Supreme Court of India : Civil Appeal No. 2506 of 2004
Judge(s): MARKANDEY KATJU ,ASOK KUMAR GANGULY
Date of Judgment: Wednesday, September 16, 2009
K.V.MOHANMMED ZAKIR Versus REGIONAL SPORTS CENTRE
We are of the view that the settled position in law is that Court should not substitute its own view for the view taken by the arbitrator while dealing with the proceedings for setting aside an award. It is equally well settled, where the arbitrator acts within jurisdiction, 'the reasonableness of the reasons' given by the arbitrator is not open to scrutiny by Courts. However, if the reasons are such as no person of ordinary prudence can ever approve of them or if the reasons are so 'outrageous in their defiance of logic' that they shock the conscience of the Court, then it is a different situation. And in an appropriate case the Court may interfere. However, the degree of such unreasonableness must be greater than the standard in a certiorari proceeding
Wednesday, September 23, 2009
Saturday, September 19, 2009
survival of arbitration agreement on termination of contract
Supreme Court of India CIVIL APPEAL NO.6399 of 2009
Judge(s): Tarun Chatterjee,R. M. Lodha
Date of Judgment: 18 September, 2009
THE B. MANAGER,M/S. MAGMA LEASING &FIN. LTD. & ANR Versus POTLURI MADHAVILATA & ANR.
The core question that falls to be determined in this appeal by special leave is : does the arbitration agreement survive for the purpose of resolution of disputes arising under or in connection with the contract even if its performance has come to an end on account of termination due to breach ?
The hire purchase agreement having been admittedly entered into between the parties and the disputes and differences have since arisen between them, we hold, as it must be, that the arbitration clause 22 survives for the purpose of their resolution although the contract has come to an end on account of its termination.
The next question, an incidental one, that arises for consideration is whether the trial court must refer the parties to arbitration under Section 8 of the Act, 1996.
Section 8 is in the form of legislative command to the court and once the pre-requisite conditions as aforestated are satisfied, the court must refer the parties to arbitration. As a matter of fact, on fulfillment of conditions of Section 8, no option is left to the court and the court has to refer the parties to arbitration.
Judge(s): Tarun Chatterjee,R. M. Lodha
Date of Judgment: 18 September, 2009
THE B. MANAGER,M/S. MAGMA LEASING &FIN. LTD. & ANR Versus POTLURI MADHAVILATA & ANR.
The core question that falls to be determined in this appeal by special leave is : does the arbitration agreement survive for the purpose of resolution of disputes arising under or in connection with the contract even if its performance has come to an end on account of termination due to breach ?
The hire purchase agreement having been admittedly entered into between the parties and the disputes and differences have since arisen between them, we hold, as it must be, that the arbitration clause 22 survives for the purpose of their resolution although the contract has come to an end on account of its termination.
The next question, an incidental one, that arises for consideration is whether the trial court must refer the parties to arbitration under Section 8 of the Act, 1996.
Section 8 is in the form of legislative command to the court and once the pre-requisite conditions as aforestated are satisfied, the court must refer the parties to arbitration. As a matter of fact, on fulfillment of conditions of Section 8, no option is left to the court and the court has to refer the parties to arbitration.
Thursday, September 17, 2009
Long pending of the matters in courts
Supreme Court of India
CIVIL APPEAL No. 6309 of 2009
Judge(s): MARKANDEY KATJU, ASOK KUMAR GANGULY
Date of Judgment: 16 September, 2009
BAJAJ AUTO LIMITED
Versus
TVS MOTOR COMPANY LIMITED
J U D G M E N T
MARKANDEY KATJU, J.
1. Leave granted.
2. This Appeal has been filed against the impugned order of the Division Bench of the High Court of Judicature at Madras dated 18.5.2009 in O.S.A. No. 92 of 2008.
3. It appears that a suit bearing No. C.S. No.1111 of 2007 had been filed by the appellant herein before the learned Single Judge of the Madras High Court alleging infringement of its patent No.195904 under the Indian Patents Act, 1973 ( for short 'the Act').
4. The learned Single Judge granted an interim injunction on 16th February, 2008.
5. Challenging the said interim order dated 16th February, 2008, an appeal was filed by the respondent-defendant before the Division Bench of the Madras High Court which allowed the appeal by the impugned order dated 18.5.2009.
