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IN THE HIGH COURT OF JAMMU AND KASHMIR AT JAMMU
Janki Nath Bhat, J.
Gh. Qadir Baksh - Appellant
Versus
State Of J&K & Ors. - Respondent
Arbitration Petition No. 31/1970
Decided On : 21 January, 1970
ARBITRATION - AGREEMENT - DISPUTE - INTERPRETATION - COURT'S JURISDICTION - INJUNCTION - LEASE - EXTENSION.
Fact of the Case:
Petitioner, a lessee of a forest compartment, sought to file an arbitration agreement and refer the matter to arbitration, alleging various disputes with the Forest Department, including cancellation of the lease, claims and counterclaims, and late communication of extension orders. The Forest Department opposed the petition, arguing that there was no dispute that could be referred to arbitration.
Finding of the Court:
The court found that there were significant differences and disputes between the parties, including allegations of flood, disturbances, and late communication of extension orders, which warranted referral to arbitration. The court held that the arbitration clause in the agreement was broad enough to encompass all matters and differences connected with the contract.
Issues: 1. Whether there was a dispute between the parties that could be referred to arbitration under the arbitration agreement. 2. Whether the court had jurisdiction to issue an injunction restraining the Forest Department from re-auctioning the lease.
Ratio Decidendi: 1. The court interpreted the arbitration clause in the agreement broadly, holding that it covered all differences between the parties, including those relating to the subject matter of the agreement. The court found that the allegations made by the petitioner in the petition constituted disputes that fell within the scope of the arbitration clause. 2. The court held that it did not have jurisdiction to issue an injunction restraining the Forest Department from re-auctioning the lease, as the extension of the lease period was not a matter of right but a concession that could be granted by the Forest Department.
Final Decision: 1. The court directed that the arbitration agreement be filed and the whole case be sent to the Chief Conservator of Forests for arbitration. 2. The court refused to grant an injunction restraining the Forest Department from re-auctioning the lease.
(1) the main application of the petitioner under section 20 of the Arbitration Act for filing the arbitration agreement and referring the matter to the arbitration of the Chief Conservator of Forests, the arbitrator designate in the agreement, and (2) for issue of temporary injunction restraining the Forest Department from re-auctioning the lease which was sanctioned in favour of the petitioner.
2. The petition as well as the rejoinder to the petition is a very lengthy one, I shall briefly summarise the relevant portions of the petition and the rejoinder. The petition avers that Compartment No. 12/D. P. P. F. Division was leased out to him for the years 1961-63 for a tendered offer of Rs. 14,02,211.69 for a marked volume of 5,03,454 Cft. of timber, mostly of fir species; that the petitioner extracted only a small quantity of timber as the area gets snow-bound much earlier than the setting in of winter; that the Forest Department is at an altitude of 10,000 ft. and timber can be removed therefrom by floating it through the Dudh Ganga Nalla, which is floatable only for two months in a year ; that inspite of the best efforts of the petitioner, he could extract only a small portion of the timber ; that in 1962 floods in the stream and 1964 and 1965 disturbances and Indo-Pak conflict respectively resulted in not enabling the petitioner to extract the requisite quantity of timber ; that the petitioner was granted extension upto November 1968 ultimately but the letter of extension dated 26-9-1967 was delivered to him late, thus not making it possible for him to take due benefit of the extension granted; that supplementary markings were made to the tune of 82,000 Cft. but this volume was never handed over to the petitioner ; that under similar circumstances other contractors had been granted extensions but it was not done in the case of the petitioner ; that the responsibility of not allowing the petitioner to work out the lease properly was upon the Forest Department ; that the Conservator had by his letter No. 3872-74 C/vii dated 20-2-1970 cancelled his lease and ordered a writ of demand to be issued against the petitioner ; that this cancellation was not in accordance with law and no show cause notice for this order had been given to the petitioner ; that the Conservator of Forests had no right to cancel the lease nor are there any reasons to support this order ; that the extensions granted to the petitioner have always been communicated to him very late, leaving no period for working out the lease; that there were recommendations for the extension of the lease by the D.F.O. and the Range Officer concerned ; that there are claims and counter claims; that Clause 44 of the agreement makes all disputes between the parties referrable to arbitration ; that the matter be referred to the arbitration of the Chief Conservator of Forests, who is the Arbitrator nominated in the agreement.
3. In reply to this long petition, the respondents learned counsel Mr. Anil Dev Singh in his objections to the petition has stated that the petitioner has not shown any sufficient cause for filing of the agreement and referring the matter to arbitration; that no dispute in terms of Clause 44 of the agreement is made out; that the petitioner took the contract knowing fully well the conditions prevailing in the Forest; that the allegations about the early snow-fall are totally unconnected with the facts whether the dispute has to be referred to the arbitration or not; that the petitioner had not been working satisfactorily from the very beginning of the lease and in order to help the petitioner, a loan of Rs. 50,000/- was secured on the responsibility of the department for him; that no timber of the petitioner was washed away during flood; that the department has been very generous to the petitioner in extending the period of execution by four years; that the extensions were given to the petitioner from November 196
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