Learned counsel for the respondent – plaintiff
further submitted that in view of Section 7 of the
Arbitration and Conciliation Act, 1996, unless and until
the written document is signed by both the sides,
arbitration agreement cannot come into existence. This
proposition is not at all acceptable. The provision of
Section 7 of the Arbitration and Conciliation Act, 1996,
is as under:
“7. Arbitration agreement
(1) In this Part, "arbitration agreement" means
an agreement by the parties to submit to
arbitration all or certain disputes which have
arisen or which may arise between them in
respect of a defined legal relationship,
whether contractual or not.
(2) An arbitration agreement may be in the form
of an arbitration clause in a contract or in
the form of a separate agreement.
(3) An arbitration agreement shall be in
writing.
(4) An arbitration agreement is in writing if
it is contained in
(a) a document signed by the parties;
(b) an exchange of letters, telex, telegrams or
other means of telecommunication which provide
a record of the agreement; or
(c) an exchange of statements of claim and
defence in which the existence of the agreement
is alleged by one party and not denied by the
other.
(5) The reference in a contract to a document
containing an arbitration clause constitutes an
arbitration agreement if the contract is in
writing and the reference is such as to make
that arbitration clause part of the contract.”
11] Section 7(1) of the Act gives the meaning of
arbitration agreement. In Section 7(2), it is mentioned
that arbitration agreement may be in the form of a clause
in the contract itself or it may be in a separate form or
a separate agreement. Section 7(3) shows that arbitration
agreement needs to be in writing. Thus, it can be said
that in Section 7(3), it is made clear that arbitration
agreement should be in writing but this subsection does
not show that unless and until it is signed by both the
sides, the agreement will not come into existence.
Section 7(4) gives the meaning of written agreement.
Subsection 4(a) shows that it can be inferred that it is
an written agreement if a document is signed by the
parties. Subsection 4(b) shows that written agreement
can come into existence by exchange of letter, telex,
telegrams or other means of telecommunication which
provide a record of the agreement. Subsection 4(c)
shows that arbitration agreement can come into existence
by exchange of statements of claim and defence also.
Thus, when the purchase order is placed, as in the
present case, the matter will fall u/s 7(4)(b). This
subsection does not show that there needs to be
signature of other party. In the present matter, written
order like purchase order was given by the defendant to
the plaintiff and the order provided that it was upto the
plaintiff either to accept or not to accept this
proposal. As the supply was made by the plaintiff as per
this order and there is specific admission in that regard
in the plaint, it needs to be presumed that the offer
given by the defendant was accepted by the plaintiff and
this acceptance was for all the terms and conditions of
the contract. It is already observed that the terms and
conditions of the contract can be found in the purchase
order and in Annexure 'A'.
12] The aforesaid position of law and facts and
circumstances of present case show that the trial Court
has committed error in observing that signature of the
plaintiff was necessary on this document and as signature
is not there, there was no agreement to refer the dispute
to arbitrator. This objection was taken prior to filing
of written statement as provided in Section 8 of the
Arbitration and Conciliation Act, 1996 by the defendant.
In view of these circumstances, it is necessary for the
parties to refer the dispute to Arbitral Tribunal as
provided in the aforesaid clauses of the contract. It is
not possible for Civil Court to directly refer the matter
to arbitrator as the procedure as laid down in the
aforesaid clauses need to be followed by the parties to
the contract. Thus, there is no other alternative than
to return the plaint for referring the matter to
arbitrator.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
CIVIL REVISION APPLICATION NO.134/2015
Indus Towers Limited,
V
Sow.Ashatai w/o Bapurao Kagne,
CORAM: T.V. NALAWADE, J.
DATE: 18.11.2015
Citation: 2016(6) ALLMR 877
1] Rule. Rule made returnable forthwith. By
consent, heard both the sides for final disposal of the
revision application.
2] Present proceedings are filed to challenge the
order dated 10.12.2013 made on Exhibit 9 in Special Civil
Suit No.349/2012 by learned VIth Joint Civil Judge,
Senior Division, Aurangabad. The application at Exhibit
9 was filed by present petitioner – defendant under the
provision of Order VII Rule 10 of the Code of Civil
Procedure and he had prayed for return of the plaint.
