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.;