Delhi Express Travels Pvt. Ltd. vs International Air Transport ...
2009 Latest Caselaw 2303 Del

     *IN THE HIGH COURT OF DELHI AT NEW DELHI

+                    IA. No.13094/2007 in CS(OS) 1044/2007

%                                       Date of decision: 28.05.2009

DELHI EXPRESS TRAVELS PVT. LTD.                           ....... Plaintiff
                            Through: Mr. Pushkar Sood with Ms. Kanchan
                                     Bala, Advocates.

                                       Versus

INTERNATIONAL AIR TRANSPORT ASSOCIATION

& OTHERS                                                  ...... Defendants

                            Through: Ms. Padma Priya, Advocate for the
                                     defendant No.1.
                                     Mr. K.K. Tyagi, Advocate for defendant
                                     No.3.

CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1.     Whether reporters of Local papers may
       be allowed to see the judgment?   Yes

2.     To be referred to the reporter or not? Yes

3.     Whether the judgment should be reported
       in the Digest? Yes


RAJIV SAHAI ENDLAW, J.

1. Application of the defendant No.1 under Section 8 of the

Arbitration and Conciliation Act, 1996 is for consideration.

2. The plaintiff has instituted the suit for i) recovery of

Rs.30,35,752/- and for ii) rendition of accounts from the defendant

No.1 (IATA) and for iii) mandatory injunction directing the defendant

No.1 to invoke the insurance the insurance policy given by the

defendant No.3 United India Insurance Co. Ltd. in favour of the

defendant No.1 for recovery of any amounts alleged to be due by the

defendant No.1 from the defendant No.3 and for iv) permanent

injunction restraining the defendant No.1 from taking recourse to

any coercive or other method, civil or criminal, for recovering any

amount from the plaintiff pertaining to the transactions between the

plaintiff and the defendant No.1, till the true and proper accounts

are rendered by the defendant No.1 to the plaintiff.

3. The aforesaid would show that the reliefs are claimed by the

plaintiff against the defendant No.1 only. Besides the defendants

No.1&3, the Travel Agent Federation of India has been impleaded as

defendant No.2. The defendant No.2 on being served appeared

through advocate but has neither filed any written statement/replies

and also stopped appearing and was on 18th November, 2008

ordered to be proceeded against ex-parte and remains ex-parte.

4. The plaintiff was carrying on business as travel agent and was

the accredited travel agent of the defendant No.1. As per the

averments in the plaint, most of the Airlines of the world are

members of the defendant No.1 and airline ticketing/sale/payments

of tickets throughout the world are routed through the defendant

No.1; the defendant No.1 distributes the stocks of tickets to its

accredited agents and collects the fortnightly payments from the

such agents on behalf of Airlines and distributes the said collection

on account of fares to the airlines and the taxes to the to the

Government Departments. All adjustments on account of advance,

cancellation, incentives qua the travel agents are also pleaded to be

done/routed through the defendant No.1. The defendant No.1 is

pleaded to be a conduit and responsible for making payments to the

concerned airlines as well as the agents. The plaintiff claims to have

become accredited agent of the defendant No.1 vide Passengers

Sales Agency Agreement dated 12th December, 2001. Disputes and

differences are stated to have arisen between the plaintiff and

defendant No.1 with respect to the plaintiff‟s claims regarding

incentives, commission, extra advance, refund etc.

5. The defendant No.2 is stated to be a representative body of

Travel Agents in India and the plaintiff claims to be its member. The

defendant No.2 is pleaded to have arranged an insurance cover for

all its members including the plaintiff with the defendant No.3

Insurance Company so that the members of the defendant No.2 can

offset any loss caused to defendant No.1 on account of any alleged

act on their part through the Insurance Company. It is the plea of the

plaintiff that the defendant No.1 failed to settle the accounts with the

plaintiff; that as on 4th May, 2007 the plaintiff had to recover a sum

of Rs.30,35,752/- from various airlines/agencies; on the contrary the

defendant No.1 was claiming a sum of Rs.1,38,35,897/- to be due

from the plaintiff without rendering accounts to the plaintiff and

without giving due credit to the claims of the plaintiff; that the

defendant No.1 for the reason of its said claims against the plaintiff

threatened to cancel the agreement with the plaintiff; that during the

discussions the defendant No.1 represented that if the plaintiff hands

over to the defendant No.1 a cheque for 50% of the amount claimed,

it would settle the accounts and give due credits of the plaintiff‟s

claim before presenting the said cheque; the plaintiff claims to have

issued a cheque for Rs.65,55,742/- to the defendant No.1; that the

defendant No.1 after receiving the said cheque is pleaded to have

renegated on its assurance and without settling the accounts

presented the said cheque and which was dishonoured. It is the case

of the plaintiff that even if the sum of Rs. 1,38,35,897/- claimed by

the defendant No.1 is due from the plaintiff, the defendant No.1 is to

recover the said amount under the insurance policy issued by the

defendant No.3 instead of claiming the same from the plaintiff. The

plaintiff thus filed the suit aforesaid.

