Gujarat High Court
Niteshkumar Kesherdev Goswami vs Gmm Coatings Private Limited on 31 January, 2025
Author: Sunita Agarwal
Bench: Sunita Agarwal
NEUTRAL CITATION
C/ARBI.P/231/2024 ORDER DATED: 31/01/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/PETN. UNDER ARBITRATION ACT NO. 231 of 2024
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NITESHKUMAR KESHERDEV GOSWAMI
Versus
GMM COATINGS PRIVATE LIMITED
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Appearance:
MR ANUJ K TRIVEDI(6251) for the Petitioner(s) No. 1
MR KARTIKEY D KANOJIYA(11031) for the Respondent(s) No. 1
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CORAM:HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE
SUNITA AGARWAL
Date : 31/01/2025
ORAL ORDER
1. Heard learned counsel for the parties and perused the
record.
2. The dispute in the instant petition is arising out of a
contract for employment dated 01.01.2023, which
contains the following arbitration clause :-
"9.10 Any dispute, controversy or claim arising out
of, or in connection with this Agreement, or the
breach, termination or invalidity thereof, shall be
referred to and finally resolved by arbitration
administered under the Arbitration and
Conciliation Act, 1996, as may be amended from
time to time. The arbitration shall be conducted by
the sole arbitrator, as appointed by the Employer.
The arbitration proceedings shall be conducted in
English. The seat of arbitration shall be
Ahmedabad. The results of any such arbitration
shall be final and binding on the parties to this
Agreement."
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3. The petitioner is raising a dispute with respect to the
termination of his employment in the capacity of General
Manager-cum-Residential Director. A perusal of the
recital in the agreement at page '9' of the paper-book
indicates that the agreement has been entered into, to
stipulate the rights and obligations of the petitioner in
his capacity as General Manager-cum-Residential
Director.
4. Mr.Kartikey D. Kanojiya, learned advocate appearing for
the respondent, however, raises a dispute with regard to
the maintainability of the application under Section
11(6) of the Arbitration Act, 1996 invoking arbitration
clause no.9.10 and would submit that the appropriate
remedy for the petitioner is to invoke the
judicial/statutory forum to agitate his grievances. The
contention is that the dispute primarily is being raised
about the validity of the termination order dated
26.07.2024 intimated to the petitioner vide email dated
27.07.2024 can very well be raised by raising an
industrial dispute under the Industrial Disputes Act,
1947.
5. This submission of the learned counsel for the
respondent is found misconceived for the simple reason
that to initiate any proceeding under the Industrial
Disputes Act, 1947, the petitioner has to fall within the
meaning of the "workman" as defined under section 2(s)
of the Industrial Disputes Act, 1947.
6. On a query made by the Court, the learned counsel for
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the respondent could not elaborate his submissions to
establish that the petitioner being the General Manager
of the establishment, can be said to be covered within
the meaning of "Workmen" under section 2(s) of the
Industrial Disputes Act, 1947. The plea of statutory
remedy available to the petitioner in the shape of raising
industrial dispute under the Act' 1947, therefore, is
turned down.
7. The learned counsel for the respondent further relied
upon the judgment of the Apex Court in Dushyant
Janbandhu vs. M/s. Hyundai Autoever India Pvt.
Ltd. [Civil Appeal No. 14299 of 2024] dated
11.12.2024 would submit that the petitioner can raise a
dispute under the Payment of Wages Act, 1936 and the
Apex Court has dismissed the petition under section
11(6) of the Arbitration and Conciliation Act, 1996 filed
by the respondent therein, noticing the availability of
statutory remedy under the Payment of Wages Act and
the Industrial Disputes Act.
8. Testing this submission of the learned counsel for the
respondent, we may further record that apart from the
bald statement made, there is nothing on record nor any
elaborate arguments could be made with regard to the
applicability of the Payment of Wages Act, 1936, insofar
as, the dispute raised in the present petition, which has
arisen out of a contract which is an employment
agreement between the parties containing an arbitration
clause.
