- (1.) -THIS appeal has been preferred by the plaintiffs-appellants upon being aggrieved by the order passed by the learned Civil Judge (Senior Division), Gautam Budh Nagar dated 25th April, 2005 in Suit No. 257 of 2005 I. T. E. C. Limited v. M/s. India Exhibition, by which the matter was directed to be presented before the competent authority for resolution by arbitration in accordance with the rules.
(2.) THE contention of Mr. Ravindra Kumar Das and Mr. K. D. Tiwari, learned Counsel appearing for the appellants, is that by disposing of such application and sending the dispute for resolution by arbitration, in effect, the Court below sent the entire matter lock, stock and barrel before the competent authority. Therefore, far to say about the application, the suit can not be heard by the Court. It is further contended that at the time of hearing the application under Order XXXIX, Rule 1 of the Code of Civil Procedure (hereinafter in short called as the 'c. P. C. ') for issuing injunction, the impugned order was passed. The appellants contended before this Court that the appellant No. 1 intended to organise exhibitions and fares, etc. periodically on a land of the plaintiff-appellant No. 2 at NOIDA with the joint venture of one Roger Shashoua, defendant-respondent No. 2 herein. Said Sri Roger Shashoua entered into the business with the plaintiffs-appellants by transfer of 50% share of the company, being plaintiff-appellant No. 1 herein, in his favour. But bypassing such agreement he started doing competitive business in the name of defendant-respondent No. 1 company. Said Sri Roger Shashoua controls a company known as M/s. Expomedia Group Plc. , which controls the respondent No. 1 herein i. e. company. Incidentally, it has been submitted that said Sri Roger Shashoua is debarred from carrying business in India by virtue of rejection letter of the Government of India dated 7th July, 2006, conveyed vide letter dated 11th July, 2006, being Armexure-2 to the rejoinder affidavit.
(3.) LEARNED Counsel appearing for the appellants relied upon paragraph-36 of the judgment in M/s. S. B. P. and Co. v. M/s. Patel Engineering Ltd. and another, AIR 2006 SC 450. , which as follows : "36. It is fundamental to our procedural jurisprudence, that the right of no person shall be affected without he being heard. This necessarily imposes an obligation on the Chief Justice to issue notice to the opposite party when he is moved under section 11 of the Act. The notice to the opposite party cannot be considered to be merely an intimation to that party of the filing of the arbitration application and the passing of an administrative order appointing an Arbitrator or an arbitral Tribunal. It is really the giving of an opportunity of being heard. There have been cases where claims for appointment of an Arbitrator based on an arbitration agreement are made ten or twenty years after the period of the contract has come to an end. There have been cases where the appointment of an Arbitrator has been sought, after the parties had settled the accounts and the concerned party had certified that he had no further claims against the other contracting party. In other words, there have been occasions when dead claims are sought to be resurrected. There have been cases where assertions are made of the existence of arbitration agreements when, in fact, such existence is strongly disputed by the other side who appears on issuance of notice. Controversies are also raised as to whether the claim that is sought to be put forward comes within the purview of the concerned arbitration clause at all. The Chief Justice has necessarily to apply his mind to these aspects before coming to a conclusion one way or the other and before proceeding to appoint an Arbitrator or declining to appoint an Arbitrator. Obviously, this is an adjudicatory process. An opportunity of hearing to both parties is a must. Even in administrative functions if rights are affected, rules of natural justice step in, The principles settled by Ridge v. Baldwin, 1963 2 ALL ER 66 are well known. Therefore, to the extent, Konkan Railway (supra) states that no notice need be issued to the opposite party to give him an opportunity of being heard before appointing an Arbitrator, with respect, the same has to be held to be not sustainable. ";