Ramesh Chander Sharma vs Rajinder Pershad Sharma & Ors.
2014 Latest Caselaw 811 Del

*             IN THE HIGH COURT OF DELHI AT NEW DELHI

+               RSA No. 51/2014 & CM No.2867/2014
%                                     12th February, 2014
RAMESH CHANDER SHARMA                       ......Appellant
                Through: Appellant in person.


                          VERSUS

RAJINDER PERSHAD SHARMA & ORS.                            ...... Respondents

Through:

CORAM:

HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?

VALMIKI J. MEHTA, J (ORAL)

1. This regular second appeal is filed under Section 100 CPC impugning

the judgments of the courts below; of the first appellate court dated

23.10.2013 and the trial court dated 7.1.2004; by which the suit of the

appellant-plaintiff has been dismissed inasmuch as with respect to the

disputes mentioned in the suit of the partnership firm of M/s Ashoka

Industries (India), there were arbitration proceedings, an Award was passed,

the said Award was made rule of the court under the Arbitration Act, 1940,

and therefore, disputes with regard to the firm M/s Ashoka Industries (India)

achieved finality. It may be mentioned that disputes were really as to all the

assets which were left behind by the father namely Sh. Raghunath Pershad

Sharma and which assets included disputes with respect to M/s Ashoka

Industries (India).

2. The trial court by its judgment dated 7.1.2004 dismissed the suit on

the basis of Section 31(2) of the Arbitration Act, 1940 which provides that

no suit can be filed to challenge the disputes which have been decided in

arbitration proceedings, and the challenge to an Award can only be by means

of filing objections to the Award. It may be noted that at the stage, when

trial court decided the suit, the proceedings for making the Award rule of the

court were pending, but the same stood decided by the time the first

appellate court passed the judgment.

3. The trial court by making the following observations and relying upon

Section 31(2) of the Arbitration Act, 1940 dismissed the suit:-

"5. First of all, I would like to refer to payer of the plaintiff made in his plaint. First prayer seeks decree thereby dissolving the firm styled M/s Ashoka Industries (India) in terms of deed of partnership dated 27.12.1987 or alternatively dated 07.02.1976, whichever is deemed just and lawful by this court. Second prayer seeks a decree directing Sh. Rajinder Prashad Sharma to render true and faithful accounts of partnership firm M/s Ashoka Industries (India) and other business determining of mesne profits bound by him and/or his associates by use of goodwill business and other properties of M/s Ashoka Industries India. Third prayer seeks decree to restrain Mr. R.P.Sharma by way of perpetual injunction from carrying on the business of sale and manufacturing of metal parts etc. and from occupying the premises No.28/2-A, Gali No.6, New Rohtak Road, New Delhi and F-25/4, Okhla Industrial area,

Phase-II, New Delhi; from use of machinery, dyes and tools, electricity connections, telephone number 5728325 and other assets installed/lying in the said premises; from use of vehicle like car no.DLJ-9873 and scooter no.DDO 5765 and funds belonging to the firm which are in his hands. Forth prayer seeks to preserve the property of the firm by removing Sh. Rajinder Prasad Sharma from control over the property of the firm and place same in the hands of a Receiver.

6. Now, we want must see what is law under Section 31 of the Arbitration Act 1940. Section 31 deals with jurisdiction and it provides that an award may be filed in any court having jurisdiction in the matter to which the reference relates. Clause (2) of the Section provides that "Notwithstanding, anything contained in any other law for the same being in force and as otherwise provided in the Act, all questions regarding valid effect or existence of award or arbitration agreement between the parties to the agreement or persons claimed under them shall be decided by the court in which the award under the agreement has been or may be filed and by no other court." Now, we have to see that whether the provisions of aforesaid Section is attracted to the fact and circumstances of the present case or not. Admittedly, a reference in respect of award made by Arbitrators is pending in the Honorable High Court of Delhi. I have gone through the Arbitration Agreement which mentions the subject mater of present suit i.e Ashoka Industries (India) Rohtak Road New Delhi and factory no. F-25/4, Okhla, Phase- II at Sl. No.2 and 4, respectively. The purpose of Arbitration as evident from the Arbitration deed is to resolve differences regarding distribution of assets left by Late Sh. Raghunath Prasad Sharma among his legal heirs. Mr. R.C.Sharma and Mr. Rajinder Prasad Sharma, who are contesting parties in the present suit are sons of aforesaid Sh. R.N.Prasad Sharma. So, there is no doubt that it is a dispute between these two parties in respect of aforesaid properties, which is covered by this alleged Arbitration Deed and award passed in respect thereof.

