IN THE HIGH COURT OF JUDICATURE AT MADRAS
S. Sounthar, J.
KKK Regence Developers - Appellant
Versus
M/s The Government Tele-Communication Employees, Co-operative Society Limited - Respondent
Arb. Appeal No. 107797 of 2024, C.M.P. No. 22102 of 2024
Decided On : 05-03-2025
JUDGMENT :
1. The Civil Miscellaneous Petition is filed seeking to condone the delay of 37 days in filing the main appeal challenging the order passed by the Trial Court dismissing the application filed by the petitioner under Section 8 of Arbitration and Conciliation Act, 1996, to refer the dispute to arbitration in terms of Arbitration Clause contained in the Memorandum of Understanding dated 01.05.2015 read with Supplementary Agreement dated 09.12.2016.
2. The 1st respondent herein filed a suit in O.S.No.113 of 2021 on the file of the V Assistant City Civil Court, Chennai against the petitioner and other respondents seeking mandatory injunction against all the defendants either jointly or severally to comply with the terms of Memorandum of Understanding dated 01.05.2015 read with Supplementary Agreement dated 09.12.2016, more particularly, Clause 11 of Memorandum of Understanding dated 01.05.2015.
3. The petitioner herein, who was arrayed as a 1st defendant in the suit filed an application under Section 8 of Arbitration and Conciliation Act, 1996 before the Trial Court seeking reference to arbitration in terms of Arbitration Clause contained in Memorandum of Understanding mentioned above. The Trial Court by relying on Clause 12 of the Memorandum of Understanding, dismissed the application seeking reference to arbitration. Aggrieved by the same, the main Arbitration Appeal in SR.No.107797 of 2024 has been filed before this Court by the petitioner/appellant. Since there was a delay in filing the appeal, the instant application is filed seeking condonation of delay.
4. When the condone delay petition is taken up for hearing, the learned counsel appearing for the 1st respondent raised a preliminary objection as to the maintainability of the appeal before this Court.
5. It is his specific case that under Section 37(1) of the Arbitration and Conciliation Act, 1996, in case of dismissal of petition filed under Section 8 of the said Act, an appeal shall lie only before the court authorised by law to entertain appeals from the original decrees passed by the said Court, which passes the order of dismissal. He further submitted that against the original order passed by the Assistant City Civil Court, an appeal shall lie only before the Principal City Civil Judge in terms of Section 15(2-D) of the Chennai City Civil Court Act, 1892 and appeal before this Court is not maintainable.
6. The learned counsel appearing for the appellant/petitioner by relying on the definition of the word 'Court' under Section 2(1)(e)(i) of the Arbitration and Conciliation Act, 1996 try to sustain the maintainability of the appeal before this Court.
7. The main issue to be decided is whether the instant appeal filed by the appellant/petitioner challenging the dismissal of Section 8 application filed by the petitioner seeking reference to arbitration is maintainable before this Court.
8. Section 2(1)(e)(i) of the Arbitration and Conciliation Act, 1996 defines the word 'Court' and the same reads as follows:-
“Section 2(1)(e)(i) - in the case of an arbitration other than international commercial arbitration, the principal Civil Court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the subject-matter of the arbitration if the same had been the subject-matter of a suit, but does not include any Civil Court of a grade inferior to such principal Civil Court, or any Court of Small Causes.”
9. Section 37 of the Arbitration and Conciliation Act, 1996, deals with appealable orders which reads as follows:-
“37. Appealable orders - (1) [Notwithstanding anything contained in any other law for the time being in force, an appeal] shall lie from the following orders (and from no others) to the court authorised by law to hear appeals from original decrees of the Court passing the order, namely:-
(a) refusing to refer the parties to arbitration under section 8;
(b
An appeal against dismissal of a Section 8 application under the Arbitration and Conciliation Act must be filed in the Court authorized by law, not the High Court.
A partnership firm must have all partners join legal actions; failure to do so renders applications non-maintainable. The court emphasized the need to provide sufficient cause for any delay in filing....
The court established that delays in appeals under the Arbitration Act are to be strictly limited, with condonation only in exceptional circumstances where compelling reasons are provided.
The court emphasized the strict timelines prescribed in the Arbitration and Conciliation Act and the Limitation Act, and held that delays beyond the statutory periods cannot be condoned.
The law of limitation applies equally to all parties, including the Government, and a lack of diligence in filing appeals can result in rejection of delay condonation applications.
The court established that the limitation period for appeals under the Arbitration Act is 60 days as per the Commercial Courts Act, but delays can be condoned based on sufficient cause, including rel....
The court emphasized that appeals under the Arbitration Act must adhere to strict timelines, and administrative delays do not constitute sufficient cause for condonation of delay.
The Court emphasized the lenient approach to be taken towards condonation of delay and the need to consider the larger perspective and the ends of justice in such matters.
An appeal is maintainable under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996 against an order rejecting a request to refer parties to arbitration under Section 8.
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.