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REPORTABLE  

IN THE SUPREME COURT OF INDIA  

CIVIL APPELLATE JURISDICTION  

REVIEW PETITOIN (C) Nos. 2629-2630 OF 2018  IN  

CIVIL APPEAL NOS.23512-23513 OF 2017       M/S. EMAAR MGF LAND LIMITED     ...APPELLANT(S)   

 VERSUS  

 AFTAB SINGH         ...RESPONDENT(S)   

J U D G M E N T  

ASHOK BHUSHAN,J.  

These review petitions have been filed seeking  

review of the judgment dated 13.02.2018 of this Court  

by which civil appeals were dismissed.    

2. The Civil Appeal Nos. 23512-23513 of 2017 had been  

filed challenging the order dated 13.07.2017 passed by  

Larger Bench of the National Consumer Disputes  

Redressal Commission (hereinafter referred to as  

“NCDRC”) holding consumer disputes to be non-

arbitrable.  Prayer was also made to set aside the

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subsequent order dated 28.08.2017 passed by Single  

Member of the NCDRC dismissing the application filed  

under Section 8 of the Arbitration and Conciliation  

Act, 1996 (hereinafter referred to as “1996 Act”) by  

the appellant.    

3. Looking to the nature of the issue raised in these  

review petitions, we have heard learned counsel for the  

parties on 27.11.2018 in the review petitions after  

issuing notice on 17.09.2018.  Delay in filing of  

review petitions is condoned.  Learned counsel for the  

parties have made elaborate submissions, which we  

proceed to consider in these review petitions.    

 4. Brief facts giving rise to civil appeals and the  

review petitions need to be noted for appreciating the  

issues raised herein.  The appellant is a company which  

has acquired and purchased land in District Mohali,  

Punjab with a view to set up and develop thereon an  

integrated township. The respondent submitted an  

application to the appellant for allotment of a villa  

in Sector 106, Mohali.  A Buyer’s agreement was entered  

dated 06.05.2008 between the appellant and the

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respondent.  In the Buyer’s agreement, there was an  

arbitration clause providing for settlement of disputes  

between parties under the 1996 Act.  On 27.07.2015, the  

respondent filed a Complaint No. 701 of 2015 before the  

NCDRC against the appellant praying for following  

reliefs in Paragraph No.17 of the complaint, which are  

as follows:-  

“a. The complainant prays for a direction to  the opposite Parties to deliver the  possession of the built up villa No. 40, At  Sector 106, GMADA, and  

 b. to adjust the excess payment in terms of  

letter dated 2.2.2008, Annexure C-5, which  comes to Rs.2,63,165/- and  

 c. to adjust the penalty @ Rs.1500/- per month  

in terms of clause 8 of the Agreement, after  2011 for 55 months as on date which comes  to Rs.83,500/- and   

 d. to adjust the final account after making  

the above deductions of clause B and C and  to refund the remaining/balance payment  back to the complainant at the earliest  along with interest @ 18% per annum from  6.2.2010 (i.e. 24 months from the date of  the Agreement); and  

 e. the Hon’ble National Commission May be  

pleased to grant compensation to the tune  of Rs. 20,00,000 on account of deficiency  in service on the part of the opposite  parties, mental agony and harassment  suffered by the complainant, and  

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f. the cost of this complaint may be awarded  from the opponent to the complainant, and  

 g. the Hon’ble National Commission may be  

pleased to grant any other relief deemed in  fit just and proper by the Hon’ble National  Commission in the Circumstances of the  case.”    

 5. Notice was issued to the appellant by the NCDRC on  

09.11.2015 asking the appellant to appear on  

11.01.2016.  The appellant appeared and made an  

application for extension of time for filing the  

written statement.  The appellant also filed an  

application under Section 8 of the 1996 Act for  

referring the matter to arbitration for and on behalf  

of the appellant. In the application, appellant has  

referred to Clause 43 of the Buyer’s agreement, which  

according to appellant would constitute a valid  

arbitration agreement in terms of Section 7(2) of the  

1996 Act.  The appellant also filed a reply to the  

complaint.  The application filed under Section 8 of  

the 1996 Act was objected by the respondent with the  

prayer that the said application be rejected. NCDRC  

heard the complaint case of the respondent alongwith  

several other similarly situated applications in the  

complaint case filed by the respondent and other

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similarly situated applications filed under Section 8  

for referring the parties to the arbitration.  A  

learned Single Member of the Commission proceeded to  

consider the said applications and passed an order  

dated 31.08.2016.  The learned Single Member had taken  

the view that considering the vital importance and far  

reaching consequence of the legal issue involved in  

these applications, it would only be appropriate that  

these applications are considered and decided by a  

Larger Bench, consisting of at least Three Members.    

6. In pursuance of the order of the learned Single  

Member, a Larger Bench of NCDRC was constituted and  

Consumer Complaint No. 701 of 2015 with Interim  

Application No. 247 of 2016 as well as interim  

applications filed by other complainants were heard and  

decided by Three Members Bench presided by President  

of the NCDRC vide its judgment dated 13.07.2017.  The  

Three Members Bench have considered the submissions of  

the parties in detail and arrived at following  

conclusions in Paragraph Nos. 55 and 56:-  

“55. In view of the afore-going discussion, we  arrive at the following conclusions: (i) the  disputes which are to be adjudicated and

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governed by statutory enactments, established  for specific public purpose to sub-serve a  particular public policy are not arbitrable;  (ii) there are vast domains of the legal  universe that are non-arbitrable and kept at a  distance from private dispute resolution;  (iii) the subject amendment was meant for a  completely different purpose, leaving status  quo ante unaltered and subsequently reaffirmed  and restated by the Hon'ble Supreme Court; (iv)  Section 2(3) of the Arbitration Act recognizes  schemes under other legislations that make  disputes non-arbitrable and (iv) in light of  the overall architecture of the Consumer Act  and Court-evolved jurisprudence, amended sub- section (1) of Section 8 cannot be construed  as a mandate to the Consumer Forums,  constituted under the Act, to refer the parties  to Arbitration in terms of the Arbitration  Agreement.    56. Consequently, we unhesitatingly reject the  arguments on behalf of the Builder and hold  that an Arbitration Clause in the afore-stated  kind of Agreements between the Complainants and  the Builder cannot circumscribe the  jurisdiction of a Consumer Fora,  notwithstanding the amendments made to Section  8 of the Arbitration Act.”      

7. After the reference having been answered by Three   

Members Bench, the Consumer Complaint No. 701 of 20156  

alongwith other applications was taken by a Single  

Member of the Commission and by order dated 28.08.2017,  

the applications filed by the appellant under Section  

8 of the 1996 Act were rejected.  After rejecting the

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application under Section 8, the Commission directed  

the parties to proceed further with the complaint.  The  

appellant filed F.A.O. No. 395 of 2017 in the Delhi  

High Court challenging the orders dated 13.07.2017 and  

28.08.2017 of NCDRC.  The High Court held that appeals  

filed by the appellant under Section 37(1)(a) of the  

1996 Act have been wrongly brought before the High  

Court.  The High Court refused to entertain the appeals  

and returned to be presented before the appropriate  

Appellate Court.  After the judgment of the Delhi High  

Court dated 07.11.2017, the appellant filed Civil  

Appeal No. 23512-23513 of 2017 challenging the judgment  

of Larger Bench of NCDRC dated 13.07.2017 as well as  

the consequential order dated 28.08.2017 in this Court.   

