Case: Khaleel Ahmed Dakhani Vs. The Hatti Gold Mines Co. Ltd

3. Appellant is a building contractor. Respondent is a Government company of the Government of Karnataka under the Companies Act, 1956. Respondent awarded the contract for construction of a school building at Hatti in District Raichur to the appellant. An agreement dated 9.3.1995 was duly entered into. Clause 35 of the agreement contained the arbitration clause. Disputes and differences having arisen appellant moved the Chief Justice of the High Court of Karnataka under Section 11 of the Arbitration and Conciliation Act, 1996 (for short the `Act) for appointment of an arbitrator. The application was allowed and Mr. H.S. Bhat, Chief Engineer (retired), who was resident of Bangalore was appointed as an arbitrator with a direction to complete the arbitration proceedings and to submit his Award within four months. Arbitration proceedings were held at Bangalore where also the Award dated 28.8.1998 was made. Arbitrator awarded some of the claims of the appellant while disallowing a few others. Respondent filed application for setting aside the Award by making an application under Section 34

Reasoning:
Whether Principal City Civil Judge, Bangalore has jurisdiction in the matter or not is still pending with him which proceedings were filed earlier in time than the execution application by the appellant in the District Court at Raichur. The award had not attained finality. In these circumstances we are of the view that the Principal District Judge, Raichur should not have entertained the application for execution and order attachment of movable properties of the respondents. The High Court referred to the concession by both the parties that all the applications under the Act had to be treated as original suits and if the court finds that it had no jurisdiction to entertain, it cannot dismiss the suit but has to return the same for the presentation to the proper Court. Whatever may be the concession of the parties, we are of the view in the circumstances of the present case Principal District Judge, Raichur should have stayed his hands and should not have entertained the execution application by the appellant. High Court took a correct view of the matter and rightly set aside the impugned orders.