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2024 Supreme(J&K) 279

HIGH COURT OF JAMMU AND KASHMIR AND LADAKH
JAVED IQBAL WANI, J.
J&K Economic Reconstruction Agency - Appellant
Versus
Rash Builders India Private Limited – Respondent
Arb P No. 28 of 2024
Decided on : 08-07-2024

Advocates:
Advocate Appeared:
For the Appellant : Abdul Rashid Malik
For the Respondent: Rahul Sharma

The court ruled it lacked jurisdiction to entertain a petition challenging an arbitration award as the arbitration was conducted in New Delhi, not in the court's jurisdiction.

Headnote:(A) Jammu and Kashmir Arbitration and Conciliation Act, 1997 - Section 34 - Jurisdiction of court - Petition filed to set aside an arbitration award - Preliminary objection raised regarding jurisdiction based on the seat of arbitration being New Delhi - Court ruled that it lacks jurisdiction as the arbitration proceedings were conducted in New Delhi, and the award was passed there. (Paras 1, 2, 7)

(B) Arbitration proceedings - Definition of 'court' under Section 2(1)(e) - The court clarified that the authority appointing arbitrators under Section 11 is not considered a 'court' for the purposes of Section 42, thus affecting jurisdiction. (Paras 5, 6)

Facts of the case:
The petitioner challenged an arbitration award passed by a sole arbitrator in New Delhi, arguing jurisdiction based on initial proceedings in the High Court. The disputes arose from four contracts requiring arbitration. (Paras 1, 4)

Findings of Court:
The court found that it lacked jurisdiction to entertain the petition as the arbitration was conducted in New Delhi, and thus the petition should be presented before the competent court there. (Paras 7)

Issues: The main issue was whether the court had jurisdiction to entertain the petition challenging the arbitration award given the seat of arbitration was in New Delhi. (Paras 2, 7)

Ratio Decidendi: The court held that the authority appointing arbitrators under Section 11 does not constitute a 'court' as defined under Section 2(1)(e), thus the petition was not maintainable in the current jurisdiction. (Paras 5, 7)

Result: Petition ordered to be returned for presentation before the competent court at New Delhi.

JUDGEMENT

1. The instant petition has been filed by the petitioner herein under Section 34 of the Jammu and Kashmir Arbitration and Conciliation Act, 1997 (for short the Act of 1997) seeking setting aside of award dated 15.01.2024 passed by sole arbitrator Hon'ble Mr. Justice Amitabh Roy Judge of the Supreme Court (Rtd.).

2. Upon coming of this petition for consideration and after counsel for the petitioner in brief narrated the grounds of challenge urged in the petition against the award under challenge, the counsel for the caveator respondent raised a preliminary objection that this court lacks jurisdiction to entertain the petition as the venue/seat of the arbitration had been at New Delhi and that the arbitration proceedings were conducted at New Delhi and even award under challenge came to be passed at New Delhi. Counsel for the petitioner would, however, oppose said objection and would contend that this court is possessed of the jurisdiction to entertain and adjudicate upon the petition as the initial petition for appointment of the arbitrator in the matter came to be filed in this Court and as such all subsequent proceedings arising out thereof are maintainable before this court under Section 42 of the Act, of 1997.

3. Having regard to the aforesaid preliminary objections it is deemed appropriate to address to the same in the first instance.

4. Perusal of the record would reveal that various disputes between the petitioner and the respondent herein arose out of four contracts pertaining to four different projects namely (i) “Kralgund-Ashpora-Qaziabad Road Project ('Kralgund Project') (ii) Handwara-Zachaldara-Wadder Road Project ('Handwara Project') (iii) Hubdipora-Kadar-Qaimoh Road Project ('Hubdipora Project') (iv) Shahdara-Kamalkote Road Project ('Shahdara Project'), which disputes had to be settled through arbitration and owing to the differences between the parties qua the nomination of the arbitrator/s in the matter, the caveator respondent herein filed four separate petitions before the Hon'ble Chief Justice of this Court being AA Nos. 09/2014, 10/2014, 11/2014 and 12/2014 under Section 11 of the Act of 1997 for appointment of arbitrator/s and in terms of the common order dated 30.07.2015 passed therein the said petitions Shri Javed Ahmad Kawoosa District and Sessions Judge (Retd.) came to be appointed as a sole arbitrator, and aggrieved whereof the petitioner herein preferred civil appeal no. 14167-14170 of 2015 before the Apex Court and in terms of order dated 07.12.2015 passed by the Apex Court with the consent of appearing counsel for the parties, Hon'ble Shri. Justice S.S. Nijjar (Retd.) Judge of the Apex Court came to be appointed as sole arbitrator considering the fact that four independent contracts are involved in the case as also in view the value of the said contracts and the Apex Court accordingly modified and set-aside the part of the aforesaid impugned order dated 30.07.2015 and the sole arbitrator so appointed by the Apex Court thereafter entered upon the reference and concluded the arbitration proceedings as well as hearing and reserved the matters for passing of award/s, however, before passing the same, the said arbitrator passed away on 26.03.2021, whereafter the respondent caveator herein filed CM No. 2676/2021 under Section 14 of the Act of 1997 before the Hon'ble Chief Justice of this Court for substitution of the arbitrator in accordance with Section 15(2) of the Act of 1997 and consequently in presence of the appearing counsel for the parties the said CM came to be disposed of on 17.09.2021 substituting Shri Justice Amitabh Roy Judge of the Supreme Court (Retd.) in place of Shri Justice S.S. Nijjar, the deceased sole arbitrator, providing further in the order that the substituted arbitrator shall enter upon the arbitration forthwith and complete the proceedings in accordance with law keeping in mind the consent of the parties, in accordance with the provisions of Section 15(3) of the Act of 199

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