Both the appeals were called for hearing on 13.02.2018  

and were dismissed by this Court.  The appellant has  

filed these review petitions to review the judgment of  

this Court.  In the review petitions, following prayers  

have been made by the appellant:-  

“(1)Allow the present review petition and  review the Order dated 13.02.2018 passed by  this Hon’ble Court in Civil Appeal No.  23512-23513 of 2017;  

(2)Set aside the Order dated 13.07.2017 passed  by the Larger Bench of the Hon’ble National  Commission in C.C. 701/2015 holding

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consumer disputes to be non-arbitrable  amongst other similar erroneous findings;  

 (3)Set aside the Order dated 28.08.2017 passed  

by the Single Judge of the Hon’ble National  Commission in C.C. 701/2015 dismissing the  Application u/S. 8 of the Arbitration and  Conciliation Act, 1996;  

 (4)And pass such other or further order or  

orders as the Hon’ble Court may deem fit  and proper in the interest of justice.“  

8. We have heard Shri Fali S. Nariman, learned senior  

counsel appearing for the appellant and Shri Aditya  

Swarup, learned counsel appearing for the respondent  

No.1.    

9. Shri Fali s. Nariman in his imitable style in  

support of review petitions submits that substantial  

questions of law has been raised in the present review  

petitions, which need to be addressed and decided by  

this Court.  Shri Nariman submits that after amendment  

of Section 8 of 1996 Act by the Arbitration and  

Conciliation (Amendment) Act, 2015 (Act 3 of 2016), by  

which Parliament had added the words “notwithstanding  

any judgment, decree or order of the Supreme Court or  

any Court” in Section 8 of the Arbitration Act w.e.f.  

23.10.2015, the Parliamentary intendment is clear that

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after the said amendment, the judicial authority is  

mandated to refer a dispute for arbitration if there  

is a valid arbitration agreement and parties apply not  

later than the date of submitting his first statement  

on the substance of the dispute.  He submits that the  

above words cannot be treated as redundant while  

interpreting the amended Section 8.  It is further  

submitted that this Court acting as an Appellate Court  

under Section 23 of Consumer Protection Act, 1986 read  

with Section 37(1)(a) of 1996 Act has duty to go into  

every fact and law including the amendment made in  

Section 8 of the 1996 Act.  It is submitted that  

Constitution Bench of this Court has already held that  

consumer fora are covered by the term “judicial  

authority” for the purposes of Section 8 of the 1996  

Act, hence, it was obligatory for the Commission to  

refer the dispute to arbitration in view of the  

arbitration clause between the parties.  NCDRC has  

wrongly termed consumer disputes as non-arbitrable,  

which is contrary to the decision of this Court in  

National Seeds Corporation Limited Vs. M. Madhusudan  

Reddy and Another, (2012) 2 SCC 506.  This Court had  

interpreted the words “notwithstanding any judgment,

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decree or order of the Supreme Court or any Court” as  

occurring in newly added Section 11(6A) of the 1996 Act  

in Duro Felguera, S.A. Vs. Gangavaram Port Limited,  

(2017) 9 SCC 729, which interpretation is equally  

applicable to Section 8 as amended by Act 3 of 2016.   

NCDRC has erred in relying on judgment of this Court  

in A. Ayyasamy Vs. A. Paramasivam and Others, (2016)  

10 SCC 386.  The amendment in Section 8 of Arbitration  

Act by Act 3 of 2016 now makes it obligatory to judicial  

authority to refer disputes to arbitration  

notwithstanding any judgment, decree or order of the  

Supreme Court or any Court.  Judgments of this Court  

interpreting Section 8 prior to 2016 amendment, thus,  

have become wholly irrelevant and have to be  

disregarded while deciding the application under  

Section 8 filed after 2016 amendment.  

 10. Referring to Section 2(3) of the 1996 Act, it is  

submitted that it cannot be said that by reason of  

provision of Consumer Protection Act, consumer disputes  

cannot be submitted to arbitration.  It is further  

submitted that far from the Consumer Protection Act,  

1986, providing either expressly or by necessary

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implication that consumer disputes may not be submitted  

to arbitration, the law as explained in the National  

Seeds Corporation Limited (supra) and in Rosedale  

Developers Private Limited (supra) clearly shows that  

arbitration of consumer disputes is definitely  

envisaged and contemplated in the Consumer Protection  

Act, 1986, itself, before the amendment by way of  

substitution of Section 8(1) of the 1996 Act, it was  

at the option of the complainant (under Section 8(1)  

as enacted) to either go to arbitration as provided for  

in the arbitration agreement or to file a complaint  

under the Consumer Protection Act, 1986.  It is  

submitted that after the substitution of Section 8(1)  

even this option is no longer available, it being  

mandatory for the judicial authority (NCDRC) to refer  

the parties to arbitration “unless it finds that prima  

facie no valid arbitration agreement exists”.          

11. Shri Aditya Swarup, learned counsel appearing for  

the respondent in his short and impressive submissions  

contends that the Consumer Act, 1986 provides for an  

additional and beneficial remedy to the consumer to  

avail of the speedy, expeditious disposal of his or her

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dispute.  The consequences of allowing the present  

petition and setting aside the impugned order would,  

inter alia, be that every consumer, no matter how small  

or big the dispute, would now be forced to adjudicate  

his dispute before an arbitral tribunal and not avail  

of the beneficial remedy provided to him or her. Under  

the 1986 Act.  Accepting the interpretation placed by  

the appellant on the 1996 Act will mean collapsing of  

entire edifice of consumer jurisprudence but also  

jurisprudence relating to trusts, tenancy disputes,  

industrial disputes, telecom disputes, intellectual  

property disputes and other non-arbitral disputes.   

Repeating the words of NCDRC, it is submitted that “the  

ripples of the amendment to Section 8(1) cannot be so  

large as to inundate the domains of other legislations  

and jurisprudence, painstakingly built by the  

Legislators and Courts, especially without any  

engagement, debate and critique with the foundations  

of these related laws”.  Section 2(3) of the  

Arbitration Act expressly states that Part I of the  

Arbitration Act “shall not affect any other law for the  

time being in force by virtue of which certain disputes  

may not be referred to arbitration”.  Under this

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Section, if any law provides, either expressly or by  

necessary implication that specified disputes may not  

be submitted to arbitration, then, in spite of the non  

obstante provision in Section 5 of the Arbitration Act,  

the law will be saved by Section 2(3) of the Arbitration  

Act.  Section 2(3) of the Arbitration Act restricts the  

overriding effect apparent in Section 5 of the  

Arbitration Act.  The Consumer Act being a beneficial  

legislation enacted to give an additional remedy for  

the settlement of disputes, the same cannot be taken  

away by Section 8 of the 1996 Act.  This Court in  

jurisdiction cases have already held that Arbitration  

Act does not exclude the jurisdiction of the Consumer  

Forum to decide disputes under the Consumer Act.  The  

amendment to Section 8(1) of the Arbitration Act by Act  

3 of 2016 was never intended to interfere with the  

jurisdiction of Consumer Forum to decide consumer  

disputes.  He submits that amendment in Section 8(1)  

is being read in a manner which was never the intention  

of the Parliament.  He submits that the NCDRC has  

rightly rejected the application under Section 8 filed  

by the appellant and no error has been committed by

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this Court in dismissing the appeal, hence, the present  

petitions are liable to be dismissed.   

12. From the submissions of the learned counsel for  

the parties and pleadings of the parties following are  

the principal issues which arise for consideration in  

these petitions:  

(i) Whether NCDRC committed error in  

rejecting the application of the  

appellant filed under Section 8 of 1996,  

Act praying for reference to the  

arbitrator as per Arbitration clause in  

the builders agreement?   