6. Hence, this appeal before us by special leave.
7. It is evident that the suit is still pending before the learned Single Judge of the Madras High Court. We are unhappy that the matter has been pending in the High Court at the interlocutory stage for such a long time as the suit was filed in December, 2007 and yet even written statement has not been filed.
8. Recently, we have held in Special Leave Petition(C) No.21594 of 2009 decided on 07th September, 2009 in the case of M/s. Shree Vardhman Rice & Gen Mills vs. M/s Amar Singh Chawalwala as follows:
"...Without going into the merits of the controversy, we are of the opinion that the matters relating to trademarks, copyrights and patents should be finally decided very expeditiously by the Trial Court instead of merely granting or refusing to grant injunction. Experience shows that in the matters of trademarks, copyrights and patents, litigation is mainly fought between the parties about the temporary injunction and that goes on for years and years and the result is that the suit is hardly decided finally. This is not proper.
Proviso (a)to Order XVII Rule 1(2)C.P.C. states that when the hearing of the suit has commenced, it shall be continued from day-to-day until all the witnesses in attendance have been examined, unless the Court finds that, for exceptional reasons to be recorded by it the adjournment of the hearing beyond the following day is necessary. The Court should also observe clauses (b) to (e) of the said proviso.
In our opinion, in matters relating to trademarks, copyright and patents the proviso to Order XVII Rule 1(2) C.P.C. should be strictly complied with by all the Courts, and the hearing of the suit in such matters should proceed on day to day basis and the final judgment should be given normally within four months from the date of the filing of the suit."
9. As has been observed by us in the aforesaid case, experience has shown that in our country, suits relating to the matters of patents, trademarks and copyrights are pending for years and years and litigation is mainly fought between the parties about the temporary injunction. This is a very unsatisfactory state of affairs, and hence we had passed the above quoted order in the above-mentioned case to serve the ends of justice. We direct that the directions in the aforesaid order be carried out by all courts and tribunals in this country punctually and faithfully.
10. In the present case, although arguments were advanced at some length by the learned counsel for both the parties, we are of the opinion that instead of deciding the case at the interlocutory stage, the suit itself should be disposed of finally at a very early date.
11. Hence, without going into the merits of the controversy, we direct the respondent-defendant to file written statement in the suit, if not already filed, on or before the last date for closing of the Madras High Court for Dussehra holidays. We would request the learned Single Judge who is trying the suit to commence the hearing of the suit on the re-opening of the Madras High Court after Dussehra holidays and then carry it on a day to day basis. No adjournment whatsoever ordinarily will be granted and the suit shall be finally disposed of on or before 30th November, 2009.
12. The interim orders of this Court dated 08th June, 2009 and 31st August, 2009 are vacated and substituted by the following directions.
13. The respondent shall be entitled to sell its product but it shall maintain an accurate records/accounts of its all India and export sales.We are appointing a Receiver to whom the records of such sale shall be furnished every fortnight by the respondent and the same shall be signed and authenticated by a responsible officer of the respondent. A copy of the same shall be given to the appellant also. We are requesting the Hon'ble the Chief Justice of the Madras High Court to forthwith nominate a Receiver in the matter to whom the sale records/accounts will be submitted by the respondent fortnightly, and the Receiver will verify the said sale records/accounts and thereafter submit his Report to the learned Bench of Madras High Court where the suit is pending. A copy of the same will be sent to the parties also. This direction will continue till the pendency of the suit. The remuneration of the Receiver will be fixed by the Hon'ble Chief Justice.
14. We make it clear that we are not making any observations on the merits of the case. The learned Single Judge shall decide the suit without being influenced by this order or by any observations made in the impugned order of the Division Bench or in the order of the learned Single Judge granting temporary injunction in favour of the appellant herein.
15. The Secretary General of this Court is directed to send a copy of this judgment forthwith to the Registrar General of the Madras High Court who shall place the same before Hon'ble the Chief Justice for obtaining the appropriate directions.
16. Copy of this order be given to the parties today itself.
17. The Appeal is disposed of accordingly. No costs.
18. Leave granted.
19. In view of our judgment in Civil Appeal arising from S.L.P.(C) No.13933 of 2009, this appeal is also disposed of on the same terms. No costs.
