TMI Blog2012 (11) TMI 607X X X X Extracts X X X X X X X X Extracts X X X X ..... t by the Arbitration Act of 1940, the jurisdiction of the Court under any other law for the time being in force is not saved, the right of appeal can therefore, be exercised against orders in arbitration proceedings only under section 39, and no appeal (except an appeal to that Court) will lie from an appellate order. Conjoint reading of Section 5 with Section 37 of the Arbitration Act, 1996, it is clear that judicial authority is barred from intervening in any proceeding which are not otherwise provided in Part I of the Arbitration Act, 1996. The Arbitration Act, 1996 being a self-contained code and the order under Section 8 passed by the judicial authority or by the court is not appealable under Section 37, the present appeal under Section 10F is not maintainable. There is no merit in the submission of Mr. Dwarkadas, the Learned Senior Counsel that there is no bar under Section 37 from hearing appeal against any other order nor specifically mentioned in Sections 37(1) (a) and (b) and 37(2) (a) and (b). As from the expression used “and from no others”, it is clear beyond reasonable doubt that appeal is not maintainable against any other order other than what is mentioned in Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent Nos. 5, 6 and 13. Mr. Simil Purohit, i/b. Mr.Kalpesh Joshi for Respondent Nos. 7, 8, 9, 10, 14, 15, 16 and 17. Ms. Ankita Singhania, Mr. Ashok Purohit, i/b. Ashok Purohit Co. for Respondent No.18. Mr. J.J.Bhatt, Senior Advocate, a/w. Mr. Gaurav Joshi, Mr. N.V. Vimadalal, Mr. Manish Doshi, i/b. Vimadalal Co. for Evershine Developers, third party. Appearance in Company Appeal (L) No. 25 of 2012 and Company Appeal (L) No. 4 of 2011 with Company Application (L) No. 322 of 2012: Mr. Gaurav Joshi, a/w. Mr.Chirag Mody, Ms.Anushka Sarda, i/b. DSL Legal for Applicant in Company Application (L) No. 322 of 2012 and Appellant in Company Appeal (L) No. 25 of 2012. Mr. Ankit Lohia, a/w. Ms. Nayna Rane, i/b. D.H.Law for Appellant in Company Mr. Rahul Chitnis, Counsel a/w. Mr. Chakrapani Misra, Mr. Devesh Juvekar, Mr.R. Arunadhri Iyer, Ms. Meghna Rajadhyaksha, i/b. Khaitan Co. Advocates for Respondent No.1 in Company Application (L) No. 322 of 2012 and Company Appeal No. 4 of 2011, Advocate for the Respondents. Mr. Harish Pandya, Counsel, a/w. Mr. M.K. Banatwala, i/b. M.K. Banatwala, Advocate for Respondent No.2 in Company Application (L) No. 322 of 2012. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed company Petition (57 of 2012) before the CLB, Western Region Bench under section 397 and 398 read with section 402 of the companies Act, 1956 alleging certain acts of oppression and mismanagement in the affairs of respondent no1 and respondent nos. 5 to 7 by the respondents and sought various reliefs. (c) In the month of August, 2012, respondent no.2 filed an application under section 8 of the Arbitration Act, 1996 (Company Application No. 116 and 120 of 2012) before the CLB relying upon clause 20.4 of the agreement, Article 58 of the Articles of Association and section 8 of the Arbitration Act, 1996. By an order dated 12th Application No. 116 and 120 of 2012 and referred the parties to arbitration as contemplated under Article 58 of the Articles of Association and clause 20.4 contained in agreement and as per provisions of the Arbitration Act, 1996. (d) During the pendency of the said application, CLB granted certain ad interim reliefs on 8th August, 2012 in favour of the appellant. The respondent nos. 1, 2 3, 5 and 7 filed appeal challenging the said interim order in this court under section 10F of the Companies Act. By order dated 14th August, 2012 passed by this court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 8 8. Power to refer parties to arbitration where there is an arbitration agreement. (1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration. (2) The application referred to in subsection (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof. (3) Notwithstanding that an application has been made under sub- section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made. Section 9 9. Interim measures etc. by Court. A party may, before, or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with section 36, apply to a court- (i) for the appointment of a guardian for a minor or perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d agreement is mill and void, inoperative or incapable of bring performed. Section 50 50. Appealable orders. (1) An appeal shall lie from the order refusing to- (a) refer the parties to arbitration under section 45; (b) enforce a foreign award under section 48, to the court authorised by law to hear appeals from such order. (2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court. Section 10F of The Companies Act, 1956 [10F. Appeals against the order of the Company Law Board. Any person aggrieved by any decision or order of the Company Law Board [made before the commencement of the Companies (Second Amendment) Act, 2002] may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Company Law Board to him on any question of law arising out of such order: Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.] 7. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 8 of the Arbitration Act, 1996. (g) The CLB while deciding the application under Section 8 filed by the 1st respondent was exercising the power under Sections 397, 398 read with Section 402 of the Companies Act, 1956. The proceedings thus filed by the appellant under Sections 397, 398 read with Section 402 were put to an end by passing an order under Section 8 of the Arbitration Act, 1996. If the CLB would have refused to refer the matter to arbitration on the application of the 1st respondent filed under section 8 of the act, the situation would have been different. 