The said application is rejected by the learned trial
Court.
3] The suit is filed in respect of the amount,
which is due to plaintiff from defendant in respect of
supply of diesel. It is the case of the plaintiff that
as per the purchase order dated 23.7.2008, the plaintiff
had supplied diesel during contract period to the
defendant, but only some amount is paid by the defendant
and the suit amount is still outstanding against the
defendant. It is contended that even after making of
demand of this amount by the plaintiff, the defendant has
not made payment and so the suit is required to be filed.
4] By filing application at Exhibit 9, the
defendant contended that there is arbitration clause in
the agreement, which was entered into by the parties and
in view of that agreement, the matter needs to be
referred to Arbitrator and the matter is not tenable in
Civil Court.
5] The trial Court has observed that the document
of contract does not show that the plaintiff had
consented to refer the dispute to Arbitrator as there is
no signature of the plaintiff on the so called written
agreement.
6] In the plaint paragraph no.3, the plaintiff has
made a mention that on the basis of purchase order, the
supply of diesel was made by her. The contents of this
paragraph further show that alongwith the purchase order,
there was annexure like 'A' sent by the defendant to the
plaintiff. Alongwith the plaint, the plaintiff has
produced copy of the purchase order and first page of
Annexure 'A'. The purchase order shows that there was
verbal talk between the parties and on that basis, the
purchase order was sent by the defendant. In the
purchase order, the terms and conditions of the contract
are mentioned and they include the particulars like rate
of the diesel, the quantity and the period during which
the diesel was to be supplied. The payment in respect of
the supply was to be made after the delivery. The
general terms and conditions of the contract are
appearing on the purchase order and there is also mention
that the terms and conditions quoted in Annexure 'A' are
also the terms and conditions of the contract.
7] Clause 16 of Annexure 'A' contains the
arbitration clause and it runs as under:
“16. DISPUTES / ARBITRATION
In the event of any dispute arising between
the two Parties relating to the various terms and
conditions set forth in the contract, the two
Parties undertake to resolve the differences by
mutual consultation. In the event of their
inability to resolve the disputes, all questions,
disputes and differences arising under or in
relation to this Agreement shall be referred to
two Arbitrators. Each Party to appoint his own
Arbitrator by giving notice to other Party. Two
appointed Arbitrators with the consent of each
other will appoint the third Arbitrator. The
award of the Arbitrators so appointed shall be
final, conclusive and binding on all the Parties
to the Agreement and provisions of the
Arbitration & Conciliation Act, 1996 or any
statutory modification or reenactment thereof
and the Rules made thereunder and for the time
being in force shall apply to the arbitration
proceedings under this clause. Venue of the
arbitration shall be at Mumbai.”
8] At Clause 13 of Annexure 'A', there is a mention
about the documents, which can be referred to ascertain
the terms and conditions of contract and Clause 13 runs
as under:
“13. ENTIRE AGREEMENT
This Agreement and the Schedule and Annexure
hereto constitute the entire understanding
between the parties concerning the subject matter
hereof and supercede all prior discussions,
agreements and representations, whether oral or
written and whether or not executed by and
between the parties.”
9] Learned counsel for the respondent plaintiff
submitted that only the first page of Annexure 'A” was
sent by the defendant alongwith the purchase order and so
it cannot be said that there was agreement between the
parties to refer such dispute to Arbitral Tribunal. This
contention is not acceptable. Even Clause No.1.1(d)
appearing on first page of Annexure 'A” is not complete.
It does not look viable that without ascertaining the
terms and conditions of the contract, the plaintiff had
made supply of the diesel when the amount was to be paid
after the delivery. It needs to be presumed for the
present purpose that only after going through all the
terms and conditions of the contract, the supply was made
by the plaintiff.
