1994 Supreme(Cal) 361

IN THE HIGH COURT AT CALCUTTA
Satyabrata Sinha, Shree Rang Misra and Vidya Nand, JJ.
Union of India - Appellant
Versus
K. Satyanarayan & Co. – Respondent
Appeal No. 357 of 1982 & Special Suit No. 14 of 1982
Decided on: 2nd December, 1994

Headnote:

ARBITRATION ACT - APPEAL - LETTERS PATENT - JURISDICTION - ORDER DIRECTING REFERENCE OF DISPUTES TO ARBITRATOR NOT APPOINTED UNDER ARBITRATION AGREEMENT NOT AGREED TO BY PARTIES - APPEALABILITY.

Fact of the Case:

The appellant and the respondent entered into an agreement on 15.6.73 for execution of earth work in formation, bridge work and miscellaneous works. The said contract contained an arbitration agreement. The respondent filed an application under Section 20 of the Arbitration Act praying that the respondents be directed to file the aforementioned arbitration agreement dated 15.6.73 and for appointment of an Arbitrator in terms thereof. The appellant preferred an appeal under Clause 15 of the Letters Patent of this Court against the second order dated 28.7.82 and not against the first order, i.e. the order dated 26.3.82.

Finding of the Court:

1. The impugned order cannot be said to be without jurisdiction inasmuch as in terms of the order dated 23.6.82, the matter was to be placed before the Court 5 week thereafter and pursuant thereto the matter was placed before the Learned Single Judge on 28.7.82. 2. The Arbitration Act is a special statute and is a self-contained Code. The provisions of the Code of Civil Procedure apply to the cases filed under the Arbitration Act as the Arbitration Act expressly provides therefor as also in terms of Section 141 of the Code of Civil Procedure. 3. An appeal is a creature of a statute. The Parliament in its wisdom may not provide for an appellate forum against some orders and may provide appeals on limited ground against the orders passed by a Court or Tribunal. 4. The right of appeal of a litigant being aggrieved by the order passed by the Court under the Arbitration Act vis-a-vis right of appeal under Clause 15 of the Letters Patent came up for consideration before various Courts. In the case of R. Wright & Partner Ltd. v. Governor General in Council reported in ILR 1948(2) Cal. 265 : 52 CWN 224, it has been observed that the right of appeal under Clause 15 of the Letters Patent is by Clause 44 subject to the legislative powers of the Governor General in Council and Section 39 of the Arbitration Act, 1940 has explicitly taken away the right. 5. The Supreme Court in the case of Union of India v. Mohindra Supply Co., repotted in AIR 1962 SC 256 held that if a Single Judge of the Punjab High Court disposed of an appeal under Section 39(1) of the Arbitration Act, whether there could be any further right of appeal under Clause 10 of the Letters Patent of that High Court or not. The Supreme Court considered the provisions of Section 39 of the Arbitration Act vis-a-vis Clause 10 of the Letters Patent of the Punjab High Court and held that no appeal lies to the Privy Council from an order passed by a single Judge under Section 33 challenging the validity of an Arbitration agreement as no appeal is provided for against it by Section 39(1).

Issues: 1. Does the Arbitration Act, 1940 permit an appeal under Section 39(1) of the said Act from an Order directing reference of the disputes to an Arbitrator not appointed under the Arbitration Agreement not agreed to by the parties when the Court by an earlier Order already directed filing, of the said Arbitration Agreement and directed reference to an Arbitrator against which no appeal has been preferred? 2. If the answer to the above question is in the negative, is such an order appealable as judgment under Clause 15 of the Letters Patent ? 3. Does an appeal lie from an Order passed under the Arbitration Act, in case not covered by Section 39(1) of the said Act, under Clause 15 of the Letters Patent where no question of jurisdiction involved? 4. Was the case of (1) Messrs Unit Construction Co. (Pvt.) Ltd. v. University of North Bengal, reported in 1986 (2) Calcutta High Court Notes 275 correctly interpreted the decision of Supreme Court in Babulal Khimji's case, reported in AIR 1981 SC 1786 and the case of the (3) Union of India v. Mohindra Supply Co., reported in AIR 1962 SC 256 ? 5. Has the case of Messrs, Unit Construction Co. Pvt. Ltd. v. University of North Bengal, (ibid) correctly decided that although no appeal lies under Section 39(1) of the Arbitration Act, there may be an appeal under Clause 15 of the Letters Patent.

Ratio Decidendi: 1. Section 20 of the Arbitration Act is, therefore in two parts. 2. The Arbitration Act is a special statute and is a self-contained Code. 3. An appeal is a creature of a statute. The Parliament in its wisdom may not provide for an appellate forum against some orders and may provide appeals on limited ground against the orders passed by a Court or Tribunal. 4. The right of appeal of a litigant being aggrieved by the order passed by the Court under the Arbitration Act vis-a-vis right of appeal under Clause 15 of the Letters Patent came up for consideration before various Courts. 5. The Supreme Court in the case of Union of India v. Mohindra Supply Co., repotted in AIR 1962 SC 256 held that if a Single Judge of the Punjab High Court disposed of an appeal under Section 39(1) of the Arbitration Act, whether there could be any further right of appeal under Clause 10 of the Letters Patent of that High Court or not. The Supreme Court considered the provisions of Section 39 of the Arbitration Act vis-a-vis Clause 10 of the Letters Patent of the Punjab High Court and held that no appeal lies to the Privy Council from an order passed by a single Judge under Section 33 challenging the validity of an Arbitration agreement as no appeal is provided for against it by Section 39(1).

Final Decision: Appeal dismissed as not maintainable.