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Sunday, March 29, 2015

whether we can entertain the Writ Petition for issuance of writ of Prohibition treating the instant Arbitral Tribunal is having a statutory character. We think that this Court has no jurisdiction to issue a writ of Prohibition for the reasons as stated hereunder and the same are backed by the materials supplied by the petitioner itself.

THE HONOURABLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HONOURABLE SRI JUSTICE SANJAY KUMAR                    

Writ Petition No.80 of 2015

22-1-2015

Hyderabad Cricket Association,Rajiv Gandhi International Cricket Stadium,Uppal,
R.R.District.Rep. by its Managing Secretary  Petitioner      
               
The State of Talangana,Law and Legislative Department,Secretariat Buildings,
Hyderabad and others Respondents  

COUNSEL FOR PETITIONER : Sri V.Ramachander Goud      

COUNSEL FOR RESPONDENT No.1: G.P. for Law and Legislative Affairs    
COUNSEL FOR RESPONDENT No.2 : G.P. for Sports and Culture      
COUNSEL FOR RESPONDENT No.3   : Sri M.Papa Reddy        

<GIST:

>HEAD NOTE:  

?CITATIONS:


THE HONBLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA            
 AND
THE HONBLE SRI JUSTICE SANJAY KUMAR        

                                                       
WRIT PETITION No.80 OF 2015  
       
               
DATED: 22.01.2015
       

ORDER: (per the Honble The Chief Justice Sri Kalyan Jyoti Sengupta)

     This Writ Petition has been filed by Hyderabad Cricket
Association for issuance of writ of Prohibition against the Arbitral
Tribunal consisting of respondents 4 to 6 arising out of Arbitration
Application No.26 of 2011 from proceeding further, declaring as
without jurisdiction.

     We have asked the learned lawyer for the petitioner as to how
the writ of Prohibition can be issued against the Arbitral Tribunal
constituted under the provisions of the Arbitration and Conciliation
Act, 1996 (for short the Act). We think, without deciding the
preliminary issue, we cannot proceed further. The learned counsel for
the petitioner argues that the Arbitral Tribunal is not a private forum
as it has been formed under the provisions of the Act.  It is the settled
law that writ of Prohibition can be issued not only against the
subordinate Courts and quasi judicial authority, but also against
Tribunal. We have noted his argument.

     In this case, we have to decide whether we can entertain the
Writ Petition for issuance of writ of Prohibition treating the instant
Arbitral Tribunal is having a statutory character. We think that this
Court has no jurisdiction to issue a writ of Prohibition for the reasons
as stated hereunder and the same are backed by the materials supplied
by the petitioner itself. There has been a written agreement, dated
16.10.2014 between the petitioner and the third respondent. This
agreement in substance was in relation to the construction of stadium,
was containing various terms and conditions.   One of its clauses,
which is relevant for our purpose, is required to be noted, hence
reproduced hereunder.
        15.    Miscellaneous:
i)      This Agreement is made and governed by and shall be
constructed in accordance with the Laws of India.
Subject to sub-clause (iii) herein below regarding
resolution of disputes by Arbitration, the parties submit
to the exclusive jurisdiction of the Courts in the twin
cities of Hyderabad  Secunderabad, hereby waiving all
right to any other jurisdiction or venue to which they
might otherwise be entitled.

ii)     In the event any part of this Agreement shall be deemed
to be in contravention of law or otherwise invalid or
unenforceable the said part shall be construed to the
extent, if any, as the law shall permit to accomplish its
intent and the legality, validity or enforceability of the
remaining provisions shall not be affected.

iii)    All disputes arising out of this Agreement shall be
settled through Arbitration, to be conducted at
Hyderabad by three Arbitrators in accordance with the
Arbitration and Conciliation Act 1996 or any statutory
modification thereof. The parties shall bear the costs of
arbitration equally in the first instance subject to the
final award as to costs that may be passed by the
Arbitrators.