8. In the alternate to the aforesaid submissions, Mr.Dwarkadas, the Learned Senior Counsel made the following submissions :- (a) The judicial authority which exercises powers under section 8 of the said Act is not exercising powers under the said Act, but under the relevant statute, which governs the jurisdiction of the relevant judicial authority. Unless and until there is an express bar appearing in the said Act which takes away the powers of appeal from orders passed by such a judicial authority in exercise of the powers conferred by the special statue the bar under Section 37 of the Act will ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s (India) Ltd. Appeal No. 345 of 2011, Jet Airways (India) Ltd. Vs. Sahara Airlines Ltd. It is submitted that after considering all these judgments, the Division Bench of this court has held as under : 5. The question to be considered is "whether against an order passed by the learned Single Judge of this Court in a civil suit terminating that civil suit or refusing to terminate the civil suit because of the provisions of Section 8 of the Arbitration and Conciliation Act, an appeal under Clause 15 of the Letters Patent would lie or it can be said that such an appeal is barred by the provisions of Section 37 of the Arbitration and Conciliation Act. Perusal of Section 37 which we have quoted above shows that that provision provides for an appeal against final order passed in the proceedings instituted under Sections 9 and 34 of the Arbitration and Conciliation Act. Subsection 3 of Section 37 lays down that no second appeal shall lie from an order passed in appeal. In so far as section 8 is concerned, perusal of that provision shows that the proceedings because of the provisions of section 8 are not to be instituted necessarily in the Court, they are to be instituted in a pending ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arred. Minimum that can be said is that where an order under section 8 is not made by the Court, section 37 will not be attracted. For example, if in a suit in the Court of Civil Judge, Junior Division an order terminating that suit is passed because of section 8 by the Civil Judge, Jr. Division, that order would be appealable before the District Judge and the appeal would not be barred by Section 37 because the Court of Civil Judge, Jr. Division is not "Court" within the meaning of section 2(e). Thus, appeal against order passed because of the provisions of Section in some civil suits by some civil Courts which are not "Court" within the meaning of section 2(e) would be maintainable while appeals against the orders passed by those Courts which are "Court" within the meaning of Section 2(e) because of the provisions of Section 8 in the civil suit would not be maintainable. It appears from section 37 that it may not be the intention of the legislature to bar appeals against the orders passed in the proceedings which are not instituted under the Arbitration and Conciliation Act. As observed above, the proceedings under section 8 are not independently instituted under the Arbitration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed by a Single Judge in the proceedings instituted for execution of an Award passed under the Arbitration Act which has become final. The Division Bench has concluded that any order passed in the proceedings filed for execution of an Award made under the Arbitration Act are to be treated as orders passed under Section 36 of the Arbitration Act and in view of the provisions of Section 37 no appeal lies against any order passed under Section 36. For recording this conclusion, the Division Bench has entirely relied on the judgment of the Supreme Court in the case "Fuerst Day Lawson Ltd. Vs. Jindal Exports Ltd." referred to above. We find from the judgment of the Division Bench in the case "Jet Airways (India) Ltd." that the Division Bench has also not taken into consideration the possibility of the execution proceedings being filed before the judicial authority which is not a court within the meaning of Section 2(e) of the Arbitration Act, and therefore, not at all attracting the provisions of Section 37. Under the Civil Procedure Code, an application for execution of a decree can be filed before the Trial Court which can transfer it to the appropriate Court where the property agai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Division Bench has observed that the result of the order passed under section 8 may be to terminate the civil suit. It is submitted that the judgment of the Division Bench of this court is thus binding on the Single Judge of this court while hearing the present appeal under section 10F of the Companies Act, 1956. 11. It is submitted by Mr. Dwarkadas, the learned senior counsel that the reliance placed by the respondents on the judgment of the Supreme Court in the case of Sumitomo Corporation Vs. CDC Financial Services (Mauritius) Ltd. and others (2008) 4 Supreme Court Cases 91, is misplaced. It is submitted that there was no issue before the Supreme Court in the said matter regarding maintainability of appeal under section 10F of the companies Act, 1956. According to learned senior counsel the issue was only in respect of the forum which could hear appeal from orders of CLB. It is submitted that there was no issue of termination of the proceedings by virtue of order passed under section 8 of the Arbitration Act, 1996 before the Supreme Court in the said matter. 12. Mr. Dwarkadas, the learned senior counsel submits that even where a question is referred to a larger Benc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of the Supreme Court in the case of ITI Ltd. Vs. Siemens Public Communications Network Ltd (2002) 5 Supreme Court Cases 510 and more particularly para 19 in support of his plea that the Supreme Court had considered the effect of section 5 of the Arbitration Act, 1996 and had held that the right of second appeal to the High Court had been expressly taken away by sub section 3 of section 37 of the Arbitration Act, 1996, however, for that reasons it cannot be held that the right of revision has also been taken away. Para 19 of the judgment in the case of ITI Ltd. (supra) reads thus: 19. Revisional jurisdiction of superior court cannot be taken as excluded simply because subordinate courts exercise a special jurisdiction under a special act. The reason is that when a special Act on matters governed by that Act confers a jurisdiction on an established court, as distinguished from a 'persona designata', without any words of limitation, then the ordinary incident of procedure of that Court right of Appeal or revision against its decision is attracted. The right of Second Appeal to the High Court has been expressly taken away by Sub-section (3) of Section 37 of the Act, but for that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 37(2)(a) or (b) are appealable and no other orders. It is submitted that the order passed under section 8 by the Judicial Authority is thus not appealable. It is submitted that under section 37 read with section 5 of the Act, the court had no power to intervene in any of the proceedings except so provided in Part I of the Act. It is submitted that in view of the bar under section 37 from entertaining appeal from any other order no provided therein, the appeal filed under section 10F of the Companies Act, 1956 by the appellant is not maintainable. 