Act, 1996, Sri S.K. Roy Moulik of the Arbitrator firm filed an application before the learned Civil Judge (Senior Division), Jalpaiguri, praying for an order of modification of the earlier order by appointing Shri S.K. Roy Moulik as Arbitrator in his individual capacity instead of the said Firm to proceed with the work of arbitral tribunal in such capacity afresh.
5. After hearing the parties the learned Civil Judge (Senior Division), Jalpaiguri allowed the application filed by Sri S.K. Roy Moulik of the Arbitrator Firm and modified the order dated 25th March, 2008 by the impugned order No.25 dated 12th January, 2010, whereby Shri S.K. Roy Moulik, partner of M/s. A. Rudra and Company, was appointed as an arbitrator to arbitrate the dispute between the parties in place of the firm M/s. A. Rudra and Company.
6. Being aggrieved by and dissatisfied with the said order passed by the learned Civil Judge (Senior Division), Jalpaiguri, the Petitioner has moved the present application praying for issuance of relief calling upon the opposite party/Plaintiff to show cause why the order complained of should not be set aside, and also praying for an interim order of stay of further proceeding of said O.C. suit No.153 of 2007 on the ground that the learned Trial Judge acted illegally and with material irregularity by entertaining that application filed by Sri S.K. Roy Moulik, a partner of M/s. A. Rudra and Company and by appointing Shri S.K. Roy Moulik as the sole ar
