Phool Singh vs Mohan Lal

Bela M. Trivedi, J.—The present revision petition has been filed by the petitioner-defendant under Sec. 115 of C.P.C. challenging the order dt. 30.9.13 passed by the Addl. Civil Judge (SD) & Addl. Chief Metropolitan Magistrate No. 7, Jaipur Metropolitan (hereinafter referred to as ''the trial court'') in Civil Suit No. 28/13, whereby the trial Court has dismissed the application of the petitioner-defendant filed under Sec. 8 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as ''the said Act''). The respondents-plaintiffs have filed the suit seeking specific performance of the agreement dt. 30.5.85 allegedly executed by the petitioner in favour of Smt. Kishni Devi, mother of the respondent Nos. 1, 2 and 3, and for permanent injunction in respect of the suit property. In the said suit, the petitioner-defendant submitted an application under Sec. 8 of the said Act for referring the dispute to the Arbitrator. The said application has been rejected by the trial Court vide the impugned order.

It is sought to be submitted by the learned counsel for the petitioner that as per the agreement dt. 30.5.85, the dispute with regard to the payment of money made by the purchaser Kishni Devi to the petitioner-defendant was required to be referred to the Arbitrator and, therefore, the suit of the respondents-plaintiffs was not maintainable. He further submitted that the trial Court has committed an error in mis-appreciating the arbitration clause in the agreement and in rejecting the application filed by the petitioner. He has also relied upon the decision of A.B.K. Dubhash & Ors. vs. Petit Towers Co-operative Housing Society Ltd. & Ors., 2010 (suppl. 2) Arb. LP 89 (Bombay) to substantiate his contention that the Arbitrator would be empowered to decide all the issues, including the issue of specific performance of the agreement.

However, the learned senior counsel Mr. M.M. Ranjan for the respondents-plaintiffs has submitted that the suit has been filed by the plaintiff seeking specific performance of the agreement in question, which dispute was not covered under the so-called clause of arbitration in the agreement.

In order to appreciate the contentions raised by the learned counsels for the parties, it would be beneficial to reproduce the relevant provision contained in the agreement in question with regard to referring the dispute to the Arbitrator, which reads as under:-

From the bare reading of the said provision contained in the agreement in question, it transpires that as per the said clause if the purchaser failed to pay the amount of consideration within the stipulated time limit, the seller would be entitled to get the dispute decided with the Arbitrator as to how much amount should be paid back with interest etc. It did not give any right to the purchaser to go to the Arbitrator for the dispute in case the seller refused to execute the sale deed in favour of the purchaser. So far as the suit of the respondents-plaintiffs is concerned it is for the specific performance of the agreement in question and such a dispute could not have been decided by the Arbitrator. The matter in dispute in the suit being not the subject of the arbitration agreement, the same could not be referred to the Arbitrator under Sec. 8 of the said Act.

The Court therefore does not find any illegality in the impugned order passed by the trial Court. However, since the trial Court has made certain observations with regard to the merits of the case in the impugned order, it is clarified that the said observations shall not come in the way of the either of the parties and the suit shall be decided by the trial Court on merits and in accordance with law. The judgment of the Bombay High Court cited by the learned counsel for the petitioner being not applicable to the facts of the present case, is not helpful to the petitioner. In that view of the matter, the revision petition being devoid of merits is dismissed.