GENERAL MANAGER J AND K CO OP SUPPLY AND MARKETING FEDERATION Vs. RAMA RICE AND GENERAL MILLS

JUDGEMENT

(1.) THE parties to the litigation are alleged to have entered into an agreement providing an arbitration in case of disputes and difference arising out of or in any manner touching or concerning the agreement, for adjudication by the Registrar, Co-operative Societies, J and K. After the expiry of the period of agreement, the respondent preferred a claim for the storage of paddy at the rate of Rs. 1/-per bag per day and upon denial of the liability by the appellant, preferred a claim of Rs. 11,77,600. As the claims were not settled, an application under Section 20 of the Arbitration Act, was filed in this Court for making of the reference to an independent arbitrator. THE petition was resisted mainly on the grounds that in view of the provisions of Section 63 of the J and K Co-operative Societies Act, no relief could be granted to the respondent herein and that in no case an indepenedent arbitrator could be appointed. THE learned Single Judge, while rejecting the pleas of the appellant herein, appointed District Judge, Jammu as the arbitrator for adjudication of all the disputes vide the judgment impugned in this appeal which is stated to be against law and facts requiring to be set aside. CTJ] G.M, J. and K. Co-op. S.M F. v. Rama Rice and Gen. Mills 407

(2.) WE have heard learned Counsel for the parties and peruse the record, Mr Gupta, learned Counsel appearing for the appellants has submitted that as the disputes raised by the respondent herein were covered by Section 63 of the J and K Co-operative Societies Act, this Court had no jurisdiction to entertain an application under Section 20 of the Arbitration Act and grant relief as prayed. It is, however, contended on behalf of the respondent that the disputes raised by the respondent were not covered by Section 63 in view of the provisions of sub-section (2) of the said section specifying exhaustively the disputs which could be adjudicated under the J and K Cooperative Societies Act.

(3.) EVEN if the parties are held to be bound by the provisions of Section 63 of the Co-operative Societies Act, yet, they are, not estopped from enterIng into or agreeing for a contractual arbitration as has been done in the instant case. Section 34 of the Arbitration Act deals with the situations where one of the party to the agreement, it entitled to get the legal proceedings stayed in a case governed by an arbitration agreement. The right conferred under Section 34 of the Act can also be waived by the parties either specifically or by their conduct It is true that Section 34 is not applicable to the statutory arbitrations, but, that does not debar the parties from contracting for a fresh arbitration agreement for the appointment of a person or authority as an arbitrator under the provisions of the Act. No party is entitled to unilaterally repudiate or rescind the arbitration but no provision is made under the Act forbidding the parties for entering into a fresh arbitration agreement or substituting a contractual arbitration in place of statutory arbitration.