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TMI Blog2005 (5) TMI 669X X X X Extracts X X X X X X X X Extracts X X X X ..... he said contract and the respondent appointed one Mr. L.R. Pahwa as the Arbitrator to adjudicate upon certain claims. However, a petition (AA No. 182/2001) under Section 11 of the Act was also moved for appointment of the Arbitrator and was disposed of by this Court on 17.1.2000 with the following order: 'I am satisfied that disputes have arisen between the parties, as stated in the petition. Counsel appearing for the respondent states that the respondent also has certain Counter Claims as against the petitioner. In that view of the matter and with the consent of the counsel appearing for the parties, I appoint Hon'ble Mr. Justice C.L. Chaudhary, a Retired Judge of this Court, as an Arbitrator for adjudicating all the disputes between the parties i.e. Claims of the petitioner arising out of and in connection with the present contract as also the Counter Claims of the respondent.' 3. The learned Arbitrator entered upon the reference and the respondent-herein filed a statement of claim dated 11.5.2002 and thereafter additional statement of claim on 12.7.2002. In response to the same, the appellant filed reply to the said statement of claims/additional claims and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. I have heard Mr. Valmiki Mehta, learned senior counsel representing the appellant and Mr. V.K. Makhija, learned senior counsel representing the respondent and have given my thoughtful consideration to their respective submissions. 7. In this case the foremost question which arises for consideration is whether the arbitrator could have made the impugned order on the application of the respondent under Section 16 of the Act holding that certain counter-claims cannot be entertained and adjudicated upon because those are pre-mature and are outside the ambit of the expression 'dispute'. The answer to this will depend on the answer of another question as to whether controversy in regard to the non-entertainability of counter-claims is a jurisdictional issue within the meaning of Section 16 of the Act and if it is not so at what stage the Arbitrator could consider this question? To find the answer we must refer to the provisions of Section 16 and 37 of the Act which are to the following effect: ' Section 16. Competence of arbitral tribunal to rule on its jurisdiction-(1) The arbitral tribunal may rule on its own jurisdiction, including ruling on any objections with r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Whether it has the jurisdiction to entertain the arbitral proceedings: (ii) Whether there exists an arbitration agreement; and (iii) Whether there exists a valid arbitration agreement between the parties. 9. Mr. Valmiki Mehta, urged that the application moved by the respondent under Section 16 of the Act which has been disposed of by the impugned order does not fall under the purview of Section 16 of the Act. In this connection he claimed parity between the provisions of Section 16 of the 1996 Act with that of Section 33 of the Arbitration Act 1940 and urged that Section 16 confers power on the arbitral tribunal to decide on its own jurisdiction, including ruling on any objections regarding the existence or validity of the Arbitration Agreement. According to him the Arbitrator could consider only the aforesaid questions and could not go into the question whether the counter-claim filed by the appellant constituted disputes. Mr. Mehta, urged that parties are at liberty to prove their claims and counter-claims by filing documents or otherwise and, thereforee, the Arbitrator has the jurisdiction to adjudicate upon the counter-claims filed by the appellant and could not h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... making additional counter claims. The contention cannot be said to be devoid of merits because it is not unusual for the parties to supplement and amend their claims and counter-claims even during the pendency of the Reference before the arbitral tribunal. Section 23 of the Act in fact provides for such a course and reads as under: 'Statements of claim and defense- (1) within the period of time agreed upon by the parties or determined by the arbitral tribunal, the claimant shall state the facts supporting his claim, the points at issue and the relief or remedy sought, and the respondent shall state his defense in respect of these particulars, unless the parties have otherwise agreed as to the required elements of those statements. (2) The parties may submit with their statements all documents they consider to be relevant or may add a reference to the documents or other evidence they will submit. (3) Unless otherwise agreed by the parties, either party may amend or supplement his claim or defense during the course of the arbitral proceedings, unless the arbitral tribunal considers it inappropriate to allow the amendment or supplement having regard to the delay in makin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be an assertion of a claim and then its denial and since the counter claims raised by the appellant were not asserted at any stage, there was no question of the respondent refuting the same and, thereforee, the said counter-claims cannot be termed as 'dispute'. It is also contended that no notice as was envisaged by Clause 24 was given by the appellant in regard to those counter claims and, thereforee, the said counter-claims cannot be said to be dispute or difference capable of arbitration. Mr. Makhija, however fairly conceded that the absence of notice would not be fatal and the counter-claims if they can constitute a dispute could well be considered the subject matter of the arbitration. 15. Yet another objection raised on behalf of the respondent is about the maintainability of the present appeal. Mr. Makhija, learned counsel for the respondent has contended that the present appeal under the provisions of Section 37 of the Act is misconceived and not maintainable because the impugned order of the learned Arbitrator deciding the plea raised by the respondent in regard to the non-maintainability of the counter-claim is within jurisdiction and powers conferred on him un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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