IN THE mGH COURT OF CHHATTISGARH AT BILASPUR. First Appeal No..f-?.^.../2007 APPELLANT Plamtiff //VERSUS // RESPONDENTS Defendants. 1. . e.^.^ .•'v^'-^ ^^ Ashok Kumar Guha, S/o Late M.N.Guha, Aged about 50 years, Occupation - Service, R/o Pratappur Road, Ambikapur, District - Sarguja (C.G.). Executive Engineer/Mechanical Division, P.H.E.D., Nawapara, !i-:^ X^ ^ Opp. Church, House of Shri Chhabra, Principal, Ambikapur, District Sarguja (Chhattisgarh). /2. Assistant Engineer, Mechanical Sub Division, P.H.E.D., Ambikapur, District Sarguja (Chhattisgarh). 3. The State of Chhattisgarh, Through the Collector, Sarguja (Chhattisgarh). »»• FIRST APPEAL UNDER SECTION 96 OF THE CODE QECIVIL PROCEDURE. 1908.Cfewn/n^pfid. \&4W cd^ /)tf t ^J.O^—^._S, ^- HIGH COURT OF CHHATTSSGW^H AT BSLASPUR Ssnaie Bench: Hon'bte Shri Justice Prashant Kumar Mishra F,A.No,1I2o|290Z Ashok Kumar >us fe"MQdl?JVe S"jlEOI! a-^F^^'^^-^^'^A^s ^ ^p- &sf~i s^A ** ^^^'^' a i* „ ^. •- :^i5!¥B " Dlvisi) E&^ Post for 2--2-0&-201 Sd/- prashant Kumar Mishra Judge {^ R ^^/ ^'"S.I.**^1 HiGH COURT OF CHHATTISGARH AT BILASPUR SJRate Bench: Hon'bSe Shrl Justice Prashant Kumar MIshra F.A, No.172 t 2QO A t~~i,"-,r~ li t R n r H,i~!-'C:LLfIi,N RESPONDENTS y ^?1 ^y^t Ashok Kumar Guha Exeeutive Engineert Diyis'on arid others. ti.inir' lanicai Sftrl Manoi Paraniu®,GQuns6l IQ!' aDDsiiant. Sh" Ajay Dwivedi, Dy. Go"t. Advocate for the «ePcAS,i.?NDERScCTiON 98 OF THE CODE OF CIVEL PROCEDUJ JUOGN 82-'l-,Q9.2y10i This first appeal under Section 96 ofthe G.P.C. has preferred by the defendant chalienging the iudament and decree passed by the triaf Court on preliminary hoiding that the plaintiffs suit is not malntainable on account of arbitration clause in the aareement as aiso for the reason that the suit is barred by timttation. (2) The the suit on 26-08-2CT36 rea^very of arresrs of rent -dmountiny to Rs.1,64,279/-. The suit was fited on the pies.dings mter ana that the suit house was taken on rent by th< defeny'ants executinu a tease deed on 17-^7-19^ sianed bv the uig.tntjff's mother -and the defendant No.2. The rent ofthesuit house was to be fis.ed by the Cotiector, Surguja, which was later on at Rs.1170/- per month vide order dated 03-07-1990. PtaintifTs mother died w', 05-03-1990. Apart from the four other brrthers and sisters whose name were mentioned in para 5 of the plaint wers the tegaf (epresernatives, however g.K uf thBrn executed a power of attomey dated 21-03-1990 in favour of the plaintiff. The power of attomey was d»a,^ .A ^. ^!,a^. SSI^^^^^S submitted before the defenda.nts No.2 which was duly recognized and acted upon -a.nu the rent to the plaintiff tiii January, 1997. The piaintiff presented bill for receivjng the rent from February, 1997 to May, 1997, whtoh was received by the defend-ants, however rent not paid. ARuther uiit was presented on 01-12-1997 before the defendant No.2 dernanuing rent from June, 1^7 to November, 1997, however the defendarn No. 2 vjue his letter 09-12-1997 informed the Dlainiiff that his brother Ashish Kumar Guha has issued a communteation to the defendants t.h.at h" withclrawn the power of attomey, therefore, ua'yfrient of rent is nut oossibie. (3) it was further biy the ptamtiff that the power of attomey beins a registered document has ndt been eancetieu in accordance with Sgw nor his brutner has ever infomied him that he has cancelled the power of attorney therefore non-payTnent of rent is illegaS. In the meanwhile, the defenuants sought permission from the ptaintiff to make repair and whtte washing but even carrying out the repairs -and white washing the of the expwses were not infomied to the piaintiff, whlch was necessai'y the same to be adjusted in the rent. it stated in the that if. the power of attomey was in the shouiti depreited ^he rent -Aith the Rent Cwitrolling Authority however no such step was taken by the defendants the payment of rent has withheld deliberately. The defend-ants jnformau by the plaintiff by his Setter 12-05-2004 that the power uf attomey is stilt and ths rent shoyld be The viue its ietter 02-09-^04 inferme( » ' the pSaintifT that thsy wiii be yaeating the prerRises on 30'^ September, '1 \ 3- •2C'C4 -and later on 22-12-2004 informjng the that they are to accept the power of attomey on behatf of uther representatives of origina! tandiord, therefore name of the representa.tives be infomied to them. This replied by piaintiff on 07-01-2035 that the power of attorney is stjil operatjve. 