10] Learned counsel for the respondent – plaintiff
further submitted that in view of Section 7 of the
Arbitration and Conciliation Act, 1996, unless and until
the written document is signed by both the sides,
arbitration agreement cannot come into existence. This
proposition is not at all acceptable. The provision of
Section 7 of the Arbitration and Conciliation Act, 1996,
is as under:
“7. Arbitration agreement
(1) In this Part, "arbitration agreement" means
an agreement by the parties to submit to
arbitration all or certain disputes which have
arisen or which may arise between them in
respect of a defined legal relationship,
whether contractual or not.
(2) An arbitration agreement may be in the form
of an arbitration clause in a contract or in
the form of a separate agreement.
(3) An arbitration agreement shall be in
writing.
(4) An arbitration agreement is in writing if
it is contained in
(a) a document signed by the parties;
(b) an exchange of letters, telex, telegrams or
other means of telecommunication which provide
a record of the agreement; or
(c) an exchange of statements of claim and
defence in which the existence of the agreement
is alleged by one party and not denied by the
other.
(5) The reference in a contract to a document
containing an arbitration clause constitutes an
arbitration agreement if the contract is in
writing and the reference is such as to make
that arbitration clause part of the contract.”
11] Section 7(1) of the Act gives the meaning of
arbitration agreement. In Section 7(2), it is mentioned
that arbitration agreement may be in the form of a clause
in the contract itself or it may be in a separate form or
a separate agreement. Section 7(3) shows that arbitration
agreement needs to be in writing. Thus, it can be said
that in Section 7(3), it is made clear that arbitration
agreement should be in writing but this subsection does
not show that unless and until it is signed by both the
sides, the agreement will not come into existence.
Section 7(4) gives the meaning of written agreement.
Subsection 4(a) shows that it can be inferred that it is
an written agreement if a document is signed by the
parties. Subsection 4(b) shows that written agreement
can come into existence by exchange of letter, telex,
telegrams or other means of telecommunication which
provide a record of the agreement. Subsection 4(c)
shows that arbitration agreement can come into existence
by exchange of statements of claim and defence also.
Thus, when the purchase order is placed, as in the
present case, the matter will fall u/s 7(4)(b). This
subsection does not show that there needs to be
signature of other party. In the present matter, written
order like purchase order was given by the defendant to
the plaintiff and the order provided that it was upto the
plaintiff either to accept or not to accept this
proposal. As the supply was made by the plaintiff as per
this order and there is specific admission in that regard
in the plaint, it needs to be presumed that the offer
given by the defendant was accepted by the plaintiff and
this acceptance was for all the terms and conditions of
the contract. It is already observed that the terms and
conditions of the contract can be found in the purchase
order and in Annexure 'A'.
12] The aforesaid position of law and facts and
circumstances of present case show that the trial Court
has committed error in observing that signature of the
plaintiff was necessary on this document and as signature
is not there, there was no agreement to refer the dispute
to arbitrator. This objection was taken prior to filing
of written statement as provided in Section 8 of the
Arbitration and Conciliation Act, 1996 by the defendant.
In view of these circumstances, it is necessary for the
parties to refer the dispute to Arbitral Tribunal as
provided in the aforesaid clauses of the contract. It is
not possible for Civil Court to directly refer the matter
to arbitrator as the procedure as laid down in the
aforesaid clauses need to be followed by the parties to
the contract. Thus, there is no other alternative than
to return the plaint for referring the matter to
arbitrator.
13] The learned counsel for the respondent –
plaintiff placed reliance on Karam Chand Thapar & Bros.
(Cs) v. Akaljot Singh Sekhom reported at 2005 (3)
Mh.L.J., 797. The facts and circumstances of this case
are altogether different. This case is of no help to the
respondent – plaintiff.
14] In the result, the civil revision application is
allowed. The order dated 10.12.2013 made on Exhibit 9 in
Special Civil Suit No.349/2012 by learned VIth Joint
Civil Judge, Senior Division, Aurangabad, is hereby set
aside. The application filed at Exhibit 9 by the
defendant is hereby allowed. The plaint be returned to
the plaintiff for following the procedure for appointment
of Arbitral Tribunal.
(T.V. NALAWADE, J.)
