- (1.) The respondents are not represented despite service. The respondents were not represented before the Single Bench either. The appeal involves a short question of law: whether during the pendency of an application for the subject-matter of a civil suit to be referred to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996, the party seeking the reference is entitled to maintain a petition under Section 9 of the said Act in respect of matters covered by the arbitration agreement.
(2.) This is the usual hire purchase matter which is the staple of the Arbitration Bench in this Court. The appellant claims that upon the respondents failing to adhere to the payment terms under the finance agreement, the respondents instituted a civil suit before the City Civil Court at Calcutta and made an interlocutory application therein. Surprisingly, as has been noticed in course of several matters, notwithstanding the finance agreements providing for specific amounts to be paid on a periodic basis, Civil Courts have often tended to rewrite the terms by allowing some remission or a lesser amount to be paid on a monthly basis without the concurrence of the finance company.
(3.) In this case, the finance company applied under Section 8 of the said Act, read with Section 5 thereof, for the virtual arrest of the civil suit and for the subject-matter of the suit to be referred to arbitration in accordance with the arbitration clause contained in the finance agreement. The arbitration clause is as follows:- "9.11 Dispute Resolution Arbitration Any disputes or differences arising out of or in connection with the agreement during its subsistence or thereafter between the parties Including any disputes and differences relating to the Interpretation of the agreement or any clause thereof shall be settled by arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996 and rules framed there under and any amendment, modification, statutory enactment thereto from time to time and shall be referred to the sole Arbitration of an Arbitrator appointed by Company on its own or upon request of the Customer and/or guarantors In writing, upon intimation to all parties to this agreement. It is made clear that the venue of Arbitration proceedings will be at Kolkata and no objection shall be entertained from any parties in this regard. The cost of the Arbitration proceedings shall be borne by the parties to this agreement. The award of the arbitrator shall be final, conclusive and binding on all the parties." ;