20. Mr. Kamdar and Mr. Chinoy, the learned senior counsel strongly placed reliance upon the judgment of the Supreme Court in the case of Sumitomo Corporation (supra) and more particularly on para 13, 14, 24 to 29, 32 and 34 which reads as under : 13. We have carefully perused all the relevant materials, Annexures and considered the rival contentions. The only question to be considered in the present appeal is whether the order dated 26.09.2006 of the CLB refusing to refer parties to arbitration under Section 45 of the Arbitration Act was liable to be challenged to the forum under Section 50 of the Arbitration Act or to the forum und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany Law Board to him on any question of law arising out of such order: Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days." The above provisions make it clear that the forum shall be court authorized by law to hear the appeals from such order. In this regard, it is useful to reproduce the Explanation to Section 47 of the Arbitration Act which reads thus: "47. Evidence.- xxx xxxx Explanation .- In this section and all the following sections of this Chapter, "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 over the subject-matter of the award 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." 25. As rightly pointed out, it is clear that unlike the explanation to Section 47, Section 50 uses the expression "Court" not simpliciter but qualified by the wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the appeal is to the court which hears the appeal and not the court which exercises original jurisdiction if the subject-matter had been a suit as provided in the explanation to Section 47 or Section 2(c) of the Arbitration Act. 28.To our mind, the reading of Section 50 clearly suggests that an appeal shall lie from the order of the CLB to the court authorized by law to hear the appeals from such order of the CLB. To make it clear that in the event the order under Section 45 is passed by the CLB, the forum which is provided under law for hearing the appeal from the order of the CLB, will be the Appellate Forum. In other words, while Section 50 of the Arbitration Act provides for the orders which can be made the subject-matter of the appeal, the forum to hear the appeal is to be tested with reference to the appropriate law governing the authority or forum which passed the original order, that is, in the case on hand, the CLB. Section 10F read with Section 10(1)(a) of the Companies Act provides for such forum to hear the appeal from the orders of the CLB as the High Court within the jurisdiction of which the Registered Office of the company in issue is situated. 29.Now let us l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in any court where part of cause of action arises. In such circumstances, we are unable to accept the lengthy arguments advanced on the above-mentioned subject by learned senior counsel for the appellant. Likewise, the submission of the appellant, namely, the Arbitration Act being a special and subsequent statute has no relevance to the present case. 21. Both the learned senior counsel submits that section 10F read with section 10(1)(a) of the Companies Act provided for forum to appeal from orders of CLB. It is submitted that appeal under section 10F is not maintainable. It is submitted that the appellant could have chosen forum for filing appeal before the forum provided under section 10F provided such appeal was maintainable under section 37 of the Arbitration Act, 1996. It is submitted that the Division Bench Judgment relied upon by the petitioner in the case of Conros Steel (supra) is contrary to the law laid down by the Supreme Court in the case of Sumitomo (supra), Union of India Vs Mohindra Supply (supra), Furest Day Lawson (supra), judgment of division bench of this Court in case of International Thermal Technology Kircher Italia (supra), Jet Airways (Supra). 22. The l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e have so far seen the decisions of the High Court s holding that a suit for enforcement of an arbitration award made on an oral reference was not maintainable, an arbitral award could only be enforced in terms Section 17 of the Arbitration Act and a suit for the enforcement of an arbitral award was not maintainable, and third, that no interest could be awarded on the amount adjudged in the award beyond the provisions of Section 29 of the Arbitration Act. 86. It is seen above that, in Mohindra Supply Co. the court held that a letters patent appeal was not maintainable in view of section (2) of Section 39 of the 1940 Act. To that extent, the decision may not have any bearing on the present controversy. But, in that decision observations of great significance were made in regard to the nature of the 1940 Act. 91. In light of the discussions made above, it must be held that no letters patent appeal will lie against an order which is not appeal able under Section 50 of the Arbitration and Conciliation Act, 1996. 