Print Page
further submitted that in view of Section 7 of the
Arbitration and Conciliation Act, 1996, unless and until
the written document is signed by both the sides,
arbitration agreement cannot come into existence. This
proposition is not at all acceptable. The provision of
Section 7 of the Arbitration and Conciliation Act, 1996,
is as under:
“7. Arbitration agreement
(1) In this Part, "arbitration agreement" means
an agreement by the parties to submit to
arbitration all or certain disputes which have
arisen or which may arise between them in
respect of a defined legal relationship,
whether contractual or not.
(2) An arbitration agreement may be in the form
of an arbitration clause in a contract or in
the form of a separate agreement.
(3) An arbitration agreement shall be in
writing.
(4) An arbitration agreement is in writing if
it is contained in
(a) a document signed by the parties;
(b) an exchange of letters, telex, telegrams or
other means of telecommunication which provide
a record of the agreement; or
(c) an exchange of statements of claim and
defence in which the existence of the agreement
is alleged by one party and not denied by the
other.
(5) The reference in a contract to a document
containing an arbitration clause constitutes an
arbitration agreement if the contract is in
writing and the reference is such as to make
that arbitration clause part of the contract.”
11] Section 7(1) of the Act gives the meaning of
arbitration agreement. In Section 7(2), it is mentioned
that arbitration agreement may be in the form of a clause
in the contract itself or it may be in a separate form or
a separate agreement. Section 7(3) shows that arbitration
agreement needs to be in writing. Thus, it can be said
that in Section 7(3), it is made clear that arbitration
agreement should be in writing but this subsection does
not show that unless and until it is signed by both the
sides, the agreement will not come into existence.
Section 7(4) gives the meaning of written agreement.
Subsection 4(a) shows that it can be inferred that it is
an written agreement if a document is signed by the
parties. Subsection 4(b) shows that written agreement
can come into existence by exchange of letter, telex,
telegrams or other means of telecommunication which
provide a record of the agreement. Subsection 4(c)
shows that arbitration agreement can come into existence
by exchange of statements of claim and defence also.
Thus, when the purchase order is placed, as in the
present case, the matter will fall u/s 7(4)(b). This
subsection does not show that there needs to be
signature of other party. In the present matter, written
order like purchase order was given by the defendant to
the plaintiff and the order provided that it was upto the
plaintiff either to accept or not to accept this
proposal. As the supply was made by the plaintiff as per
this order and there is specific admission in that regard
in the plaint, it needs to be presumed that the offer
given by the defendant was accepted by the plaintiff and
this acceptance was for all the terms and conditions of
the contract. It is already observed that the terms and
conditions of the contract can be found in the purchase
order and in Annexure 'A'.
12] The aforesaid position of law and facts and
circumstances of present case show that the trial Court
has committed error in observing that signature of the
plaintiff was necessary on this document and as signature
is not there, there was no agreement to refer the dispute
to arbitrator. This objection was taken prior to filing
of written statement as provided in Section 8 of the
Arbitration and Conciliation Act, 1996 by the defendant.
In view of these circumstances, it is necessary for the
parties to refer the dispute to Arbitral Tribunal as
provided in the aforesaid clauses of the contract. It is
not possible for Civil Court to directly refer the matter
to arbitrator as the procedure as laid down in the
aforesaid clauses need to be followed by the parties to
the contract. Thus, there is no other alternative than
to return the plaint for referring the matter to
arbitrator.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
CIVIL REVISION APPLICATION NO.134/2015
Indus Towers Limited,
V
Sow.Ashatai w/o Bapurao Kagne,
CORAM: T.V. NALAWADE, J.
DATE: 18.11.2015
Citation: 2016(6) ALLMR 877
1] Rule. Rule made returnable forthwith. By
consent, heard both the sides for final disposal of the
revision application.
2] Present proceedings are filed to challenge the
order dated 10.12.2013 made on Exhibit 9 in Special Civil
Suit No.349/2012 by learned VIth Joint Civil Judge,
Senior Division, Aurangabad. The application at Exhibit
9 was filed by present petitioner – defendant under the
provision of Order VII Rule 10 of the Code of Civil
Procedure and he had prayed for return of the plaint.