CIVIL APPEAL No. 6309 of 2009
Judge(s): MARKANDEY KATJU, ASOK KUMAR GANGULY
Date of Judgment: 16 September, 2009
BAJAJ AUTO LIMITED
Versus
TVS MOTOR COMPANY LIMITED
J U D G M E N T
MARKANDEY KATJU, J.
1. Leave granted.
2. This Appeal has been filed against the impugned order of the Division Bench of the High Court of Judicature at Madras dated 18.5.2009 in O.S.A. No. 92 of 2008.
3. It appears that a suit bearing No. C.S. No.1111 of 2007 had been filed by the appellant herein before the learned Single Judge of the Madras High Court alleging infringement of its patent No.195904 under the Indian Patents Act, 1973 ( for short 'the Act').
4. The learned Single Judge granted an interim injunction on 16th February, 2008.
5. Challenging the said interim order dated 16th February, 2008, an appeal was filed by the respondent-defendant before the Division Bench of the Madras High Court which allowed the appeal by the impugned order dated 18.5.2009.
6. Hence, this appeal before us by special leave.
7. It is evident that the suit is still pending before the learned Single Judge of the Madras High Court. We are unhappy that the matter has been pending in the High Court at the interlocutory stage for such a long time as the suit was filed in December, 2007 and yet even written statement has not been filed.
8. Recently, we have held in Special Leave Petition(C) No.21594 of 2009 decided on 07th September, 2009 in the case of M/s. Shree Vardhman Rice & Gen Mills vs. M/s Amar Singh Chawalwala as follows:
"...Without going into the merits of the controversy, we are of the opinion that the matters relating to trademarks, copyrights and patents should be finally decided very expeditiously by the Trial Court instead of merely granting or refusing to grant injunction. Experience shows that in the matters of trademarks, copyrights and patents, litigation is mainly fought between the parties about the temporary injunction and that goes on for years and years and the result is that the suit is hardly decided finally. This is not proper.
Proviso (a)to Order XVII Rule 1(2)C.P.C. states that when the hearing of the suit has commenced, it shall be continued from day-to-day until all the witnesses in attendance have been examined, unless the Court finds that, for exceptional reasons to be recorded by it the adjournment of the hearing beyond the following day is necessary. The Court should also observe clauses (b) to (e) of the said proviso.
In our opinion, in matters relating to trademarks, copyright and patents the proviso to Order XVII Rule 1(2) C.P.C. should be strictly complied with by all the Courts, and the hearing of the suit in such matters should proceed on day to day basis and the final judgment should be given normally within four months from the date of the filing of the suit."
9. As has been observed by us in the aforesaid case, experience has shown that in our country, suits relating to the matters of patents, trademarks and copyrights are pending for years and years and litigation is mainly fought between the parties about the temporary injunction. This is a very unsatisfactory state of affairs, and hence we had passed the above quoted order in the above-mentioned case to serve the ends of justice. We direct that the directions in the aforesaid order be carried out by all courts and tribunals in this country punctually and faithfully.
10. In the present case, although arguments were advanced at some length by the learned counsel for both the parties, we are of the opinion that instead of deciding the case at the interlocutory stage, the suit itself should be disposed of finally at a very early date.
11. Hence, without going into the merits of the controversy, we direct the respondent-defendant to file written statement in the suit, if not already filed, on or before the last date for closing of the Madras High Court for Dussehra holidays. We would request the learned Single Judge who is trying the suit to commence the hearing of the suit on the re-opening of the Madras High Court after Dussehra holidays and then carry it on a day to day basis. No adjournment whatsoever ordinarily will be granted and the suit shall be finally disposed of on or before 30th November, 2009.
12. The interim orders of this Court dated 08th June, 2009 and 31st August, 2009 are vacated and substituted by the following directions.
13. The respondent shall be entitled to sell its product but it shall maintain an accurate records/accounts of its all India and export sales.We are appointing a Receiver to whom the records of such sale shall be furnished every fortnight by the respondent and the same shall be signed and authenticated by a responsible officer of the respondent. A copy of the same shall be given to the appellant also. We are requesting the Hon'ble the Chief Justice of the Madras High Court to forthwith nominate a Receiver in the matter to whom the sale records/accounts will be submitted by the respondent fortnightly, and the Receiver will verify the said sale records/accounts and thereafter submit his Report to the learned Bench of Madras High Court where the suit is pending. A copy of the same will be sent to the parties also. This direction will continue till the pendency of the suit. The remuneration of the Receiver will be fixed by the Hon'ble Chief Justice.