23. Alternatively, it is submitted that the order passed by the Division Bench in the case of Conros Steel does not lay down any law. By the said judgment, the Divisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mport the concept that the appellate court must be distinct and separate from the court passing the order or the decree. The legislature has not so enacted and the context does not warrant such an interpretation. The clause merely indicates the forum of appeal. If from the decision of a court hearing a suit or proceeding an appeal will lie to a Judge or more Judges of the same court, by virtue of section 39(1) the appeal will lie from the order passed under the Arbitration Act, if the order is appealable, to such Judge or Judges of that court. The argument that the right to file an appeal to the Supreme Court from orders in arbitration proceedings would be seriously restricted has in our view no substance. If an order passed in a proceeding on the original side of the High Court is appealable under section 39(1), an appeal will lie to a Division Bench of the High Court and from the order passed by the Division Bench, an appeal, by the express provision contained in sub-section (2) will lie subject to the restrictions contained in the relevant articles of the Constitution to the Supreme Court. If the order is not one falling within section 39(1), no appeal will evidently lie. It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Arbitration Act which by implication reserves the jurisdiction under the Letters Patent to entertain an appeal against the order passed in arbitration proceedings. Therefore, in so far as Letters Patent deal with appeals against orders passed in arbitration proceedings, they must be read subject to the provisions of section 39(1) and (2) of the Arbitration Act. 25. Relying upon this judgment of the Supreme Court in the case of Union of India Vs. Mohindra (supra), it is submitted that section 10F thus merely indicates forum of appeal and does not right of appeal against the order of CLB passed under section 8 of the Arbitration Act, 1996. 26. The learned senior counsel for the respondents also placed reliance on the judgment of Punjab Haryana High Court in the case of Smt. Sudarshan Chopra (supra) and more particularly pages 684, 685, 686,. 693 and 694 which reads thus : We shall first make an endeavour to determine on the basis of the submissions advanced before us whether or not the Arbitration Act, 1996, is an exclusive, exhaustive and comprehensive code. For the aforesaid issue, it is not necessary to examine the differences between the provisions of the Arbitr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority . . . exercising judicial power of the State . . / and'... discharging judicial functions ....'. In the aforesaid view of the matter, it is evident that the term 'judicial authority' will necessarily include 'court' as defined in Section 2(e) of the Arbitration Act, 1996, as well as an appellate court. In such a situation, while interpreting Section 5 of the Arbitration Act, 1996, it is evident that the remedy of appeal to an appellate court would be permissible only if so expressed, specifically or by necessary implication, in Part I of the Arbitration Act, 1996, and not otherwise. 27. Having arrived at the conclusion that the Arbitration Act, 1996, is an exclusive, exhaustive and comprehensive code and further that the mandate of Section 5 of the Arbitration Act, 1996, does no permit any judicial authority which as noticed above would include a court or an appellate court to intervene in a matter specified under the provisions of the Arbitration Act, 1996, except where so provided. It, therefore, becomes imperative to determine whether or not the Arbitration Act, 1996, provides for a remedy of appeal against an order passed by a judicial authority while deciding a clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) of the Arbitration Act, 1996 : '. . . from decrees of the court passing the order...'. Inviting the attention of the court to Section 2(e) of the Arbitration Act, 1956, wherein the word 'court' has been defined, learned counsel for the appellants vehemently argued that the term 'court/ used in Section 37(1) would include a civil court of original jurisdiction in a district, and the High Court in exercise of its original civil jurisdiction, and no other 'court'. It is submitted that the orders passed by a 'judicial authority' are clearly not within the ambit of Section 37(1) of the Arbitration Act, 1996. It is, therefore, suggested that the expression 'orders' used in Section 37(1) will not include an order passed under Section 8 of the Arbitration Act, 1996, because an order passed under Section 8 is not passed by a court as defined in Section 2(e) of the Arbitration Act, 1996. 35. The aforesaid argument, on first blush, seems to be attractive. It is, however, clearly misconceived. In our view, the words relied on by learned counsel for the appellants (extracted above) are being read out of context. In order to examine the exact effect of the aforesaid words, it is necessary t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon the judgment of the Delhi High Court in Vijay Sekhri and anr. Vs. Tinna Oils Chemicals Ors (2010) 174 DLT 462. Delhi High Court has after considering the judgment of the Punjab Haryana High Court in the case of Sudarshan Chopra, Sumitomo Corporation, Kinetic Engg. Ltd. Union of India Vs. Mohindra Supply Co. and held thus: 6. It is admitted case of the parties that the appellants herein had filed two petitions under Sections 397-398 of the Companies Act alleging oppression and mismanagement before the CLB in the affairs of M/s Tinna Agro Industries Limited and Tinna Oil and Chemicals Limited. During the pendency of the said petitions, applications under Sections 8 and 45 of the Arbitration Act were filed and by the impugned orders dated 20th July, 2010 passed by the CLB, the applications have been allowed and the matters have been referred to arbitration to be conducted in accordance with the rules of the conciliation and arbitration of the International Chamber of Commerce in London. What has been decided by the CLB are the applications filed under Sections 8 and 45 of the Arbitration Act and not the petitions under Section 397-398 of the Companies Act. The disput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants would merit acceptance. In such an eventuality, it would have to be concluded that the search for the appellate forum would have to be restricted to the Companies Act, 1956. However, if this Court arrives at the conclusion that the impugned order dated 08.12.2000 had been passed by the Company Law Board in its capacity of 'judicial authority' in exercise of obligations flowing out of the Arbitration Act, 1996, in furtherance of the provisions of the Arbitration Act, 1996, then certainly, the remedy must be searched for, from within the provisions of the Arbitration Act, 1996. In such an eventuality, the contention advanced on behalf of the appellants would not merit acceptance. 