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2005 Supreme(Del) 1058

High Court Of Delhi
APPAREL EXPORT PROMOTION COUNCIL - Appellant
Versus
PRABHATI PATNI, PROPRIETOR COMFORT FURNISHERS - Respondent
Decided On : 12/01/2005

Headnote:Arbitration & Conciliation Act, 1996 Sections 34 & 42 - Objection/challenge to arbitration award - Territorial jurisdiction of the Court - Agreement between the parties conferring exclusive jurisdiction on the Courts at Jaipur - Proceedings conducted at Delhi - Held that the jurisdiction of Courts at Delhi stand excluded under the Agreement - Merely filing objections in wrong court would not confer jurisdiction on the Court.

       [Paras 16, 17, 18,21 & 23]

BADAR DURREZ AHMED, J.

( 1 ) THE question that arises for consideration is whether this court has jurisdiction to entertain the OMP no. 34/2000 filed by the petitioner praying for the rejection of the award dated 31. 10. 1999 made by the respondent No. 2.

( 2 ) THE facts leading to the filing of the petition (OMP No. 34/2000) are as follows. The petitioner and the respondent No. 1 entered into an agreement on 01. 07. 1992. In terms of clause 4. 9 of the conditions of contract governing the said agreement, disputes between the parties were to be settled by reference to arbitration. Clause 4. 9, so much as is relevant, is reporduced hereinbelow:-

4. 9 Arbitration. 4. 9. 1 Settlement of Disputes. In case any dispute or difference shall arises between the parties either upon any question relating to the meaning of the specifications, designs, drawings and instructions herein before mentioned or these conditions, or otherwise concerning the work, or the execution, or failure to execute the same, whether arising during the progress of the work, or after the completion or abandonment thereof, or as to the breach of this contract, then either party shall forthwith dispute or difference shall be referred to Director General of the council who will be the sole Arbitrator, and Council whose decision thereon shall be final, conclusive, binding on all the Parties. The Contractor shall not stop work on account of reference of any dispute with Arbitrator and shall complete the work as per the time Schedule of the agreement.

( 3 ) SINCE disputes had arisen between the parties, the arbitration clause was invoked and the designated arbitrator (i. e. , The Director General of the petitioner) was requested to enter upon the reference. The respondent No. 1 preferred a claim before the said arbitrator (respondent No. 2) and the petitioner filed its counter-claim. Thereafter, the arbitration proceedings continued and culminated into making of the award dated 31. 10. 1999 by the respondent No. 2. It is noteworthy that the entire arbitration proceedings were conducted at delhi and the award itself was made at Delhi. By the impugned award, the arbitrator (respondent No. 2) rejected the claims of the respondent No. 1 as well as the counter- claim of the petitioner. Since both the adversaries, namely, the petitioner and the respondent No. 1 were unhappy with the impugned award, both have filed objections u/s 34 of the Arbitration and Conciliation act, 1996 (hereinafter referred to as the said Act ) for setting aside the said award. However, while the respondent No. 1 filed the objections against the said award before the District Court at Jaipur (Rajasthan) being Arbitration Case No. 102/2000), the petitioner has filed the present petition (OMP No. 34/2000) in this court on 31. 01. 2000. In the proceedings before the District court at Jaipur, the petitioner is said to have appeared and filed its reply. However, the District Court at jaipur, on being informed about the pendency of the present petition, has, by an order dated 17. 03. 2001, stayed further proceedings before it. In the present petition, this court had by an order dated 09. 02. 2000 directed issuance of notice to the respondents. After several attempts, the respondent No. 1 was ultimately served. At the first instance, the present application being IA No. 4652/2001 was moved by the respondent No. 1 u/s 4, 2 (b), 2 (e), 2 (h), 7, 34, 35 and 42 of the said act read with Order 7 Rules 10 and 11 and Section 151 of the Code of Civil Procedure, 1908 (hereinafter referred to as the cpc ) praying for dismissal / rejection of OMP no. 34/2000 filed by the petitioner on the ground that it was not maintainable for want of jurisdiction. Thereafter pleadings were completed in the application and it is this application which has come up for disposal today. If the application is to succeed, then the petition (OMP No. 34/2000) would have to be dismissed on the ground of lack of territorial jurisdiction. On t




































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