6. The defendant No.3 Insurance Company has filed the written

statement as well as IA No.5629/2007 under Order 1 Rule 10 of the

CPC for deletion of its name from the array of defendants. It is the

case of the defendant No.3 that it is neither necessary nor proper

party to the suit and no relief in law is possible directing the

defendant No.1 to take legal action against the defendant No.3, in as

much as it is the discretion of the defendant No.1 to either take

recourse against the plaintiff or the defendant No.3 and the

defendant No.1 cannot be compelled to initiate action against the

defendant No.3. The defendant No.3 otherwise admits issuing the

insurance policy at the instance of the plaintiff in favour of the

defendant No.1. The defendant No.3 has further pleaded that the

defendant No.1 has lodged a claim for Rs.1,38,35,897/- vide letter

dated 5th December, 2006 against the defendant No.3 and which

claim was stated to be under process. At another place in the

written statement the defendant No.3 has denied that the said sum is

covered by the insurance policy.

7. The defendant No.1 before filing its first statement of defence

in the suit has applied under Section 8 of the Arbitration Act, 1996

along with the copy of the Passenger Sales Agency Agreement dated

12th December, 2001, the Travel Agent‟s Handbook. The defendant

No.1 has also filed copy of letter dated 1st December, 2006 of the

defendant No.1 to the plaintiff terminating the said Passenger Sales

Agency Agreement and giving 30 days time to the plaintiff to appeal

to the Travel Agency Commissioner for review. The plaintiff has

contested the application under Section 8 and denied any Arbitration

Agreement. it is pleaded that the documents filed by the defendant

No.1 talk of right of arbitration if the agent as the plaintiff is/was,

considers itself aggrieved by the decision of the Travel Agency

Commissioner. It is further contended that the disputes, subject

matter of the suit are not covered by the matters on which the Travel

Agency Commissioner can take a decision.

8. I had inquired from the counsels whether there was any

precedent of a dispute concerning IATA (defendant No.1) or in which

the alleged arbitration agreement had been invoked. I was informed

there are none. It is also the contention of the plaintiff that the claim

of the plaintiff is not only against the defendant No.1 but also against

the defendant No.3, and the defendant No.2 is also a party to the suit

and thus the ambit of the suit was much wider than the Arbitration

Clause even if any and the third parties being parties to the suit, the

application under Section 8 is not maintainable. Reliance is placed

on the Sukanya Holdings Pvt. Ltd. Vs. Jayesh H. Pandya AIR

2003 SC 2252.

9. Though the matter was argued on the premise of the

Passenger Sales Agency Agreement aforesaid being between the

plaintiff and the defendant No.1 but post hearing on perusal of the

same I find that it is not so. The said agreement is between the

plaintiff and each member airlines of the defendant No.1, of course

represented by the Director General of the defendant No.1 (acting

not on behalf of the defendant No.1 but on behalf of the said member

airlines). Thus the agreement out of which agreement the disputes

are alleged to have arisen by the plaintiff and which agreement the

defendant No.1 has set up as containing an Arbitration Clause, is not

between the plaintiff and the defendant No.1 but between the

plaintiff and the Airlines who are members of defendant No.1 but

who are not parties to the suit. The defendant No.1 is a distinct legal

entity from its member Airlines. On finding so, at first blush it was

felt that suit as well as the application under Section 8 of the

Arbitration Act are misconceived in as much the defendant No.1 in

the matter of the said agreement was acting merely as the agent of

the airlines; the settled legal principle under Section 230 of the

Indian Contact Act being that an agent cannot personally be bound

by the contract entered into on behalf of the principal. Here the

agreement on the basis whereof the plaintiff is claiming and on the

basis whereof the defendant No.1 is pleading arbitration, having

been entered into by the defendant No.1 as the agent of the airlines,

the defendant No.1 can neither be personally liable to the plaintiff

under the said agreement nor can take advantage of the Arbitration

Agreement if any between the plaintiff and the airlines whose tickets

the plaintiff under the agreement had agreed to sell/market.