9. Undoubtedly, when the petition was filed by the respondents (herein) before the Company Law Board, the Company Law Board was exercising jurisdiction under the provisions of Sections 397 and 398 of the Companies Act, 1956. However, when the appellants (herein) moved an application under Section 8 of the Arbitration Act, 1996, before the Company Law Board, the Company Law Board while deciding the said application acted in its capacity as judicial authority' under Section 8 of the Arbitration Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordinary incident of procedure of the Court, including right to appeal, where proceedings were/are pending would automatically get attached with the decision. The Punjab and Haryana High Court has held that the rule of attachment is not applicable in view of the express provisions and the bar under Section 37 of the Arbitration Act. It was observed: 15.2 In fact, even the judgment in Vanita M. Khanolkar's case, supra, which, according to the counsel for the appellants, completely covers the controversy in the present case, it is apparent from the extract already reproduced above that the procedure including the fight of appeal would not get attached'.. unless the statutory enactment concerned expressly excludes appeals. '. Additionally, in Vanita M. Khanolkar's case AIR 1998 SC 424, supra, the observations of the Supreme Court in respect of the jurisdiction of the High Court must necessarily be noticed to the limited scope of its examination by the Supreme Court, namely, whether a legislative enactment could override the constitutional power of the High Court In the instant appeal, the appellants are seeking to invoke Section 10F of the Companies Act, 1956, in order to substant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew relying upon Clause 15 of the Letter Patent applicable to the High Court of Bombay. Thus, there appears to be conflict of decisions on this question. 10. The Punjab and Haryana High Court has further held that the Arbitration Act is an exclusive, exhaustive and comprehensive code as the said Act is a consolidating and an amending Act relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards and for matters connected with or incidental thereto. The High Court relied upon observations of the Supreme Court in Union of India v. Mohindra Supply Co. MANU/SC/0004/1961 : AIR 1962 SC 256 with reference to enactment of Arbitration Act, 1940, which was again a consolidating and an amending statute. It was accordingly held that the remedy by way of appeal would be permissible only if expressed, specifically or by necessary implication in Part I of the Arbitration Act and not otherwise. The legislative intent is to provide remedy of appeal in Section 37 against a limited category of orders and exclude remedy of appeal against an order not specified in Section 37. Accordingly, it has been observed by the Punjab and Haryana High Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs. Section 50 of the Arbitration Act creates the said bar. Similar view has been taken in Shivnath Rai Harnarain India Co. V. G.G. Rotterdam MANU/DE/2802/2009 : 164 (2009) DLT 197 and in Usha Drager Pvt. Ltd. v. Dragerwerk AG, MANU/DE/2572/2009 : 2010 (170) DLT 628. 12. In Sumitomo Corporation v. CDC Financial Services (Mauritius) Limited and Ors. MANU/SC/1101/2008: (2008) 4 SCC 91, the CLB had refused to refer the parties to arbitration under Section 45 of the Arbitration Act. An appeal was filed before the Delhi High Court under Section 50 of the Arbitration Act and was registered as FAO. This FAO was dismissed by the Delhi High Court for lack of territorial jurisdiction holding that Section 10(1)(a) of the Companies Act will take precedence over Section 50 of the Arbitration Act. The question, which arose before the Supreme Court was whether the order passed by the CLB refusing to refer the parties to arbitration under Section 45 of the Arbitration Act was liable to be challenged to the forum under Section 50 of the Arbitration Act or to the forum under Section 10(1)(a) of the Companies Act. 13. It was observed that Section 50 uses the expression 'court' but is followed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tration Act. The appeal is a statutory remedy and it can lie only to the specified forum. The appellate forum cannot be decided on the basis of cause of action as applicable to original proceedings such as suit which could be filed in any court where part of cause of action arises. In such circumstances, we are unable to accept the lengthy arguments advanced on the abovementioned subject by learned Senior Counsel for the appellant. Likewise, the submission of the appellant, namely, the Arbitration Act being a special and subsequent statute has no relevance to the present case. 14. Thus, the Supreme Court has held that Section 50 of the Arbitration Act stipulates the orders that can be made subject matter of appeal but does not prescribe or fix the forum which will hear the appeal. The forum to which an appeal will lie, is determined and decided with reference to appropriate law governing the authority of the forum which has passed an order which is appealable under Section 50 of the Arbitration Act. Accordingly, an appeal will lie under Section 10F of the Companies Act against an appealable order under Section 50 of the Arbitration Act passed by the CLB. The aforesaid decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that the appeals under Section 10F of the Companies Act are