Civil Revision No.4373 of 2009 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Civil Revision No. 4373 of 2009 Date of decision: November 26, 2009 Punjab State Cooperative Supply and Marketing Federation Limited and another. …..PETITIONERS Versus M/s Mouli Ram, Cotton Ginning Pressing and General Mills, Budhlada and another …..RESPONDENTS CORAM: HON’BLE MR JUSTICE T.P.S.MANN PRESENT: Mr D.P.Gupta, Advocate for the petitioners. Mr Mukund Gupta, Advocate for for respondent No.1. T.P.S.MANN, J. The order passed by Additional District Judge, Chandigarh on 27.3.2009 while deciding preliminary issue No.2 qua the jurisdiction of the Court to decide the objections under Section 34 of the Arbitration and Conciliation Act, hereinafter referred to as 'the Act', has been challenged in the present revision filed under Article 227 of the Constitution of India. An agreement dated 12.10.1994 was entered into between the petitioners and respondent No.1 for milling of paddy. As a dispute arose between them, the matter was referred to respondent No.2, who was nominated as Arbitrator as per the arbitration clause. The Arbitrator Civil Revision No.4373 of 2009 -2- gave his award dated 20.4.2001 in favour of the petitioners. Respondent No.1 did not file any objections against the award within the stipulated time. Accordingly, the petitioner-Markfed applied under Section 36 of the Act for enforcement of the award by filing execution application before Additional District Judge, Mansa on 5.9.2001. Notice of the execution application was sent by the said Court to respondent No.1. After receiving the said notice for 22.11.2001, respondent No.1 filed objection petition under Section 34 of the Act before the District Judge, Chandigarh. It was mentioned therein that the Arbitrator had not served/sent a copy of the award to the objector and it came to his knowledge about the passing of the award only on 30.10.2001, when notice for execution was received from the Court of the Additional District Judge, Mansa for 22.11.2001. It was also stated that as the office of the Markfed was situated at Chandigarh and the arbitration proceedings were conducted at Chandigarh, followed by passing of the award, therefore, the Court at Chandigarh had the jurisdiction to try and entertain the objection petition under Section 34 of the Act. On 12.3.2009, Sh. Inderjit Sharma appeared on behalf of respondent No.1 before the Additional District Judge, Chandigarh and admitted that the said Court had no jurisdiction to try the petition in view of the provisions of Section 42 of the Act and therefore, the preliminary issue regarding jurisdiction be decided, accordingly. He prayed that the objection petition be transferred to the Court of Additional District Judge, Mansa. The said statement of Shri Inderjit Sharma is reproduced here-below: “I admit that this Court has got no jurisdiction to try the petition due to Section 42 of Arbitration and Conciliation Civil Revision No.4373 of 2009 -3- Act. Preliminary issue be decided accordingly. It is further prayed that the objection petition be transferred to the Court of Addl. District Judge, Mansa.” In the objection petition under Section 34 of the Act, the Additional District Judge, Chandigarh framed four issues, which included issue No.2 regarding jurisdiction of the Court to decide the objections. The said issue read as under: “Whether this Court has no jurisdiction to decide the objections? OPR” On 17.2.2004, learned lower Court ordered that issue No.2 with regard to jurisdiction be treated as a preliminary issue. However, inadvertently, vide order dated 8.10.2004, learned lower Court directed the parties to lead evidence. This order was challenged through Civil Revision No.1773 of 2005, which was decided on 16.10.2008. The High Court set aside the order dated 8.10.2004 and directed the lower Court to decide the issue of jurisdiction in the first instance. Taking into consideration the fact that the arbitration proceedings were conducted at Chandigarh, the Head Office of the Markfed being at Chandigarth it was held vide impugned order that the objection qua jurisdiction taken by the petitioner-Markfed was without any substance and therefore, the Court at Chandigarh had the jurisdiction to hear and decide the objection petition under Section 34 of the Act. While issuing notice of motion to respondent No.1 in the present revision, this Court, vide order dated 5.8.2009, stayed further proceedings before the trial Court. Section 42 of the Act ordains that when in respect of an Civil Revision No.4373 of 2009 -4- arbitration agreement any application is filed in a Court, that Court alone shall have the jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that Court alone. Once the Arbitrator had given award dated 20.4.2001, the respondent-miller did not file any objections within the stipulated period. Instead, the petitioner-Markfed filed an application under Section 36 of the Act before the Court at Mansa for enforcement of the award. Upon filing of the said application, the Court at Mansa issued notice to the respondent-miller for 22.11.2001. It was only thereafter that the respondent-miller filed objection petition under Section 34 of the Act at Chandigarh and while doing so, it was mentioned by it in para-3 (iv) of the same that it came to know about the passing of the award only on 30.10.2001, when notice of execution was received from the Court of Shri Harbans Lal, Additional District Judge, Mansa for 22.11.2001. Once the petitioner had moved the Court at Mansa by filing petition under Section 36 of the Act for enforcement of the award, any application under Section 34 of the Act in respect of the same was required to be made only at Mansa and not at Chandigarh, as is clear from the provisions of Section 42 of the Act. If the respondent- miller was to file objections, it could to do so by filing necessary petition before the Court at Mansa and not at Chandigarh. There is no denial of the fact that a statement was made on behalf of the respondent-miller in its petition under Section 34 of the Act at Chandigarth that the said Court had no jurisdiction to try the petition in view of the provisions of Section 42 of the Act and therefore, the preliminary issue regarding jurisdiction be decided, accordingly. It was Civil Revision No.4373 of 2009 -5- further prayed that the objection petition be transferred to the Court of Additional District Judge, Mansa. Despite the said fact, learned Additional District Judge, Chandigarh vide impugned order dated 27.3.2009 wrongly decided issue No.2 by holding that as the arbitration proceedings were conducted at Chandigarh and the Head Office of the Markfed was at Chandigarh, therefore, the said Court had the jurisdiction to hear and decide the petition under Section 34 of the Act. Apparently, the provisions of Section 42 of the Act have not been looked into by the learned lower Court while passing the impugned order. Resultantly, the revision is allowed. The impugned order passed by the Additional District Judge, Chandigarh while holding that it had the jurisdiction to hear and decide the objection petition under Section 34 of the Act is set aside and a direction is issued to the said Court to transmit the petition under Section 34 of the Act to the Court of Additional District Judge, Mansa, who is already seized of the proceedings under Section 36 of the Act initiated at the instance of the petitioner. (T.P.S.MANN) November 26, 2009 JUDGE Pds.