10. The aforesaid Passenger Sales Agency Agreement dated 12th

December, 2001 also refers to the Travel Agent‟s Handbook and

binds the parties to the agreement, thereto also.

11. However, on delving deeper into the aforesaid document, what

emerges is that IATA (defendant No.1) is an association of all/most of

the airlines of the world. The defendant No.1 has its Head Office at

Montreal - Geneva. The overall decision making authority of IATA

lies with the Passenger Agency Conference composed of senior

managers drawn from all member airlines of IATA. The said

Passenger Agency Conference adopts Resolutions by unanimous vote

which upon receipt of approval from concerned governments become

binding upon all IATA member airlines and their appointed agents.

The Passenger Agency Conference meets regularly once a year but

special meetings can be called at short notice to deal with issues

requiring immediate attention. IATA has some 49,000 travel agency

locations around the world and more than 260 airlines as members.

The day to day operation of IATA are handled by a local IATA Agency

Services Office (ASO), generally one for a country or for a group of

countries.

12. Under the Passenger Sales Agency Agreement aforesaid the

plaintiff was authorized to sell air passenger transportation services

of the carriers/airlines who are members of IATA; the plaintiff under

the said agreement is required to issue immediately a Traffic

Document when money is received by it for specified passenger air

transportation or ancillary services sold by it under the agreement

and the plaintiff is responsible for remittance to the airlines, of the

amount payable in respect of such traffic document. Under the said

agreement all monies collected by the plaintiff as accredited agent

for transportation and ancillary services sold under the agreement

including applicable remuneration to which the plaintiff is entitled,

are the property of the Airlines and to be held by the plaintiff in trust

and for and on behalf of the Airlines until satisfactorily accounted for

and settlement made. It is further a clause of the agreement that for

sale for air transportation and ancillary services by the plaintiff

under the agreement the Airlines shall remunerate the plaintiff in a

manner and amount as may be stated from time to time and

communicated to the plaintiff by the Airlines and such remuneration

shall constitute full compensation for the services rendered by the

plaintiff to the Airlines. Under the agreement, the responsibility of

maintenance of records and accounts is of the plaintiff and it is the

plaintiff who is liable for giving inspection thereof to the Airlines.

Clause 14 of the agreement concerns arbitration. It is as under:-

"14. Arbitration If any matter is reviewed by arbitration pursuant to the Sales Agency Rules, the agent hereby submits to arbitration in accordance with such rules and agrees to observe the procedures therein provided and to abide by any arbitration award made thereunder."

13. The agreement vide Clause 17 thereof is to be interpreted

and governed in all respects by the law of the principal place of

business of the plaintiff.

14. The Travel Agent‟s Handbook which is to be read as part of

the agreement aforesaid, under the head "The Travel Agency

Commissioner" informs that there are three such Commissioners

worldwide; "these ombudsmen have been serving the travel

industry"; they are appointed jointly by IATA and United

Federation of Travel Agents Association; to enable them to serve

impartially they are funded by the airlines and the travel agents;

their main function is to provide an accessible source of appeal

to an accredited agent aggrieved by a decision taken under the

Sales Agency Rules; it further provides that the Travel Agency

Commissioner‟s offices was created by the industry as a whole to

ensure that due process is afforded by IATA to all accredited

agents. It further provides that if the agent remains aggrieved by

the review decision of the Commissioner, access to further

possible relief is provided by recourse to arbitration.

15. Resolution 810d in the Handbook aforesaid governs the

relationship between airlines who are members of IATA and

accredited agents in India. Resolution 810i has adopted the

rules mentioned therein as applicable to the Passenger Sales

Agency Agreement in India. Section 5 thereof deals with custody

and issue of traffic documents and Section 10 with the conditions

for payment of commission and other remuneration. Section 13

deals with arbitration. Section 13.1 is as under:-

"13.1 Right to Arbitration Any agent or applicant which considers itself aggrieved by a decision of the Travel Agency Commissioner („The Commissioner‟) under Resolution 820e shall have the right to have the decision reviewed by arbitration in accordance with the following procedure (hereafter in this Section the term Appellant is used to designate both an aggrieved agent and an applicant seeking review by arbitration except where the context specifies otherwise)"

Section 13.2 provides for appellant from the decision of the

Travel Agency Commissioner sending written notice to the Agency

Administrator of its wish to have the decision reviewed by

arbitration. The Agency Administrator is to notify all members that

arbitration has been requested.