not maintainable against the impugned orders allowing applications under Section 45 of the Arbitration Act. 18. It is clarified that this Court has not expressed any opinion on the merits of the impugned orders dated 20th July, 2010 allowing the applications and referring the matter to International Arbitration as this Court has no jurisdiction to entertain the present appeals under Section 10F of the Companies Act. It is clarified that this Court has not expressed any opinion whether the appellants have remedy to challenge the said orders by way of writ petitions or in some other appropriate proceedings. This question has not been raised and argued before me. 28. The learned senior counsel for the respondents placed reliance upon the judgment of this court in the case of International Technology Kirchner Italia Branch, S.P.A. (supra). The Division Bench of this court has interpreted section 37 of the Arbitration Act and after referring to the judgment of the Punjab Haryana High Court in the case of Sudarshan Chopra, has held thus: 3. Aggrieved thereby, the defendant has filed the present appeal. Ms Shah, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... darshan Chopra and others V. Vijay Kumar Chopra and others, reported in (2002) 4 Company Law Journal 1, pointed out by Ms Shah, the learned Counsel for the respondent. The Division Bench of Punjab and Haryana High Court observed in para 36 as follows:- "Having dealt with all issues canvassed by learned counsel, we now endeavour to draw conclusions based on our interpretation of section 37 of the Arbitration Act, 1996. In the absence of judicial precedent on the pointed issue, we will embark upon the controversy on first principles. We have already concluded above that even a remedy of appeal would not be available unless expressly provided for, while interpreting section 5 of the Arbitration Act, 1996. We have also concluded that the term "orders" referred in Section 37 of the Arbitration Act, 1996, refers to orders passed under Part I of the Arbitration Act, 1996. The question then is whether the remedy of appeal is excluded against an order passed by a "judicial authority" under section 8 of the Arbitration Act, 1996? In our view, it is. The reason for the aforesaid conclusion are the words and from no others qualifying the word orders it leaves no doubt that section 37 (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this court delivered by the division Bench of this Court on 8th August, 2011 in the case of Jet Airways and another Vs. Subrato Roy in Appeal No. 345 of 2011. This court after considering the judgment of the Supreme Court in Fuerst Day Lawson Limited (supra) has held that LPA is not maintainable. Para 21, 22 30 to 34 of the said judgment reads thus: 21. In Sharda Devi, the Court pointed out that in South Asia Industries, the Court had examined Sections 39 and 43 of the Delhi Rent Control Act and held that a combined reading of the two sections showed that an order passed by the High Court in an appeal under Section 39 was to be final. It was held that the provision of finality was intended to exclude any further appeal. This decision was, thus, based on interpretation of Sections 39 and 43 of the Delhi Rent Control Act. Section 54 of the Land Acquisition Act, has no similarity with Sections 39 and 43 of the Delhi Rent Control Act. Hence, the decision in South Asia Industries had no relevance to decide the question whether a letters patent appeal is maintainable against the judgment passed by a single judge under Section 54 of the Land Acquisition Act. 22. In regard to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... andra Kanta Sinha v. Oriental Insurance Co. Ltd. and Ors. MANU/SC/0339/2001: (2001) 6 SCC 158, under Section 140 of the Motor Vehicles Act, 1988, Sharda Devi (supra), under Section 54 of the Land Acquisition Act and Subal Paul (supra), under Section 299 of the Indian Succession Act, 1925 and came to the conclusion that the consensus of judicial opinion has been that Section 104(1) Code of Code of Civil Procedure expressly saves the letters patent appeal and the bar under Section 104(2) Code of Code of Civil Procedure does not apply to letters patent appeals. In paragraph 22 of the judgment, the Court observed as follows: 22. ...The view has been that a letters patent appeal cannot be ousted by implication but the right of an appeal under the Letters Patent can be taken away by an express provision in an appropriate legislation. The express provision need not refer to or use the word "letters patent" but if on a reading of the provision it is clear that all further appeals are barred then even a letters patent appeal would be barred. 27. Further, analysing the two Sub-sections of Section 104(2) along with Section 4 Code of Code of Civil Procedure, this Court in paragraph 30 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1)(a) of the Act. It is submitted that there is no such provision made by the legislature under section 37(1) or (2) in respect of the order passed by the Judicial Authority under section 8 of the Arbitration and Conciliation Act, 1996. The learned counsel submits that the legislative intent of the Parliament is absolutely clear that no remedy of appeal is provided under section 37 against the order passed by the Judicial Authority under section 8 of the Act. It is submitted that the remedy of appeal is provided by the statute and since no such appeal is provided against the order passed by the Judicial Authority under section 8, appeal filed by the appellant under section 10F is not maintainable. The learned senior counsel submits that there is no merit in the submissions made by Mr. Dwarkadas, that appeal is maintainable as the proceedings filed by the appellant under section 397 and 398 read with section 402 are terminated by virtue of order passed by CLB under section 8. The learned senior counsel placed reliance upon the judgment of P. Anand Gajapati (supra) and more particularly paragraph 8 which reads thus: 8. In the matter before us, the arbitration agreement covers all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t include any order passed by the Judicial Authority. It is submitted that from the perusal of section 37(2) it is clear that appeal lies to court against the order passed by the arbitral tribunal under section 16(2) or (3) and against the interim measures passed under section 17 which also does not include any order passed by the judicial authority. It is submitted that the legislative intent is very clear that with a view to minimise judicial intervention of the court, court's intervention is minimal. The learned senior counsel has adopted the other submissions made by Mr. Kamdar and Mr. Chinoy. It is submitted that the Judgment of this court in Jet Airways and in the case of International Thermal is still in force and is binding. 