Cadre Estate Pvt Ltd. vs Salochna Goyal And Ors
2010 Latest Caselaw 4672 Del

       IN THE HIGH COURT OF DELHI AT NEW DELHI

              W.P.(C) 2782/2010 and C.M. No. 5556/2010 (Stay)

                                        Reserved on: 22nd September 2010
                                        Decision on : 05th October 2010

       CADRE ESTATE PVT LTD.                           ..... Petitioner
                    Through: Mr. Ramji Srinivasan, Senior Advocate
                    with Mr. Rajeev Saxena, Advocate.

                        versus

       SALOCHNA GOYAL AND ORS                         ..... Respondents
                   Through : Mr. A.K. Singla, Senior Advocate with
                   Ms. Priya Kumar, Advocate for R-1.
                   Mr. Rajiv Garg, Advocate for R-2.
                   Mr. S.K. Pruthi, Advocate for R-3.
                   Mr. Ankit Shah, Advocate for R-4.


       CORAM: JUSTICE S. MURALIDHAR

       1. Whether Reporters of local papers may be
            allowed to see the judgment?                             No
       2. To be referred to the Reporter or not?                     Yes
       3. Whether the judgment should be reported in Digest?          Yes

                                 JUDGMENT

05.10.2010

1. There are two questions that arise for consideration in this petition. The

first concerns the question of maintainability of this petition which challenges

the order dated 18th December 2009 of a learned Arbitrator in an application

filed by Respondent No.1 under Section 17 of the Arbitration and

Conciliation Act 1996 („AC Act‟). The second question, which arises if the

petition is held to be maintainable, is as to who is a proper party to an

arbitration proceedings?

Background Facts

2. This writ petition under Article 226 of the Constitution is by M/s Cadre

Estate Private Limited („CEPL‟) which claims to have purchased a property

bearing No. L-10, New Delhi South Extension Part-II, New Delhi

admeasuring 495 sq. yards („property in question‟) on 31st December, 2008

for a consideration of Rs.7.50 crores by virtue of a tripartite agreement

executed between the Petitioner, Shri Saroj Kumar Bagaria (`Bagaria‟)

Respondent No. 2 herein and the Punjab National Bank („PNB‟), Respondent

No. 3 herein in full and final settlement of the claims of PNB against

Respondent No. 2 under a One Time Settlement („OTS‟). The Petitioner

claims that after the payment of Rs.7.5 crores by the Petitioner on 31st

December 2008 directly to the PNB a sale deed was executed with regard to

the said property and duly registered in the office of Sub Registrar, Delhi.

Upon taking possession of the property, the Petitioner claims to have

commenced construction thereon. The Petitioner states that at that stage it

received notice in a petition OMP No. 168/2009 filed by Respondent No. 1

Smt. Salochna Goyal („Goyal‟) in this Court under Section 9 of the AC Act.

3. In OMP No. 168/2010, Goyal arrayed Bagaria, PNB, CEPL and M/s

Standard Chartered Bank („SCB‟), Respondent No. 4 herein, as party

respondents. In the said petition Goyal stated that she had entered into an

Agreement to Sell dated 30th September, 2008 with Bagaria in respect of the

property in question for a total sale consideration of Rs.9.45 crores.

Admittedly, out of the said consideration she paid Rs.95 lakhs to Bagaria as

earnest money deposit (`EMD‟). Goyal stated that she had recently come to

know that Bagaria and the PNB had, in collusion with each other and in

contravention of the order passed by the Debt Recovery Tribunal („DRT‟),

disposed of the suit property to CEPL by a sale deed dated 30 th December,

2008, thereby depriving her of her lawful rights in the Agreement to Sell

dated 30th September 2008 entered into between her and Bagaria. Goyal drew

attention to the Clause 12 of the agreement to sell dated 30th September 2008

whereby the parties had agreed that the disputes or differences between them

arising out of the agreement shall be adjudicated through the arbitration of a

sole Arbitrator. The appointment of the Arbitrator and the conduct of the

arbitral proceedings were to be governed by the AC Act or any other

enactment in force at the time of reference or the Award as the case may be.

The prayer in the OMP No. 168/2009 filed under Section 9 of the AC Act

was for an ad-interim order directing the Respondents to maintain status quo

in respect of the property in question.

4. OMP 168/2009 was listed first before this Court on 31st March, 2009. On

the said date a learned Single Judge of this Court passed the following order:

"Notice.

