TMI Blog2002 (9) TMI 759X X X X Extracts X X X X X X X X Extracts X X X X ..... d between the said DLF Real Estate Developers and the appellant herein whereby and whereunder the appellant herein agreed to purchase an office block consisting of floor space admeasuring 24210 sq. ft. situated at DLF Corporate Park, DLF City, Phase-III, Gurgaon for a total consideration of Rs. 5,56,82,162 only. A sum of Rs. 81,70,875 only was paid towards the amount of consideration. Pursuant to or in furtherance of the said agreement to sell, the appellant herein was to obtain delivery of possession within three and a half (3 ) years therefrom. However, the said partnership firm was dissolved on or about 15-12-1995 and the assets and liabilities thereof were taken over by the respondent herein. Disputes and differences arose between the parties hereto. According to the petitioner herein, it not only made payments in accordance with terms and conditions of the said agreement to sell but also made further payments as demanded by the respondent herein from time to time. A final payment of Rs. 76,66,398 was also made on 24-7-1997 on obtaining possession. Despite the same allegedly in the year 1999, the respondent herein raised an arbitrary demand of Rs. 1,65,74,552. The petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f membership of the said firm, the mechanism as regards appointment of the arbitrator came to an end. In support of the said contention, strong reliance was placed upon a decision of the Privy Council in Bhagwanji Morarji Goculdas v. Alembic Chemical Works Co. Ltd. AIR 1948 PC 100. The learned counsel would contend that the assets and liabilities of the said firm, having vested in the respondent herein in terms of section 47 of the Partnership Act, it was bound thereby. The learned counsel would further contend that as the learned Single Judge has failed to appoint an arbitrator, as prayed for by the petitioner as by reason of the impugned order he having rejected the prayer of the petitioner, a writ petition would be maintainable. Reliance in this connection has been placed on Konkon Railway Corpn. Ltd. v. Rani Construction P. Ltd. [2002] 2 SCC 388. 4. Mr. Seth, the learned counsel appearing on behalf of the respondent, on the other hand, would contend that this writ petition is not maintainable inasmuch as by reason of the impugned order, the learned Single Judge has appointed an arbitrator. Reliance in this behalf was placed on Konkan Railway Corpn. Ltd. s case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Arbitration in England by Sir Michael J. Mustill and Stweart C. Boyd, London Butterworths 1982, the law is stated in the following terms : "4. Assignment. The fourth situation is the one which most commonly arises. Here, the claimant is the assignee of the benefit of the contract - either by statute, or by a full legal assignment under section 136 of the Law of Property Act, 1925 or by an equitable assignment. The decided cases on the rights of the parties in this situation are not clear. There would be much to be said for an argument that although the presence of the arbitration clause would not prevent the assignee from obtaining a valid right of claim, he would have to enforce his claim by action, rather than arbitration. It appears, however that this is not the law, and that the position is as follows : ( i )The presence of an arbitration clause in a contract does not prevent the contract from being assigned. ( ii )The assignee can and must enforce his claim by arbitration, unless the clause is so worded as to make it clear that it binds only the original parties. ( iii )Where there has been a legal assignment under the Law of Property Act 1925, the assignee may m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p, the arbitration agreement between the parties, which is in the following terms, is required to be construed : "45. That all disputes arising out of or under or in any manner connected with this agreement shall be referred to the sole arbitrator appointed by the Firm and the proceedings thereof shall be governed by the Indian Arbitration Act, 1940 and the Rules framed thereunder and the award shall only be filed in a court of appropriate jurisdiction in Delhi and in no other court. There shall be no objection that the Arbitrator so appointed by the Firm is an official of their Firm or of any of the Partners of the Firm." 10. If the contract was assignable as a result whereof the parties hereto are bound thereby, the arbitration agreement can be enforced. Once the arbitration agreement is enforced, the right of the parties to appoint arbitrator cannot be taken away. For all intent and purport, the respondent herein having succeeded to the assets of the said partnership firm and being entitled to all its rights and liabilities, in the considered view of this Court, it would also be entitled to enforce the contract in the manner as specified therein. 11. It is, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the words Secretary in the Ministry of Food and Agriculture and urged that what the parties to the contract had in mind was not a Secretary in the Ministry of Food and Agriculture but the Secretary in the Ministry of Food and Agriculture and that clearly postulated one definite Secretary in the Ministry of Food and Agriculture and not one of two Secretaries in that Ministry. This is, in our opinion, a hypertechnical argument which seeks to make a fortress out of the dictionary and ignores the plain intendment of the contract. We fail to see why the Secretary in the Ministry of Food and Agriculture incharge of the department of Food could not be described as the Secretary. He would be the Secretary in the Ministry of Food and Agriculture concerned with the subject-matter of the contract and clearly and indubitably he would be the person intended by the parties to exercise the power of nominating the arbitrator. The parties to the contract obviously could not be expected to use the words a Secretary in the Ministry of Food and Agriculture , because their intendment was not that any Secretary in the Ministry of Food and Agriculture should be entitled to exercise the power of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ime or without entertaining any contentious issues at that stage, by a party objecting to the appointment of an arbitrator. If this approach is adhered to, then there would be no grievance of any party and in the arbitral proceeding, it would be open to raise any objection, as provided under the Act. But certain contingencies may arise where the Chief Justice or his nominee refuses to make an appointment of an arbitrator and in such a case a party seeking appointment of an arbitrator cannot be said to be without any remedy. Bearing in mind the purpose of legislation, the language used in section 11(6) conferring power on the Chief Justice or his nominee to appoint an arbitrator, the curtailment of the powers of the Court in the matter of interference, the expanding jurisdiction of the arbitrator in course of the arbitral proceeding, and above all the main objective, namely, the confidence of the international market for speedy disposal of their disputes, the character and status of an order appointing an arbitrator by the Chief Justice or his nominee under section 11(6) has to be decided upon..." (p. 207) The said dicta has been upheld by the Constitution Bench of the Apex Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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