MICROVISION TECHNOLOGIES PVT.LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) This notice of motion (Commercial Notice of Motion (Lodging) No.2043 of 2019) seeks transfer of the captioned commercial arbitration petition along with Commercial Notice of Motion No.1826 of 2018 to the District Court at Nashik. The application for transfer, made by the original petitioner, is under Section 42 of the Arbitration and Conciliation Act, 1996 ("Act").

(2.) The Applicant, who is a supplier within the meaning of The Micro, Small and Medium Enterprises Development Act ("MSME Act"), had contracts awarded by the Respondent (through Central Railways) for electrification of integrated security system - video surveillance system proposed to be implemented by the Central Railways at certain places. We are concerned here with two contracts, both of which were in pursuance of tenders invited by the Respondent where the Applicant was the winning bidder. Disputes arose between the parties in connection with these contracts, which were referred to conciliation under Section 18(2) of the MSME Act. Upon failure of conciliation, the Applicant applied to the Facilitation Council to act under Section 18(3) of the MSME Act to commence arbitral proceedings. Pending consideration of that application, the Applicant moved a petition under Section 9 of the Act before the District Court at Nashik, seeking interim reliefs pending arbitration. The Applicant thereafter moved an application under Section 11 of the Act before this court seeking appointment of an arbitrator for adjudication of the disputes and differences. The Respondent objected to the application on the ground that the mandate of clauses 63 and 64 of the General Conditions of Contract, which inter alia provided for pre-arbitration steps, was not complied with by the Applicant. The Respondent also objected to the jurisdiction of this court for deciding the application under Section 11 on the ground of the prior pending application under Section 9 before the District Court at Nashik. By its order dated 16 December 2016, this court allowed the Section 11 application and appointed a sole arbitrator. The Applicant thereafter withdrew its petition under Section 9 of the Act from the District Court at Nashik with liberty to apply for interim reliefs before the arbitral tribunal. The arbitration reference thereafter proceeded before the sole arbitrator, who, by his award dated 15 January 2018, decided it. The award has been the subject matter of challenge under Section 34 of the Act in Commercial Arbitration Petition (Lodging) No.855 of 2018 herein. There has been a delay in filing of the arbitration petition. The companion Notice of Motion (Commercial Notice of Motion No.1826 of 2018) has been filed for condonation of that delay. During the pendency of that motion, the present motion (Commercial Notice of Motion (Lodging) No.2043 of 2019) has been taken out, as noted above, for transfer of proceedings from this court to the District Court at Nashik.

(3.) The basis of this transfer application made under Section 42 of the Act is prior to filing of the petition under Section 9 before the District Court at Nashik. Section 42 of the Act mandates that where, with respect to an arbitration agreement any application under this part (i.e. Part I) has been made in a court, it is that court alone (and no other court) which has jurisdiction over the arbitral proceedings; and any challenge to an award rendered in such proceedings lies only before that court. It is submitted that the Applicant herein having filed a petition under Section 9 before the District Court at Nashik, the jurisdiction for entertaining a challenge to the award made in pursuance of the arbitration agreement lies before the District Court, and accordingly, the proceedings be transferred to that court.