Paras Ram Sood vs Union of India (UOI) and Ors

D.B. Lal, J.—Shri Paras Ram Sood filed an application under sections 8 and 20 of the Arbitration Act, 1940, and the same was dismissed for default of the Petitioner on June 4, 1973. Thereafter Paras Ram Sood filed another application (O.M.P. No. 12 of 1974) under sections 8 and 20 of the said Act and a preliminary objection has been taken that the second application is not maintainable as the Applicant should have asked for restoration of the previous application under Order 9. Rule 9 of the Code of Civil Procedure.

The vexed question that rises for decision is of some importance. The contention of the Respondent is that u/s 41 of the Arbitration Act, 1940, the provisions of the CPC shall apply to all proceedings before the Court and as such Order 9 Rule 8 and Order 9. Rule 9 of the CPC have their full application. This is all the more so according to the Respondent u/s 141 of the CPC because proceedings u/s 20 were proceedings in a Court of civil jurisdiction and the procedure provided in the Code in regard to suits was to be followed. In that connection reference was also made to Section 20 of the Arbitration Act which enjoins that the application is to be numbered and registered as a suit between the Plaintiff and the Defendant. In reply the Applicant Paras Ram Sood contends that Order 9. Rule 9 applies to "suits" and not to any other proceedings. According to him the application u/s 20 will not be a suit and, therefore, he could not apply for restoration of his previous application.

In my opinion the objection of the Respondent must prevail. Section 41 of the Arbitration Act, 1940, read with Section 141 of the CPC leaves no doubt that Order 9 being a provision in the said Code would be applicable to all proceedings before the Court. The application u/s 20 of the Arbitration Act was a proceeding before the Court as contradistinguished from proceeding before the Arbitrator. There is nothing in the Arbitration Act, 1940, which might indicate that an application for restoration of the nature specified in Order 9 cannot be moved in any proceeding before the Court. Thus Section 41 of the Arbitration Act, in my opinion, clinches the issue. Section 141 of the CPC further strengthens the argument and the procedure provided in the Code in regard to suits will be followed in all proceedings and the application u/s 20 of the Arbitration Act is decidedly a proceeding in a Court of civil jurisdiction. In that connection the learned Counsel relied on Sitaram Khandu v. Bapurao Mukandrao and Ors. AIR 1953 Nag 153 . The ratio of that case was that Order 9 does not deal with procedure but deals with substantive law inasmuch as the suit is dismissed for default of appearance and, therefore, Section 141 in terms should not apply. That case related to a restitution application u/s 144 of the Code of Civil Procedure. The case never related to Section 20 of the Arbitration Act nor the implication of Section 41 of the said Act was considered. Moreover as evident in Section 20 the application is already treated as a suit which is so specifically laid down therein. For these reasons I respectfully consider that the ratio of Nagpur decision will not apply to the present case. In Om Prakash Vs. Union of India (UOI), a Division Bench held that procedure of restoration and setting aside of ex-parte orders does not apply to arbitrations. There can be no quarrel with this proposition but the procedure of restoration and setting aside of ex-parte order in the present case is made applicable to proceeding before the Court and not to a proceeding before the Arbitrator. So this authority will have no application. The third case referred to was Profulla Chandra Karmakar and Anr. v. Panchanan Karmakar and Ors. AIR (33) 1946 Cal 427, and a very valuable observation occurs in this case inasmuch as the scope of Section 41 of the Arbitration Act was considered and it was held that the said section is restricted to attracting the procedural rules of the Code to proceedings under the Arbitration Act. Therefore, Order 9, Rule 9, had its application.

In this view of the matter, Paras Ram Sood should have applied for restoration of the previous application which was dismissed for default on June 4, 1973. The result is that Order M.P. No. 12 of 1974 is dismissed and Paras Ram Sood, if so advised, can apply for restoration of the previous application under Sections 8 and 20 of the Arbitration Act which shall of course be decided in accordance with law. No order is made as to costs.