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2022 Supreme(Telangana) 444
IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
P. NAVEEN RAO, G. RADHA RANI, JJ.
M/s. Janset Labs Pvt. Ltd. - Petitioner
Versus
M/s. Sudha Analyticals - Respondent
Civil Revision Petition No. 293 of 2022
Decided On : 03-08-2022
For the Petitioner: Sri Sharad Sanghi.
For the Respondent: Sri Sriram Polali.
Point of Law : Provisions of CPC are to be followed as a guidance’, and that ‘CPC will apply only insofar as same are not inconsistent with spirit and provisions of Arbitration Act’.
Headnote:
Civil Procedural Code, 1973 - Section 151 - Order VII Rule 11 - Arbitration and Conciliation Act, 1996 - Section 9 and 21 - Arbitration - Saving of inherent powers of Court - Whether respondent has paid certain amounts and is required to pay lesser amount than what is claimed by petitioner, for Court to hold that what is required to be paid by respondent is less than Rs.1 Crore and to hold that Commercial Court jurisdiction is ousted - Petitioner are liable to be rejected on sole ground that Order VII Rule 11 has no application to applications filed under Section 9 of Act. (Para 15)
Finding of the Court :
Specified value is required to be seen based on claim made by applicant who filed application under Section 9 of Act 1996 - Before Commercial Court in C.O.P., applicant claimed an amount of Rs.1,19,17,928/- as due from respondent, which alone is required to be considered. At stage of consideration of application Under Section 9, Court cannot go into aspect as to whether respondent has paid certain amounts and is required to pay lesser amount than what is claimed by petitioner, for Court to hold that what is required to be paid by respondent is less than Rs.1 crore and to hold that Commercial Court jurisdiction is ousted. Issue of what is amount claimed, amount due and payable are matters for consideration in Section 9 application only to a limited extent of considering to grant interlocutory measures pending commencement of arbitral proceedings. All aspects of inter se disputes have to be gone into in arbitral proceedings - Court cannot go into those aspects in application filed under Order VII Rule 11 of CPC.
Results : Civil Revision Petition dismissed.
ORDER :
P. Naveen Rao, J.
Petitioner is proprietary concern engaged in the business of leasing imported hi-tech/advance technology machineries to various enterprises for their activities. The petitioner has approached the respondent to import “SCIEX QTRAP4500 SYSTEM” an enhanced high performance hybrid triple quadrupole/linear ion trap LC-MS/MS Spectrometer to be installed in their premises to meet their commercial demands for their business activities. Based on the said request respondent imported said machine from Singapore vide invoice dated 28.9.2020 and installed the same in the premises of the petitioner. In terms of the agreement, petitioner is liable to pay Rs.13,74,740/- each month as lease amount excluding GST/other statutory taxes and on remittance of 12 months lease amount, the ownership rights get transferred to the petitioner company. While so, disputes arose on the issue of remittance of monthly lease amount. As on 25.10.2021 respondent claimed Rs.1,19,17,928/- from the petitioner. Contending that in spite of repeated requests, the amount is not remitted, respondent sought to invoke Arbitration clause incorporated in the lease agreement and in the process to protect his interests in the interregnum period, he filed C.O.P No. 20 of 2021 in the Special Court for Trial and Disposal of Commercial Disputes, Ranga Reddy District at L.B. Nagar. In the said C.O.P., petitioner filed I A No. 2 of 2022 taking recourse to Order VII Rule 11 read with Section 151 of CPC praying the Court to reject the main petition as barred under law.
2. It was contended that specified value of the dispute involved is less than Rs.1 crore, therefore, Commercial Court has no jurisdiction to deal with the application filed under Section 9 of the Arbitration and Conciliation Act, 1996. According to petitioner, he has paid Rs.87,15,720/- and balance amount to be paid is Rs.97,39,243/-, therefore, the amount involved is less than Rs.1 crore and Commercial Court has no jurisdiction. The Court below, rejected the said application by order dated 10.2.2022. Hence, this Revision.
3. Heard learned counsel for petitioner Sri Sharad Sanghi and learned counsel for respondent Sri Sriram Polali.
4. Learned counsel for petitioner contended that petitioner is liable to pay Rs.97,39,243/- thus, the specified value of dispute is less than Rs.1 crore and Commercial Court has no jurisdiction to deal with application filed under Section 9 of Act, 1996 and party has to go before the civil Court. In support of his contention, learned counsel referred to the statement of accounts shown in tabulated form in I.A. No. 2 of 2022. According to learned counsel, the total amount required to be paid is Rs.1,19,17,928/- out of which petitioner paid an amount of Rs.97,39,243, leaving the balance amount required to be paid as Rs.97,33,158/- and this is the amount which is required to be considered for the purpose of assessment of specified value. Unless specified value of dispute is more than Rs.1 crore, the Commercial Court has no jurisdiction to deal with application filed under Section 9 of Act, 1996 application.
5. Learned counsel referred to Section 21 of the Act, 1996 to contend that arbitral proceedings must commence for a person to have a grievance and to seek interlocutory protection under Section 9 of the Act, 1996, whereas, arbitral proceedings did not commence by the time application was filed by the respondent and even now no proceedings have commenced, therefore, the entire process is vitiated on that ground alone.
6. He further contended that as per lease agreement disputes have to be resolved within the territorial limits of Hyderabad District, whereas, the application under Section 9 of the Act, 1996 was filed in the Commercial Court at Ranga Reddy, therefore, the application is not maintainable. However, learned counsel fairly admits that this contention was not urged before the Commercial Court.
7. Learned counsel by referring to judgment of Supreme Court in Kiran Si
