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S.C. Malik Vs. Union of India, Through Director General of Supplies and Disposals, New Delhi-1 - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtDelhi High Court
Decided On
Case NumberSuit No. 309 of 1971
Judge
Reported inAIR1972Delhi211
ActsArbitration Act, 1940 - Sections 2, 20 and 31
AppellantS.C. Malik
RespondentUnion of India, Through Director General of Supplies and Disposals, New Delhi-1
Appellant Advocate D.C. Singhania, Adv
Respondent Advocate B.L. Maurya, Adv.
Excerpt:
.....well as the interest of the minor child, which, no doubt, is one of the most important considerations in matters relating to custody of a minor child. - 6. now, it is well settled, and not disputed that where two courts have jurisdiction to try a matter, an agreement that the disputes will be tried by one of them only is valid and enforceable......by form-dgs & d-68 (revised), which embodies the general conditions of contract applicable to contracts placed by the central government, purchase organisation of the government of india, (now under the ministry of supply). clause 24 in the said form is the arbitration clause, the relevant portions of which provide, inter alia, as follows:-'24. in the event of any question dispute or difference arising under these conditions or any special conditions of contract, of in connection with this contract, (except as to any matter the decision of which is specially provided for by these or the special conditions) the same shall be referred to the sole arbitration of an officer in the ministry of law, appointed to be the arbitrator by the director general of supplies & disposals. it will be.....
Judgment:
ORDER

1. This is an application filed by, S.C. Malik, herein called 'the petitioner' under Section 20 of the Arbitration Act praying that the respondent Union of India, be directed to file in Court the arbitration agreement forming part of the contract, i.e. acceptance of tender No. Kan /1092-D / Kp-6 / 86 / Paod dated February 16, 1968 and the disputes and differences between the parties be referred to arbitration by an order of reference.

2. A preliminary objection was raised on behalf of the Union of India that this Court has no territorial jurisdiction to entertain the application inasmuch as the contract was governed by the general conditions of contract contained in Form 68 (revised) which has the following Clause 20 (3) :-

'20 (3) Jurisdiction of Courts. - The Courts of the place from where the acceptance of tender has been issued shall alone have jurisdiction to decide any dispute arising out of or in respect of the contract.'

3. The following issue accordingly was framed to be tried as a preliminary issue:-

'Whether this Court has jurisdiction in the matter?'

4. It is not disputed that the contract is governed by Form-DGS & D-68 (revised), which embodies the general conditions of contract applicable to contracts placed by the Central Government, Purchase Organisation of the Government of India, (now under the Ministry of Supply). Clause 24 in the said form is the arbitration clause, the relevant portions of which provide, inter alia, as follows:-

'24. In the event of any question dispute or difference arising under these conditions or any special conditions of contract, of in connection with this contract, (except as to any matter the decision of which is specially provided for by these or the special conditions) the same shall be referred to the sole arbitration of an Officer in the Ministry of Law, appointed to be the arbitrator by the Director General of Supplies & Disposals. It will be no objection that the arbitrator is a Government servant, that he had to deal with the matter to which the contract relates or that in the course of his duties as a Government servant he has expressed views on all or any of the matters in dispute or difference. The award of the arbitrator shall be final and binding on the parties to this contract.

XX XX XX XX XX XX XX XX XX XX The venue of arbitration shall be the place from which the acceptance note is issued or such other place as the arbitrator at his discretion may determine. XX XX XX XX XX XX XX XX XX XX XX

The contention of the learned counsel for the petitioner is that Clause 20 (3) is applicable only if a suit is filed in respect of the contract in question and not when the dispute is settled through arbitration under Clause 24 of the said Form 68 (re-vised).

5. According to the terms of the contract, the place of delivery has been mentioned as 'free loose delivery at Igsd, Delhi'. The place at which the stores are required to be tendered for inspection has been specified as 'at Igsd, New Delhi.' Payment is stipulated to he made 'by the Pay & Accounts Officer, Ministry of Works, Housing and Supply, New Delhi.' The contract, however, was accepted at Kanpur and the acceptance of the tender was issued from Kanpur. It is, thereforee, not disputed that in the absence of arbitration clause, the civil Courts both at Kanpur and at Delhi would have had jurisdiction to entertain a suit concerning disputes arising out of the said contract. According to Clause 20 (3) (Supra), how ever, the Courts of the place from where the acceptance of tender has been issued, alone will have jurisdiction to decide any dispute arising out of or in respect of the contract.

6. Now, it is well settled, and not disputed that where two courts have jurisdiction to try a matter, an agreement that the disputes will be tried by one of them only is valid and enforceable. The contention of Mr. Singhania, the learned counsel for the petitioner, is that the application under Section 20 of the Arbitration Act, is not a dispute arising out of or in respect of the contract, nor is it an application to the Court with a prayer to decide such a dispute. On the other hand, according to him it is an application to move the statutory provision of an enactment. It is just an application, which is a prelude to setting into motion the arbitration machinery, which has been agreed to by and between the parties in accordance with Clause 24 of the contract. He thereforee, submits that Clause 20 has no application to the facts of the present case.

7. The contention of Mr. Singhania, however cannot be accepted according to Section 31(3) of the Arbitration Act 1940 all applications regarding the conduct of arbitration proceedings or otherwise arising out of such proceedings are required to be made to the Court where the award may be filed. 'and to no other Court'. According to sub-section (1) of Section 31, subject to the provisions of the Act, an award may be filed in any Court having jurisdiction in the matter to which the reference relates. The word 'Court has been defined in Section 2(c) of the Arbitration Act, to mean a civil Court having jurisdiction to decide the questions forming the subject-matter of reference, if the same has been the subject-matter of a suit, Reading these provisions together, it is obvious that an application under Section 20 of the Arbitration Act, which is an application regarding the conduct of arbitration proceedings, can be filed in any Court having jurisdiction in the matter to which the reference relates, or in other words, having jurisdiction to decide the question forming the subject matter of the reference. As has been seen above, the civil Courts both at Kanpur and Delhi have jurisdiction to decide such question in the present case. Such being the situation, the agreement of the parties, as contained in Clause 20 of Form-68 (revised), would step in and all Courts other than the Court of the place from where the acceptance of tender was issued, which in this case was Kanpur, would be excluded. It is, thereforee, the Kanpur Court alone, which has jurisdiction to entertain the application under Section 20 of the Arbitration Act.

8. In above view of the matter, this Court has no jurisdiction to entertain the application, which shall be returned to the petitioner for presentation to the proper Court. There shall, however, be no order as to costs.

9. Order accordingly,


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