Supreme Court under no circumstances to be considered as “Court” for the purposes of Section 2(1)(e), and whether the Supreme Court does or does not retain seisin after appointing an Arbitrator
Which Court will have the jurisdiction to entertain and decide an application under Section 34 of the Arbitration and Conciliation Act, 1996 (‘the Act’) was the question that arose for consideration before the Court.
The Court in order to adjudicate on the above issue referred Sections 2(1)(e) defining ‘Court’ and 42 dealing with ‘jurisdiction’ of the Act.
Court as defined under Section 2(1)(e) reads as under:
“Court” means the principal Civil Court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the subject-matter of the arbitration if the same had been the subject-matter of a suit, but does not include any Civil Court of a grade inferior to such principal Civil Court, or any Court of Small Causes.
Section 42 of the Act describing ‘Jurisdiction’ reads as under:
Notwithstanding anything contained elsewhere in this Part or in any other law for the time being in force, where with respect to an arbitration agreement any application under this Part has been made in a Court, that Court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that Court and in no other Court.
The Court after taking reference of the above two provisions concluded as under:
a. Section 2(1)(e) contains an exhaustive definition marking out only the Principal Civil Court of original jurisdiction in a district or a High Court having original civil jurisdiction in the State, and no other Court as “Court” for the purpose of Part-I of the Arbitration Act, 1996.
b. The expression “with respect to an arbitration agreement” makes it clear that Section 42 will apply to all applications made whether before or during arbitral proceedings or after an Award is pronounced under Part-I of the 1996 Act.
c. Section 42 would apply only to applications made under Part-I if they are made to a Court as defined. Since applications made under Section 8 are made to judicial authorities and those under Section 11 to the Chief Justice or his designate, the judicial authority and the Chief Justice or his designate not being Court as defined, such applications would be outside Section 42.
d. Section 9 applications being applications made to a Court and Section 34 applications to set aside arbitral awards are applications which are within Section 42.
e. Supreme Court under no circumstances to be considered as “Court” for the purposes of Section 2(1)(e), and whether the Supreme Court does or does not retain seisin after appointing an Arbitrator, applications will follow the first application made before either a High Court having original jurisdiction in the State or a Principal Civil Court having original jurisdiction in the district as the case may be.
f. Section 42 will apply to applications made after the arbitral proceedings have come to an end provided they are made under Part-I.
g. If the first application is made to a Court which is neither a Principal Court of original jurisdiction in a district or a High Court exercising original jurisdiction in a State, such application not being to a Court as defined would be outside Section 42. Further, an application made to a Court without subject matter jurisdiction would be outside Section 42.
[State of West Bengal & Anr. vs. Associated Contractors]