35. The learned counsel placed reliance upon the judgment of the Supreme Court reported in Harbhajan Singh and another Vs. State of Punjab and another 2009 13 SCC 608, and more particularly para 14 and 15. It has been held by the Supreme Court that merely because the issue is pending before the larger bench, the court need not wait for its outcome of the decision. Para 14 and 15 reads thus: 14. In the aforementioned decision, the learned Judges had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the enforcement of New York Convention awards. In one sense, the two sections, though each containing the appellate provision belong to different statutes. 62. Having come to this conclusion, it would appear that the decisions rendered by the Court on the interplay between Section 39 of the 1940 Act and the Letters Patent jurisdiction of the High Court shall have no application for deciding the question in hand. But that would be only a superficial view and the decisions rendered under Section 39 of the 1940 Act may still give the answer to the question under consideration for a very basic and fundamental reason. 37. It is submitted that reliance placed by the appellant on the judgment of Conros (supra) is totally misplaced. There is no issue arising in this matter as to whether the appeal under clause 15 of Letters Patent lies or not. 38. Mr. Samdani, learned counsel for respondent no. 4 submits that under section 37 of the Arbitration Act, the appeal is provided only against the order of court or arbitral tribunal and not against the orders passed by the judicial authority. It is submitted that all other orders which are not specifically included under section 37(1) and ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d thus appeal filed by the appellant under Section 10F is maintainable and shall be heard on merits. 41. I have heard the learned counsel appearing for the parties at length on the issue of maintainability of the present appeal and have given my anxious consideration to the rival submissions made by the learned counsel. 42. The Supreme Court in the case of Fuerst Day Lawson Limited (supra) after referring to the decision of the Constitution Bench in the case of P.S. Sathappan Vs. Andhra Bank Ltd. (2004) 11 SCC 672, the judgment of the Supreme Court in the case of Mohindra Supply Company (supra) held that the Arbitration and Conciliation Act, 1996 is a self-contained and exhaustive code in itself. Arbitration and Conciliation Act, 1996 consolidates, amends and designs the law relating to arbitration to bring it as much as possible, in harmony with the UNCITRAL Model must be held only to be more so. It is observed that once it is held that he Arbitration Act of 1996 is a self-contained code and exhaustive, then it must also be held that it carries with it a negative import that only such acts as are mentioned in the Act are permissible to be done and acts or things not mentioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 8 of the Arbitration Act, 1996. In my view, remedy of appeal if any, thus has to be traced out from within the provisions of the Arbitration Act, 1996 and not under any other provisions of law including Companies Act, 1956. From the perusal of the pleadings including appeal memo in the present proceedings, it is clear that the order passed by CLB is under section 8 of the Arbitration Act, 1996 and not under the provisions of the Companies Act, 1956. I am of the view that since the Arbitration Act, 1996 is a self-contained, complete and exhaustive code in all respects, all the remedies from the orders passed and action taken in Arbitration Act, 1996 must flow from the said statute itself. It carries negative import and thus only such acts which are mentioned to be done under the said Act are permissible and all other acts or things not mentioned are not permissible. 45. The Supreme Court in the case of Union of India Vs. Mohindra Supply Co. has considered and interpreted section 39 of the Indian Arbitration Act, which reads thus : " (1) An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorised by law to hear appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d various other provisions of the Arbitration Act and Letters Patent Act held that perusal of Arbitration Act, 1996 indicate that it provides for filing of appeal against only some specified orders and do not provide for appeal against every order passed in the proceedings under 1996 Act. It has been held that the general law cannot defeat the provisions of special law to the extent to which they are in conflict; else effort has to be made on reconciling the two provisos by homogeneous reading. It has been held that the provisions of section 37 (the relevant portion of which is para materia relevant portion of section 39 of 1940 Act) leave no manner of doubt that the provisions of the special enactment will prevail over the general law namely, the 1908 Code. It has been held that statutory scheme of 1996 Act and the Letters Patent Act and the binding precedents of Supreme Court and this lead the Court to only one conclusion that clause 15 of the Letters Patent are impliedly excluded by the 1996 Act. The Division Bench in the said judgment after considering the judgment of the Supreme Court in Fuerst Day Lawson (supra) held that the Supreme Court in the case of Fuerst Day Lawson con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 10F read with section 10(1)(a) of the Companies Act provides for such forum to hear the appeal from the orders of CLB as the high Court within the jurisdiction of which the registered office of the company in issue is situated. It has been held that the appeal is a statutory remedy and it can lie only to the specified forum. The appellate forum cannot be decided on the basis of cause of action as applicable to original proceedings such as suit which could be filed in any court where part of cause of action arises. 