MAHESWARI STEEL PVT. LTD. Vs. ARAVADI LEASING LTD.

JUDGEMENT

(1.) In this case a very interesting question has since arisen. A suit was filed before this Court for declaring that a particular agreement was a financing agreement and praying for certain other reliefs. Admittedly the said agreement contained an arbitration clause. An application' under Sec. 34 of the Arbitration Act, 1940 was filed on behalf of the Defendant. The said application was filed on August 4, 1993. In the meantime the Arbitration & Conciliation Act, 1996 has since been enacted. "The said Act came into force with effect from January 25, 1996. After the said Act come into force a reference was made to arbitration by the Defendant under Sec. 8 of the 1996 Act. the learned Single Judge in an order dated March 11, 1997 had held that the reference under Sec. 8 of the 1996 Act was not maintainable and that by reason of coming' into operation of the 1996 Act, the application under Sec. 34 of the 1940 Act became infructuous. An appeal having been preferred, the appeal court by an order dated December 1, 1999 wars unable to agree with the view taken by the learned Single Judge that the application under Sec. 34 of the' Arbitration Act, 1940 had been rendered infructuous. However, the Appeal Court had directed the Trial Judge to hear out the application under Sec. 34 of the 1940 Act on merits and in accordance with law and until disposal thereof the arbitration proceedings commenced by the Defendant shall remain stayed. This is how this matter has come before this Court.

(2.) Mr. Sarkar, the Learned Counsel for the Defendant Applicant, contends that after there is an order of remand and a Court exercises its jurisdiction after remand, the jurisdiction is circumscribed within the scope and ambit of the order of remand. In support of his contention he had relied upon the case of Kanappa Mudaliar v/s. Kusalaru alias Munuswami Pillai and Ors. : AIR 1970 Mad 328.

(3.) This proposition has, .however, not been disputed by Mr. Roy, appearing for the Plaintiff Respondent. It is an accepted proposition of law that whenever a matter is remanded the Court has to decide such matter on remand within the scope and ambit of the remand order. A question decided in Appeal, while remanding the matter adjudicating the respective rights, becomes conclusive between the parties and cannot be reopened on remand unless the remand is an open one and the. point remains to be agitated on remand. Thus, this proposition is not in dispute. Therefore, this case has to be decided within the scope and ambit of the order of remand..