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9. Moreover, the judgment of the Apex Court relied by the
learned counsel for the respondent is not applicable as it
is distinguishable in the facts before the Apex Court. A
perusal of the said decision of the Apex Court indicates
that in the very beginning, the Apex Court has noted that
the Court while exercising jurisdiction under section
11(6) of the Arbitration Act' 1996, must exercise judicial
restraint as incorporated in Section 5 of the Act' 1996.
However, in view of the peculiar facts and circumstances
of the case, the Apex Court has reached at the
conclusion that filing of application under Section 11(6)
of the Act' 1996 was a clear abuse of the process of the
Court. It was noted therein that on the termination
order passed therein on account of non-cooperation and
absenteeism of the employee, after disciplinary
proceeding initiated against the employee, a petition
under section 15(2) of the Payment of Wages Act, 1936
was filed by him. It seems that the respondent therein
issued a notice alleging that the dispute must be settled
through arbitration and appointed an arbitrator
unilaterally.
10. It was noted by the Apex Court that the claim for
arbitration was related to stoppage of payment of wages,
which according to the appellant therein was within the
jurisdiction of the authority under the Payment of Wages
Act, 1936. The unilaterally appointed arbitrator by the
respondent therein had commenced the arbitration
proceedings and an application under Section 16 of the
Act was filed by the appellant calling upon the arbitrator
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to rule on his competence. The arbitrator ultimately
closed the arbitration proceedings. The respondent,
however, moved an application under Section 8 of the
Arbitration and Conciliation Act, 1996 seeking reference
of the dispute involved in the petition in the proceeding
under Section 15(2) of the Payment of Wages Act, 1936
to arbitration, which was dismissed.
11. In the meantime, the appellant therein approached the
Industrial Tribunal by filing a petition under Section 2(A)
of the Industrial Disputes Act, questioning the
termination order dated 21.01.2021, which was pending
adjudication by the Industrial Tribunal.
12. In these facts and circumstances of the case, it was
noted by the Apex Court that the respondent had
approached the High Court by filing a petition under
Section 11(6) of the Arbitration and Conciliation Act,
1996 seeking for appointment of arbitrator when the
dispute relate to non-payment of wages and legality and
validity of the termination order dated 21.01.2021. In
the said petition, an issue of violation of non-closure
obligation under clause 19 was raised, which was held to
be an afterthought. The Apex Court having noted the
provisions of the Payment of Wages Act, 1936, has
recorded that the jurisdiction of the Industrial Tribunal
and the authority under the Payment of Wages Act is to
the exclusion of the jurisdiction of the Civil Court and
the dispute is non-arbitrable. The reason assigned by
the Apex Court in the order dated 11.12.2024 to go into
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the merits of the claim of the petitioner about the non-
arbitrability of the dispute was in the peculiar facts and
circumstances of the said case.
13. Insofar as the present case is concerned, as the learned
counsel for the respondent could not place any argument
on the availability of the statutory remedy to the
petitioner and the question as to the non-arbitrability of
the dispute can very well be agitated before the
arbitrator, this Court does not find any reason to
adjudicate upon this issue within the limited scope of
power at the pre-referral stage under section 11(6) of
the Arbitration and Conciliation Act, 1996.
14. The matter is, therefore, referred to the arbitrator. It is
clarified that all issues raised by the respondent can very
well be agitated before the arbitrator.
15. The application is accordingly allowed. I proceed to pass
the following :
ORDER
(i) Petition is ALLOWED.
(ii) Hon'ble Smt. Justice Abhilasha Kumari, Former
Chief Justice, High Court of Manipur, Residing at :
Residing at - J-4, AALJ-19 Homes, Near Bhagwat
Bunglows, ThaltejShilaj Road, Ahmedabad - 380059,
Mob. Nos.9825049587, 6352179498, e-mail address :
[email protected] is appointed as sole
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Arbitrator to resolve the disputes between the parties in
accordance with the Arbitration Centre (Domestic and
International), High Court of Gujarat Rules, 2021. Both
parties would be governed by said Rules.
(iii) Registry is directed to communicate this order to the
sole arbitrator forthwith by speed post. No order as to
costs.
(iv) Consequently, all pending connected application/s, if
any, stands disposed of.
(SUNITA AGARWAL, CJ )
BIJOY B. PILLAI