14. We make it clear that we are not making any observations on the merits of the case. The learned Single Judge shall decide the suit without being influenced by this order or by any observations made in the impugned order of the Division Bench or in the order of the learned Single Judge granting temporary injunction in favour of the appellant herein.
15. The Secretary General of this Court is directed to send a copy of this judgment forthwith to the Registrar General of the Madras High Court who shall place the same before Hon'ble the Chief Justice for obtaining the appropriate directions.
16. Copy of this order be given to the parties today itself.
17. The Appeal is disposed of accordingly. No costs.
18. Leave granted.
19. In view of our judgment in Civil Appeal arising from S.L.P.(C) No.13933 of 2009, this appeal is also disposed of on the same terms. No costs.
Tuesday, September 15, 2009
the special law overrides the general law
Supreme Court of India
Judge(s): MARKANDEY KATJU, ASOK KUMAR GANGULY
Date of Judgment: Tuesday, September 01, 2009
GENERAL MANAGER, TELECOM versus M. KRISHNAN & ANR.
O R D E R
Heard learned counsel for the appellant.
No one appears for the respondents although they had been served.
This appeal is directed against the Full Bench judgment and order dated 14.02.2003 of the High Court of Kerala at Ernakulam whereby the Writ Appeal filed by the appellant herein has been dismissed.
The dispute in this case was regarding non-payment of telephone bill for the telephone connection provided to the respondent No. 1 and for the said non-payment of the bill the telephone connection was disconnected. Aggrieved against the said disconnection, the respondent No. 1 filed a complaint before the District Consumer Disputes Redressal Forum, Kozhikode. By order dated 26.11.2001, the Consumer Forum allowed the complaint and directed the appellant herein to re-connect the telephone connection to the respondent No. 1 and pay compensation of Rs. 5,000/- with interest @ 12% per annum from the date of filing of the complaint.
Aggrieved against the order of the Consumer Forum, the appellant filed a writ petition before the High Court of Kerala challenging the jurisdiction of the consumer forum. A learned Single Judge of the High Court dismissed the writ petition. Thereafter, the appellant filed a Writ Appeal before the Division Bench of the High Court. The Division Bench felt that the matter required consideration by a larger Bench and hence the matter was placed before the Full Bench. By the impugned order the Full Bench of the High Court has dismissed the writ appeal. Hence, the appellant is before us by way of present appeal by special leave.
In our opinion when there is a special remedy provided in Section 7-B of the Indian Telegraph Act regarding disputes in respect of telephone bills, then the remedy under the Consumer Protection Act is by implication barred. Section 7-B of the Telegraph Act reads as under:-
"S. 7B Arbitration of Disputes:-
(1) Except as otherwise expressly provided in this Act, if any dispute concerning any telegraph line, appliance or apparatus arises between the telegraph authority and the person or whose benefit the line, appliance or apparatus is, or has been provided, the dispute shall be determined by arbitration and shall, for the purpose of such determination, be referred to an arbitrator appointed by the Central Government either specifically for the determination of that dispute or generally for the determination of disputes under this Section.
(2) The award of the arbitrator appointed under sub-s. (1) shall be conclusive between the parties to the dispute and shall not be questioned in any Court."
Rule 413 of the Telegraph Rules provides that all services relating to telephone are subject to Telegraph Rules. A telephone connection can be disconnected by the Telegraph Authority for default of payment under Rule 443 of the Rules.
It is well settled that the special law overrides the general law. Hence, in our opinion the High Court was not correct in its approach.
In Chairman, Thiruvalluvar Transport Corporation Vs. Consumer Protection Council (1995) 2 SCC 479 it was held that the National Commission has no jurisdiction to adjudicate upon claims for compensation arising out of motor vehicles accidents. We agree with the view taken in the aforesaid judgment.
In view of the above, we allow this appeal, set aside the impugned judgment and order of the High Court as well as the order of the District Consumer Forum dated 26.11s.2001.