The said application is rejected by the learned trial
Court.
3] The suit is filed in respect of the amount,
which is due to plaintiff from defendant in respect of
supply of diesel. It is the case of the plaintiff that
as per the purchase order dated 23.7.2008, the plaintiff
had supplied diesel during contract period to the
defendant, but only some amount is paid by the defendant
and the suit amount is still outstanding against the
defendant. It is contended that even after making of
demand of this amount by the plaintiff, the defendant has
not made payment and so the suit is required to be filed.
4] By filing application at Exhibit 9, the
defendant contended that there is arbitration clause in
the agreement, which was entered into by the parties and
in view of that agreement, the matter needs to be
referred to Arbitrator and the matter is not tenable in
Civil Court.
5] The trial Court has observed that the document
of contract does not show that the plaintiff had
consented to refer the dispute to Arbitrator as there is
no signature of the plaintiff on the so called written
agreement.
6] In the plaint paragraph no.3, the plaintiff has
made a mention that on the basis of purchase order, the
supply of diesel was made by her. The contents of this
paragraph further show that alongwith the purchase order,
there was annexure like 'A' sent by the defendant to the
plaintiff. Alongwith the plaint, the plaintiff has
produced copy of the purchase order and first page of
Annexure 'A'. The purchase order shows that there was
verbal talk between the parties and on that basis, the
purchase order was sent by the defendant. In the
purchase order, the terms and conditions of the contract
are mentioned and they include the particulars like rate
of the diesel, the quantity and the period during which
the diesel was to be supplied. The payment in respect of
the supply was to be made after the delivery. The
general terms and conditions of the contract are
appearing on the purchase order and there is also mention
that the terms and conditions quoted in Annexure 'A' are
also the terms and conditions of the contract.
7] Clause 16 of Annexure 'A' contains the
arbitration clause and it runs as under:
“16. DISPUTES / ARBITRATION
In the event of any dispute arising between
the two Parties relating to the various terms and
conditions set forth in the contract, the two
Parties undertake to resolve the differences by
mutual consultation. In the event of their
inability to resolve the disputes, all questions,
disputes and differences arising under or in
relation to this Agreement shall be referred to
two Arbitrators. Each Party to appoint his own
Arbitrator by giving notice to other Party. Two
appointed Arbitrators with the consent of each
other will appoint the third Arbitrator. The
award of the Arbitrators so appointed shall be
final, conclusive and binding on all the Parties
to the Agreement and provisions of the
Arbitration & Conciliation Act, 1996 or any
statutory modification or reenactment thereof
and the Rules made thereunder and for the time
being in force shall apply to the arbitration
proceedings under this clause. Venue of the
arbitration shall be at Mumbai.”
8] At Clause 13 of Annexure 'A', there is a mention
about the documents, which can be referred to ascertain
the terms and conditions of contract and Clause 13 runs
as under:
“13. ENTIRE AGREEMENT
This Agreement and the Schedule and Annexure
hereto constitute the entire understanding
between the parties concerning the subject matter
hereof and supercede all prior discussions,
agreements and representations, whether oral or
written and whether or not executed by and
between the parties.”
9] Learned counsel for the respondent plaintiff
submitted that only the first page of Annexure 'A” was
sent by the defendant alongwith the purchase order and so
it cannot be said that there was agreement between the
parties to refer such dispute to Arbitral Tribunal. This
contention is not acceptable. Even Clause No.1.1(d)
appearing on first page of Annexure 'A” is not complete.
It does not look viable that without ascertaining the
terms and conditions of the contract, the plaintiff had
made supply of the diesel when the amount was to be paid
after the delivery. It needs to be presumed for the
present purpose that only after going through all the
terms and conditions of the contract, the supply was made
by the plaintiff.
