Decided on September 16,1957



D.Falshaw - (1.) THIS is a revision petition against the order of Court at Delhi returning the application, under Sections 32 and 33 of the Indian Arbitration Act to the present petitioners on the ground that it had no jurisdiction to entertain it.
(2.) THE petitioners are the firm Chhunnu Mal-Kishan Chand and its partners Indar Chand Jain, Kishan Chand Jain and Dharam Pal Tain, and a dispute has arisen regarding some dealings which they had with Bombay firm Messrs. Puran Mal- Bansi Dhar respondent No. 1. THE petitioners received a letter dated 16-4-1956 from the Bombay firm stating that whereas claims, disputes and differences had arisen and were pending between them the Bombay firm had appointed Mr. N. N. Dubash respondent. No. 2 as its arbitrator and calling on the petitioners to appoint their arbitrator within seven days. THE petitioners sent a reply dated 20-4-1956 contending that any reference to arbitration was illegal and inoperative on various grounds. However, respondent No. 4 the Native Share and Stock Brokers Association of Bombay proceeded to appoint Jayant Amar Chand respondent No, 3 as a second arbitrator, on behalf of the petitioners this appointment being communicated by a letter dated 7th of May 1956. The petitioners then filed their application in the Court at Delhi under Sections 32 and 33 of the Indian Arbitration Act and 4-6-1956 denying the existence and validity of the alleged agreement under which the Bombay firm had caused the matters in dispute to be referred to arbitration. The Bombay firm raised the objection that the Delhi Courts had no jurisdiction to entertain the application, and the present petition has been filed challenging the order of the lower Court by which this contention was upheld. Section 32 of the Arbitration Act provides that notwithstanding any law for the time being in force no suit shall lie on any ground whatsoever for a decision upon the existence effect or validity of an arbitration, agreement or award, nor shall any arbitration, agreement or award be set aside amended, modified or in any way affected otherwise than its provided in this Act. The first part of Section 33 reads : "Any party to an arbitration agreement or any person claiming under him desiring to challenge the existence or validity of an arbitration agreement or an award or to have the effect of either determined shall apply to the Court and the Court shall decide the question on affidavits." The meaning of the term "Court" is defined be Section 2(c) which reads; " 'Court' means a civil Court having jurisdiction to decide the questions forming the subject matter of the reference if the same had been subject-matter of a suit but does not except for the purpose of arbitration proceedings under Section 1 include a Small Cause Court."
(3.) THE lower Court proceeded to decide the matter on the basis that it was admitted that the contracts in dispute were entered into at Bombay and that no part of the cause of action arose within the jurisdiction of the Delhi Court, and the contention advanced on behalf of the petitioners that since they were residents of Delhi a suit on the basis of the contracts in dispute could have been filed by the Bombay firm in the Delhi Court, was repelled. On behalf of the petitioners it is denied that there was any admission in the Court below that no part of cause of action arose at Delhi in any suit which the Bombay firm could have brought on the basis of the contracts and the argument has again been advanced that since any person can bring a suit either in a Court located where all or part of the cause of action arose or else where the defendant resides, a suit based on the disputes which have been referred to arbitration by the Bombay firm could have been brought at Delhi and therefore the Court here had jurisdiction to entertain the application under Section 33 of the Arbitration Act, Support of this contention was sought to be derived from certain observations made by Abdul Rahman J. in Radha Kishen v. Bombay Company Ltd., AIR 1943 Lah 295 and by Kania J. in Cursetji Jamshedji Ardaseer Wadia v. Dr. R. D. Shiralee AIR 1943 Bom 32 Actually in the first case Abdul Rahman J. decided the matter on other grounds but undoubtedly on p. 297 he has remarked : "Since an application like this is not covered by Clause 9 of the agreement such Courts would have jurisdiction to entertain it under Section 2(c) Arbitration Act as could have decided 'the questions forming the subject-matter of the reference' and as a suit for damages which is now proposed to be the subject-matter of the reference could have been instituted at Amritsar, both because the contract had been taken place at Amritsar and the defendants were residing at that place, the Courts in Amritsar would be competent to entertain the application under Section 33 Arbitration Act." In the other case Kania J. has observed; "In my opinion the construction sought to be put on Section 2(c); by the petitioners is erroneous. It docs not mean that a Court has jurisdiction to receive and award only if the whole cause of action arose within the jurisdiction of the Court. Reading the sub-section as worded, it is deaf that any Court which would have jurisdiction to decide the question arising from the subject-matter of the reference, would be the proper court in which the award may be filed." In neither of these cases was the question being considered in the manner in which it has arisen in the present case.;

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