Appeal allowed. No order as to the costs.
Judge(s): MARKANDEY KATJU, ASOK KUMAR GANGULY
Date of Judgment: Tuesday, September 01, 2009
GENERAL MANAGER, TELECOM versus M. KRISHNAN & ANR.
O R D E R
Heard learned counsel for the appellant.
No one appears for the respondents although they had been served.
This appeal is directed against the Full Bench judgment and order dated 14.02.2003 of the High Court of Kerala at Ernakulam whereby the Writ Appeal filed by the appellant herein has been dismissed.
The dispute in this case was regarding non-payment of telephone bill for the telephone connection provided to the respondent No. 1 and for the said non-payment of the bill the telephone connection was disconnected. Aggrieved against the said disconnection, the respondent No. 1 filed a complaint before the District Consumer Disputes Redressal Forum, Kozhikode. By order dated 26.11.2001, the Consumer Forum allowed the complaint and directed the appellant herein to re-connect the telephone connection to the respondent No. 1 and pay compensation of Rs. 5,000/- with interest @ 12% per annum from the date of filing of the complaint.
Aggrieved against the order of the Consumer Forum, the appellant filed a writ petition before the High Court of Kerala challenging the jurisdiction of the consumer forum. A learned Single Judge of the High Court dismissed the writ petition. Thereafter, the appellant filed a Writ Appeal before the Division Bench of the High Court. The Division Bench felt that the matter required consideration by a larger Bench and hence the matter was placed before the Full Bench. By the impugned order the Full Bench of the High Court has dismissed the writ appeal. Hence, the appellant is before us by way of present appeal by special leave.
In our opinion when there is a special remedy provided in Section 7-B of the Indian Telegraph Act regarding disputes in respect of telephone bills, then the remedy under the Consumer Protection Act is by implication barred. Section 7-B of the Telegraph Act reads as under:-
"S. 7B Arbitration of Disputes:-
(1) Except as otherwise expressly provided in this Act, if any dispute concerning any telegraph line, appliance or apparatus arises between the telegraph authority and the person or whose benefit the line, appliance or apparatus is, or has been provided, the dispute shall be determined by arbitration and shall, for the purpose of such determination, be referred to an arbitrator appointed by the Central Government either specifically for the determination of that dispute or generally for the determination of disputes under this Section.
(2) The award of the arbitrator appointed under sub-s. (1) shall be conclusive between the parties to the dispute and shall not be questioned in any Court."
Rule 413 of the Telegraph Rules provides that all services relating to telephone are subject to Telegraph Rules. A telephone connection can be disconnected by the Telegraph Authority for default of payment under Rule 443 of the Rules.
It is well settled that the special law overrides the general law. Hence, in our opinion the High Court was not correct in its approach.
In Chairman, Thiruvalluvar Transport Corporation Vs. Consumer Protection Council (1995) 2 SCC 479 it was held that the National Commission has no jurisdiction to adjudicate upon claims for compensation arising out of motor vehicles accidents. We agree with the view taken in the aforesaid judgment.
In view of the above, we allow this appeal, set aside the impugned judgment and order of the High Court as well as the order of the District Consumer Forum dated 26.11s.2001.
Appeal allowed. No order as to the costs.
Latest on Territorial jurisdiction
IN THE SUPREME COURT OF INDIA : CIVIL ORIGINAL JURISDICTION
TRANSFER PETITION (CIVIL) NO.78 OF 2009
Balaji Coke Industry Pvt. Ltd. Vs.M/s Maa Bhagwati Coke (Guj) Pvt. Ltd.
Dated : 09.09.2009
In the instant case, the parties had knowingly and voluntarily agreed that the contract arising out of the High Seas Sale Agreement would be subject to Kolkata jurisdiction and even if the courts in Gujarat also had jurisdiction to entertain any action arising out of the agreement, it has to be held that the agreement to have the disputes decided in Kolkata by an Arbitrator in Kolkata, West Bengal, was valid and the Respondent- Company had wrongly chosen to file its application under Section 9 of the Arbitration and Conciliation Act before the Bhavnagar Court (Gujarat) in violation of such agreement. The decisions of this Court in A.B.C. Laminart (P) Ltd. (supra) as also Hakam Singh (supra) are very clear on the point.