'he defendants No.1, vide its letter 16-02-2005 demanded fresh The power of attomey. The plaintiff competl^ to sep/e notice 2807-2005 and thereafter the suit was fiied. (4) The dBfenuants, in their statement denied the a'segation and th-at in the deed it has been agreed the that in of it be referred to the Secretary, Pubiic Engineering Ospartment of the Govemment for aruitratio" snd therefore the suit is not maintainaMe. The defendanti denied the of attorney, however, they admitted that rent has been paid to the tiii Janu-ary, 1997, According to the defendants, Ashjsh Guha of the ptaintiff has a dispute and has that S"ie is withu'rawing the power of attomey as a!so making a prayer that the rent of the office buildina be sl tili time fresh consent for payment of rent is by him. St by the defendante that in v'iew uf tne the representatives the piaintiffs obtain a from the competent Couft 6r snouid sut consent from other representatives for maintaining the suit. The uefend.ants uemonstratecl it's inability to make payment of rent in the \ absence of tetter of consent from other representatives. -^i- 1 (5) tt further by the defendants that since admittedly there are other representatives of the original landlord Smt. Renu Guha, the plaintiff is not to receive the rent, h&'wever in viev,' of ciispute amongst the segai representatives it was incumbent upon tnem to have dispute or to have obtain suceession certifscate, It was denieu by the defendants that pavment of rent has been stopped without sny grounil. The defendants further that they yacated the premises on 30"* Ssptember, 2004. Ths defendants sdmfttsd to received t.he plaintiff's tetter dated 16-11-2003 demandlng rent from Febru-ary, 1997 tu December 2003, however they denied that term* of the h-ave been violated and that after obtaining possession of t'ne premlses the representatives net informe< ur objecteu that the premises is not in good condition or that it has damaged. tn 21 of the 'ATitten statement the defendants have that pS-aintiffs brother has possession of the premlses wi.thout any objection and has issued a receipt of obtaining possessiun to the defendants. The defendants further that the suit is by ilmitation a.nu the should have been to the arbitrator as per the terms of the !n 27 of the wrttten the pieaded that in the suit ftied on 26- 02-2C-06 the uf rent for preceuing three years could have been prayed, however since the defendants have already s^nt Rs.20,000,'- towards and washing, in faet the defendants are to Rs 4620/- a.nd no arrears are due from them. It was also that the uiaintiff's suit is not maintainable on accourrt of non-jolnder of inasmuch as the other representatives of orifliRai defendant ':t 'I:i3ss& S Yfe^X/ -5- Smt. Renu Guha have not joined and the plaintiff is nrt entitled to receive th®rent exciusiveiy. i'6'i The triai Court dismissat the suit hoiding that in view of existence of arbitratiun the ptaintiff hsve referred the uispute for arbitration and that suit is by timitation, (7) Leamed counsel for the appeliant has argued that the question of limitation a mixed of iaw and shouid not have been decided as a preiiminary that in view of the defendarsts acimission in various letters admitting their to payrnent of rent the be to benefit of Section 18 of the Limitatton Aet which a.gain is a question of fact and shouid h-ave been decided after reguiar trla!. H.e woulu subm'rt that in any the of the pla.intiff couid not have been thrown out. Learned coynse! for the appeiiant would further submit in fact is no dispule between th^ piaintiff -and the defendants, and the dispute, if any, was between the piaintiff and his brother, thus, the -arbitration ci-ause is not attracted in this case and further that ttie of Section 8 of the Arbitration an< Conciliation Act has not fulfslted by the defendants, therefore the suit not a.s not in view of of .A.rbitratiQn ciause. counsei for the appellant has on the judgments in the matter of The Poft Tnsst Vs. Hymanshu uy ,'(s V. 6y L-Rs. in •S37S SC i't44, Fredoom Vs. 'f96f SC f238, Oawoodftaf AWu «ler AiR f831 18^ - b Lt. ,Uk — -T <».n.