Rajasthan High Court
Mahima Real Estate Pvt.Ltd vs M/S Ascent Buildhome Developers ... on 5 March, 2021
Bench: Indrajit Mahanty
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Arbitration Application No. 48/2020
Mahima Real Estate Pvt.ltd., F-1 Govind Marg, Opposite Petrol
Pump Raja Park, Jaipur At Present Head Office At 4Th Floor,
Cristal Palm, 22, Godown Circle, Jaipur- 302001 Through
Managing Director Dhirendra Madan, S/o Late D.r. Madan, Aged
60 Years, Resident Of B-22 Prabhu Marg, Tilak Marg, Jaipur.
----Petitioner
Versus
M/s Ascent Buildhome Developers Ltd.,(Cin U452012Rj2005Plc
20959), Having Its Registered Office At J-100, Basement, Ashok
Chowk, Adarsh Nagar, Jaipur Through Its Director Murshid
Ahmed.
----Respondent
For Petitioner(s) : Mr. Anoop Dhand
For Respondent(s) : Mr. Jatin Agarwal
HON'BLE THE CHIEF JUSTICE
Order
05/03/2021
1. Heard learned counsel for the respective parties.
2. This arbitration application has been filed under
Sections 10 & 11 of the Arbitration & Conciliation Act, 1996
(hereinafter to be referred as 'the Act of 1996') for appointment
of an Arbitrator to adjudicate the disputes arisen between the
parties.
3. Learned counsel for the respondent raised a preliminary
objection on account of the fact that alleged documents in which
the transaction is alleged to have been entered into has not been
stamped. Accordingly, he placed reliance on certain judgments
passed by Hon'ble Supreme Court in the case of SMS Tea
(2 of 3) [ARBAP-48/2020]
Estates Pvt. Ltd. Vs. M/s Chandmari Tea Co. Pvt. Ltd.
reported in (2011) 14 SCC 66 and Garware Wall Ropes
Limited Vs. Coastal Marine Constructions and Engineering
Limited reported in (2019) 9 SCC 209.
4. Learned counsel for the petitioner on the other hand
placed reliance on a latest judgment of Hon'ble Supreme Court in
the case of M/s N.N. Global Mercantile Pvt. Ltd. Vs. M/s Indo
Unique Flame Ltd. & Others reported in 2021 SCC Online SC
13 and in particular, the finding of the Court in paragraph 12
thereof, which reads as under:-
"12. We are of the considered view that the
finding in SMS Tea Estates and Garware that the
non-payment of stamp duty on the commercial
contract would invalidate even the arbitration
agreement, and render it non-existent in law,
and un-enforceable, is not the correct position in
law.
In view of the finding in paragraph 92 of
the judgment in Vidya Drolia by a co-ordinate
bench, which has affirmed the judgment in
Garware, the aforesaid issue is required to be
authoritatively settled by a Constitution bench of
this Court.
We consider it appropriate to refer the
following issue, to be authoritatively settled by a
Constitution bench of five judges of this Court :
"Whether the statutory bar contained in
Section 35 of the Indian Stamp Act, 1899
applicable to instruments chargeable to Stamp
Duty under Section 3 read with the Schedule to
the Act, would also render the arbitration
agreement contained in such an instrument,
which is not chargeable to payment of stamp
duty, as being non-existent, unenforceable, or
invalid, pending payment of stamp duty on the
substantive contract / instrument?"
5. Although, the Hon'ble Supreme Court has referred the
issue for settlement of a Constitution Bench of five judges, it was
(3 of 3) [ARBAP-48/2020]
at the same time held that SMS Tea Estates and Garware Wall
Ropes Limited cases cited (supra) have not laid down the correct
position of law.
6. Accordingly, following the latest judgment of Hon'ble
Supreme Court in the case of M/s N.N. Global Mercantile Pvt.
Ltd. referred hereinabove, this Court proceeds to appoint Hon'ble
Mr. Justice P.S. Asopa (Retd.) R/o 7-Dha-6, Jawahar Nagar, Jaipur
to act as an Arbitrator to decide all issues without prejudice to the
rights and contentions raised by the either side. The arbitration
fees shall be in accordance with fourth schedule of the Act of
1996.
7. The parties are at liberty to raise all such objections
before the Arbitrator.
8. Registry is directed to intimate Hon'ble Mr. Justice P.S.
Asopa (Retd.) of his appointment as Arbitrator and parties are at
liberty to call upon reliable date for necessary directions.
9. The application is accordingly allowed.
(INDRAJIT MAHANTY),CJ
N.Gandhi/Harshit/19
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