49. The Judicial Authority has not been defined in any of the provisions of Arbitration Act, 1996. In my view the court may in appropriate matter act as judicial authority under section 8 whereas the judicial authority may not be the court as defined under section 2(1)(e). From perusal of section 37 of the Arbitration Act, 1996 it is clear that section 37(1) is in two parts. First part indicates the maintainability of appeal against specific orders and not others set out in section 37(1)(a), (b), 2(a) and 2(b). Second part under section 37(1) reflects forum which is authorized by law to hear appeals from original decrees. In my view, only such specified orders pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In my opinion, from the expression used and from no others , it is clear beyond reasonable doubt that appeal is not maintainable against any other order other than what is mentioned in Section 37 (1) (a) and (b) and 37 (2) (a) and (b). In my view there is clear bar under Section 37 restricting right of appeal only against specified orders set out therein and no other orders. In my view, Section 5 of the Arbitration Act, 1996 leave no room for doubt that judicial authorities and court is restrained from intervening in matters governing domestic arbitration except where so provided . In my view, an order passed under Section 8 of the Arbitration Act, not having been provided as appealable order under under Section 37, recourse to Section 10F of the Companies Act is not permissible. 52. In my view, the impugned order is passed by the Company Law Board under Section 8 of the Arbitration Act, 1996 and thus all rights, obligation and liabilities of the parties are created and/or arising out of Arbitration Act, 1996 and therefore, remedy if any provided under Arbitration Act, 1996 only can be invoked. In my view, the provisions of the Arbitration Act, 1996 are exhaustive and it is co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Arbitration Act 1996, legislature would have provided for an appeal also in respect of order passed by the judicial authority under Section 8 refusing or referring parties to arbitration under Section 8. It is thus clear that in case of proceedings covered by Part I of the Arbitration Act, the legislature has intended the minimum interference of court by not providing any appeal against order passed by the judicial authority or court under section 8 of the Arbitration Act, 1996. In my opinion, the legislature has consciously taken away the right to appeal against all other orders which are not provided in Section 37 of the Arbitration Act, 1996 had so far as proceedings falling under Part I of the Arbitration Act, 1996 are concerned. 55. Supreme Court in case of ITI Ltd. vs. Siemens Public Communications Network Ltd. (supra) has considered the revisional jurisdiction of the superior court while interpreting Section 37(3) of the Arbitration Act, 1996. The Supreme Court has held that under Section 37(3) of the Arbitration Act, second appeal is barred from the order passed in appeal under Section 37(1) or 37(2). It is held that the supervisory and revisional jurisdiction of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of Mr.Dwarkadas, the Learned Senior Counsel that by virtue of the order passed by the CLB under Section 8 of the Arbitration Act, 1996, the proceeding filed by the appellant under Sections 397, 398 read with Section 402 of the Companies Act, 1956 is terminated and is put to an end and thus the Appellant would be without any remedy in law. The Supreme Court in case of P. Anand Gajapathi Raju (supra) has held that language of Section 8 is peremptory and is thus obligatory for the Court to refer the parties to arbitration in terms of their arbitration agreement. Nothing remains to be decided in the original action or the appeal arising therefrom. It is held that all the rights, obligations and remedies of the parties would now be governed by the Arbitration Act, 1996 including the right to challenge the award. In my view, once the judicial authority has referred the matter to arbitration, the judicial authority cannot continue its jurisdiction over the subject matter of such proceedings and nothing remains to be decided in the original action once parties are referred to arbitration. 58. In case of Conros Steel Pvt. Ltd. (supra) heavily relied upon by the Appellant in support of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce on the judgment of the Supreme Court in case of Harbhajan Singh and another (supra) that only because of the correctness of a portion of the judgment has been doubted by another bench, the same would not mean that this court should wait for the decision of the larger bench. 60. In my view, since the order passed by the CLB under Section 8 of the Arbitration Act referring parties to the arbitration is not appealable order under Section 37 of the Arbitration Act, 1996, appellant cannot invoke Section 10F of the Companies Act, 1956. In my view, Section 10F provides for forum of appeal, provided an appeal is maintainable under Section 37 of the Arbitration and Conciliation Act, 1996. I am, therefore, of the opinion that all the aforesaid appeals filed under Section 10F of the Companies Act are not maintainable in view of bar under Section 37 of the Arbitration Act, 1996 and are dismissed. 61. In view of the order passed in Company Appeals by this Court holding that appeals under Section 10F of the Companies Act, 1956 is not maintainable, reliefs claimed in Company Applications does not survive and are accordingly disposed of. It is made clear that this court has not expressed a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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