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TMI Blog2011 (12) TMI 723X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 of the Arbitration and Conciliation Act, 1996 for referring all the disputes involving in the said suit to Arbitration in terms of the arbitration agreement contained in the deed of partnership dated 23rd December, 1972. 2. In the said application the claim for referring the disputes to Arbitration is based on the following summarized fact: The plaintiffs have asked for aforesaid relief in the said suit with regard to a partnership firm namely M/s. Bharat Industries and Commercial Corporation, disputes and differences in respect of the said firm have arisen. Several proceedings are pending before the Hon'ble Court in connection with such firm. One Mohanlal Maheswari and one Mohanlal Kocher both since deceased were the original two partners and they formed this aforesaid firm under deed of partnership dated 23rd December, 1972. The aforesaid deed of partnership contains an arbitration clause for resolution of all the disputes between the said two partners and/or their heirs and legal representatives in relation to the affairs of the said partnership firm. Mohanlal Maheswari died on or about 17th December, 1984. The plaintiffs are the heirs and legal represent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 5 and vice versa. Mimani was not a party to the Arbitration and the said person is independent one having separate and distinct legal entity from Kochers as will be borne out from the claim of Mimani's Suit in 1993 which is an independent action for enforcement of agreement of sale by Kochers to Om Prakash Chowdhury which has been acquired by Mimani on assignment. This suit was filed prior to the action taken by Kochers. While drawing our attention to the language of section 8 with reference to section 2(h) of the Arbitration Conciliation Act, 1996 (hereinafter referred to as the said 'Act'), parties therein mentioned mean parties to Arbitration agreement. Since admittedly Mimani was not a party to the 1972 agreement no claim nor any dispute of the Kochers' or Maheshwaris' with Mimani could or can be subject-matter of reference. The subject-matter of the dispute is clearly not covered by the arbitration agreement. The learned Trial Court did not have the jurisdiction to refer the matter, which also involves Mimani, to Arbitration by the order under appeal Mimani's fate will be decided in his absence, which cannot be permitted. He has drawn the support ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mandatory provision and the learned Trial Court could not have entertained the application and the disputes could not have been referred to Arbitration. In fact, he urges placing reliance on decisions of the Supreme Court in case of Atul Singh and others vs. Sunil Kumar Singh and others reported in 2008 (2) SCC 602 and N. Radhakrishnan vs. Maestro Engineer and ors reported in (2010) 1 SCC 72 the learned Trial Court did not have jurisdiction to entertain the application. 9. He further contends in support of the plea of appealability of the impugned order that by the impugned order the suit has been disposed of. As far as the portion of the disposal of the suit is concerned the Court lacks jurisdiction as there is no power under the said Act to dispose of the suit. Therefore the said portion of the order at least is not under 1996 Act. Hence, it is an appealable order under Clause 15 of Letters Patent and on this point the Division Bench of this Court has made the legal position clear in case of M.K. Telecommunication Limited vs. Affcon Consultants Private Limited reported in (1999) 1 Cal LT 285. Hence order in which lack of jurisdiction is involved is appealable and restri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... third party the Court has ample power to pass appropriate orders and this has been held so by the Supreme Court in the case of Sukanya Holding Private Limited vs. Jayesh H Pandya and another reported in (2003) 5 SCC 531. Apart from the above authority the learned counsel has referred to in this context, to the decision of Supreme Court in cases of Rashtriya Ispat Nigam Limited and Everest Holding reported in (2006) 7 SCC 275 and (2008) 16 SCC 774 respectively. In view of the aforesaid legal position the present appeal is liable to be dismissed. 11. Learned counsel for the respondent Kishan Mimani contends that his client has already filed a suit. His client admittedly is not a party to arbitration agreement and as such filed a separate and comprehensive suit being No. 510 of 1993 for specific performance against Kochers. Thus claim of the Kochers is subjudice being subject matter of the earlier suit. The suit filed by Maheshwaris' being C.S. 195 of 2010 is a later suit and in the said suit the appellant has been made a party and the Maheshwaris have challenged the right of Kochers to sell their right title and interest of the properties of the partnership firm to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laid down by the Supreme Court that Clause 15 of the Letters Patent has to be made applicable subject to similar provision of any other special enactments made by the competent legislature as provided in Clause 44 of the Letters Patent Act. The Arbitration and Conciliation Act is one of such legislation as contemplated in Clause 44 of Letters Patent Act. 16. We are of the view that the aforesaid proposition of law will be applicable only when the Court finds that order passed is in substance under section 8 of the said 1996 Act. Task of this Court is thus to examine whether the aforesaid order can be said to be an order under section 8 of the 1996 Act in substance although the said section was invoked. 17. We, therefore, set out the provision of section 8 of the said Act: 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obviously is whether it is judgment within the meaning of Clause 15 of the Letters Patent to maintain present appeal. 23. It has been contended by the learned counsel for the appellant that even the dispute involved in the suit cannot be referred to arbitration as the right of referring the dispute to arbitration has become time barred and the learned Trial Judge ignoring this point of limitation has passed order referring the dispute to arbitration. It is well settled that any decision on the question of limitation has now become a judgment within the meaning of Clause 15 of the Letters Patent (see AIR 1981 SC 1786, paragraph 119). 24. That apart it appears question of jurisdiction of the learned Trial Judge has also been agitated as it is noticed that suit itself has been dismissed. According to the learned counsel for the appellant while referring the disputes to the arbitration the suit cannot be dismissed simply the Court has no jurisdiction while considering prayer for reference. We find this contention of learned counsel carries some force as the decision on question of jurisdiction is also a judgment within the meaning of Clause 15 of the Letters Patent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is passed before the suit filed by this defendant for specific performance is taken up for hearing obviously it would be rendered infructuous. Therefore, it is clear that the cause of action as against the defendants Nos. 1, 2, 3, 4a and 4b and the defendant No. 5 in the suit is so closely interlinked that the same cannot be dissected and with the exclusion of defendant No. 5 neither the suit can be maintained nor the arbitration proceedings can be proceeded with. In this connection the decision of the Supreme Court in case of Sukanya Holding Private Limited reported in (2003) 5 SCC 531 may be referred to. It is ruled in the said decision that where the suit is commenced in respect of the matter which falls partly within the arbitration agreement and partly outside and which involves parties some of whom are parties to the arbitration agreement while some are not so, section 8 is not attracted. As rightly submitted by the learned counsel for the appellant that Courts do not give countenance multiplicity of proceeding or bifurcation as, there might be possibility of inconsistent findings. The decision of the Arbitrator may conflict with the decision of the Court. In this connection ..... X X X X Extracts X X X X X X X X Extracts X X X X
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