(ii) Whether after the amendments made in  

Section 8 by the Arbitration and  

Conciliation (Amendment)Act, 2015 the  

application filed under Section 8 by the  

appellant could not have been rejected  

in view of substantial changes brought  

in the statutory scheme by inserting the  

words “notwithstanding any judgment,  

decree or order of the Supreme Court or

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any Court” in sub-section (1) of Section  

8?  

(iii) Whether NCDRC as well as this Court  

committed error in not adverting to the  

above statutory amendment which  

completely changed the legal position as  

was earlier existing prior to the  

aforesaid amendment?   

(iv) Whether by the insertion of words  

“notwithstanding any judgment, decree  

or order of the Supreme Court or any  

Court” under Section 8(1) by the   

(Amendment) Act, 2015 legislature  

intended to do away with the decision  

of judgments of Supreme Court laying  

down that Consumer Protection Act being  

special remedy can be initiated and  

continued despite there being any  

arbitration agreement between the  

parties?  

 13. All the issues being interconnected are being taken  

together. The main emphasis of Shri Fali S. Nariman,

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learned senior counsel for the petitioner is that  

entire legal regime pertaining to the 1996, Act in  

relation to Consumer Protection Act when seen after the  

amendment fully supports the interpretation put by the  

petitioner which has not at all adverted by the NCDRC  

and this Court.   

 14. Before we come to the amendments made by the 2015,  

Act and its real intent and consequences, it is  

necessary to look into the law as was existing prior  

to the said amendment in relation to proceedings under  

Consumer Protection Act in reference to arbitration  

agreement under 1996 Act.  

 15. The Consumer Protection Act, 1986 has been enacted  

to provide for better protection of the interests of  

consumers and for the purpose, to make provision for  

the establishment of Consumer Councils and other  

authorities for the settlement of consumer disputes and  

for matter connected therewith. This Court had occasion  

to consider the object and purpose of the Act in Lucknow  

Development Act vs. M.K. Gupta, (1994) 1 SCC 243, this  

Court elaborately noticed the object and purpose of the  

Act in the following words:   

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“To begin with the preamble of the Act, which can  afford useful assistance to ascertain the  legislative intention, it was enacted, ‘to provide  for the protection of the interest of consumers’.  Use of the word ‘protection’ furnishes key to the  minds of makers of the Act. Various definitions and  provisions which elaborately attempt to achieve  this objective have to be construed in this light  without departing from the settled view that a  preamble cannot control otherwise plain meaning of  a provision. In fact the law meets long felt  necessity of protecting the common man from such  wrongs for which the remedy under ordinary law for  various reasons has become illusory. Various  legislations and regulations permitting the State  to intervene and protect interest of the consumers  have become a haven for unscrupulous ones as the  enforcement machinery either does not move or it  moves ineffectively, inefficiently and for reasons  which are not necessary to be stated. The importance  of the Act lies in promoting welfare of the society  by enabling the consumer to participate directly in  the market economy. It attempts to remove the  helplessness of a consumer which he faces against  powerful business, described as, ‘a network of  rackets’ or a society in which, ‘producers have  secured power’ to ‘rob the rest’ and the might of  public bodies which are degenerating into  storehouses of inaction where papers do not move  from one desk to another as a matter of duty and  responsibility but for extraneous consideration  leaving the common man helpless, bewildered and  shocked. The malady is becoming so rampant,  widespread and deep that the society instead of  bothering, complaining and fighting against it, is  accepting it as part of life. The enactment in these  unbelievable yet harsh realities appears to be a  silver lining, which may in course of time succeed  in checking the rot.”   

16. Section 3 of the Act provided that the provisions  

of this Act shall be in addition to and not in

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derogation of the provisions of any other law for the  

time being in force. Noticing the object and purpose  

of the Act as well as Section 3, this Court in  

Secretary, Thirumurugan Cooperative Agricultural  

Credit Society vs. M. Lalitha (dead) Through LRs. And  

others, (2004) 1 SCC 395, laid down following in  

paragraph 11 and 12:  

“11. From the Statement of Objects and Reasons  and the scheme of the 1986 Act, it is apparent  that the main objective of the Act is to  provide for better protection of the interest  of the consumer and for that purpose to provide  for better redressal, mechanism through which  cheaper, easier, expeditious and effective  redressal is made available to consumers. To  serve the purpose of the Act, various quasi- judicial forums are set up at the district,  State and national level with wide range of  powers vested in them. These quasi-judicial  forums, observing the principles of natural  justice, are empowered to give relief of a  specific nature and to award, wherever  appropriate, compensation to the consumers and  to impose penalties for non-compliance with  their orders.    

12. As per Section 3 of the Act, as already  stated above, the provisions of the Act shall  be in addition to and not in derogation of any  other provisions of any other law for the time  being in force. Having due regard to the scheme  of the Act and purpose sought to be achieved  to protect the interest of the consumers  better, the provisions are to be interpreted  broadly, positively and purposefully in the  context of the present case to give meaning to  additional/extended jurisdiction, particularly  when Section 3 seeks to provide remedy under

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the Act in addition to other remedies provided  under other Acts unless there is a clear bar.”  

17. This court had occasion to consider the provisions  

of Section 34 of Arbitration Act, 1940 in reference to  

the Consumer Protection Act, 1986 in Fair Air  

Engineering Pvt. Ltd. and another vs. N.K. Modi, (1996)  

6 SCC 385. This Court in the said case held that  

consumer fora is a judicial authority. In the above  

case, the appellant had entered into a contract with  

the respondent to carry out installation of a centrally  

air-conditioned plant in the residential house of the  

respondent. The respondent filed a complaint before the  

State Commission under the Consumer Protection At, 1986  

which proceedings were stayed by the State Commission  

and it relegated the parties to arbitration  

proceedings. The NCDRC held that the proceedings before  

the Consumer fora is not a legal proceedings and  

Commission is not a judicial authority, therefore,  

Section 34 of the Arbitration Act, 1940 is not  

available to stay the proceedings. The said order of  

NCDRC was challenged in this Court. This Court reversed  

the order of the State Commission and remitted the

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matter to the State Commission to decide the matter on  

merits according to law. This Court held that the  

Parliament was well aware of the Arbitration Act, 1940  

when the Consumer Protection Act was enacted providing  

for additional remedy. In paragraphs 15 and 16  

following has been laid down:  

“15. Accordingly, it must be held that the  provisions of the Act are to be construed  widely to give effect to the object and purpose  of the Act. It is seen that Section 3 envisages  that the provisions of the Act are in addition  to and are not in derogation of any other law  in force. It is true, as rightly contended by  Shri Suri, that the words “in derogation of the  provisions of any other law for the time being  in force” would be given proper meaning and  effect and if the complaint is not stayed and  the parties are not relegated to the  arbitration, the Act purports to operate in  derogation of the provisions of the Arbitration  Act. Prima facie, the contention appears to be  plausible but on construction and conspectus  of the provisions of the Act we think that the  contention is not well founded. Parliament is  aware of the provisions of the Arbitration Act  and the Contract Act, 1872 and the  consequential remedy available under Section 9  of the Code of Civil Procedure, i.e., to avail  of right of civil action in a competent court  of civil jurisdiction. Nonetheless, the Act  provides the additional remedy.    16. It would, therefore, be clear that the  legislature intended to provide a remedy in  addition to the consentient arbitration which  could be enforced under the Arbitration Act or  the civil action in a suit under the provisions  of the Code of Civil Procedure. Thereby, as  seen, Section 34 of the Act does not confer an

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automatic right nor create an automatic embargo  on the exercise of the power by the judicial  authority under the Act. It is a matter of  discretion. Considered from this perspective,  we hold that though the District Forum, State  Commission and National Commission are  judicial authorities, for the purpose of  Section 34 of the Arbitration Act, in view of  the object of the Act and by operation of  Section 3 thereof, we are of the considered  view that it would be appropriate that these  forums created under the Act are at liberty to  proceed with the matters in accordance with the  provisions of the Act rather than relegating  the parties to an arbitration proceedings  pursuant to a contract entered into between the  parties. The reason is that the Act intends to  relieve the consumers of the cumbersome  arbitration proceedings or civil action unless  the forums on their own and on the peculiar  facts and circumstances of a particular case,  come to the conclusion that the appropriate  forum for adjudication of the disputes would  be otherwise those given in the Act.”      

