ASIASOFT INDIA PVT LTD Vs. GLOBESYN TECHNOLOGIES LTD

JUDGEMENT

(1.) Application filed by the defendants invoking Section 5 and 8 of the Arbitration and Conciliation Act, 1996 is being disposed of by the present order. Section 5 and Section 8 relied upon read as under:- 5. Extent of judicial intervention.- Notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part. 8. Power to refer parties to arbitration where there is an arbitration agreement. - (1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute refer the parties to arbitration. (2) The application referred to in sub-section(1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof. (3) Notwithstanding that an application has been made under sub-section(1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made.

(2.) Pleadings of the defendants in aid of the relief prayed in the application, relief being to refer the dispute to arbitration, are as under:- That the Defendants herein submits that the enterprise Partner agreement dated 26th August 2000 although not signed by the Plaintiff but upon which the Plaintiff insists and relied at various points of time consist of an arbitration clause being Clause No.19, which states as under: All disputes or the differences whatsoever arising between the parties hereto out of or relating to the construction, meaning and operation or effect of this Agreement or the breach thereof which cannot be settled by mutual discussion the same shall be referred to the decision of an arbitrator to be appointed in writing by the parties to the Agreement or if they cannot agree upon a single arbitrator to the decision of three arbitrators, one each to be appointed by the Parties herein and the third to be mutually agreed upon by the two arbitrators will be appointed as the Chairman. The arbitration proceedings shall be conducted at New Delhi and the arbitration proceedings shall be in accordance with the provisions of the Arbitration and Conciliation Act, 1996.

(3.) Sh.Biswajeet Bhattacharya, counsel for the defendants urged that mandate of Section 5 of the Arbitration & Conciliation Act, 1996 prohibited a judicial authority to determine any dispute which was the subject matter of an arbitration agreement between the parties. Counsel urged that mandate of Section 8 required a judicial authority before which an action is brought to refer the parties to arbitration if the subject matter of the action was the subject matter of an arbitration agreement.