M/S National Agricultural ... vs M/S Roj Enterprises (P) Ltd. & Ors.
2009 Latest Caselaw 3546 Del

 *        IN THE HIGH COURT OF DELHI AT NEW DELHI

                                     Date of Reserve: July 23, 2009
                                 Date of Order: September 03, 2009
+ OMP No.21/2009
%                                               03.09.2009
    M/S NATIONAL AGRICULTURAL COOPERATIVE
    MARKETING FEDERATION OF INDIA LTD.(NAFED)
                                                ... Petitioner
              Through : Mr. A.K. Singh with Ms. Gitanjli Suraj
                        & Mr. S.K. Singh, Advocates

     Versus

     M/S ROJ ENTERPRISES (P) LTD & ORS. .... Respondents
               Through: Mr. Krishnam Venugopal with
                        Mr. Abir Phukan, Advocates

     JUSTICE SHIV NARAYAN DHINGRA

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

2.   To be referred to the reporter or not?

3.   Whether judgment should be reported in Digest?

     ORDER

1. By this application under Section 9 of the Arbitration and

Conciliation Act, petitioner has sought an injunction against

respondents no. 1 and 2 restraining them from selling, alienating,

transferring or creating third party interest in property no. A-8,

Saket, 45/1+2/A, Karve Nagar, Opposite Patwardhan Baug, Pune

and property of respondent no. 2 bearing house no. R-II, 8/8A,

Swapna Nagar, Pune, Maharashtra. The petitioner has submitted

that the petitioner and respondent had signed an agreement dated

23rd March, 2004 which was followed by a subsequent agreement

dated 30th April, 2004 whereunder the petitioner had advanced a

loan/financial assistance of Rs.21.02 crores to the respondent and

the respondent committed breach of the agreement by not adhering

to the terms of the agreement and an arbitral dispute had arisen

within the terms of Clause 13 of the agreement dated 24 th March,

2004 which the petitioner has invoked and the petitioner is claiming

interim relief under this petition.

2. The respondent in reply has stated that this Court has

no jurisdiction to entertain the petition since the material agreement

between the parties was dated 30th April, 2004. The MOU signed

between the parties on 28th March, 2004 in Delhi was followed by

the agreement dated 30th April, 2004 and it was this agreement

under which the financial assistance was given to the respondent

and parties acted and proceeded on the basis of this agreement.

MOU had become irrelevant. The agreement dated 30 th April, 2004

was signed at Pune. The financial assistance was given to the

respondent at Pune. The entire cause of action had taken place at

Pune and in view of Section 2(1)(e) of the Arbitration and

Conciliation Act, the petition under Section 9 was not maintainable

before this Court. It is also submitted that the respondent had filed

the petition under Section 9 before the District Judge, Pune, seeking

certain interim reliefs against the petitioner. The petitioner had filed

reply to that petition of the respondent and in view of Section 42 of

the Arbitration and Conciliation Act, the Court in Pune alone would

have the jurisdiction to entertain the subsequent petition.

3. It is not disputed that the initial MOU dated 28th March,

2004 executed between the parties was succeeded by a specific

agreement dated 30th April, 2004 executed at Pune between the

petitioner and the respondent and under this agreement, the

petitioner had agreed to finance the purchases made by the

respondent. The agreement contains detailed terms and conditions

of these finances. It is also not disputed that the money was

provided under this agreement to the respondent at Pune. No doubt

the arbitration clause even in the agreement dated 30th April, 2004

provides that in case of any dispute and differences between the

parties, the same shall be referred to Indian Arbitration Council in

New Delhi. However, a petition under Section 9 is maintainable

before a Court as defined under Section 2(1)(e) and as per Section

2(1)(e) only that Court can entertain an application under Section 9

if all the facts stated in the application were considered as facts of

the suit, the suit had been maintainable before the Court. In this

case the agreement was executed at Pune, the respondent is based

at Pune, the finance was provided to the respondent at Pune, the

breach of the agreement had taken place at Pune and the

attachment of property situated in Maharashtra is sought, thus the

entire cause of action in this case had taken place in Pune. Even if a

fraction of cause of action has taken place in Delhi, the Court of

jurisdiction under Section 2(1)(e) would be the Court at Pune and

the Court at Delhi is not the proper Court for entertaining the

application under Section 9 of the Arbitration and Conciliation Act.

4. It is also not disputed that the respondent had filed an

application under Section 9 before the District Judge at Pune on 29 th

August, 2008 much prior to the present application and this

application was entertained by the Court at Pune. It is also not

disputed that because of the dishonour of the cheque issued by the

respondent, the petitioner initiated proceedings against the

respondent under Section 138 of the Negotiable Instruments Act

before Judicial Magistrate Ist Class of Pune. Under these

circumstances, I consider that in view of Section 42 of the

Arbitration and Conciliation Act, 1996 only the Court at Pune would

have jurisdiction to entertain this petition and the Court at Delhi is

not the Court of competent jurisdiction. This petition under Section

9 is therefore hereby dismissed for want of jurisdiction. The

petitioner however, would be at liberty to prefer an appropriate

petition before the Court at Pune.

September 03, 2009                         SHIV NARAYAN DHINGRA J.
ak