Indus Towers Limited Havings Its ... vs Sow. Ashatai Bapurao Kagne
2015 Latest Caselaw 545 Bom

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              IN THE HIGH COURT OF JUDICATURE AT BOMBAY

                         BENCH AT AURANGABAD                                          




                                                 
                       
                     CIVIL REVISION APPLICATION NO.134/2015




                                                
                      Indus Towers Limited,
                      a Company incorporated under the
                      Companies Act I of 1956 having its
                      Branch Office situate at 501 & 504,
                      5th Floor, Pentagon-1, Magarpatta




                                       
                      Cyber City, Hadapsar, Pune,
                      Maharashtra - 411 028.
                                  
                      Through its authorized signatory,
                      Ramesh Eknath Salvekar,
                      age 50 yrs., occu.service.           
                                 
                                         ...Petitioner..
                             Versus

                      Sow.Ashatai w/o Bapurao Kagne,
      

                      age 32 yrs., occu.business,
                      Proprietor of OM Telecom Services,
   



                      Office Address - Indu-Ganga Arcade,
                      Plot No.1, N-2, Cidco, Aurangabad. 
                                         ...Respondent... 
                                                          
                              .....





    Shri Sachin S. Deshmukh, Advocate for petitioner.
    Shri S.V. Mundhe, Advocate for respondent. 
                              .....
      
                                CORAM: T.V. NALAWADE, J. 

DATE: 18.11.2015

ORAL JUDGMENT :

1] Rule. Rule made returnable forthwith. By

consent, heard both the sides for final disposal of the

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revision application.

2] Present proceedings are filed to challenge the

order dated 10.12.2013 made on Exhibit 9 in Special Civil

Suit No.349/2012 by learned VIth Joint Civil Judge,

Senior Division, Aurangabad. The application at Exhibit

9 was filed by present petitioner - defendant under the

provision of Order VII Rule 10 of the Code of Civil

Procedure and he had prayed for return of the plaint.

The said application is rejected by the learned trial

Court.

3] The suit is filed in respect of the amount,

which is due to plaintiff from defendant in respect of

supply of diesel. It is the case of the plaintiff that

as per the purchase order dated 23.7.2008, the plaintiff

had supplied diesel during contract period to the

defendant, but only some amount is paid by the defendant

and the suit amount is still outstanding against the

defendant. It is contended that even after making of

demand of this amount by the plaintiff, the defendant has

not made payment and so the suit is required to be filed.

4] By filing application at Exhibit 9, the

defendant contended that there is arbitration clause in

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the agreement, which was entered into by the parties and

in view of that agreement, the matter needs to be

referred to Arbitrator and the matter is not tenable in

Civil Court.

5] The trial Court has observed that the document

of contract does not show that the plaintiff had

consented to refer the dispute to Arbitrator as there is

no signature of the plaintiff on the so called written

agreement.

6] In the plaint paragraph no.3, the plaintiff has

made a mention that on the basis of purchase order, the

supply of diesel was made by her. The contents of this

paragraph further show that alongwith the purchase order,

there was annexure like 'A' sent by the defendant to the

plaintiff. Alongwith the plaint, the plaintiff has

produced copy of the purchase order and first page of

Annexure 'A'. The purchase order shows that there was

verbal talk between the parties and on that basis, the

purchase order was sent by the defendant. In the

purchase order, the terms and conditions of the contract

are mentioned and they include the particulars like rate

of the diesel, the quantity and the period during which

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the diesel was to be supplied. The payment in respect of

the supply was to be made after the delivery. The

general terms and conditions of the contract are

appearing on the purchase order and there is also mention

that the terms and conditions quoted in Annexure 'A' are

also the terms and conditions of the contract.

7] Clause 16 of Annexure 'A' contains the

arbitration clause and it runs as under:-

"16. DISPUTES / ARBITRATION

In the event of any dispute arising between the two Parties relating to the various terms and conditions set forth in the contract, the two

Parties undertake to resolve the differences by

mutual consultation. In the event of their inability to resolve the disputes, all questions, disputes and differences arising under or in

relation to this Agreement shall be referred to two Arbitrators. Each Party to appoint his own Arbitrator by giving notice to other Party. Two appointed Arbitrators with the consent of each

other will appoint the third Arbitrator. The award of the Arbitrators so appointed shall be final, conclusive and binding on all the Parties to the Agreement and provisions of the Arbitration & Conciliation Act, 1996 or any statutory modification or re-enactment thereof and the Rules made thereunder and for the time

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being in force shall apply to the arbitration

proceedings under this clause. Venue of the arbitration shall be at Mumbai."

8] At Clause 13 of Annexure 'A', there is a mention

about the documents, which can be referred to ascertain

the terms and conditions of contract and Clause 13 runs

as under:-

"13. ENTIRE AGREEMENT

This Agreement and the Schedule and Annexure

hereto constitute the entire understanding between the parties concerning the subject matter hereof and supercede all prior discussions,

agreements and representations, whether oral or

written and whether or not executed by and between the parties."

