BHOWANI COTTON MILLS Vs. UNION TEXTILE TRADERS
LAWS(CAL)-1965-11-10
HIGH COURT OF CALCUTTA
Decided on November 19,1965

BHAWANI COTTON MILLS Appellant
VERSUS
UNION TEXTILE TRADERS Respondents

JUDGEMENT

A.N.Ray, J. - (1.) FOUR questions have been canvassed on the notice of motion. First, that the arbitration agreement is vague. Secondly, that the rules of Indian Chamber of Commerce are illegal. Thirdly, that the Registrar, Tribunal of Arbitration, Indian Chamber of Commerce failed to exercise his discretion. FOURthly, that the arbitrators are guilty of misconduct.
(2.) THE petitioner and the respondent had dealings and transactions whereby the respondent sold and the petitioner bought certain quantities of Cone yarn. THE contract contained inter alia the following provisions: (a) In case of any dispute arising out of this contract the matter in dispute shall be referred to the arbitration of the Indian Chamber of Commerce whose decision shall be binding on both the parties. (b) THE Courts at Calcutta alone and no other Courts whatsoever shall have jurisdiction to entertain and try suits in respect of any claim or disputes arising out of or under this contract or in any way relating to the same. Counsel on behalf of the petitioner contended that the arbitration agreement is vague because there are various Indian Chambers of Commerce and secondly Indian Chamber of Commerce, Calcutta, is not the agreed arbitrator. In aid of these contentions allegations in sub-paragraph (b) of paragraph 46 of the petition were relied upon. It appears from the petition that it is not the petitioner's case that Indian Chamber of Commerce, Calcutta, is not the Indian Chamber of Commerce referred to in the agreement. Further, the correspondence indicates that the parties had no difficulty in identifying the Indian Chamber of Commerce as the agreed arbitral authority. The petitioner wrote to Indian Chamber of Commerce and the petitioner received replies and the petitioner appeared before the Indian Chamber of Commerce. Counsel on behalf of petitioner relied on the decision in C.M. Karanji and Co. v. Indo China Trading Co. Ltd. reported in (1952) 56 Cal WN 763 where a provision to the effect that the parties would have the right to call for arbitration on the matter in dispute under the rules of local Chamber of Commerce was held to be vague. That decision to my mind is of no assistance to the petitioner, because of the wide difference in the language of the agreement. It is obvious that the phrase 'local Chamber of Commerce' might refer to any of several Chambers of Commerce whereas the language in the present case that the arbitral authority is the Indian Chamber of Commerce does not suffer from any indefiniteness or vagueness. The Indian Chamber of Commerce is the agreed arbitral authority and its situation is at Calcutta is amply proved by the unequivocal appearance of the parties before the authority.
(3.) THE other contention on behalf of the petitioner was that it appeared from a Clause of the agreement that the Courts at Calcutta would have jurisdiction, that it was open to the parties to come to a Court of law and therefore the agreement as to arbitration was vague. Settlement of dispute through the medium of arbitration and through recourse to Court of law are two different aspects. It may be that the parties envisaged disputes which are not covered by the arbitration Clause and in such a case the parties might have recourse to a Court of law. That is why the parties stipulated that the Courts at Calcutta would have jurisdiction. I am unable to find any inconsistency between the provisions or to hold that there is any vagueness or uncertainty or that the Clause providing for resort to Courts of law in Calcutta nullifies the arbitration agreement. Further, counsel for the respondent rightly contended that in a document of this nature if there was any inconsistency the earlier Clause would prevail unlike in a Will where the later Clause would prevail. I make it quite clear that I do not hold that there is any inconsistency.;


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