Section 13.3 deals with the setting up of arbitration board.

Section 13.5 concerns the conduct of proceedings and Section 13.6

provides the scope of appeal before the Arbitration Board and

Section 13.7 deals with the Award.

16. Resolution 820e deals with review by the Travel Agency

Commissioner. The Preamble thereof is as under:-

Resolved that as established under Resolution 820d, the

Travel Agency Commissioner (The Commissioner) shall

conduct reviews with respect to decisions affecting agents

and applicants in the countries where the Sales Agency

Rules apply (it being understood that the definition in

Resolution 866 apply to this Resolution) in accordance

with the following procedure:-

Section 1 - Review Initiated by Agent or Applicant

The Commissioner shall review and rule on cases initiated by:

1.1.1 any Person whose application to become an Accredited Agent has been disapproved by the Agency Administrator, or has been disapproved upon reconsideration;

1.1.2 an Agent whose application for approval of an additional location has been rejected by the Agency Administrator, or has been disapproved upon reconsideration;

1.1.3 any Person who has acquired ownership or is seeking to acquire ownership of an Agent or Location and whose application for change of ownership has been disapproved by the Agency Administrator, either on first consideration, or upon reconsideration;

1.1.4 an Agent who has received notice from the Agency Administrator of impending removal of the Agent or an Approved Location of the Agent from the Agency List, or of any action or impending action by the Agency Administrator with regard to the Agent, that unreasonably diminishes the Agent‟s ability to conduct business in a normal manner;

1.1.5 an Agent whose application for change of location and/or name has been disapproved by the Agency Administrator;

1.1.6 an Agent from whom stocks of Standard Traffic Documents and Carrier Identification Plates have been withdrawn by ISS Management, or its representative, pursuant to the Accounting Irregularity Safeguards provisions in Subparagraph 1.7.13.1(b) of Resolution 832;

       provided    that   any   review     initiated under   this
       subparagraph     shall   be    interlocutory  pending    a

redetermination of the eligibility of the Agent or the Location to be retained on the Agency List under Paragraph 1.3 of this Resolution;

1.1.7 an Agent who considers that its commercial survival is threatened by a Member‟s individual decision preventing it from acting as Agent for, or from issuing Traffic Documents on behalf of, such Member;

1.1.8 an Agent who is aggrieved by an impending amendment to its Passenger Sales Agency Agreement."

17. Though the agreement as aforesaid is between the plaintiff and

the airlines whose fares the plaintiff was selling under the said

agreement but considering the aforesaid nature of the agreement, it

contains an agreement contrary to the general principle under

Section 230 of the Contract Act i.e. of making IATA signing the

agreement as agent of the Airlines personally liable thereunder.

Section 230 also provides that a contract making the agent

personally liable shall be presumed to exist where the principal is a

resident abroad and/or where the principal though disclosed cannot

be sued. The agreement in the present case was with all the airlines

who were the members of IATA. Most of the said airlines are

resident abroad. Moreover the agreement is such that the principal

i.e. airlines cannot be sued thereunder in as much as the claim of the

plaintiff as made out is for accounts of the transaction of the plaintiff

with various airlines who were members of IATA. IATA an agent of

all the said airlines had been dealing with the plaintiff. No single

airline is in a position to settle accounts with the plaintiff as accounts

are of the cumulative transaction of the plaintiff with all the airlines.

Thus in my view the Passenger Sales Agreement though entered into

by defendant No.1 IATA as agent of its members airlines, binds IATA

itself and the plaintiff is competent to make claims for accounts and

monies against IATA and IATA is competent to take the plea of

Section 8 of the Arbitration Act.

18. The main contention of the counsel for the plaintiff is that the

arbitration under the agreement has been provided only against the

decision of the Travel Agency Commissioner; the Travel Agency

Commissioner is entitled to take a decision only on the matter

specified in Section 1 (Supra) of Resolution 820e in the Handbook

aforesaid and which does not contain any express power to take

decision on the matter of accounts.