Notice is accepted by Mr. Rajiv Garg, counsel for respondent No.1.

The petitioner in this petition under Section 9 of the Arbitration and Conciliation Act, 1996 made respondents No.2, 3 and 4 as party to this petition who are not parties to the agreement to sell.

It is submitted by counsel for the petitioner that the petitioner does not press these respondents No.2, 3 and 4 as parties to this petition and their names may be deleted from the array of parties. Accordingly, names of respondents No.2, 3 and 4 are hereby deleted from the array of parties.

Respondent No.1 shall file reply to this petition within four weeks. Rejoinder thereto, if any, be filed two weeks thereafter.

List on 31st July 2009.

Till disposal of the instant petition, respondent No.1 shall maintain status quo as far as its right in the property are concerned.

The petitioner shall be at liberty to seek other legal remedies available under law to protect her interest."

5. Resultantly, PNB, CEPL and SCB who were parties to the above Section

9 application as Respondent Nos. 2, 3 and 4 respectively, were dropped as

parties by Goyal even while she was granted the liberty to seek other legal

remedies under law to protect her interest.

6. On 1st April, 2009, learned counsel for Bagaria wrote to Goyal, inter alia,

giving consent for the appointment of Justice K. Ramamoorthy as a sole

Arbitrator to adjudicate upon the disputes between the parties.

7. It may be noticed at this stage that in the Section 9 AC Act application,

Goyal stated that Bagaria had committed default in repayment of the loan

borrowed by him from PNB and for which the property in question had been

mortgaged to PNB. She stated that Bagaria entered into a full and final

settlement with PNB on 29th May 2008 in terms of which Bagaria had to pay

PNB Rs.6.92 crores. Thereafter, PNB would have no lien over the suit

property. It was stated that since Bagaria was unable to generate that amount,

he entered into an Agreement to Sell dated 30th September, 2008 with Goyal

agreeing to sell the property in question to her for Rs.9.5 crores. In her

Section 9 AC Act petition Goyal proceeded to state that she was subsequently

surprised to learn of an order dated 20th October, 2008 passed by DRT in RC

No. 263/2002 titled as Standard Chartered Bank v. M/s Vishal Global

Limited and Others attaching the property in question. Bagaria was the

second Respondent in the above recovery claim before the DRT. Goyal

stated that when she approached Bagaria, he assured her that the above

attachment would stand vacated. On 29th December, 2008 the Recovery

Officer DRT vacated the earlier attachment order dated 20th August, 2008 in

an application filed in the said claim of PNB. The DRT clarified that the right

of the Certificate Holder (CH) bank i.e SCB was confined to sharing of

surplus amount which PNB might realize in excess of its dues. It was further

directed by the DRT that the exercise of realisation of the amount by PNB

had to be transparent and to be ratified by the competent authority of the

SCB. Goyal stated that on 29th December 2008 she received a notice from

Bagaria asking her to deposit the balance sale consideration by 31st December

2008. According to Goyal, notwithstanding her reply of 30 th December 2008

asking for a copy of the order of the DRT, Bagaria, and PNB acted in

collusion and sold the property to CEPL on 31st December 2008.

8. To continue chronologically, it may also be noticed that certain

applications were filed before the DRT in O.A. No. 410/2009 (which was a

recovery claim by PNB against VTL (India) Limited, Bagaria and Canara

Bank). One of the IAs was by SCB seeking to implead itself and another by

SCB seeking impleadment of CEPL as „appropriate and necessary parties‟.

The PNB filed an IA citing the settlement arrived at between it and Bagaria

and seeking to withdraw its claim petition. By an order dated 22 nd June 2009

the DRT held that the sale deed dated 31st December 2008 executed by

Bagaria in favour of CEPL was void. However, the question of refund of the

sale consideration to CEPL was held by the DRT to be beyond its

jurisdiction. Accordingly it was left to CEPL to claim its money from

Bagaria through other appropriate legal remedies. The sale consideration was

asked to be deposited with the PNB. The DRT declined to permit the PNB to

withdraw its claim and restored its order of attachment of the property in

question.

9. Thereafter the Section 9 AC Act petition, OMP No. 168 of 2009 was

disposed of by this Court by an order dated 31 st July 2009. After noticing that

the disputes had been referred to arbitration and the order dated 22 nd June

2009 passed by the DRT, this Court directed that Bagaria "shall maintain

status quo in respect of his rights whatever are left in him in pursuance of the

order of the DRT till the pendency of the proceedings before the Arbitrator."

