STEEL AUTHORITY OF INDIA Vs. RANA CONSTRUCTIONS

JUDGEMENT

(1.) STEEL Authority of India has filed the revision challenging the order passed by the Civil Judge (Senior Division), Jagatsinghpur, in Misc. Case No. 153 of 1997. The aforesaid Misc. Case was registered on the basis of an application filed by present opposite party No. 1 purporting to be Under Section 10 of the Arbitration Act, 1940.

(2.) IT appears that prior to filing of the said application, present opposite party No. 1 had filed Title Suit No. 95 of 1996 wherein objection was raised on behalf of the present petitioner regarding maintainability of the suit on the footing that an arbitration clause was there to settle the dispute between the parties and on the basis of such stand taken by the present petitioner, the suit was dismissed obviously on the assumption, that it is open to the parties to pursue their remedy relating to arbitration as contemplated in Clause 75 of the Contract. The relevant portion of Clause 75 of the Contract is extracted hereunder :

(3.) THERE is no doubt that the order passed by the Civil Judge, (Senior Division) is without jurisdiction, as by then the new Arbitration and Conciliation Act had come into force. Moreover, the arbitration clause itself contemplates appointment of three arbitrators, one to be nominated by each party and the two arbitrators on their own to nominate the third arbitrator. The Civil Judge (Senior Division) has appointed two Arbitrators from out of the panel submitted by present opposite party No. 1 and nothing has been indicated about the appointment of third Arbitrator. The order passed by the Civil Judge (Senior Division), therefore, cannot be sustained.