9] Learned counsel for the respondent - plaintiff

submitted that only the first page of Annexure 'A" was

sent by the defendant alongwith the purchase order and so

it cannot be said that there was agreement between the

parties to refer such dispute to Arbitral Tribunal. This

contention is not acceptable. Even Clause No.1.1(d)

appearing on first page of Annexure 'A" is not complete.

It does not look viable that without ascertaining the

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terms and conditions of the contract, the plaintiff had

made supply of the diesel when the amount was to be paid

after the delivery. It needs to be presumed for the

present purpose that only after going through all the

terms and conditions of the contract, the supply was made

by the plaintiff.

10] Learned counsel for the respondent - plaintiff

further submitted that in view of Section 7 of the

Arbitration and Conciliation Act, 1996, unless and until

the written document is signed by both the sides,

arbitration agreement cannot come into existence. This

proposition is not at all acceptable. The provision of

Section 7 of the Arbitration and Conciliation Act, 1996,

is as under:-

"7. Arbitration agreement -

(1) In this Part, "arbitration agreement" means an agreement by the parties to submit to arbitration all or certain disputes which have

arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not.

(2) An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement. (3) An arbitration agreement shall be in

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writing.

(4) An arbitration agreement is in writing if it is contained in-

(a) a document signed by the parties;

(b) an exchange of letters, telex, telegrams or other means of telecommunication which provide

a record of the agreement; or

(c) an exchange of statements of claim and defence in which the existence of the agreement

is alleged by one party and not denied by the

other.

(5) The reference in a contract to a document

containing an arbitration clause constitutes an arbitration agreement if the contract is in writing and the reference is such as to make

that arbitration clause part of the contract."

11] Section 7(1) of the Act gives the meaning of

arbitration agreement. In Section 7(2), it is mentioned

that arbitration agreement may be in the form of a clause

in the contract itself or it may be in a separate form or

a separate agreement. Section 7(3) shows that arbitration

agreement needs to be in writing. Thus, it can be said

that in Section 7(3), it is made clear that arbitration

agreement should be in writing but this sub-section does

not show that unless and until it is signed by both the

sides, the agreement will not come into existence.

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Section 7(4) gives the meaning of written agreement.

Sub-section 4(a) shows that it can be inferred that it is

an written agreement if a document is signed by the

parties. Sub-section 4(b) shows that written agreement

can come into existence by exchange of letter, telex,

telegrams or other means of telecommunication which

provide a record of the agreement. Sub-section 4(c)

shows that arbitration agreement can come into existence

by exchange of statements of claim and defence also.

Thus, when the purchase order is placed, as in the

present case, the matter will fall u/s 7(4)(b). This

sub-section does not show that there needs to be

signature of other party. In the present matter, written

order like purchase order was given by the defendant to

the plaintiff and the order provided that it was upto the

plaintiff either to accept or not to accept this

proposal. As the supply was made by the plaintiff as per

this order and there is specific admission in that regard

in the plaint, it needs to be presumed that the offer

given by the defendant was accepted by the plaintiff and

this acceptance was for all the terms and conditions of

the contract. It is already observed that the terms and

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conditions of the contract can be found in the purchase

order and in Annexure 'A'.

12] The aforesaid position of law and facts and

circumstances of present case show that the trial Court

has committed error in observing that signature of the

plaintiff was necessary on this document and as signature

is not there, there was no agreement to refer the dispute

to arbitrator. This objection was taken prior to filing

of written statement as provided in Section 8 of the

Arbitration and Conciliation Act, 1996 by the defendant.

In view of these circumstances, it is necessary for the

parties to refer the dispute to Arbitral Tribunal as

provided in the aforesaid clauses of the contract. It is

not possible for Civil Court to directly refer the matter

to arbitrator as the procedure as laid down in the

aforesaid clauses need to be followed by the parties to

the contract. Thus, there is no other alternative than

to return the plaint for referring the matter to

arbitrator.

13] The learned counsel for the respondent -

plaintiff placed reliance on Karam Chand Thapar & Bros.

(Cs) v. Akaljot Singh Sekhom reported at 2005 (3)

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Mh.L.J., 797. The facts and circumstances of this case

are altogether different. This case is of no help to the

respondent - plaintiff.

14] In the result, the civil revision application is

allowed. The order dated 10.12.2013 made on Exhibit 9 in

Special Civil Suit No.349/2012 by learned VIth Joint

Civil Judge, Senior Division, Aurangabad, is hereby set

aside. The application filed at Exhibit 9 by the

defendant is hereby allowed. The plaint be returned to

the plaintiff for following the procedure for appointment

of Arbitral Tribunal.

(T.V. NALAWADE, J.)

ndk/c18111540.doc