10. Goyal thereafter filed a claim before the learned Arbitrator on 28th

October 2009 along with an application under Section 17 AC Act for interim

directions. Goyal arrayed Bagaria as Respondent No.1, and CEPL, SCB and

PNB as Respondent Nos. 2, 3 and 4 respectively in the arbitration

proceedings. The main claim in the arbitration petition was for a decree of

specific performance of the Agreement to Sell dated 30th September, 2008

between Goyal and Bagaria in respect of the property in question. The second

relief was for declaration of the sale deed executed by Bagaria in favour of

CEPL on 31st December, 2008 was void. In para 10 of the application under

Section 17 it was averred:

"10. Apprehending further breach of the Agreement to Sell, the applicant/claimant approached the Hon‟ble Court for interim orders wherein the orders of maintaining status- quo in respect of the respondent No. 1 were passed on 31.03.2009. This order was made absolute by an order dated 31.07.2009 and the petition was disposed off in the light of the present Arbitral Tribunal having been constituted."

Goyal made no mention of the fact that by the order dated 31st March 2009 of

this Court Goyal dropped CEPL as a party to the application under Section 9

AC Act.

11. Goyal‟s claim was taken up by the learned Arbitrator on 18th December

2009, on which date Bagaria entered appearance through his counsel. Notice

was then issued to Respondent Nos. 2 to 4, i.e CEPL, SCB and PNB

respectively. A separate order was passed by the learned Arbitrator in the

Section 17 application for interim relief. The learned Arbitrator noted in the

order dated 18th December, 2009:

"The Ld. Counsel for the Claimant submits that even though the second respondent is not a party to the agreement for sale, as it is a subsequent purchaser, for the purpose of this arbitration, in law, the second respondent is to be deemed to be a party to the arbitration. Therefore, second respondent is bound by the ultimate outcome of the arbitration proceedings."

12. Thereafter the learned Arbitrator proceeded to pass an order restraining

both Bagaria as well as CEPL from dealing with the property in question in

any manner or putting up any construction or demolishing the existing

structure or creating any sort of encumbrance by way of equitable mortgage

or in any other form till further orders in the application under Section 17.

This order has been challenged in the present petition by the CEPL inter alia

questioning the very jurisdiction of the learned Arbitrator to issue notice to

and restrain CEPL which was not a party to the arbitration agreement.

13. The Petitioner states that it learnt of the above restraint order only on 1st

February, 2010 when a letter was sent to it by learned counsel for Goyal.

The Petitioner states that it appeared before the learned Arbitrator on 19th

February, 2010 and filed an application under Section 16 of the AC Act

requiring the learned Arbitrator to rule on his jurisdiction as well as on the

objections raised by the CEPL with respect to the existence and validity of

the arbitration agreement.

14. It appears that the Petitioner also filed application under Sections 12 and

14 AC Act asking the learned Arbitrator to recuse himself. The Petitioner

alleged that the learned Arbitrator was an interested party and ought not to

adjudicate the dispute since he had in the past purchased a flat from Goyal‟s

brother-in-law, Sri Rajinder Kumar Goyal. The learned Arbitrator by an

order dated 19th March 2010 rejected the above applications holding as

under:

"It is stated in the application itself that the flat was purchased in 2001. It is not stated anywhere in the petition that I am

interested in any away in any of the companies in which the claimant or others are shareholders. Due to the above said reason, the application under Sec. 12 and 14 filed by Mr. Rajeev Saxena, Ld. Counsel for Respondent No. 2 is dismissed."

The Petitioner‟s application under S. 16 AC Act was adjourned to 23rd

April 2010 for arguments.

15. Meanwhile on 10th March 2010, the order dated 22nd June 2009 of the

DRT was reversed by the Debt Recovery Appellate Tribunal („DRAT‟) in

Appeal Nos. 208 and 209 of 2009 filed by Bagaria and the PNB. By the

order dated 11th March, 2010 the DRAT held the settlement between Bagaria

and the PNB to be lawful. The sale in favour of CEPL was held to be legal.

The recovery proceedings instituted by the PNB before the DRT was

dismissed as withdrawn in view of the settlement between the PNB and

Bagaria.