18.  This Court had occasion to consider the provisions  

of Consumer Protection Act as well as the Arbitration  

Act, 1996. In Skypak Couriers Ltd. v. Tata Chemicals,  

(2000) 5 SCC 294, this Court laid down the following:  

“Even if there exists an arbitration clause in  an agreement and a complaint is made by the  consumer, in relation to a certain deficiency  of service, then the existence of an  arbitration clause will not be a bar to the  entertainment of the complaint by the Redressal  Agency, constituted under the Consumer  Protection Act, since the remedy provided under  the Act is in addition to the provisions of  any other law for the time being in force.”  

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19.  Another judgment which is relevant for the present  

issue is National Seeds Corporation Limited vs. M.  

Madhusudhan Reddy and another, (2012) 2 SCC 506. In the  

above case, the respondent filed a complaint in the  

District Consumer Redressal Forum that they had  

suffered loss due to failure of the crops/less yield  

because the seeds sold/supplied by the appellant were  

defective. The compensation was awarded against which  

appeal was dismissed. The appellant challenged the  

order of the Commission and main contention was that  

the District Forum has no jurisdiction to entertain the  

complaint, in view of the provisions of Seeds Act, 1966  

it was contended that there was arbitration clause  

contained in the agreement and the only remedy  

available to the respondent is an appropriate  

arbitration and the District Forum has no jurisdiction  

to entertain the complaint. This Court repelled the  

submission and dismissed the appeal. In paragraph 64  

this Court had noticed the contention of the appellant  

which is to the following effect:  

“64. According to the learned counsel for the  appellant, if the growers had applied for  arbitration then in terms of Section 8 of the  Arbitration and Conciliation Act the dispute  arising out of the arbitration clause had to be

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referred to an appropriate arbitrator and the  District Consumer Forums were not entitled to  entertain their complaint. This contention  represents an extension of the main objection  of the appellant that the only remedy available  to the farmers and growers who claim to have  suffered loss on account of use of defective  seeds sold/supplied by the appellant was to file  complaints with the Seed Inspectors concerned  for taking action under Sections 19 and/or 21  of the Seeds Act.”    

20. The contention was dealt with in paragraph 66 where  

following was laid down:  

“66. The remedy of arbitration is not the only  remedy available to a grower. Rather, it is an  optional remedy. He can either seek reference  to an arbitrator or file a complaint under the  Consumer Protection Act. If the grower opts for  the remedy of arbitration, then it may be  possible to say that he cannot, subsequently,  file complaint under the Consumer Protection  Act. However, if he chooses to file a complaint  in the first instance before the competent  Consumer Forum, then he cannot be denied relief  by invoking Section 8 of the Arbitration and  Conciliation Act, 1996. Moreover, the plain  language of Section 3 of the Consumer Protection  Act makes it clear that the remedy available in  that Act is in addition to and not in derogation  of the provisions of any other law for the time  being in force.”    

21. Another judgment where this Court reiterated the  

position of law is Rosedale Developers Private Limited  

Vs Aghore Bhattacharya And Others, (2018) 11 SCC 337  

(decided on 06.09.2013). In the above case, a complaint  

was filed by the respondent before NCDRC. An

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application was filed by the appellant praying for  

making reference to the arbitrator in view of the  

arbitration agreement. The issue has been noticed in  

paragraphs 1 and 2 which are to the following effect:  

“1. Delay condoned. This appeal filed against  order dated 13-5-2013 (2013 SCC OnLine Ncdrc  486, DLF Ltd. v. Mridul Estate (P) Ltd.338b)  passed by the National Consumer Disputes  Redressal Commission (for short “the National  Commission”) whereby the appellant’s prayer  for making a reference to the arbitrator was  rejected can appropriately be termed as a  frivolous piece of litigation which merits  nothing but dismissal at the threshold with  exemplary costs.  

 2. The respondents filed complaint alleging  deficiency in service on the appellant’s part  and claimed compensation to the tune of Rs  17,41,09,000 with costs of Rs 1,00,000. On  being noticed by the National Commission, the  appellant filed a written statement to contest  the complaint. It also filed an application  under Section 8 of the Arbitration and  Conciliation Act, 1996 (for short “the 1996  Act”) for making a reference to the arbitrator.  A two-member Bench of the National Commission  referred the matter to the larger Bench. After  considering the relevant statutory provisions  and adverting to several judgments including  the judgments in Fair Air Engineers (P) Ltd.  v. N.K. Modi; Skypak Couriers Ltd. v. Tata  Chemicals Ltd.  and National Seeds Corpn. Ltd.  v. M. Madhusudhan Reddy, the larger Bench of  the National Commission held that the consumer  forums constituted under the Consumer  Protection Act, 1986 (for short “the 1986 Act”)  are not bound to refer the dispute raised in  the complaint to an Arbitral Tribunal in terms  of the arbitration clause contained in the  agreement entered into between the parties.

25    

22. The contention was raised before this Court that  

once an application under Section 8 of 1996 Act is  

filed, Consumer Forum is duty-bound to make a reference  

to the arbitrator. The above submission was noticed in  

paragraph 3 which is to the following effect:  

“3. Shri Sanjay Ghose, learned counsel for the  appellant relied upon the judgment of the  Constitution Bench in SBP & Co. v. Patel Engg.  Ltd. as also the judgments in Agri Gold Exims  Ltd. v. Sri Lakshmi Knits and Wovens and Magma  Leasing and Finance Ltd. v. Potluri Madhavilata  and argued that once an application is filed  under Section 8 of the 1996 Act, the consumer  forum is duty-bound to make a reference to the  arbitrator because that section is mandatory  in character.”    

23. This Court rejected the above submission and laid  

down in paragraph 4:  

“4. In our opinion, there is no merit in the  submission of the learned counsel. The question  whether the existence of an arbitration clause  contained in the agreement executed between the  parties excludes the jurisdiction of the  consumer forum and on an application made by  either party, the consumer forum is duty-bound  to make a reference to the arbitrator was  extensively considered in National Seeds  Corpn. Ltd. v. M. Madhusudhan Reddy and it was  observed: (SCC pp. 534-35, paras 64-66.)”    

