GOOD EARTH MINMET PVT. LTD. Vs. CHANDRA MOHAN GUPTA
LAWS(CAL)-2019-3-157
HIGH COURT OF CALCUTTA
Decided on March 06,2019

Good Earth Minmet Pvt. Ltd. Appellant
VERSUS
Chandra Mohan Gupta Respondents

JUDGEMENT

ARINDAM SINHA,J. - (1.) This suit and applications were specially assigned to this Bench. Of four applications two have been heard and are being dealt with by this judgment. The first is GA 650 of 2016 made by defendant invoking section 8 of Arbitration and Conciliation Act, 1996 as amended, for stay of suit and referring parties to arbitration. The other is GA 2863 of 2018 made by plaintiff for amendment of the plaint. Mr. Mookherjee, learned senior advocate appears on behalf of applicant and had on earlier occasions made submissions. He referred to paragraphs 4, 5 and 17 of the plaint to show that plaintiff had pleaded an agreement between itself and his client to give effect to 22nd which, agreement dated May, 2008 was executed also between the parties. Subsequently, raising contracts were also executed between his client and one other in which plaintiff was a confirming party. Claims in the plaint are made for money against defendant where said other person has not been made party to the suit.
(2.) He submitted, by Arbitration and Conciliation (Amendment) Act, 2015 section 4 therein, amendment was made to section 8 of the Act of 1996. Sub-section (1) of section 8 in 1996 Act was substituted to become present provision where a judicial authority, before which an action is brought in a matter which is the subject matter of an arbitration agreement shall, if, inter alia, a party to the arbitration agreement applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgement, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no arbitration agreement exists. He drew attention to clause 11 in agreement dated 22nd May, 2008, which is reproduced below: "11. That if any difference or dispute arises in respect of the terms of this agreement or any work done under this agreement, the same will be referred to an arbitrator who will resolve the dispute in terms of the Arbitration and Conciliation Act, 1996." His client is a party to said arbitration agreement contained in a document, which according to plaintiff, was executed to give effect to agreement alleged in the plaint also made between the parties. His client having had made this application, it is for plaintiff to show prima facie that there is no valid agreement for arbitration between the parties. In paragraph 4 of the plaint, statement has been made that the agreement pleaded was entered into between the parties some time in or around the first half of May, 2008 as would also be borne out from, inter alia, documents referred thereinafter. Statements in paragraph 5 are to the effect that there was a document dated 22nd May, 2008 which is a part of the oral agreement. This document is written agreement, clause 11 in which is arbitration agreement between the parties. He submitted, in paragraphs following paragraphs 4 and 5 in the plaint, there is no other document that could be one as would bear out oral agreement pleaded in the plaint. It is, therefore, this 22nd agreement dated May, 2008 which is the agreement between the parties. In event there are matters, fringe or otherwise, that is for consideration by the Arbitral Tribunal.
(3.) He relied on amended section 8 to submit, intention of Legislature is, where there is an arbitration agreement, parties must be compelled to go for arbitration and all disputes are to be decided in arbitration. He relied on judgment dated 3rd May, 2018 of Supreme Court in Civil Appeal 4690 of 2018 (Ameet Lalchand Shah and Ors. Vs. Rishabh Enterprises and Ors.),reported in (2018)15 SCC 678). He placed paragraphs 2 to 8, 18, 22, 23, 25 to 27, 33 and 35 of print. He submitted, facts in that case were that in matter of commercial transactions to commission Photovoltaic Solar Plant there were inter- connected agreements, some containing arbitration agreements and others without. He submitted, Supreme Court declared the law, in such facts, to be that amended section 8 would compel all parties to arbitration. He submitted, there is inter-connection between oral agreement pleaded in the plaint and written agreement 22nd dated May, 2008 containing arbitration agreement. Position of law has evolved to be that only existence and validity of arbitration agreement is what needs to be looked at by Court in matters of arbitration. Amended section 11(6A) confines requirement of enquiry to existence of arbitration agreement while section 8 restricts the enquiry to prima facie finding of validity of existing arbitration agreement. Mr. Anindya Mitra, learned senior advocate appeared on behalf of plaintiff in opposing the application for reference. He submitted, substituted section 8 still requires, for purpose of compelling the parties to arbitration, that the action brought before a judicial authority is in a matter which is the subject of an arbitration agreement. His client, while does not dispute validity of arbitration agreement contained in 22nd document dated May, 2008 but, contends that said arbitration agreement does not cover subject matter of the suit as it is very narrow in scope being in relation to work done under it.;


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