7. It is, thus, clear that subject matter of dispute in the present suit and subject matters of the award are same and therefore, I am

convinced that provisions of Section 31 Clause (2) of Arbitration Act, 940 applies to the present case and accordingly, this court has no jurisdiction to entertain the present case. Hence, suit is dismissed. File be consigned to record room."

4. As already stated above, during the pendency of the appeal, the

proceedings for making the Award rule of the court achieved finality and

therefore really issues which were the subject matter of the suit stood

decided, achieved finality and thus the suit become barred by the principle of

res judicata. The appellate court notes this aspect as also the disentitlement

to file the suit disputes which were subject matter of the arbitration

proceedings by making the following observation in para-6 of the impugned

judgment dated 23.10.2013 which reads as under:-

6. This is a dispute between brothers with respect to the assets and properties left by their father Sh. Raghunath Prasad Sharma. It is evident that plaintiff filed various suits in one form or the other seeking distribution of properties, particularly with respect to the business of M/s Ashok Industires (India). The suit, wherein the impugned order was passed, was filed in the year 1995. It is further evident from the record particularly the proceedings and others filed before the High Court that subject matter of the suit was already referred by the parties to the arbitrator, who passed the award dated 17.03.1988. The proceedings were also initiated before High Court of Delhi to make the award rule of the court and even the objections u/s 30 and 33 of the Arbitration Act, 1940 were filed. The matter was disposed of by the High Court of Delhi vide order dated 08.12.2008 and award was made rule of the court. The contention of the appellant that subject matter of the suit and of the reference before the arbitrator have been distinct and

separate, does not carry any merit or substance in view of the final adjudication of disputes between the parties with respect to the properties and assets left by the father of the parties including the firm in question. The appeal fails on two grounds, firstly, the Civil court has no jurisdiction to adjudicate over the subject matter which has already been the subject matter of arbitration between the parties. Secondly, it is not open to the plaintiff to re-agitate the issues by way of various litigations even after the passing of the award in the year 1988. Since, the award has now been made rule of the court vide order dated 08.12.2008 and it has attainted finality, there is no justification left in the grounds of the appeal. The order of Ld. Civil Judge is reasonable and logical and in accordance with the legal provisions of Arbitration Act, 1940.

5. The first appellate court by the impugned judgment in para 7 also

mentions about similar cases having been filed by the appellant-plaintiff and

appeals against which were dismissed right till this Court in terms of the

order dated 28.3.2011, and when I put it to the appellant who is present in

Court where is this order dated 28.3.2011, it was said that this is on the

record of the trial court and no copy has been filed for this Court to consider

the same in spite of observations having been made by the first appellate

court in para 7 of its judgment and which read as under:-

"7. It is important to note that in other cases the same position came up before the courts and in one such similar case, the matter went up to the High Court and the appeal of the appellant/plaintiff was dismissed vide order dated 28.03.2011, which has been filed on behalf of M/s Ashoka Industries (India). In the said case also the appeal was preferred against the dismissal of the suit on account of reference to the

arbitration. In the said order, there is mention about the various litigations preferred by the plaintiff and Hon'ble High Couirt observed that arbitrators have since decided the disputes and award has been made rule of the court and judgment has attained finality, the appeal deserves dismissal."

6. It is quite clear that the appellant intends to abuse the process of law.

The object of the legal procedure is to settle grievances which have some

reasonable basis at least, however, it is clear that the appellant wants to

indulge in repeated litigations although there is finality achieved with

respect to the disputes of M/s Ashoka Industries (India). The appeal being

an abuse of the process of law is dismissed with costs of Rs.50,000/- which

shall be deposited with the Delhi High Court Legal Aid Services Committee

within a period of six weeks from today.

7. List before the Registrar General for compliance of this order of

deposit of costs on 6th April, 2014. In case the appellant does not deposit

the costs within a period of six weeks, the Registrar General can recover the

costs as arrears of land revenue for being deposited with the Delhi High

Court Legal Aid Services Committee.

FEBRUARY 12, 2014                              VALMIKI J. MEHTA, J.
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