24. This Court held that there is no merit in the above  

submission of the counsel. This Court referred to

26    

judgments of this Court in National Seeds Corporation  

Ltd. (supra) and Fair Air Engineers Pvt. Ltd.(supra)  

and laid down following in paragraph 6 and 7:  

“6. The judgments relied upon by Shri Ghose do  not have any bearing on the issue raised in  this appeal. In neither of those cases, has  this Court interpreted the provisions of the  1996 Act in the light of the provisions  contained in the 1986 Act. Therefore, the  propositions laid down in those judgments that  Section 8 of the 1996 Act is mandatory cannot  lead to an inference that the consumer forum  is bound to make a reference to the Arbitral  Tribunal.    7. In view of the abovestated legal position,  the National Commission did not commit any  error by holding that the remedy of arbitration  available to the complainant does not bar the  jurisdiction of the consumer forums and the  consumer forums are not under an obligation to  refer the matter to the Arbitral Tribunal. With  the above observation, the appeal is  dismissed.”    

25. This Court in the series of judgments as noticed  

above considered the provisions of Consumer Protection  

Act, 1986 as well as Arbitration Act, 1996 and laid  

down that complaint under Consumer Protection Act being  

a special remedy, despite there being an arbitration  

agreement the proceedings before Consumer Forum have  

to go on and no error committed by Consumer Forum on  

rejecting the application. There is reason for not

27    

interjecting proceedings under Consumer Protection Act  

on the strength an arbitration agreement by Act, 1996.  

The remedy under Consumer Protection Act is a remedy  

provided to a consumer when there is a defect in any  

goods or services. The complaint means any allegation  

in writing made by a complainant has also been  

explained in Section 2(c) of the Act. The remedy under  

the Consumer Protection Act is confined to complaint  

by consumer as defined under the Act for defect or  

deficiencies caused by a service provider, the cheap  

and a quick remedy has been provided to the consumer  

which is the object and purpose of the Act as noticed  

above.   

26. Not only the proceedings of Consumer Protection  

Act, 1986 are special proceedings which were required  

to be continued under the Act despite an arbitration  

agreement, there are large number of other fields where  

an arbitration agreement can neither stop or stultify  

the proceedings. For example, any action of a party,  

omission or commission of a person which amounts to an  

offence has to be examined by a criminal court and no  

amount of agreement between the parties shall be  

relevant for the said case. For example, there may be

28    

a commercial agreement between two parties that all  

issues pertaining to transaction are to be decided by  

arbitration as per arbitration clause in the agreement.  

In case where a cheque is dishonoured by one party in  

transaction, despite the arbitration agreement party  

aggrieved has to approach the criminal court.  

Similarly, there are several issues which are non-

arbitrable. There can be prohibition both express or  

implied for not deciding a dispute on the basis of an  

arbitration agreement. This Court had occasion to  

consider the above aspect and has noticed various  

disputes which are non-arbitrable, reference is made  

to the judgment of this Court in Booz Allen and Hamilton  

Inc. vs. SBI Home Finance Limited and others, (2011) 5  

SCC 532. In paragraphs 35 to 38 following has been laid  

down:  

“35. The Arbitral Tribunals are private fora  chosen voluntarily by the parties to the  dispute, to adjudicate their disputes in place  of courts and tribunals which are public fora  constituted under the laws of the country.  Every civil or commercial dispute, either  contractual or non-contractual, which can be  decided by a court, is in principle capable of  being adjudicated and resolved by arbitration  unless the jurisdiction of the Arbitral  Tribunals is excluded either expressly or by  necessary implication. Adjudication of certain  categories of proceedings are reserved by the

29    

legislature exclusively for public fora as a  matter of public policy. Certain other  categories of cases, though not expressly  reserved for adjudication by public fora  (courts and tribunals), may by necessary  implication stand excluded from the purview of  private fora. Consequently, where the  cause/dispute is inarbitrable, the court where  a suit is pending, will refuse to refer the  parties to arbitration, under Section 8 of the  Act, even if the parties might have agreed upon  arbitration as the forum for settlement of such  disputes.    36. The well-recognised examples of non- arbitrable disputes are: (i) disputes relating  to rights and liabilities which give rise to  or arise out of criminal offences; (ii)  matrimonial disputes relating to divorce,  judicial separation, restitution of conjugal  rights, child custody; (iii) guardianship  matters; (iv) insolvency and winding-up  matters; (v) testamentary matters (grant of  probate, letters of administration and  succession certificate); and (vi) eviction or  tenancy matters governed by special statutes  where the tenant enjoys statutory protection  against eviction and only the specified courts  are conferred jurisdiction to grant eviction  or decide the disputes.    37. It may be noticed that the cases referred  to above relate to actions in rem. A right in  rem is a right exercisable against the world  at large, as contrasted from a right in  personam which is an interest protected solely  against specific individuals. Actions in  personam refer to actions determining the  rights and interests of the parties themselves  in the subject-matter of the case, whereas  actions in rem refer to actions determining the  title to property and the rights of the  parties, not merely among themselves but also  against all persons at any time claiming an  interest in that property. Correspondingly, a

30    

judgment in personam refers to a judgment  against a person as distinguished from a  judgment against a thing, right or status and  a judgment in rem refers to a judgment that  determines the status or condition of property  which operates directly on the property itself.  (Vide Black’s Law Dictionary.)    38. Generally and traditionally all disputes  relating to rights in personam are considered  to be amenable to arbitration; and all disputes  relating to rights in rem are required to be  adjudicated by courts and public tribunals,  being unsuited for private arbitration. This  is not however a rigid or inflexible rule.  Disputes relating to subordinate rights in  personam arising from rights in rem have always  been considered to be arbitrable.”  

27. The complaints filed under the Consumer Protection  

Act can also be proceeded with despite there being any  

arbitration agreement between the parties which have  

been well settled by the catena of decisions as noticed  

above.   

28. Now, the issue to be addressed is effect and  

consequences of the above stated position of law  

consequent to the Arbitration and Conciliation  

(Amendment) Act, 2015 amending Section 8. Section 8(1)  

and 8(2) of Act, 1996 (as existed prior to amendment  

of the Act, 1996) are as follows:   

“8. Power to refer parties to arbitration  where there is an arbitration agreement.-   (1) A judicial authority before which an

31    

action is brought in a matter which is the  subject of an arbitration agreement shall,  if a party so applies not later than when  submitting his first statement on the  substance of the dispute, refer the parties  to arbitration.     (2) The application referred to in sub- section (1) shall not be entertained unless  it is accompanied by the original arbitration  agreement or a duly certified copy thereof.”     

29. Section 8(1) and 8(2) after Amendment by Act, 2015  

are as follows:  

“Section 8(1) A judicial authority, before  which an action is brought in a matter which  is the subject of an arbitration agreement  shall, if a party to the arbitration agreement  or any person claiming through or under him,  so applies not later than the date of  submitting his first statement on the substance  of the dispute, then, notwithstanding any  judgment, decree or order of the Supreme Court  or any Court, refer the parties to arbitration  unless it finds that prima facie no valid  arbitration agreement exists.     (2) the following proviso shall be inserted,  namely:— “Provided that where the original  arbitration agreement or a certified copy  thereof is not available with the party  applying for reference to arbitration under  sub-section (1), and the said agreement or  certified copy is retained by the other party  to that agreement, then, the party so applying  shall file such application along with a copy  of the arbitration agreement and a petition  praying the Court to call upon the other party  to produce the original arbitration agreement  or its duly certified copy before that  Court.”.”  

32    

30. Two more provisions of the 1996 Act need to be  

noted before we proceed further to consider the issues.   

The 1996 Act contains two Parts – Part I and Part II.   

