The court clarified that ongoing arbitration does not bar jurisdiction for matters involving a non-party to the arbitration agreement.

JUDGMENT:-

1. The Defendant No.2 has taken out this notice of motion under Order VII, Rule 11 of the Civil Procedure Code.

2. Mr. Kanetkar, the learned counsel for the Defendant No.2 contends that the dispute is predominantly between the Plaintiff and the Defendant No.2. He contends that based on the same cause of action as averred in this suit, the Plaintiff has initiated arbitration proceedings and that the said arbitration proceedings between the Plaintiff and the Defendant No.2 are pending before the learned arbitrator. He contends that the reliefs sought against the Defendant No.1 are ancillary and would be covered by the arbitral award. He therefore contends that the present suit is barred by law and hence, the plaint needs to be rejected.

3. Ms Bhavana Anklesaria, the learned counsel for the Plaintiff per contra submits that the Defendant No.1 is not a party to the arbitration proceedings. She has further submitted that the Plaintiff by letter dated 10/7/2009 addressed to the Managing Director of the Defendant No.1 had invoked arbitration clause No.69 of dealership agreement and requested the Managing Director to act as a sole arbitrator and commence arbitration proceedings. The Defendant No.1, vide reply dated 8/9/2009 had categorically declined to appoint an arbitrator alleging that the dealership agreement dated 20/7/1980 was executed with Defendant No.1 as a proprietor of M/s. Shalimar Auto Service . The Defendant No.1 had claimed that it had no privity of contract with the Plaintiff and as such no arbitrator could be appointed at the request of the Plaintiff. Relying upon the decision of the Apex Court in Sukanya Holdings Pvt. Ltd. vs. Jayesh H. Pandya and Anr.,(2003) 5 SCC 531 and the decision of this Court (Coram : R.M. Savant, J.) in M/s. Eagle Agro-Farm Private Limited versus M/s. Eagle Soraj Townships Private Ltd., in Civil Writ Petition No.7872 of 2013, she submits that the dispute between the Plaintiff and the Defendant No1. cannot be referred to the arbitrator. She therefore contends that the pendency of the arbitration proceedings between the Plaintiff and the Defendant No.2 would not oust the jurisdiction of this Court.

4. I have perused the records and considered the submissions advanced by the learned counsel for the respective parties.

5. The Plaintiff and the Defendant No.2 are brothers. They were the partners of M/s. Jagat Singh and Sons, which was engaged in transport business. The said partnership firm had taken on lease a plot of land admeasuring 1953.73 sq.meters bearing Plot No.C, at Dr.C. Gidwani Marg, Chembur, Mumbai-400074 (hereinafter referred to as “the suit plot”).

6. It is the case of the Plaintiff that some time in the year 1977, the partnership firm got a consumer pump installed in the suit plot through the Defendant No.1. In the year 1979, the Plaintiff and the Defendant No.2 constituted another partnership firm in the name of M/s. Shalimar Auto Service. Partnership firm M/s. Jagat Singh and Sons permitted M/s. Shalimar Auto Service to carry on business on the suit plot and to use and occupy structures standing thereon. Upon formation of M/s. Shalimar Auto Service, a consumer outlet of M/s. Jagat Singh and Sons was converted into a retail outlet. The Plaintiff claims that the Defendant No.1 had entered into a dealership agreement dated 28/7/1980 with the partnership M/s. Shalimar Auto Service.

7. The Plaintiff claims that the suit plot wherein the petrol pump being run is in possession of the partnership firm of M/s. Jagat Singh and Sons as the lessee whereas all the structures standing