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Genesis Colors Private Limited vs Anil Ramlabhaya Suri and Another

Bombay High Court · Decided on 14 October 2009 · Citation: (2010) 2 BomCR 223

HON’BLE JUDGES
Mohta Anoop V., J
ACTS & SECTIONS REFERRED
Arbitration and Conciliation Act, 1996 — Section 9 · Presidency Small Cause Courts Act, 1882 — Section 41, 41(1)
RESULT
Dismissed
CASE NUMBER
Arbitration Petition No. 613 of 2009
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Judgment

7 paragraphs · 370 words

Mohta Anoop V., J.—The petitioner has taken out this petition u/s 9 of the Arbitration and Conciliation Act, 1996 (for short, the Act) in a Leave and Licence Agreement (Agreement) between the parties having arbitration clause. The petitioner is claiming refund of a security deposit made in pursuance to the agreement. The claim of recovery is arising out of and part of the agreement. The dispute is quite interlinked and directly connected with the agreement. The remedy is elsewhere.

2.

This High Court in Carona Limited Vs. Sumangal Holdings, , considering the scheme and object of Section 41 of the Presidency Small Causes Court Act, 1882, held that such arbitration proceeding is impermissible. The basic observation in Carona Limited (supra) is as under:

11 Thus, as the legislature has created a special forum for adjudication of disputes between the licensee and licensor in relation to recovery of possession and licence fee, the jurisdiction of the Court of Original Civil Jurisdiction will be ousted by necessary implication and, therefore, applying the law laid down by the Supreme Court in Natraj Studios, the reference to arbitration of the question which falls for decision before the Small Causes Court suit u/s 41, cannot be possible.

Again this Court in ING Vysya Bank Limited Vs. Modern India Limited and Another, has observed as under:

23 For all these reasons, I am of the view that the objection to the jurisdiction of this Court to entertain the petition is well founded. The recourse to arbitration under the terms of the arbitration clause contained in the agreement of leave and licence would be barred by virtue of the exclusive jurisdiction conferred upon the Court of Small Causes by Section 41(1) of the Presidency Small Cause Courts Act, 1882. The petition shall stand dismissed.

3.

In view of this specific bar and considering the averments so made and the prayer clauses as the dispute is arising out of the agreement which falls within the ambit of Section 41 of the Presidency Small Causes Court Act, in my view also, this Court has no jurisdiction to grant any relief u/s 9 of the Act in a dispute of such nature.

4.

The petition is therefore dismissed. No costs.