Part I contains heading “Arbitration” and Part II  

contains heading “Enforcement of certain Foreign  

Awards”.  Chapter I of Part I is “General Provisions”,  

in which Section 2 deals with definitions.  Section  

2(1) begins with the words “In this Part, unless the  

context otherwise requires”.  Section 2(1) contains  

definitions.  Section 2(3) provides:-  

“Section 2(3) This Part shall not affect any  other law for the time being in force by virtue  of which certain disputes may not be submitted  to arbitration.”      

31. There are two aspects to be noticed in the Scheme  

of Section 2, firstly, Section 2 contains a heading  

“Definitions” but it is covered by general heading of  

Chapter I “General Provisions”.  Section 2(3) does not  

contain any definition but contain a general provision  

which clarifies that “This Part shall not affect any  

other law for the time being in force by virtue of  

which certain disputes may not be submitted to  

arbitration”.  Section 2(3) gives predominance of any  

other law for the time being in force by virtue of

33    

which certain disputes may not be submitted to  

arbitration.    

 32. We have already noted several categories of cases,  

which are not arbitrable.  While referring to judgment  

of this Court in Booz Allen and Hamilton Inc. (supra),  

those principles have again been reiterated by this  

Court in A. Ayyasamy (supra), Dr. A.K. Sikri, J.  

delivering the judgment in that case has noticed  

certain cases, which are not arbitrable in paragraph  

No.14, which is as follows:-  

“14. In the instant case, there is no dispute  about the arbitration agreement inasmuch as  there is a specific arbitration clause in the  partnership deed. However, the question is as  to whether the dispute raised by the respondent  in the suit is incapable of settlement through  arbitration. As pointed out above, the Act does  not make any provision excluding any category  of disputes treating them as non-arbitrable.  Notwithstanding the above, the courts have held  that certain kinds of disputes may not be  capable of adjudication through the means of  arbitration. The courts have held that certain  disputes like criminal offences of a public  nature, disputes arising out of illegal  agreements and disputes relating to status,  such as divorce, cannot be referred to  arbitration. The following categories of  disputes are generally treated as non- arbitrable:    (i) patent, trade marks and copyright;  (ii) anti-trust/competition laws;  (iii) insolvency/winding up;

34    

(iv) bribery/corruption;  (v) fraud;  (vi) criminal matters.    Fraud is one such category spelled out by the  decisions of this Court where disputes would  be considered as non-arbitrable.”      

33. Dr. Justice D.Y. Chandrachud, J. in his concurring  

opinion has referred to Booz Allen and Hamilton Inc.  

(supra) and noticed the categories of cases, which are  

not arbitrable.  Paragraph No. 35 of the judgment is  

quoted as below:-  

“35. Ordinarily every civil or commercial  dispute whether based on contract or otherwise  which is capable of being decided by a civil  court is in principle capable of being  adjudicated upon and resolved by arbitration  “subject to the dispute being governed by the  arbitration agreement” unless the jurisdiction  of the Arbitral Tribunal is excluded either  expressly or by necessary implication. In Booz  Allen and Hamilton Inc. v. SBI Home Finance  Ltd., this Court held that (at SCC p. 546, para  35) adjudication of certain categories of  proceedings is reserved by the legislature  exclusively for public fora as a matter of  public policy. Certain other categories of  cases, though not exclusively reserved for  adjudication by courts and tribunals may by  necessary implication stand excluded from the  purview of private fora. This Court set down  certain examples of non-arbitrable disputes  such as: (SCC pp. 546-47, para 36)    (i) disputes relating to rights and liabilities  which give rise to or arise out of criminal  offences;

35    

(ii) matrimonial disputes relating to divorce,  judicial separation, restitution of conjugal  rights and child custody;  (iii) matters of guardianship;  (iv) insolvency and winding up;  (v) testamentary matters, such as the grant of  probate, letters of administration and  succession certificates; and  (vi) eviction or tenancy matters governed by  special statutes where a tenant enjoys special  protection against eviction and specific  courts are conferred with the exclusive  jurisdiction to deal with the dispute.    This Court held that this class of actions  operates in rem, which is a right exercisable  against the world at large as contrasted with  a right in personam which is an interest  protected against specified individuals. All  disputes relating to rights in personam are  considered to be amenable to arbitration while  rights in rem are required to be adjudicated  by courts and public tribunals. The enforcement  of a mortgage has been held to be a right in  rem for which proceedings in arbitration would  not be maintainable. In Vimal Kishor Shah v.  Jayesh Dinesh Shah, (2016) 8 SCC 788 this Court  added a seventh category of cases to the six  non-arbitrable categories set out in Booz  Allen, namely, disputes relating to trusts,  trustees and beneficiaries arising out of a  trust deed and the Trust Act.”  

34. Another Section, which needs to be noted is Section  

5, which is as follows:-  

“Section 5. Extent of judicial intervention.— Notwithstanding anything contained in any  other law for the time being in force, in  matters governed by this Part, no judicial  authority shall intervene except where so  provided in this Part.”   

36    

 35. Section 5 contains an injunction to judicial  

authority from intervening except where so provided in  

this Part.  Section 2(3), Section 8, Section 11 and  

Section 34 are some of the provisions, which provides  

for judicial intervention in matters.  Here, we are  

concerned with power of judicial authority under  

Section 8, hence Section 5 is not much relevant in the  

present case.   

36. Now, we come back to the interpretation of Section  

8 as amended by Act No. 3 of 2016.  What is the  

legislative intent and object in bringing the amendment  

to Section 8 is the main question to be answered in  

this case.  Amendment under Section 8 has been  

undertaken by the Parliament after taking into  

consideration the 246th Law Commission Report (2014).   

Taking into consideration the working of the 1996 Act,  

there was an earlier attempt to carry out certain  

amendments in the 1996 Act.  176th Report of the Law  

Commission on the “Arbitration and Conciliation  

(Amendment) Bill, 2001” was submitted by the  

Commission, although, the Government decided to accept

37    

the recommendations and introduced a bill namely  

“Arbitration and Conciliation (Amendment) Bill, 2003,  

the bill was referred to Department relating Standing  

Committee on Personnel, Public Grievances, Law and  

Justice for a further analysis, which opined that many  

provisions of the bill were insufficient hence the bill  

was withdrawn.  The Ministry of Law and Justice issued  

a consultation paper and asked the Law Commission to  

take a study of the amendments proposed to the 1996  

Act.  The Law Commission submitted 246th Report  

“Amendments to the Arbitration and Conciliation Act,  

1996 in August, 2014.  The Commission in its Report has  

observed “judicial intervention in arbitration  

proceedings adds significantly to the delays in the  

arbitration process and ultimately negates the benefits  

of arbitration”.  Commission referring to amendments,  

which were recommended in Section 8 and 11 in paragraph  

No. 33 stated following:-  

“33. It is in this context, the Commission has  recommended amendments to sections 8 and 11 of  the Arbitration and Conciliation Act, 1996. The  scope of the judicial intervention is only  restricted to situations where the  Court/Judicial Authority finds that the  arbitration agreement does not exist or is null  and void. In so far as the nature of  intervention is concerned, it is recommended

38    

that in the event the Court/Judicial Authority  is prima facie satisfied against the argument  challenging the arbitration agreement, it  shall appoint the arbitrator and/or refer the  parties to arbitration, as the case may be. The  amendment envisages that the judicial  authority shall not refer the parties to  arbitration only if it finds that there does  not exist an arbitration agreement or that it  is null and void. If the judicial authority is  of the opinion that prima facie the arbitration  agreement exists, then it shall refer the  dispute to arbitration, and leave the existence  of the arbitration agreement to be finally  determined by the arbitral tribunal. However,  if the judicial authority concludes that the  agreement does not exist, then the conclusion  will be final and not prima facie……….”    

