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2021 Supreme(MP) 486

IN THE HIGH COURT OF MADHYA PRADESH (JABALPUR BENCH)
Vishal Dhagat, J.
Madhya Pradesh Road Development Corporation - Appellants
Vs.
Baisakhu - Respondent
Misc. Petition No. 1532/2021
Decided On : 05-05-2021

Advocates Appeared:
For the Appellant :Atul Nema, Advocate

The main legal point established in the judgment is the determination of jurisdiction for setting aside an award under section 34 of the Arbitration and Conciliation Act 1996, based on the seat and venue of the arbitration proceedings.

Headnote:

Appeal - Jurisdiction - Arbitration and Conciliation Act 1996 - Commercial Courts Act 2015 - Code of Civil Procedure, 1908 - Section 13(1) of the Commercial Courts Act - Order XLIII of the Code of Civil Procedure Code, 1908 - Section 37 of the Arbitration Act - Section 8 - Section 16 - Section 34 - Section 3G(5) - Section 3G(6) - National Highways Act, 1956

Fact of the Case:

The petitioner filed a Misc. Petition questioning the maintainability of an order passed by the First Additional District Judge, Mandla, MP. The Registry raised an objection regarding the maintainability of the Misc. Petition, citing the judgment of the Apex Court in the case of Kandla Export Corporation and another Vs. OCI Corporation and another. The petitioner's application under section 34 of the Arbitration and Conciliation Act 1996 was returned by the trial court on the ground that the Divisional Commissioner, Jabalpur, had been appointed as an Arbitrator by the Central Government. The learned Additional District Judge, Mandla, held that the Principal Civil Court at Jabalpur would have jurisdiction to consider and decide the application filed under section 34 of the Act of 1996. The petitioner argued that the Principal Civil Court, Mandla, had exclusive jurisdiction to entertain the application under section 34 of the Act of 1996, as the compensation amount had been decided by the competent authority at Mandla and the land was situated at Mandla. The petitioner also contended that there was no arbitration agreement between the parties and that the cause of action arose within the territorial jurisdiction of Mandla. The court dismissed the Misc. Petition, affirming the order passed by the First Additional District Judge, Mandla.

Finding of the Court:

The court found that the application for setting aside the award under section 34 of the Act of 1996 would lie before the Principal Civil Court of original jurisdiction in Jabalpur and not at Mandla. The court affirmed the order passed by the First Additional District Judge, Mandla, and dismissed the Misc. Petition filed by the petitioner.

Issues: The issues involved the maintainability of the Misc. Petition, the jurisdiction of the Principal Civil Court at Jabalpur, and the applicability of the Arbitration and Conciliation Act 1996 in determining the jurisdiction for setting aside the award.

Ratio Decidendi: The court held that the seat and venue of the arbitration proceedings were at Jabalpur, and therefore, the application for setting aside the award under section 34 of the Act of 1996 would lie before the Principal Civil Court of original jurisdiction in Jabalpur. The court also emphasized the importance of party autonomy and the jurisdiction of the courts where the arbitration takes place.

Final Decision: The court affirmed the order passed by the First Additional District Judge, Mandla, and dismissed the Misc. Petition filed by the petitioner.

ORDER :

Vishal Dhagat, J.

1. Petitioner has filed this Misc. Petition calling in question order dated 02.02.2021 passed by First Additional District Judge, Mandla, MP.

2. Registry has raised an objection regarding maintainability of Misc. Petition filed by the petitioner. Registry has pointed out that Misc. Appeal under Order 43 Rule 1 of CPC ought to have been filed by petitioner instead of Misc. Petition under Article 227 of the Constitution of India.

3. Considered the objections raised by the Registry.

4. As per the judgment of Apex Court in the case of Kandla Export Corporation and another Vs. OCI Corporation and another, (2018) 14 SCC 715, it has been held in para 13, 14 and 15 of said judgment as under:-

    "13. Section 13(1) of the Commercial Courts Act, with which we are immediately concerned in these appeals, is in two parts. The main provision is, as has been correctly submitted by Shri Giri, a provision which provides for appeals from judgments, orders and decrees of the Commercial Division of the High Court. To this main provision, an exception is carved out by the proviso. The primary purpose of a proviso is to qualify the generality of the main part by providing an exception, which has been set out with great felicity in CIT v. Indo-Mercantile Bank Ltd., 1959 Supp (2) SCR 256 at 266-267, thus:

"9.... The proper function of a proviso is that it qualifies the generality of the main enactment by providing an exception and taking out as it were, from the main enactment, a portion which, but for the proviso would fall within the main enactment. Ordinarily it is foreign to the proper function of a proviso to read it as providing something by way of an addendum or dealing with a subject which is foreign to the main enactment.

"8..... it is a fundamental rule of construction that a proviso must be considered with relation to the principal matter to which it stands as a proviso".

Therefore it is to be construed harmoniously with the main enactment. (Per Das, C.J. in Abdul Jabar Butt v. State of Jammu & Kashmir (1957) SCR 51, 59). Bhagwati, J., in Ram Narain Sons Ltd. v. Assistant Commissioner of Sales Tax (1955) 2 SCR 483, 493] said:

"10. It is a cardinal rule of interpretation that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision. It carves out an exception to the main provision to which it has been enacted as a proviso and to no other."

10. Lord Macmillan in Madras & Southern Maharatta Railway Co. v. Bezwada Municipality [(1944) LR 71 IA 113, 122] laid down the sphere of a proviso as follows:

"..... The proper function of a proviso is to except and deal with a case which would otherwise fall within the general language of the main enactment, and its effect is confined to that case. Where, as in the present case, the language of the main enactment is clear and unambiguous, a proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it by implication what clearly falls within its express terms."

The territory of a proviso therefore is to carve out an exception to the main enactment and exclude something which otherwise would have been within the section. It has to operate in the same field and if the language of the main enactment is clear it cannot be used for the purpose of interpreting the main enactment or to exclude by implication what the enactment clearly says unless the words of the proviso are such that that is its necessary effect. (Vide also Corporation of City of Toronto v. Attorney-General for Canada [(1946) AC 32, 37].)"

14. The proviso goes on to state that an appeal shall lie from such orders passed by the Commercial Division of the High Court that are specifically enumerated under Order XLIII of the Code of Civil Procedure Code, 1908, and Section 37 of the Arbitration Act. It will at once be noticed that orders that are not specifically enumerated under Order XLIII of the CPC would, therefore, not be appealable, and ap

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