19. However that in my view is not a correct reading of the

agreement. The Preamble of Resolution 820e provides that the

Travel Agency Commissioner shall conduct reviews with respect to

all decisions affecting agents. Such decisions would include the

decision of the Airlines acting through IATA claiming sum of

Rs.1,38,35,897/- being due from the plaintiff as well as the decision

declining the sum of Rs.30,35,752/- to be due from the Airlines

through IATA to the plaintiff. The plaintiff could certainly apply to

the Travel Agency Commissioner in this regard and if dis-satisfied

with the decision of the Travel Agency Commissioner, for arbitration

of such disputes. The language of Section 1.1.4 of Resolution 820e is

again very wide and covers any action or impending action by the

Agency Administrator with respect to the agent and which

unreasonably diminishes the agent ability to conduct business in a

normal manner. The action of the Agency Administrator claiming

Rs.1,38,35,897/- crore from the plaintiff and/or declining to pay the

claim of Rs.30,35,752/- of the plaintiff would certainly unreasonably

diminish the plaintiff‟s ability to conduct business in a normal

manner.

20. Even otherwise I find the relationship/transaction subject

matter of the suit to be of a specialized nature. The said

transaction/relationship is governed by norms/rules peculiar to the

business and which are not/may not be found in respect of any other

business. The agreement provides its own mechanism for resolution

of the disputes by experts from the field. The said experts are

competent/better equipped to resolve the said disputes

expeditiously. Having thus found the Agreement of Resolution of

disputes by arbitration, even otherwise Section 8 of the Arbitration

Act becomes applicable immediately.

21. The contention of the counsel for the plaintiff of the disputes

being not subject matter of arbitration for the reason of no decision

having been given by the Travel Agency Commissioner is also

misconceived. Merely because the agreement between the parties

provides for a precursor to the arbitration, arbitration cannot be

avoided on the ground of the pre requisite step having not been

taken. A party cannot be permitted to renegate out of the

Arbitration Agreement by contending that owing to its own default or

otherwise the precursor event to arbitration has not occurred. In the

present case it was open to the plaintiff to have applied to the Travel

Agency Commissioner for review of the decision of the Agency

Administrator with which the plaintiff was aggrieved. The plaintiff

having not done has itself to blame for not adopting the course

leading to arbitration and cannot maintain a suit on that basis. Even

otherwise the only requirement of Section 8 is that the subject

matter of the dispute brought before the court is the subject matter

of an arbitration. Once the court finds so, the court has no option but

to refer the parties to arbitration. The court is not to go into the

question whether the party which has applied under Section 8 of the

Act has been ready and willing to proceed with the arbitration or not.

That is one of the drastic changes made in the 1996 Act from the

1940 Act. Thus even if there had been a default of the Travel Agency

Commissioner not attributable to the plaintiff, the disputes raised by

the plaintiff against the defendant No.1 in the present suit would still

be governed by the Arbitration Agreement and hence this court has

no jurisdiction to entertain the suit.

22. The contention of the counsel for the plaintiff that the Travel

Agency Commissioner is concerned only with disputes as to

termination of the Passenger Sales Agency Agreement is not found

correct and is not borne out from the language of Resolution 820e

aforesaid.

23. The other contention of the counsel for the plaintiff is of

arbitration being not applicable for the reason of defendants No.2&3

who are not parties to the Arbitration Agreement also being parties

to the present suit. The counsel for the defendant No.1 has in this

regard relied upon W.P.I.L. Vs. NTPC Ltd. MANU/DE/0078/2009

laying down that where the non parties to the Arbitration Agreement

but parties to the suit are neither necessary nor proper for

adjudication of disputes, the law as laid down in Sukanya Holdings

would not be applicable. From the narrative facts given herein I am

of the opinion that the defendants No.2&3 are neither necessary nor

proper parties for adjudication of the accounts/claims of the plaintiff

qua the defendant No.1.

24. With respect to the defendant No.2, there is no averment in the

plaint save that as per the decision of the defendant No.2, the

plaintiff arranged the insurance policy from the defendant No.3 in

favour of the defendant No.1. The defendant No.3 Insurance

Company was impleaded only because the relief claimed was of

directing the defendant No.1 to claim its dues if any from the

defendant No.3. It is not as if the plaintiff has claimed any relief

against the defendant No.3 directing the defendant No.3 to release

any payments to the defendant No.1. In fact it is the case of the

plaintiff that on accounts being taken no monies would be found due

from the plaintiff to the defendant No.1 when according to the

plaintiff, no monies are due from plaintiff to defendant No.1 and on

the contrary Rs.30,35,752/- would be found due from the defendant

No.1 to the plaintiff, the question of the defendant No.3 being liable

to make any payment to the defendant No.1 would not arise. Even

otherwise I find merit in the contention of the defendant No.3 that

the plaintiff cannot compel defendant No.1 to make a claim against

the defendant No.3.