Submissions of counsel

16. Mr. Ramji Srinivasan, learned Senior Counsel for CEPL submitted that

the present petition under Article 226 of the Constitution against the

assumption of jurisdiction by the learned Arbitrator against CEPL in general

and the order dated 18th December 2009 of the learned Arbitrator restraining

it from dealing with the property in question was maintainable as there was

no other efficacious remedy available to CEPL. To expect CEPL to wait for

the outcome of the Section 16 AC Act application was not justified as the

rejection of that application would offer no relief to CEPL. It would have to

wait for the Award to challenge the assumption of jurisdiction of the learned

Arbitrator against CEPL. Relying on the decisions in Anuptech Equipments

(P) Ltd v. Ganpati Co-operative Housing Society Limited 1999 (3) Arb LR

231 (Bom.), Unik Accurates Pvt. Ltd. v. Sumedha Fiscal Services Ltd.

2003(4) RAJ 571 (Cal) and Archon (M/S) v. Sewda Construction Co. 2004

Legal Eagle 2877 (Gau.) it was submitted that the powers of the High Court

under Article 226 of the Constitution could not be whittled down even by

Section 5 of the AC Act.

17. On merits, it was submitted by Mr.Srinivasan that having dropped CEPL

as a party in the application filed by her under Section 9 AC Act before this

Court, it was not open to Goyal to again array CEPL as a party to the

arbitration proceedings filed subsequently. He pointed out that CEPL was not

party to the agreement to sell dated 30th September 2008 between Bagaria

and Goyal which contained an arbitration clause. The sale of the property in

question by Bagaria to CEPL on 31st December 2008 was independent of the

dispute between Bagaria and Goyal. Referring to Section 7 and Section 2(h)

of the AC Act, it is submitted that CEPL is not a proper party to the

arbitration proceedings. Mr. Srinivasan submitted that the law as regards

proper parties to arbitration proceedings was settled. He referred to the

decisions in Sandeep Kumar v. Master Ritesh 2006 (13) SCC 567, Indowind

Energy Ltd. v. Wescare (I) Ltd. AIR 2010 SC 1793 and Yogi Agarwal v.

Inspiration Clothes & U (2009) 1 SCC 372.

18. Mr. A. K. Singla, learned Senior counsel for Goyal submitted that

whatever be the grievance of a party against the order of an Arbitrator, the

remedy had to be worked out within the confines of the AC Act itself.

Recourse could not be had to a petition under Article 226 to achieve

indirectly a result that was expressly barred under Section 5 AC Act. CEPL

having filed an application under Section 16 AC Act before the learned

Arbitrator had to pursue that remedy and thereafter proceed in accordance

with the AC Act for further relief. This petition was therefore premature in

any event.

19. On merits it is submitted by Mr. Singla that whatever was possible for a

Plaintiff to seek as a remedy in a suit for specific performance, was available

to her in the arbitration proceedings. Inasmuch as CEPL was claiming to be a

bonafide third party purchaser of the property in question, it was a necessary

and a proper party to the suit for specific performance and therefore to the

arbitration proceedings. He referred to the decisions in Durga Prasad v.

Deep Chand AIR 1954 SC 75, Dwarka Prasad Singh v. Harikant Prasad

(1973) 1 SCC 179, Kafiladdin v. Samiraddin AIR 1931 Cal 67 and Brawn

Laboratories Ltd. V. Fittydent International Gmbh 85 (2000) DLT 204.

Maintainability of the petition

20. The first issue to be considered is whether the present petition under

Article 226 of the Constitution is maintainable against an order dated 18th

December 2009 of the learned Arbitrator directing the notice to issue to the

Petitioner, who is not a party to the arbitration agreement, and restraining the

Petitioner from dealing with the property of which the Petitioner claims to be

a bonafide purchaser?

21. The AC Act restricts the scope of interference by judicial authorities with

arbitral proceedings. This legislative intent has been made express in Section

5 AC Act which reads as under:

"5. Extent of judicial intervention--Notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part."

22. Under Part I of the AC Act, interference by the Court is only to the extent

permissible thereunder. Section 8 enables the Court before which an action

is brought to refer parties to arbitration. A court can pass orders of an interim

nature even before the commencement of arbitral proceedings. This is

envisaged in the circumstances outlined in Section 9 AC Act. The power of

the Chief Justice to appoint an arbitrator where any of the parties fails to

appoint one despite an arbitration agreement is contained in Section 11. The

grounds for challenging the appointment of an Arbitrator are set out in

Section 12 and the challenge procedure is in Section 13 of the AC Act.