TRANSFER PETITION (CIVIL) NO.78 OF 2009
Balaji Coke Industry Pvt. Ltd. Vs.M/s Maa Bhagwati Coke (Guj) Pvt. Ltd.
Dated : 09.09.2009
In the instant case, the parties had knowingly and voluntarily agreed that the contract arising out of the High Seas Sale Agreement would be subject to Kolkata jurisdiction and even if the courts in Gujarat also had jurisdiction to entertain any action arising out of the agreement, it has to be held that the agreement to have the disputes decided in Kolkata by an Arbitrator in Kolkata, West Bengal, was valid and the Respondent- Company had wrongly chosen to file its application under Section 9 of the Arbitration and Conciliation Act before the Bhavnagar Court (Gujarat) in violation of such agreement. The decisions of this Court in A.B.C. Laminart (P) Ltd. (supra) as also Hakam Singh (supra) are very clear on the point.
Saturday, September 12, 2009
Power of the court u/s 9 of A &C Act 1996 & Legal position of show cause notice
OMP 538/08
IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Reserve: August 27, 2009 Date of Order: September 02, 2009
R.P.S. EDUCATIONAL SOCIETY(REGD.) versus DELHI DEVELOPMENT AUTHORITY
However, an order under Section 9 of the Arbitration and Conciliation act cannot be passed by the Court directing specific performance of the contract, the breach of which is alleged by the petitioner. This Court in Excel Generators Pvt. Ltd. Vs. IJM Corporation Berhad OMP No. 241/09(decided on 13th May, 2009) had observed that where a contract is terminable contract and it can be foreclosed, the interim relief under Section 9 of the Arbitration and Conciliation Act cannot be granted for specific performance of the contract. In all those cases where monetary damages can compensate the breach of contract, the Court cannot insist upon the parties that the contract should be specifically performed. 6. Termination of the contract is one of the facets of the commercial law and if a party is aggrieved that the contract was wrongly terminated, the remedy lies in claiming damages. The party cannot insist that the contract should be specifically performed and it should be restored to the position prior to the breach of the contract. Even otherwise it is settled law that show-cause notice cannot be stayed by a Court. Giving show-cause notice amounts to giving an opportunity to the party to explain the breaches. Serving show-cause notice is a right of the party and the Court cannot interfere in serving show-cause notice and cannot say that the department should not ask the contracting party to explain its action. It is also settled law that the Court cannot write a new contract or revalidate a contract for the parties, if the contract is already terminated. The Court cannot thrust a contract upon the party under Section 9 of the Arbitration and Conciliation Act and ask that the contract should be restored. I find no force in the petition.
SHIV NARAYAN DHINGRA
IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Reserve: August 27, 2009 Date of Order: September 02, 2009
R.P.S. EDUCATIONAL SOCIETY(REGD.) versus DELHI DEVELOPMENT AUTHORITY
However, an order under Section 9 of the Arbitration and Conciliation act cannot be passed by the Court directing specific performance of the contract, the breach of which is alleged by the petitioner. This Court in Excel Generators Pvt. Ltd. Vs. IJM Corporation Berhad OMP No. 241/09(decided on 13th May, 2009) had observed that where a contract is terminable contract and it can be foreclosed, the interim relief under Section 9 of the Arbitration and Conciliation Act cannot be granted for specific performance of the contract. In all those cases where monetary damages can compensate the breach of contract, the Court cannot insist upon the parties that the contract should be specifically performed. 6. Termination of the contract is one of the facets of the commercial law and if a party is aggrieved that the contract was wrongly terminated, the remedy lies in claiming damages. The party cannot insist that the contract should be specifically performed and it should be restored to the position prior to the breach of the contract. Even otherwise it is settled law that show-cause notice cannot be stayed by a Court. Giving show-cause notice amounts to giving an opportunity to the party to explain the breaches. Serving show-cause notice is a right of the party and the Court cannot interfere in serving show-cause notice and cannot say that the department should not ask the contracting party to explain its action. It is also settled law that the Court cannot write a new contract or revalidate a contract for the parties, if the contract is already terminated. The Court cannot thrust a contract upon the party under Section 9 of the Arbitration and Conciliation Act and ask that the contract should be restored. I find no force in the petition.
SHIV NARAYAN DHINGRA
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