25. Thus the presence of the defendants No.2&3 in the suit is not

found to come in the way of allowing the application under Section 8

of the Arbitration Act.

26. The counsel for the defendant No.1 has also relied upon on a

recent dicta of the Apex court in VISA International Ltd. v.

Continental Resources (USA) Ltd. 2009 2 SCC 55 laying down

that the existence of a valid Arbitration Agreement should be

determined from the facts and circumstances of the case including

the intention of the parties covered from the correspondence

exchanged between them, surrounding circumstances and conduct

of the parties. It was further held that the agreement need not be in

any particular form and the use or absence of the word arbitration,

arbitrator or arbitrators or reference is immaterial. It was further

held that when the intention of the parties is to seek arbitration in

case of any further disputes is clear, then inartistic drafting of

arbitration clause cannot be taken advantage of by any party. The

Arbitration Agreement in the present case though not in the

normal/traditional form is nevertheless found to indicate an intention

of the parties to arbitrate. The reason for the inartistic language is

apparent. The Arbitration Agreement is in the form of Resolutions

passed in the Passenger Agency Conference of the Managers of

Airlines. The said managers are not used to astute legal drafting and

have in their own commercial way provided for Dispute Resolution

Mechanism by experts in the field of travel as also for arbitration.

The plaintiff by accrediting itself as an agent with IATA, bound itself

with the said agreement and cannot now be heard to contend

otherwise.

27. Having held so, the suit of the plaintiff against the defendant

No.1 cannot continue and under Section 8 the plaintiff and the

defendant No.1 are referred to arbitration.

28. That brings me to the continuance of the suit qua the

defendants No.2&3, once the disputes qua the defendants No.1 have

been referred to arbitrator. At this stage, it may be stated that vide

order dated 9th May, 2008 in the suit the defendant No.3 Insurance

Company was directed to place on record the status of the claim in

Rs.1,38,35,897/- made by the defendant No.1 on the defendant No.3.

It was informed on 18th November, 2008 that the defendant No.3 had

offered vide its letter dated 8th July, 2008 to pay a sum of

Rs.1,02,48,552/- to the defendant No.1 but the defendant No.1 had

not completed the requisite formalities. During the hearing it was

informed that the said amount already stands paid. Upon payment

thereof by the defendant No.3 to the defendant No.1 the balance

claim of the defendant No.1 of Rs.35,87,345/- remains. It was

informed by the counsel for the plaintiff that there was no

impediment to the payment thereof by the defendant No.3 also and

only certain formalities remained to be completed.

29. The only reason for the plaintiff to implead the defendant No.3

in the suit was to have a direction issued to the defendant No.1 to

recover its claims if any against the plaintiff from the defendant No.3

under the insurance policy aforesaid. It has transpired that

defendant No.1 in fact has made a claim with the defendant No.3.

Upon the said admission, the said relief of the plaintiff against the

defendant No.1 stands satisfied. The question of whether the

defendant No.3 under its policy is liable to make the payment of the

balance amount or not is not the subject matter of this suit and does

not fall for adjudication herein. Be that as it may, substantial

amounts under the policy have been informed to be paid and the

supervision of payment of balance amount and/or of adjudication

thereof is not to be done in the present suit.

30. On 18th November, 2008 it was ordered that the application of

the defendant No.3 for deletion from array of defendants shall be

considered while hearing this application. Though while hearing this

application, the counsel for the plaintiff or the defendant No.3 were

not called upon to expressly make submissions on this application

but since the entire gamut of the controversy has been discussed

herein above, it is not felt necessary to post the suit for hearing

separately of the application of the defendant No.3, particularly

when it was so ordered on 18th November, 2008. I thus find that in

view of the admitted position, the suit of the plaintiff qua the

defendants No. 2&3 also does not survive.

31. The suit is thus disposed of qua the defendant No.1 by

reference to arbitration and qua the defendants No.2 & 3 as not

disclosing any cause of action and also as satisfied in view of the

admission of the defendant No.3 of the defendant No.1 having

lodged a claim under the policy against the defendant No.3.

Decree sheet be drawn up.

In the fact of the case, the parties are left to bear their own

costs.

RAJIV SAHAI ENDLAW (JUDGE) May 28, 2009 PP