37. The Report of the Commission on amendment to  

Section 8 as well as Note thereon contains a Note,  

which is to the following effect:-  

“[NOTE: The words “such of the parties… to the  arbitration agreement” and proviso (i) of the  amendment have been proposed in the context of  the decision of the Supreme Court in Sukanya  Holdings Pvt. Ltd. v. Jayesh H. Pandya and  Anr., (2003) 5 SCC 531, – in cases where all  the parties to the dispute are not parties to  the arbitration agreement, the reference is to  be rejected only where such parties are  necessary parties to the action – and not if  they are only proper parties, or are otherwise  legal strangers to the action and have been  added only to circumvent the arbitration  agreement. Proviso (ii) of the amendment  contemplates a two-step process to be adopted  by a judicial authority when considering an  application seeking the reference of a pending  action to arbitration. The amendment envisages  that the judicial authority shall not refer the

39    

parties to arbitration only if it finds that  there does not exist an arbitration agreement  or that it is null and void. If the judicial  authority is of the opinion that prima facie  the arbitration agreement exists, then it shall  refer the dispute to arbitration, and leave the  existence of the arbitration agreement to be  finally determined by the arbitral tribunal.  However, if the judicial authority concludes  that the agreement does not exist, then the  conclusion will be final and not prima facie.  The amendment also envisages that there shall  be a conclusive determination as to whether the  arbitration agreement is null and void.]”     (iii) In sub-section (2), after the words “duly  certified copy thereof” add “or a copy  accompanied by an affidavit calling upon the  other party to produce the original arbitration  agreement or duly certified copy thereof in a  circumstance where the original arbitration  agreement or duly certified copy is retained  only by the other party.”     [NOTE: In many transactions involving  Government bodies and smaller market players,  the original/ duly certified copy of the  arbitration agreement is only retained by the  former. This amendment would ensure that the  latter class is not prejudiced in any manner  by virtue of the same.]”      

38. The Commission proposed amendment in Section 11 by  

adding sub-section (6A).  In its Report, following Note  

was submitted in the above context:-  

“[NOTE: The proposed section 11 (6A) envisages  the same process of determination as is  reflected in the proposed amendment to section  8. Explanation 2 envisages that reference by  the High Court to any person or institution  designated by it shall not be regarded as a

40    

delegation of judicial power. Explanation 3 has  been inserted with the hope and expectation  that High Courts would encourage the parties  to refer the disputes to institutionalize  arbitration by a professional Indian or  international arbitral institute.]”      

39. After taking into consideration the Report of the  

Law Commission, a Bill namely “The Arbitration and  

Conciliation (Amendment) Bill, 2015” was submitted.   

The Statement of Objects and Reasons of the Bill throws  

considerable light on the Objects and Reasons of the  

amendments.  Relevant part of the Statement of Objects  

and Reasons is as follows:-  

“2. The Act was enacted to provide for speedy  disposal of cases relating to arbitration with  least court intervention. With the passage of  time, some difficulties in the applicability  of the Act have been noticed. Interpretation  of the provisions of the Act by courts in some  cases have resulted in delay of disposal of  arbitration proceedings and increase in  interference of courts in arbitration matters,  which tend to defeat the object of the  Act……………………..”    6. xxxxxxxxxxxxxxxxxxxxxxx    (iv) to provide that while considering any  application for appointment of arbitrator, the  High Court or the Supreme Court shall examine  the existence of a prima facie arbitration  agreement and not other issues;    

xxxxxxxxxxxxxxxxxxxxx”   

41    

40. Notes on the Clauses on amendment in Section 8  

reads as follows:-  

“Clause 4 of the Bill seeks to amend section 8  of the principal Act to specify that the  judicial authority shall refer the parties to  arbitration unless it finds that prima facie  no valid arbitration agreement exits. A proviso  below sub-section (2) is inserted to provide  that where the original arbitration agreement  or certified copy thereof is not available with  the party who apply under sub-section (1), and  is retained by the other party, such party  shall file a copy of the arbitration agreement  along with application under sub-section (1)  praying the Court to call upon the other party  to produce the original arbitration agreement  or its duly certified copy before the Court.”  

41. On amendment to Section 11 by inserting sub-section  

(6A), following was stated:-      

“Clause 6 of the Bill seeks to amend section  11 of the principal Act to provide that  appointment of arbitrator shall be made by the  Supreme Court or the High Court, as the case  may be, instead of the Chief Justice of India  or the Chief Justice of the High Court.  Subsection (6A) is inserted to provide that the  Supreme Court or the High Court while  considering application under sub-section (4)  to (6) shall confine to the examination of an  arbitration agreement………………..”      

42. Prior to above amendment, this Court in several  

cases has interpreted Section 8.  Several conditions  

for exercising power under Section 8 were laid down by  

this Court.  In P. Anand Gajapathi Raju and Others Vs.

42    

P.V.G. Raju (Dead) and Others, (2000) 4 SCC 539,  

several conditions were noticed by this Court, which  

are to be satisfied before Court can exercise its power  

under Section 8.  In paragraph No.5, following has been  

stated:-  

“5. The conditions which are required to be  satisfied under sub-sections (1) and (2) of  Section 8 before the court can exercise its  powers are:    (1) there is an arbitration agreement;    (2) a party to the agreement brings an action  in the court against the other party;    (3) subject-matter of the action is the same  as the subject-matter of the arbitration  agreement;    (4) the other party moves the court for  referring the parties to arbitration before it  submits his first statement on the substance  of the dispute.    

Xxxxxxxxxxxxxxxxxx”    

43. In Paragraph No. 8 of the judgment, it was further  

stated that the language of Section 8 is peremptory and  

it is, therefore, obligatory for the Court to refer the  

parties to arbitration in terms of their arbitration  

agreement.   

43    

44. In Sukanya Holdings (P) Ltd. Vs. Jayesh H. Pandya  

and Another, (2003) 5 SCC 531, this Court had occasion  

to consider the ingredients of Section 8.  This Court  

noticed certain circumstances, where matter was not  

required to be referred to the Arbitral Tribunal.  In  

Paragraph No. 12, 13 and 15, following has been held:-  

“12. …………… Further, the matter is not required  to be referred to the Arbitral Tribunal, if:  (1) the parties to the arbitration agreement  have not filed any such application for  referring the dispute to the arbitrator; (2)  in a pending suit, such application is not  filed before submitting first statement on the  substance of the dispute; or (3) such  application is not accompanied by the original  arbitration agreement or duly certified copy  thereof………………………………..     13. Secondly, there is no provision in the Act  that when the subject-matter of the suit  includes subject-matter of the arbitration  agreement as well as other disputes, the matter  is required to be referred to arbitration.  There is also no provision for splitting the  cause or parties and referring the subject- matter of the suit to the arbitrators.    15. The relevant language used in Section 8 is:  “in a matter which is the subject of an  arbitration agreement”. The court is required  to refer the parties to arbitration. Therefore,  the suit should be in respect of “a matter”  which the parties have agreed to refer and  which comes within the ambit of arbitration  agreement. Where, however, a suit is commenced  — “as to a matter” which lies outside the  arbitration agreement and is also between some  of the parties who are not parties to the  arbitration agreement, there is no question of

44    

application of Section 8. The words “a matter”  indicate that the entire subject-matter of the  suit should be subject to arbitration  agreement.”      

