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2018 Supreme(MP) 759

IN THE HIGH COURT OF MADHYA PRADESH
Prakash Shrivastava, J.
Anik Industries Ltd. (M/s) v. M/s. DCM Shriram Consolidated Ltd.
First Appeal No. 514 of 2018 (I); Decided on 22.11.2018*

Advocates:
Advocate Appeared:
R.T. Thanewala for appellant; Vinay Saraf with Amit Bhatia for respondent.

Headnote:Arbitration and Conciliation Act, 1996 -- Ss. 5 and 8 -- Civil P.C., 1908 -- O. 7. R. 11 -- appellant filed suit for recovery of sum with plea that goods supplied to respondent in terms of purchase order -- trial Court allowed respondent's application under Order 7 rule 11, CPC and rejected plaint -- parties given liberty to invoke arbitration clause -- purchase order signed by both parties -- it mentions that general terms and conditions shall be as per Annexure which contains arbitration clause -- arbitration clause exists -- trial Court rightly dismissed suit and directed parties to invoke arbitration clause for setting dispute. (1999) 7 SCC 61, (1987) 1 SCC 615, (2000) 4 SCC 539 and (2006) 5 SCC 275 followed. 2003 (4) MPHT 564 relied on. [Paras 8, 16 & 22

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JUDGMENT

1. By this first appeal under section 96 of the CPC plaintiff has challenged the judgment of the trial Court dated 4.9.2017 passed in CS No. 1-B/2013 allowing the respondent's application under Order 7 rule 11 of the CPC read with sections 5 and 8 of the Arbitration and Conciliation Act, 1996 (for short "the Arbitration Act") and rejecting the plaint by giving liberty to the parties to invoke the arbitration clause for settling the dispute.

2. Appellant had filed the suit for recovery of a sum of Rs. 43,79,754/- along with the interest @ 18% with the plea that in terms of the purchase order, appellant had supplied Indonesian Coal to the respondent but only a part consideration amount was paid, hence the recovery of the balance consideration amount was sought in the plaint.

3. Respondent had filed the application under sections 5 and 8 of the Arbitration Act read with Order 7 rule 11 of the CPC for dismissing the suit as not maintainable and referring the parties to arbitration on the ground that the arbitration clause exists. The said application was opposed by the appellant by filing the reply.

4. Trial Court in the order under challenge has reached to the conclusion that Annexure G(I) to the supply order dated 28.11.2008 is a part of the arbitration agreement between the parties and since the arbitration agreement exists, therefore, in terms of section 5 and 8 of the Arbitration Act the jurisdiction of the civil Court is barred. Hence by allowing the application, trial Court has dismissed the suit for want of jurisdiction permitting the parties to approach the arbitrator in terms of the arbitration clause.

5. Learned counsel appearing for the appellant submits that in the purchase order signed by the parties there is no arbitration clause and general terms on which the respondent is relying upon, cannot be referred and cannot be treated to be incorporation by reference, hence on that basis it cannot be held that the arbitration clause exists. He has further submitted that general terms were not supplied to the appellant. In support of his submission he has placed reliance upon the judgment of the Supreme Court in the matter of M.R. Engineers and Contractors Pvt. Ltd. v. Som Datt Builders Limited, reported in (2009) 7 SCC 696 and in the case of M/s. Elite Engineering and Constructions (Hyd) Pvt. Ltd. v. M/s. Techtrans Construction India Pvt. Ltd. vide judgment dated 23.2.2018 passed in Civil Appeal No. 2439/2018. He has also tried to distinguish the judgment in the case of M/s. Inox Wind Ltd. v. M/s. Thermocables Ltd. vide judgment dated 5.1.2018 passed in Civil Appeal No. 19/2018 on the ground that it is a subsequent judgment of the equal strength of judges taking a different view, therefore, it is per incurium. He has also submitted that under section 8, Court was required to refer the matter to the arbitrator instead of dismissing the suit.

6. Learned counsel for the respondent submits that the general terms are not incorporated by reference but the arbitration clause is contained in the general terms which is an annexure to the purchase order, hence it is not a case of relying upon the arbitration clause incorporated by reference. He has further submitted that the purchase order is signed by the parties and it is not necessary to sign the annexure and that the purchase order was issued in the year 2008 and till the filing of the reply to the application under Order 7 rule 11 of the CPC, appellant had never raised any issue that the annexure to the purchase order was not supplied. He has placed reliance upon M/s. Inox Wind Ltd. v. M/s. Thermocables Ltd. vide judgment dated 5.1.2018 passed in Civil Appeal No.19/2018 and the judgment in the matter of Groupe Chemique Tunisien SA v. Southern Petrochemicals Industries Corpn. Ltd., reported in (2006) 5 SCC 275, in the matter of Atlas Export Industries v. Kotak and Company, reported in (1999) 7 SCC 61 and in the matter of Brahan Dutt Shukla v. Ashok Leyland Finance, repor



























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