Author: Samarth Sharma, 2nd Year student at Bennett University.
Date of decision: 5th May 2021
Bench: Vishal Bhagat
Original copy: View
Background of the case:
- A Misc. a petition was filed by the petitioner which was in accordance with the order dated 2nd January 2021 which was passed by the First Additional District Judge in Mandla, Madhya Pradesh.
- An objection has been raised by the registry which is in regard to the maintainability of the said misc. petition, this in accordance to the fact that the misc. a petition which was filed by the petitioner under the Article 227 of the Constitution of India, should have been filed under Order 43 Rule 1 of Civil Procedure Code.
- Consideration was given to the objections which were raised by the Registry.
- Is the Misc. petition maintainable in the court proceedings?
- Which Principal Court has jurisdiction over court proceedings?
- This will be taken into accordance of the judgement of the Apex Court, in the case of Kandla Export Corporation V OCI Corporation :-
- The Commercial Courts Act’s section 13(1), in concern towards the appeals, divided into two sections. Shri Giri properly pointed out an important provision, is one that allows appeals from judgments and decrees issued by the Commercial Division of the High Court. The proviso carves out an exception to the main requirement. The fundamental role of a proviso is for qualifying generalization of the central portion as it gives an exception in this scenario, as CIT v. Indo-Mercantile Bank Ltd illustrates so well.
- The proper role of a proviso is for qualifying the generalization of the central law by giving a special case and removing it from the main enactment, as it were, a component that would come inside the main enactment but for the proviso. Ordinarily, reading a provision as an appendix unrelated to the primary enactment is contrary to its legitimate role.
- The proviso goes on to say that orders made by the Commercial Division of the High Court that are explicitly listed in Order 43 of the CPC, 1908, and Section 37 of the Arbitration Act are appealable. It should be noted right away that orders not expressly specified under Order XLIII of the CPC aren’t a subject to appeal, and only the appeals which are mentioned under Section 37 of the Arbitration Act can be brought before the Commercial Appellate Division of a High Court.
- Hence, a decree referring parties towards arbitration in Section 8 of the Commercial Courts Act would not be a subject to appeal in accordance to Section 37(1) (a) and thus would not be a subject to appeal under Section 13(1) of the Commercial Courts Act. Likewise, an appeal dismissing a plea sub – sub-sections (1) (2) and (3) of Section 16 of the Arbitration Act won’t form a subject to appeal in Section 37(2)(a) of the Commercial Courts Act and, hence, in Section 13(1) of the Commercial Courts Act.”
- Aforementioned criteria put forth by the Apex Court and the facts of this case, it is obvious that there is no arbitration agreement between the parties establishing an agreement of arbitration. The responsible authority determines the compensation for land acquisition for the construction/widening of the National Highway. The sum decided by the body was not acceptable to the parties, therefore an application was filed to have an Arbitrator appointed by the Central Government for determining the amount of compensation.
- The provisions of the 1996 Arbitration and Conciliation Act are made relevant to the Commissioner’s assessment of compensation. Commissioner of Jabalpur was appointed as arbitrator by the authority of Central Government, and the two parties took part in the procedures before Commissioner Jabalpur. Because the seat and venue of the arbitration procedures were both in Jabalpur, an action for putting aside under Section 34 of the Act of 1996 would not be heard before the Principal Civil Court of Mandla but Jabalpur.
- In sending the petitioner’s application to be brought before the relevant court, The Additional District Judge of Mandla made no mistakes. The ruling of First Additional District Judge Mandla, dated February 2, 2021, is upheld, and the misc. petition which was earlier filed has been given dismissal.
- The provisions which are maintained under the Arbitration and Conciliation Act, are responsible for over-ruling the provisions maintained under the Commercial Court Act and Civil Procedure Code. As, the appeal is not a subject to be maintained under the provisions of Section 37 of the Arbitration and Conciliation Act, hence resorting to Order 43 of the CPC and Section 13 of the Commercial Court Act for filling a misc. appeal is not possible.
- It is to be seen that an arbitration agreement does not exist between the contracting parties in which there has been an agreement of the seat of arbitration amongst them. The amount decided for the construction of the National Highway was under the subject of control of a competent authority, this amount was rejected by both the parties and this was a result for the movement of an application for the determining the sum of money by an Arbitrator. The Government is responsible for notifying the Commissioner of Jabalpur for deciding the amount to be paid in accordance to section 3G (5) of the National Highways Act. The provisions which are mentioned in the Act of 1996 are having applicability for the Commissioner for deciding the compensatory amount.
- Hence, both the parties were responsible for participating in the court proceedings with the Commissioner of Jabalpur as the Arbitrator. The venue along with the seat of the proceedings were to be conducted in Jabalpur, hence the application to set aside the sum of money will be lying before the Principal Civil Court of Jurisdiction in Jabalpur and not Mandla.