SHRIRAM TRANSPORT FINANCE COMPANY LTD Vs. G LAKSHMANAN

JUDGEMENT

(1.) This Civil Revision Petition has been filed by the defendant in O.S.No.258 of 2011.

(2.) The following facts are not in dispute: 2.1.The plaintiff in the suit in O.S.No.258 of 2011 is a borrower from the petitioner herein, which is a finance company. The plaintiff himself admitted in the plaint that he obtained loan for purchasing a harvesting machine in 2008. It is the case of the plaintiff that he purchased harvesting machine with the financial assistance from the petitioner and that he has closed the account as he was compelled to pay large sum than due. It was also the case of the plaintiff that for the said purpose, the plaintiff once again borrowed a sum of Rs.6 lakhs on 20.07.2010 agreeing to repay the amount in 47 equally monthly installments. Though it is further stated that the plaintiff, who has paid a sum of Rs.2,57,000.00 for a period of 40 installments, the defendant has not credited the amount paid by the plaintiff. However, in violation of principles of natural justice and ignoring the fact that the plaintiff is ready and willing to settle the whole amount borrowed from the plaintiff towards principal and interest, the defendant is taking steps to take possession of the harvesting machine forcibly. Hence, the prayer in the suit filed by the respondent herein is for permanent injunction restraining the petitioner and their men from taking possession of the harvesting machine bearing Registration No.TN-76-Y-8464.

(3.) It appears that the Revision Petitioner after getting summons, filed I.A.No.91 of 2012 in O.S.No.258 of 2011, seeking a prayer to refer the case to arbitration. The petition filed under Sec. 8 r/w. Sec. 5 of Arbitration and Conciliation Act, 1996 in I.A.No.91 of 2012 was contested by the respondent only on the ground that the plaintiff is not disputing the agreement and that the suit is only for an injunction to prevent the respondent from forcibly dispossessing the defendant. Since the relief sought for by the respondent cannot be granted by the arbitrator under the Arbitration and Conciliation Act, it is contended that the Civil Court alone has got jurisdiction. The petition filed by the petitioner was dismissed by the Trial Court accepting the case of the respondent that the Civil Court alone is competent to grant relief in the suit as the scope of arbitration is only in relation to the dispute that may arise between the parties under the agreement. The Trial Court also relied upon the judgment of the Honourable Supreme Court reported in 2011(3) LW 150, wherein it has been held that no order referring the dispute to arbitration could be passed in a suit, if the subject matter of the suit is capable of adjudication only by a public forum or the relief claimed can only be granted by a Special Court or Tribunal. Since the prayer in the suit is for injunction, the trial Court was of the view that the relief can be granted only by the Civil Court. The reasoning of the learned Judge is perverse and erroneous and on a wrong understanding and interpretation of Sec. 8 of the Arbitration and Conciliation Act.