^tjnk j»*. •SSS t <«? (8) On the other hand, the leamect counset for the respondents has aruued that filinQ of the suit and existence of sause of action wouid itself ue sufflcient to hc"d. that there is a dispute between the pl-aintiff and th< therefore, the arbitrstion is appiicabie and the sult has rightly been (Jismisseu un this ground, (9) The regarding tlmitation to say that the sult is by xmitgtio" has the plaintifff^peilant on the ressonlng that the piaintiff is of rent from February, 1997 tii! the of vacation and the suft has on 26-02-^)06 which is ctearty barred because for recovery of rent, the iimitation is three years under Articte 52 of the Limitation Act. While recording the said firsdiRg the t"ai Court has comptetely lost siyht of fact that the period immediately precedlng from the date uf filing of the suit i.e. from 26-08-2006 woul-.:! ateo cover the from August, 2003 to September 2004 during w'nich the defendants in possession, (the defendants hsve vacsted the premises on 3£^1Septsmber 2004). Eyen othenwse ths pi-ajntiff is also taking of tetter from the defendgnts from time to time actatowiedging theif' liability to make paynient of rent. Whether or not the comrnunicauon by the defendsnts on 02-09- 22-12-2004 and 16-12-20i4 would constitute an acknov/iedgemerA '."MnR the meaning of Section 18 of the Kmitation Act is a question o' t;3c* to bs (jetenTiined 9S.W rscorelinQ of •vidence. Thus, the finding 'r\^ rscordeii tjy the tria! Court that the entire suit is barred by iimitation is not 7 and it is held that the suit could not have been as oarreu uy itiTiiiaiion. i 105 8 of the A.rbitration and Concitiation Act, l' reDroduced as uwaw'.- "S. Power to refer (o where fe- ai-s agreemwit-(l) A jiidiGia! authonty frsfore whicti an action fe ;'," a whsch is the Siibj'eGt of an shal!, if a s-o noi wheft hiS on the of the the to arMration. (2) Ths to in siib-section (1) not &e ^ fs &y ?ne original or a cefWed copy thereof. r3,s that an appticatiQn has itffdaf sub-seclion (1) and that the is feefore ff?e judtoiai authonty, a" aftostration fnay be commenced or co,"ffi"yed an aitiiral made" (11) Ciause 12 of the stipulates that "if any g'lse between the here to m respect of or any of the p'uvfsiort comamed or anyfhing arising there frorn, ffie same sha" &" reimsfsd to the to tf'ie Secretafy te Govemnwnt of M.P. of ff?" coRC8f? , wnose be finat and uincfmg on tha pasties. Thijs, an ailiitration cSause in the Acconslng to the pta.intiff is no dispute a.s sich between the plaintiff \ anci the defendant, therefore arbitration is not and that y ths sult 5A?'9s majntstngbte, -% (12) in the uf p^ofeum Co?pn. Ud. Vs. Pmkeil in (®/1SCC 503 the Hon'ble Suprem' Court has helu thus i.n paras 13,14,15 and 16:- "13. A of this ctause oieariy shows th-at the parties to the Agreement had to refer their gilsing oul of the Agreement, of whatever nature it rnay be, to an arbitrator as contemplateci in that Agreement, Section 8 of the Act in mandates that a judicial authority before whteh an is brought i" a matter which is the of an arbitr'dtlon agreement to refer such parties to arujtrationi ths ianguage of this section is unambiguous. 14. This Court in the of P. Anand Gajapathf Raju v. P V.G. Rafu 4 SCC 539 has heid that the of SeGtson 8 is pei'emptory In nature. Therefore, in cases where there te an in the agreement, it is obiigatory for the court to the to arbitration in terms of their and nothing remains to be decided in the origlnai action after such an apptscation is made to refer the to an arbitrator, Therefore, it is ciear that if, as contenyed by a party in an agreement between the parties the civii court, there is a for arbitration, it is RTandatory for ths civi'i court to the dispute to an arbitr-ator. In the the existence of an arbitrai cts.use in the Agreement is accepted by both the as by the but the apptteability thereof is disputed by the resF'ondent and the is by the courts Be that as it may, a.t the of repetition, we may th-at the existence of the arbitration cl-ause is admitted. if be so, ir* '.'iew of the m.and-ato(:y language of Section 8 of the Act, the ueiow ought to refened the to arbttratio". ', 15, The question then would whal wouid be the roie the civii court when an afgufflent is that such an arbstration does not to the of the in '^.-3 ''-S;. iih, V "-. '^^^, " ^ ^' . W1^B^L ff %. & "% / "v^^y.