MOTILALKHANAYALAL BHARADIYA Vs. KEDARMAL JAINARAYAN BHARADIYA

JUDGEMENT

(1.) JUDGMENT debtor (original defendant), by this revision petition, challenges order dated 5-12-2001 passed by Civil Judge, Senior Division, Jalgaon, at Exhibit 543 of Special Civil Suit No. 51/1964 on his file. By this application - Exhibit 543 filed on 3-12-2001, a document dated 22-2-1993 was produced before the Court and it was pleaded that although titled as "general Mukhtyar Patra", it was in fact an arbitration agreement. It was, therefore, prayed that property dispute pending between the parties before the Court may be referred to the two surviving arbitrators viz. Gokuldas Bhutada and Nandkishor Bharadia for the settlement of the matter and final decree should be drawn only after a report from those arbitrators. Admittedly, third person named in the same document, namely Ishwardas Baldawa, is dead. This application was rejected by learned Civil Judge, Senior Division, mainly on three grounds :

(2.) LEARNED Advocate Shri R. F. Totla for revision petitioner, while submitting that the document is arbitration agreement and, therefore, in view of provisions of the Arbitration Act, 1996, Court had no option but to refer the dispute to arbitrator; referred to relevant provisions of the Arbitration Act, 1996, as also some judicial pronouncements in support of his propositions. According to Shri Totla, as per Section 2 (1) (b) "arbitration agreement" means an agreement referred to in Section 7. Section 7 (1) defines "arbitration agreement" as an agreement by the parties to submit to arbitration, all or certain disputes, which have arisen or which may arise between them, in respect of defined legal relationship, whether contractual or not. Sub-sections (2) to (4) of Section 7 of the Arbitration Act, 1996, lay down that an arbitration agreement can be in the form of an arbitration clause in a contract or in the form of separate agreement. The same is required to be in writing. It can be gathered from a document signed by parties or in the exchanged correspondence between the parties and even a reference in a contract to a document containing an arbitration clause constitutes an arbitration agreement, if the contract is in writing, making the arbitration clause part of the contract. According to Advocate Shri Totla, reading the contents in the document dated 22-2-1993, and more particularly contents at pages 3 and 5 indicate that it is an arbitration agreement. Referring to Sections 11 and 16 of the Arbitration Act, 1996, in the light of observations of the Apex Court in AIR 2000 SC 3107, Nimet Resources Incorporation and Anr. v. Essar Steels Ltd. , Shri Totla submitted that even the issue whether document is "arbitration agreement" can be considered by the arbitrators named. Referring to Section 5, which has given overriding effect to the provision vis-a-vis any other legislation for the time being in force, he pointed out that by the said section, the Arbitration Act, 1996, limits the scope of intervention by any judicial authority where there is arbitration agreement between the parties, to intervention as provided by Sections 14, 34 and 37 only. Thus, it was urged that the order of learned Civil Judge, Senior Division, may be set aside and matter may be referred to arbitrators.

(3.) ADVOCATE Shri A. K. Gugale, while opposing the revision petition, has advanced two pronged argument. According to him, the document is not at all an arbitration agreement and in fact it has all the incidents and trappings of contract of agency. It is, therefore, a power of attorney as titled, which fact is also evident from the duties assigned to the attorneys appointed by virtue of Clause 3 Sub-clauses (1) to (35) of the said document. Secondly, according to him, if the document is considered to be arbitration agreement, for the sake of arguments, then Section 8 (1) of the Arbitration Act, 1996, debars any reference to arbitration, parties having acquiesced to the jurisdiction of the Court for a long span of 8 years from 1993 to 2001, without making a request of arbitration by any of them.