Augustine George Masih, J. - (1.) THROUGH this petition, the petitioner -Bank is challenging the order dated 23.3.2007 vide which the learned Civil Judge (Junior Division), Jalandhar has dismissed the application moved by the petitioner -Bank under Sections 8 and 11 of the Arbitration Act.
(2.) IT is the contention of the petitioner -Bank that as per the Agreement dated 1.9.2004 entered into between the petitioner -Bank and the respondent -plaintiff, there being arbitration clause as contained in Clause 29 of the said Agreement, the matter should have been referred to the Arbitrator as per the said Agreement. Clause 29 of the Agreement reads as follows: 29. ARBITRATION All disputes, differences and/or claim arising out of or touching upon this Agreement whether during its subsistence or thereafter shall be settled by arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996, or any statutory amendments thereof and shall be referred to the sole Arbitration of an Arbitrator nominated by the Bank. The award given by such an Arbitrator shall be final and binding on the Borrower and Guarantor to this agreement. Replying on the said Clause, the petitioner contends that all disputes, differences and/or claim arising out of or touching upon this Agreement would be referable to the Arbitrator and, therefore, the application moved by the petitioner before the learned Civil Judge (Junior Division), Jalandhar, for referring the matter to the Arbitrator under Sections 8 and 11 of the Arbitration Act, should have been allowed. It is the contention of the counsel for the petitioner that the suit, which has been preferred by the plaintiff before the Civil Judge (Junior Division), Jalandhar, is for damages for of Rs. 1 lac on account of illegally detaining the vehicle of the plaintiff and causing loss to the business of the plaintiff. The said claim of damages arises from the Agreement dated 1.9.2004 and, therefore, should have been referred to the Arbitrator as per Clause 29 of the Agreement. It is the contention of the counsel for the petitioner that the plaintiff -respondent in Para 9 of the civil suit has stated that the vehicle remained in the illegal possession of the defendant from 29.07.2006 and was released on 9.8.2006 and the plaintiff has suffered damages to the tune of Rs. 1 lac on account of illegal tactics of the defendant and they are liable to pay the same to the plaintiff. This, the counsel for the petitioner states, is an offshoot of the Agreement dated 1.9.2004, which was entered into between the petitioner -defendant and the respondent -plaintiff. Briefly, the facts leading to the filing of the suit are that the petitioner -defendant has advanced a loan of Rs. 6,70,000/ - for the purchase of a truck to the respondent -plaintiff and, accordingly, entered into an agreement on 1.9.2004. The respondent -plaintiff agreed to pay the amount in 47 monthly instalments each. One instalment was taken in advance by the petitioner -defendant and the remaining 46 instalments were to be paid by the respondent -plaintiff in equal monthly instalments. The respondent -plaintiff handed over 46 post dated cheques of Rs. 16,023/ - drawn on Indian Overseas Bank, Branch Nangal Township, Tehsil Nandpur Sahib, District Ropar, Punjab to the petitioner -defendant. It is the contention of the petitioner that some of the cheques, which were handed over by the respondent -plaintiff, were misplaced during transit and, therefore, the cheques could not be encashed. The petitioner informed the respondent -plaintiff about the said loss and claimed the amount along with interest, penalty and service charges. The respondent -plaintiff, according to the petitioner, did not pay the cheques, and therefore, he agreed to surrender the truck to the officials and the representatives of the Bank at Ambala and signed the letter, handed over the possession of the truck to the officials of the Bank on 29.7.2006. The respondent -plaintiff preferred a complaint against the petitioner -defendant before the President, District Consumer Disputes Redressal Forum, Jalandhar. A compromise was reached there, wherein the plaintiff has paid the entire unpaid instalments and 23 post dated cheques for the remaining future instalments were resubmitted by the respondent -plaintiff. It would not be out of way to mention here that it was merely the unpaid amount of instalments, which was paid by the respondent -plaintiff and not the service charges or penalty, which was claimed by the petitioner -defendant.
(3.) NOW a suit has been preferred by the plaintiff -respondent claiming damages for a period during which the truck of the plaintiff -respondent remained in possession with the defendant -petitioner i.e. from 29.07.2006 to 9.8.2006. The counsel for the petitioner contends that these damages, which the respondent -plaintiff is claiming, are arising out of the Agreement dated 1.9.2004, therefore, the application under Section 8 of the Arbitration Act was required to be allowed and the matter should have been referred to the Arbitrator as per the Clause 29 of the Agreement. He relies on Clause 13, which relates to events of default to contend that if the borrower fails to pay any sum due from him then as per Clause 17, the Bank was entitled to take possession of the vehicle with special reference to Clause 17.2(i) and 17.3. He further contends that in the light of these provisions, the Bank is authorized to take in custody the truck and the dispute would arise from the Agreement dated 1.9.2004. He relies on the judgment of the Hon'ble Supreme Court in the case of Rashtriya Ispat Nigam Limited and Anr. v. Verma Transport Company Civil appeal No. 3420 of 2006 decided on 8.8.2006 and India Household and Healthcare Ltd. v. LG Household and Healthcare Ltd. Arbitration Petition No. 18 of 2005 decided on 8.3.2007 to contend that in case, there is a clause for reference to the Arbitrator in the agreement, that matter is required to be referred to the Arbitrator. He further relies upon a judgment of this Court in the case of Haryana State Electricity Board v. to contend that if a dispute arises and such dispute falls within the Agreement, the matter is required to be referred to the Arbitrator. He further relies upon the judgment of this Court in Bathinda Construction Company v. to contend that all disputes between the parties to the contract were required to be referred to the Arbitrator except such disputes, which are excluded specifically, and, therefore, the matter should have been referred to the Arbitrator by the trial Court.;