10] Learned counsel for the respondent – plaintiff
further submitted that in view of Section 7 of the
Arbitration and Conciliation Act, 1996, unless and until
the written document is signed by both the sides,
arbitration agreement cannot come into existence. This
proposition is not at all acceptable. The provision of
Section 7 of the Arbitration and Conciliation Act, 1996,
is as under:
“7. Arbitration agreement
(1) In this Part, "arbitration agreement" means
an agreement by the parties to submit to
arbitration all or certain disputes which have
arisen or which may arise between them in
respect of a defined legal relationship,
whether contractual or not.
(2) An arbitration agreement may be in the form
of an arbitration clause in a contract or in
the form of a separate agreement.
(3) An arbitration agreement shall be in
writing.
(4) An arbitration agreement is in writing if
it is contained in
(a) a document signed by the parties;
(b) an exchange of letters, telex, telegrams or
other means of telecommunication which provide
a record of the agreement; or
(c) an exchange of statements of claim and
defence in which the existence of the agreement
is alleged by one party and not denied by the
other.
(5) The reference in a contract to a document
containing an arbitration clause constitutes an
arbitration agreement if the contract is in
writing and the reference is such as to make
that arbitration clause part of the contract.”
11] Section 7(1) of the Act gives the meaning of
arbitration agreement. In Section 7(2), it is mentioned
that arbitration agreement may be in the form of a clause
in the contract itself or it may be in a separate form or
a separate agreement. Section 7(3) shows that arbitration
agreement needs to be in writing. Thus, it can be said
that in Section 7(3), it is made clear that arbitration
agreement should be in writing but this subsection does
not show that unless and until it is signed by both the
sides, the agreement will not come into existence.
Section 7(4) gives the meaning of written agreement.
Subsection 4(a) shows that it can be inferred that it is
an written agreement if a document is signed by the
parties. Subsection 4(b) shows that written agreement
can come into existence by exchange of letter, telex,
telegrams or other means of telecommunication which
provide a record of the agreement. Subsection 4(c)
shows that arbitration agreement can come into existence
by exchange of statements of claim and defence also.
Thus, when the purchase order is placed, as in the
present case, the matter will fall u/s 7(4)(b). This
subsection does not show that there needs to be
signature of other party. In the present matter, written
order like purchase order was given by the defendant to
the plaintiff and the order provided that it was upto the
plaintiff either to accept or not to accept this
proposal. As the supply was made by the plaintiff as per
this order and there is specific admission in that regard
in the plaint, it needs to be presumed that the offer
given by the defendant was accepted by the plaintiff and
this acceptance was for all the terms and conditions of
the contract. It is already observed that the terms and
conditions of the contract can be found in the purchase
order and in Annexure 'A'.
12] The aforesaid position of law and facts and
circumstances of present case show that the trial Court
has committed error in observing that signature of the
plaintiff was necessary on this document and as signature
is not there, there was no agreement to refer the dispute
to arbitrator. This objection was taken prior to filing
of written statement as provided in Section 8 of the
Arbitration and Conciliation Act, 1996 by the defendant.
In view of these circumstances, it is necessary for the
parties to refer the dispute to Arbitral Tribunal as
provided in the aforesaid clauses of the contract. It is
not possible for Civil Court to directly refer the matter
to arbitrator as the procedure as laid down in the
aforesaid clauses need to be followed by the parties to
the contract. Thus, there is no other alternative than
to return the plaint for referring the matter to
arbitrator.
13] The learned counsel for the respondent –
plaintiff placed reliance on Karam Chand Thapar & Bros.
(Cs) v. Akaljot Singh Sekhom reported at 2005 (3)
Mh.L.J., 797. The facts and circumstances of this case
are altogether different. This case is of no help to the
respondent – plaintiff.
14] In the result, the civil revision application is
allowed. The order dated 10.12.2013 made on Exhibit 9 in
Special Civil Suit No.349/2012 by learned VIth Joint
Civil Judge, Senior Division, Aurangabad, is hereby set
aside. The application filed at Exhibit 9 by the
defendant is hereby allowed. The plaint be returned to
the plaintiff for following the procedure for appointment
of Arbitral Tribunal.
(T.V. NALAWADE, J.)
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