However, Section 13(4) makes it clear that if a challenge procedure is not

successful, the Arbitral Tribunal shall continue the arbitral proceedings and

make an arbitral award.

23. A challenge to the jurisdiction of the Arbitral Tribunal including the

existence or validity of the arbitration agreement is envisaged under Section

16(1) of the AC Act. Section 16(1) (b) clarifies that the decision of the

Arbitral Tribunal that the contract is null and void "shall not entail ipso jure

the invalidity of the arbitration clause". Under Section 16(2) of the AC Act,

the plea objecting to the jurisdiction of the Arbitral Tribunal should be raised

by the objector not later than the submission of the statement of defence.

However, a party shall not be precluded from raising such a plea merely

because he has been appointed, or participated in the appointment of an

Arbitrator. Under Section 16(3), a plea that the Arbitral Tribunal is exceeding

the scope of its authority shall be raised as soon as the matter alleged to be

beyond the scope of its authority is raised during the arbitral proceedings.

Under Section 16(4) the Arbitral Tribunal can excuse the delay under

Sections 16(2) and (3) if it considers the delay justified. Section 16(5) states

that whether the Arbitral Tribunal takes a decision rejecting the plea under

Sections 16(2) and (3), it shall continue with the arbitral proceedings and

make an arbitral award. Under Section 16(6) the party aggrieved by such an

arbitral award may make an application for setting aside the award in

accordance with Section 34.

24. Although a party may raise a challenge to the jurisdiction of the

Arbitrator under Section 16(1) of the AC Act, if such challenge is

unsuccessful, such party will have to wait for the award to be made and then

raise the plea again as a ground to challenge the award under Section 34 of

the AC Act. This position is also reiterated in Section 37(2) AC Act. It

provides the right of an appeal to the Court only where the Arbitral Tribunal

upholds the objection to its jurisdiction under Section 16(2) or 16(3) of the

AC Act. No appeal is provided where it rejects such objection. An appeal is

provided under Section 37(2) (b) against an order of the Arbitral Tribunal

granting or refusing interim relief under Section 17 of the AC Act.

Consequently, the AC Act cannot be said to be silent on what happens if the

plea of a party objecting to the jurisdiction of the Arbitrator is negatived by

the Arbitral Tribunal. Section 16 (5) read with Section 16 (6) makes it clear

that the aggrieved party has to wait till the award is passed by the Arbitral

Tribunal before raising a challenge to the Award on the grounds outlined in

Section 34 of the AC Act.

25. In Anuptech Equipments (P) Ltd v. Ganpati Co-operative Housing

Society Limited the facts were that the arbitral tribunal met on 18th July 1997

to decide to terminate the proceedings under Section 25(1) of the AC Act on

the ground that without sufficient cause the claimant had failed to file its

statement of claim in accordance with Section 23(1) of the AC Act. On that

very date, the Petitioners there wrote a letter objecting to the appointment of

one of the arbitrators as he was not duly qualified. The Award of the tribunal

dated 1st August 1987 rejecting the plea of the Petitioner was also challenged

in the writ petition. Meanwhile, the Petitioner had filed a separate petition in

the High Court for the appointment of a suitable person as arbitrator. The

Petitioner sought to invoke the jurisdiction of the High Court under Sections

12(3) (b), 13, 14, 15 and 24 of the AC Act. An objection was raised as to the

maintainability of the writ petition. It may be mentioned here that the above

writ petition was decided at the time when decision of the Supreme Court in

SBP & Co. v. Patel Engineering Ltd. (2005) 8 SCC 618 had not been

rendered. The learned Single Judge of the Bombay High Court analysed the

provisions of the AC Act and held that although the arbitral tribunal was not

subject to the supervisory jurisdiction of the High Court, a writ could still

issue to it. It was further held that although one of the objects of the AC Act

was to minimise the supervisory role of the Court, no party could be

remediless. Since the High Court concluded that the arbitral tribunal was not

properly constituted and therefore lacked jurisdiction, it was held that a

defect in jurisdiction "strikes at the very authority of the court to pass any

decree, and such a defect cannot be cured even by consent of the parties."

26. The above decision is distinguishable on facts. It did not envisage a

situation where the party had invoked Section 16 of the AC Act and invited

the Arbitral Tribunal to rule on its own jurisdiction. The Bombay High Court

therefore did not have the occasion to discuss the combined effect of Sections

16 (5) and Section 16 (6) in the context of the Arbitral Tribunal ruling on its

jurisdiction.