^/ ^A"^--' -5 hanu? Leamed counsei for the appellant contends that it is a matter whteh shoulcj be before the arbitrator who fe competent to acijudtoate upon the s-ame and the civlt court sE'iijulu not embark upon an inquiry in to the appiteability of the •arbitratjun to the of the case. White ieamed coynsel appearing for the contends that since the appiteab'l'ty of the arbitration to the facts of the goes ?.o the very root. of the jurisdiction of the reference to arbitration, this question wi!s have to be by the dyii court before refemng the matter to arbitration even in cases where is admitteegy an arbitrstion clause. The answer to thls argument, in our QpniQn, is found in Section 16 of the Aet itsetf. ft has e Arbitrai Tribunai to rute on its own jurisdictio" inciuding rute on any objection with respect to the or v-aiidity of the artitration agreement. Tha.t apart, a Cunstitution Bench of this Court in Konkan R!y. Cofpn. l.td. v. Rani Constivcuon (P) W. (2002) 2 SCC 388 v/ith reference to the uower of the arbitrator under Section 16 has laid down thus: (SCC p. 405, para 21) "21. (t snight be that in a given the Chief .Justte or his designate rn.av have nominated an arbltrator aithouQ" the oeriod of thirty davs not expired. if ao, the Arbjtrai Tribunal woutd have been imQroperly constituted and be without juriscliction. ft woutd then ue open to^the aggrieved pafty to reqwre the Tribunat to mte on te jiirisdicSon. 1o provfcfes for (ftfe, ff states ttiat the AfbitraS Tribanat may fufe u" its own jiiris^ction. That the AfWraf Tribiinsf may fute on anj.' objecSoRS wsth respect to (fte exfetenc-e u,r waiidsty offfie arbttration agreement'sfiows that the Aitiitral TribuRat's authQntf ynder Seeffor; 16 is nor cQitfsned to the wiuffii of Ss jyrfstfcffon, ss W9S by teamecf counsel for ft'e appettants, bist .goes to the very mot of ifs jurisdjction. There would, r therefore, be no imDedtmerrt in contendma beTore the o ArtiitraS Tribuna! that it had been wrongiy constjtuted by reason of the fact that the Chief Justice or hi' had nominated an arbitrator -although the period uf thirty hact not e^iired and that, therefore, IS had no jurisdicuon." (emphasis supptied) 18. it is from the langus^e of the secticm, as interpreteu by the ConstitufJQn Bench jyjgment in Konkan R!y.(supfa) that if there is any objectlon as to the applicabitity of the arbjtration to the facts of the case, the wil have to be the Atbitrai Tribunai concemed. TS'ierefore, in our opinion, in this the courts beiow ought not to have proceeded to examine the a^ttoabitity of the to the facts of the in hand but ought to have ieft th8t to be determined by the Arbitrai Tribunalas eontempiateu in 40 of e Deaierehip ^reement and as reauired Sections 8 and 16 of the Act." (13) in the there is no that there an arbitrst'on in the agreement. The plaintiff claims arrears of rent. The uriginat landtord died te-avjng njne iegat representatives incluuing the appeStaiH.. initisiiy power of attomey was executed in favour of the ptaintiff by other tegai representatives, however subsequentiy one of the brother issued a coETimunication to thn defendant that he has withdram th" Dower of attorney. The defendants sav thgt out of the totat t^aiiv recoverabty amount a sum uf Rs.20,STO/-wouid be adjusted towards the repairs and whlte washing as the same was spent by the defen.dante and that if the amount is aujust^ it is the plaintlffwho wouSd be to pay a sum of Rs.4,620/- to the defendant The other tegal representatives of the oriairrdl iandlord not been ioined in the suit. Thus there an l^ variuus issues a.nd djsDUtes between the Darties v>rtiich reauijes -n- aujudication and it cannot be said that no djsoute exists between the Diaintiff and defenuants. i'14's (n the matter of Corofi. Ltd. Vs. Pinkcltv the Supreme Court has that once it is au'nstted that an cfause in the agreement and a dispute has arisen the i.n retstion to a m-atter covered in the agreement, IS is mandatory for the Civi! Court to refer the and that a!S inciuding the objedion regardira jyrisdiction of the are required to be before the a?fcitrator hlmseif. Leamed counsei for the appellant has that since the p-F'ereqUfSits of Sestion 8 has not been complied with, the suit was iTiasntgtnabie, however on perusai of the record ft wouid appear that the uel'endants have fiied the original a.ureement and an QbjeGtion has been raiseu in th" 'writte" statement regarding the maintainabiijty of the suit on accuunt of existenc0 of arujtration ciause, Thus, in view of the judgment of the Suuren'ie Cuurt in the matter of PetFoieiim Ceron. L(d. Vs. PiffKCity (supra) thers was no othef optlon vflth the Civii Cuurt fciut to refer the disyute to the arbitrator. i0i oraer e vjew of the above. the aDDeat is dismissed. There shall be no tu costs. A. decree be drawn-up accordingiy, Sd/- Prashant Kumar Mishra Judge