BENGAL SURGICALS LIMITED Vs. L B ENTERPRISE

JUDGEMENT

(1.) Heard Mr. D. Mazumdar, learned counsel for the petitioner and Mr. N.M. Lahiri, learned senior couunsel assisted by Mr. N. Choudhury, learned counsel for the opposite party /respondent.

(2.) The facts of the Case in a short compass are as follows-: The present opposite party/respondent herein instituted a Money Suit No. 114/1997 as against the present petitioner and one another who is the Managing Director of the present petitioner for recovery of the outstanding dues to the tune of Rs. 1,30,531.99 out of which the defendant, petitioner herein admitted its liability to the tune of Rs. 35,736.66 and when the suit was pending before the learned Civil Judge (Senior Division) No. 2, Kamrup, Guwahati, the defendant No. 1, petitioner herein filed an application under Section 8 of the Arbitration and Conciliation Act, 1996 for referring the parties to Arbitration in respect of the dispute and the claim and the relief sought for by the plaintiff in the said suit in terms of Clause 29 of the Agreement dated 3rd December, 1992 coupled with a prayer for stay of the proceeding of the said Money Suit No. 114/1997 by contending inter-alia, that despite the existence of the Arbitration agreement and the related Clause 29 for Arbitration, the plaintiff filed a suit and sought for the reliefs claimed in the plaint which is not maintainable. However, the learned Court below, upon hearing the parties the prayer of the defendant No. 1, the petitioner herein was rejected under the impugned order dated 25.5.1998 passed in M.S. No. 114/ 1997. Being dissatisfied with the impugned order the present petitioner filed this revision petition. At the very outset Mr. Mazumdar, learned counsel appearing for the petitioner contended that the learned Court below had completely misappreciated the provisions of law laid down under Section 8 read with Section 34 of the Arbitration and Conciliation Act, 1996 inasmuch as the learned Court below ought to have referred the parties to Arbitration in terms of the related Clause 29 of the said agreement. It is argued by the learned counsel that, agreement was for 3 years, and during the validity of the said agreement the petitioner filed a petition under Section 8 of the Arbitration and Conciliation Act, 1996 for short the Act of 1996 as the agreement and its validity was upto 3rd December, 1995. According to Mr. Mazumdar, learned counsel, though a copy of the agreement was submitted/filed before the Court below on 8.12.97 that is before the final disposal of the matter under Section 8 of the Act, 1996, the learned Court below ought to have held that the said application preferred under sub section 1 of Section 8 should be entertained. Supporting his submission Mr. Mazumdar, learned counsel has also relied upon the decision of the Apex Court rendered in Laxmi Ratan Engineering Works Ltd. Vs Assistant Commissioner (Judicial) Sale Tax reported in AIR 1968 SC 488 and contended that the word 'entertain' means either to deal with or admit to consideration and that being the position; at the time of the hearing of the present case in hand the petitioner filed the certified copy of the agreement and as such the same ought to have been examined by the Court below and ought to have admitted it as the plaintiff has not raised any obj ection about the existence of the said agreement. Mr. Mazumdar further relied upon another decision of the Apex Court rendered in Martin and Harris Ltd. Vs. VI Additional District Judge and others respondents reported in AIR 1998 SC 492 and submitted that the word 'entertain' mentioned in Section 8 of the Act of 1996 is necessarily means entertaining the ground for consideration for the purpose of adjudication of the case on merits and not at any stage prior thereto. Therefore, the impugned order suffers from certain illegality Mr. Mazumdar argued.

(3.) Mr. N.M. Lahiri, learned senior counsel assisted by Mr. N. Choudhury for the respondent has submitted that a larger Bench of the Apex Court has dealt with the matter about the law enunciated by the Apex Court in Laxmi Ratan Engineering Works Ltd. Vs. Assistant Commissioner, Sales Tax (supra) inasmuch as in a case between Lala Ram Vs. Hari Ram reported in 1969 (III) SCC 173 the Apex Court was of the view that "entertain" means "file or received by the High Court and that being the position the present petitioner filed an application under Section 8 of the Act, 1996 which was to be accompanied by the Original Arbitration Agreement or a duly certified copy thereof but in the instant case, it was not done, and as such the Court below rightly rejected the prayer of the present petitioner. It is also argued by the learned senior counsel that Section 8 of the Act of 1996 is mandatory and, it is to be followed strictly for entertaining the application under Section 8 of the Act of 1996 and as such there is no infirmity or illegality in the impugned order. The respondent also relied upon a decision of this Court rendered in North Eastern Electric Power Corporation Ltd. and Others Vs. Jeeban Kr. Shah, respondent reported in 1999 (3) GLT 16 : 2000 (2) GLR 242 and submitted that this Court held that proviso of Section 8 of the Act is ought to be strictly complied with and the parties should not be referred to Arbitration unless the procedure or other requirement of law as provided under Section 8 is not complied with strictly.