27. In Unik Accurates Pvt. Ltd. v. Sumedha Fiscal Services Ltd., a learned

Single Judge of the Calcutta High Court held that under Article 227 of the

Constitution an Arbitral Tribunal was subject to the supervisory jurisdiction

of the High Court and, therefore, an order passed by an Arbitral Tribunal

under Section 16 of the Act could be challenged before the High Court by

way of a writ petition. However, having so held the High Court did not find

any substance in the challenge to the order of the Arbitral Tribunal on merits.

Consequently, the writ petition was dismissed on merits. Again this decision

is distinguishable as the High Court was approached with a writ petition after

the Arbitral Tribunal had ruled on its jurisdiction and not before.

28. In Archon (M/S) v. Sewda Construction Co., the Gauhati High Court

held that the mere existence of an alternative remedy by way of an appeal

against the impugned order of the Arbitrator would not by itself be a bar to

the High Court exercising its powers under Articles 226 and 227 of the

Constitution. This decision is again distinguishable on facts. The question

whether the jurisdiction under Article 226 could be exercised even when

Section 16 (6) read with Section 16 (5) AC Act requires the aggrieved party

to await the passing of the Award, was not considered by the Gauhati High

Court.

29. The reliance by the learned Senior counsel for the Petitioner on the

decision of this Court in Union of India v. Classic Credit Ltd. (decision

dated 20th October 2008 in LPA No. 123/2008) is misplaced. Although it was

held that a writ petition against the order of Foreign Exchange Appellate

Tribunal would be maintainable, the said decision is no longer good law in

view of the recent judgment of the Supreme Court in Raj Kumar Shivhare v.

Assistant Director, Directorate of Enforcement (2010) 4 SCC 772 where it

has been held that against any order of the Appellate Tribunal only an appeal

will lie under Section 35 of the Foreign Exchange Management Act, 1999.

30. It may be observed that as regards the Petitioner's challenge to the

jurisdiction of the learned Arbitrator it is not as if it has no remedy. If its

application under Section 16 of the AC Act is allowed by the learned

Arbitrator it will have no grievance left. If not, the Petitioner has to abide by

the legislative scheme outlined in Section 16 (5) read with Section 16 (6) AC

Act and await the passing of the Award. If the Award goes against the

Petitioner, it can challenge the Award on the grounds available to it under

Section 34 of the AC Act. The mere fact that this may cause it the

inconvenience of having to await the conclusion of the arbitral proceedings is

no ground to entertain a writ petition at an intermediate stage in a manner

contrary to the legislative scheme under Section 16 AC Act. The AC Act

being a complete code in itself and with Section 5 of the AC Act limiting

interference by judicial authorities, any attempt to expand the scope for

interference by the High Court in exercise of its powers under Article 226 of

the Constitution would defeat the object and purposes of the AC Act.

31. As regards the grievance of the Petitioner against the status quo order

dated 18th December 2009 passed by the learned Arbitrator under Section 17

of the AC Act, the Petitioner has a statutory remedy by way of an appeal

under Section 37(2) (b) of the AC Act. Merely because the Petitioner files

such an appeal will not mean that it has waived its objection to the

jurisdiction of the learned Arbitrator, as long as it has also filed an

application under Section 16 (1) AC Act before the learned Arbitrator.

32. Consequently, this Court holds that the present writ petition under Article

226 of the Constitution read with Article 227 thereof, to challenge either the

jurisdiction of the learned Arbitrator generally or the order dated 18 th

December 2009 passed by the learned Arbitrator in particular, is not

maintainable.

No need to decide the second question

33. Since this Court has held against the Petitioner as regards maintainability,

there is no need to consider the submissions made by either party on the

second question whether CEPL is a proper party to the arbitral proceedings.

That is an issue on which the learned Arbitrator will opine while deciding the

application filed by CEPL under Section 16 AC Act. All the contentions

raised on merits by either party, including the tenability in law of Respondent

No.1 making the Petitioner a party to the arbitral proceedings after earlier

dropping it as a party to the Section 9 AC Act petition, are left open to be

raised before the learned Arbitrator who will give a decision thereon at his

earliest convenience, uninfluenced by any observation that may have been

made by this Court on merits.

34. The writ petition is dismissed being not maintainable but, in the

circumstances, with no order as to costs. The pending application is also

dismissed.

S. MURALIDHAR, J.

OCTOBER 5, 2010 ak/ AK