GENERAL MANAGER J AND K CO OP SUPPLY AND MARKETING FEDERATION Vs. RAMA RICE AND GENERAL MILLS
LAWS(J&K)-1993-2-4
HIGH COURT OF JAMMU AND KASHMIR
Decided on February 26,1993

GENERAL MANAGER, J AND K CO-OPERATIVE SUPPLY AND MARKETING FEDERATION Appellant
VERSUS
RAMA RICE AND GENERAL MILLS Respondents


Referred Judgements :-

U.P.CO-OPERATIVE FEDERATION V. SUNDER BROTHERS [REFERRED TO]
ROSHAN LAL SETHI VS. CHIEF SECRETARY [REFERRED TO]


JUDGEMENT

R.P.Sethi, J. - (1.)THE parties to the litigation are alleged to have entered into an agreement providing an arbitration in case of disputes and difference arising out of or in any manner touching or concerning the agreement, for adjudication by the Registrar, Co-operative Societies, J and K. After the expiry of the period of agreement, the respondent preferred a claim for the storage of paddy at the rate of Rs. 1/-per bag per day and upon denial of the liability by the appellant, preferred a claim of Rs. 11,77,600. As the claims were not settled, an application under Section 20 of the Arbitration Act, was filed in this Court for making of the reference to an independent arbitrator. THE petition was resisted mainly on the grounds that in view of the provisions of Section 63 of the J and K Co-operative Societies Act, no relief could be granted to the respondent herein and that in no case an indepenedent arbitrator could be appointed. THE learned Single Judge, while rejecting the pleas of the appellant herein, appointed District Judge, Jammu as the arbitrator for adjudication of all the disputes vide the judgment impugned in this appeal which is stated to be against law and facts requiring to be set aside. CTJ] G.M, J. and K. Co-op. S.M F. v. Rama Rice and Gen. Mills 407
(2.)WE have heard learned Counsel for the parties and peruse the record, Mr Gupta, learned Counsel appearing for the appellants has submitted that as the disputes raised by the respondent herein were covered by Section 63 of the J and K Co-operative Societies Act, this Court had no jurisdiction to entertain an application under Section 20 of the Arbitration Act and grant relief as prayed. It is, however, contended on behalf of the respondent that the disputes raised by the respondent were not covered by Section 63 in view of the provisions of sub-section (2) of the said section specifying exhaustively the disputs which could be adjudicated under the J and K Cooperative Societies Act.
The question as to whether the disputes raised by the respondent were covered by Section 63 of the J and K Co-operative Societies Act or not is not relevant for the purposes of deciding this appeal in view of the fact that the parties had admittedly into an agreement wherein it was provided

"All disputes and differences arising out of or In any manner touching or concerning this agreement whatsoever shall be referred to the sole arbitration of Registrar, Co-operative Societies, JandK. All points of law and facts will be exclusively decided by the arbitrator and it shall not be open to the contrator and the surety to plea that the Registrar Co-operative Societies, JandK, is the Head and the Offices of the Party No. 1".
The arbitration is provided for the parties to get their disputes settled through the intervention oi a third person, as agreed to be appointed as a judge of the parties, but without having recourse to a court of law. The underlying idea of arbitration is based upon the principle of withdrawing the disputes from the ordinary courts and enabling the contending parties to substitute a domestic tribunal of their choice The arbitration contemplated under the Act may be contractual or statutory. It has to be ascertained from the agreement that the parties has intended to make a submission to arbitration i. e , there must exist animus arbitrandi. The essentials of an arbitration agreement within the meaning of Section 2 (a) of the Act are : (1) There should be an agreement between the parties; (2) Such agreement should be in writing; and (3) The agreement should be to refer the existing or future disputes to arbitration. The statutory arbitrations are such arbitrations where there is no agreement or contract between the parties, but they are required to make a reference to an arbitrator under the provisions of some statute covering them. In such cases the enactment under the provisions of which reference is required to be made, shall be deemed to be the arbitration agreement and the consequent proceedings are required to be conducted as in the case of any other arbtitration agreement. However, in statutory arbitrations the provisions of Sections 6 (1), 7, 12 and 37 would not apply as is provided under Section 46 of the Arbitration Act.
(3.)EVEN if the parties are held to be bound by the provisions of Section 63 of the Co-operative Societies Act, yet, they are, not estopped from enterIng into or agreeing for a contractual arbitration as has been done in the instant case. Section 34 of the Arbitration Act deals with the situations where one of the party to the agreement, it entitled to get the legal proceedings stayed in a case governed by an arbitration agreement. The right conferred under Section 34 of the Act can also be waived by the parties either specifically or by their conduct It is true that Section 34 is not applicable to the statutory arbitrations, but, that does not debar the parties from contracting for a fresh arbitration agreement for the appointment of a person or authority as an arbitrator under the provisions of the Act. No party is entitled to unilaterally repudiate or rescind the arbitration but no provision is made under the Act forbidding the parties for entering into a fresh arbitration agreement or substituting a contractual arbitration in place of statutory arbitration.


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