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2025 Supreme(Mad) 3228

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


Advocates:
Advocate Appeared:
For the Appellant : B. Gautham
For the Respondent: T. Sundaranathan

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.

Headnote:(A) Arbitration and Conciliation Act, 1996 - Sections 2(1)(e)(i), 8, and 37 - Condonation of delay - Appeal against dismissal of application to refer dispute to arbitration - The Court found that the appeal was not maintainable before it as per the provisions of Section 37(1) of the Act, which mandates that appeals from orders of dismissal of Section 8 applications lie before the Court authorized by law to hear appeals from original decrees. The Court clarified that the definition of 'Court' differs in context and that the appeal must be presented to the appropriate Court as per the Chennai City Civil Court Act, 1892. (Paras 5, 12, 16)

(B) Limitation Act, 1963 - Section 14 - Exclusion of time - The appellant is entitled to exclude the time taken in prosecuting the matter before this Court when filing an appropriate application under Section 14. (Paras 17)

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

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