     Thus, it will appear therefrom that the parties thereto have
entered into arbitration agreement for resolution of the dispute
mentioned aforesaid. Thereafter, the third respondent in and about
2011 made an application before the learned Single Judge of this
Court for appointment of Arbitrator under Section 11(6) of the Act.
His Lordship by order, dated 02.08.2011 allowed the application
granting relief as prayed for therein. His Lordship appointed Dr.
Justice Motilal B.Naik, a retired Judge of this Court, to resolve the
disputes relatable to agreement, dated 16.10.2014. While passing the
said order of appointment, His Lordship concluded as follows:
        Since the agreement contains an arbitration clause and
as the disputes between the parties are relatable to the said
agreement, I find that the applicant has made a valid
ground for appointment of an arbitrator.

      Thus, His Lordship has been satisfied that the disputes arose
between the parties are covered by the arbitration agreement and made
such appointment. This order was not challenged before the Honble
Supreme Court. So, the order containing the findings of His Lordship
with regard to the formation of Arbitral Tribunal reached finality.

     Learned counsel for the petitioner has raised an interesting
question that even if the aforesaid order is assumed to be correct and
not challenged, the Tribunal formed pursuant to the aforesaid order
read with the Act can be treated to be a statutory Tribunal and
amenable to writ jurisdiction.

     We are unable to accept the contention of the learned counsel
for the petitioner that this Arbitral Tribunal is of statutory one. We are
of the view that this Tribunal is of private character, however
legitimatized by the Act. Formation of Arbitral Tribunal is really
made by the contractual agreement between the private parties thereto.
It is the settled position of law that the writ will be maintainable
against any Government authority or its body or the instrumentality of
the State. It is also settled law that any private individual can be
treated to be an authority within the meaning of Article 226 of the
Constitution of India if it discharges the public duty.
     Here, the Tribunal is meant for two private individuals and not
for the public at large to term it as the Tribunal of public character.
The provisions of the Act enable the private individuals to resolve
their disputes outside the Court and it is a measure of encouragement
of the litigant public to have their civil disputes resolved outside
forum established by the Government for public at large.

     The Act in our view serves as enabling and regulatory
machinery for creation and functioning of Tribunal of private
individuals.  In other words, the Tribunal formed under the Act does
not deliver justice to the public at large.  Unless an institution is
obliged to discharge public duty or public function, it cannot be made
answerable in writ jurisdiction under Article 226 of the Constitution.
We accordingly overrule the contention of the learned lawyer for the
petitioner that petition seeking writ of Prohibition is maintainable.

     Learned counsel would argue that since the learned Single
Judge of this Court has passed an order under the Act for formation of
the Tribunal, it has the character of the Tribunal. We are unable to
accept this contention for simple reason that order passed by the Chief
Justice or his designate Judge or authority under the Act, is based on
the arbitration agreement. Unless there is an arbitration agreement
followed by inaction of either party to the agreement, the order of
appointment cannot be passed under Section 11 of the Act. The Chief
Justice or his designate Judge in exercise of power under Section 11
of the Act merely activate the recalcitrant party to go to domestic
forum for the parties to the agreement only, not for member of the
public at large.

     We find from the Writ Petition, the question of inherent lack of
jurisdiction is raised.    We think that the issue for the time being is
not allowed to be agitated before us, as Section 16 of the Act provides
measures enabling parties to question jurisdiction of the Tribunal
itself. Therefore, this point very well be agitated before the learned
Arbitrator. It can also be challenged before appropriate Court under
Section 34 of the Act. The object of the Act is to avoid the Courts as
far as possible and to get the disputes resolved as early as possible
finally on merit. In these circumstances, we feel that this application is
not maintainable and accordingly, dismissed in limine without passing
any order on merit. All questions have to be agitated before the
Arbitral Tribunal. No order as to costs.

          Consequently, miscellaneous petitions, if any pending, shall
stand closed.
___________________  
K.J. SENGUPTA, CJ  
22nd JANUARY, 2015.  
_________________  
SANJAY KUMAR, J

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