45. Court further held that Section 8 does not admit  

interpretation to partly referring the disputes to  

arbitration.  In Paragraph No.16, following was laid  

down:-   

“16. The next question which requires  consideration is — even if there is no  provision for partly referring the dispute to  arbitration, whether such a course is possible  under Section 8 of the Act. In our view, it  would be difficult to give an interpretation  to Section 8 under which bifurcation of the  cause of action, that is to say, the subject- matter of the suit or in some cases bifurcation  of the suit between parties who are parties to  the arbitration agreement and others is  possible. This would be laying down a totally  new procedure not contemplated under the Act.  If bifurcation of the subject-matter of a suit  was contemplated, the legislature would have  used appropriate language to permit such a  course. Since there is no such indication in  the language, it follows that bifurcation of  the subject-matter of an action brought before  a judicial authority is not allowed.”  

46. The law as declared by this Court in the above  

cases was in existence when the Law Commission  

submitted its 246th Report and Parliament considered  

the Bill, 2015 for Amendment Act, 2016.  The Law  

Commission itself in its Report has referred to

45    

amendment in Section 8 in context of decision of this  

Court in Sukanya Holdings (P) Ltd. (supra), which was  

clearly noticed in the Note to Section 8 as extracted  

above.  The words “notwithstanding any judgment, decree  

or order of the Supreme Court or any Court” added by  

amendment in Section 8 were with intent to minimise the  

intervention of judicial authority in context of  

arbitration agreement.  As per the amended Section  

8(1), the judicial authority has only to consider the  

question whether the parties have a valid arbitration  

agreement?  The Court cannot refuse to refer the  

parties to arbitration “unless it finds that prima  

facie no valid arbitration agreement exists”.  The  

amended provision, thus, limits the intervention by  

judicial authority to only one aspect, i.e. refusal by  

judicial authority to refer is confined to only one  

aspect, when it finds that prima facie no valid  

arbitration agreement exists.  Other several  

conditions, which were noticed by this court in various  

pronouncements made prior to amendment were not to be  

adhered to and the Legislative intendment was clear  

departure from fulfilling various conditions as noticed  

in the judgment of P. Anand Gajapathi Raju (supra) and

46    

Sukanya Holdings (P) Ltd. (supra). Same Legislative  

intendment is decipherable by amendment of Section 11  

by adding sub-section (6A).  Section 11(6A) is as  

follows:-  

11. Appointment of arbitrators.—    

xxxxxxxxxxxxxxxxxxxxxxxx     [(6A) The Supreme Court or, as the case may  be, the High Court, while considering any  application under sub-section (4) or sub- section (5) or sub-section (6), shall,  notwithstanding any judgment, decree or order  of any Court, confine to the examination of the  existence of an arbitration agreement.      

47. The same words “notwithstanding any judgment,  

decree or order of any Court” finds place in sub-

section (6A) of Section 11 and Supreme Court and High  

Court is confined to the examination of the existence  

of an arbitration agreement.  This Court had occasion  

to consider the amendment made in Section 11(6A) in  

Duro Felguera, S.A. (supra).  Justice Kurian Joseph in  

his concurring opinion in Paragraph No. 48 has laid  

down following:-  

“48. Section 11(6-A) added by the 2015  Amendment, reads as follows:    

“11. (6-A) The Supreme Court or, as the  case may be, the High Court, while  considering any application under sub-

47    

section (4) or sub-section (5) or sub- section (6), shall, notwithstanding any  judgment, decree or order of any court,  confine to the examination of the  existence of an arbitration agreement.”  

(emphasis supplied)    

From a reading of Section 11(6-A), the  intention of the legislature is crystal clear  i.e. the court should and need only look into  one aspect—the existence of an arbitration  agreement. What are the factors for deciding  as to whether there is an arbitration agreement  is the next question. The resolution to that  is simple—it needs to be seen if the agreement  contains a clause which provides for  arbitration pertaining to the disputes which  have arisen between the parties to the  agreement.”  

48. Section 8 of the 1996 Act as amended also came for  

consideration in Ameet Lalchand Shah and Others Vs.  

Rishabh Enterprises and Another, AIR 2018 SC 3041:  

(2018) 6 SCALE 621: 2018 SCC Online SC 487.  This Court  

noticed the object and purpose of amended Section 8.   

In Paragraph No. 29 to 31, following has been laid  

down:-  

“29. "Principally four amendments to Section  8(1) have been introduced by the 2015  Amendments-(i) the relevant "party" that is  entitled to apply seeking reference to  arbitration has been clarified/amplified to  include persons claiming "through or under"  such a party to the arbitration agreement; (ii)  scope of examination by the judicial authority  is restricted to a finding whether "no valid  arbitration agreement exists" and the nature

48    

of examination by the judicial authority is  clarified to be on a "prima facie" basis; (iii)  the cut-off date by which an application Under  Section 8 is to be presented has been defined  to mean "the date of" submitting the first  statement on the substance of the dispute; and  (iv) the amendments are expressed to apply  notwithstanding any prior judicial precedent.  The proviso to Section 8(2) has been added to  allow a party that does not possess the  original or certified copy of the arbitration  agreement on account of it being retained by  the other party, to nevertheless apply under  Section 8 seeking reference, and call upon the  other party to produce the same." (Ref: Justice  R.S. Bachawat's Law of Arbitration and  Conciliation, Sixth Edition, Vol. I (Sections  1 to 34) at page 695 published by LexisNexis).    31. The language of amendment to Section 8 of  the Act is clear that the amendment to Section  8(1) of the Act would apply notwithstanding any  prayer, judgment, decree or order of the  Supreme Court or any other Court. The High  Court laid emphasis upon the word ".....unless  it finds that prima-facie no valid agreement  exists". The High Court observed that there is  no arbitration agreement between Astonfield  and Rishabh. After referring to Sukanya  Holdings and the amended Section 8 and Section  45 of the Act, the High Court pointed out the  difference in language of Section 8 and Section  45 of the Act. The High Court distinguished  between Sukanya Holdings and Chloro Controls,  and observed that Sukanya Holdings was not  overruled by Chloro Controls….”   

49. This Court, thus, in the above cases has noticed  

that amendments  are expressed to apply notwithstanding  

any prior judicial precedents, but the scope of  

amendment under Section 8(1) was confined to three

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categories as has been noted in Paragraph No.29.   

Amendments under Section 8, thus, were aimed to  

minimise the scope of judicial authority to refuse  

reference to arbitration and only ground on which  

reference could have been refused was that it prima  

facie finds that no valid arbitration agreement exists.   

Notwithstanding any prior judicial precedents referred  

to under Section 8(1) relates to those judicial  

precedents, which explained the discretion and power  

of judicial authority to examine various aspects while  

exercising power under Section 8.                               

50. The Legislative intent and object were confined to  

only above aspects and was not on those aspects, where  

certain disputes were not required to be referred to  

arbitration.  Can it be said that after amendment under  

Section 8(1), the law laid down by this Court in  

reference to Section 2(3), where large number of  

categories have been held to be non-arbitrable has been  

reversed or set at naught.  Neither any such  

Legislature intendment was there nor any such  

consequence was contemplated that law laid down by this

50    

Court in context of Section 2(3) has to be ignored or  

reversed.       

 51. While carrying out amendment under Section 8(1) of  

Act, 1996, the statutes providing additional  

remedies/special remedies were not in contemplation.  

The legislative intent is clear that judicial  

authority’s discretion to refuse arbitration was  

minimise in respect of jurisdiction exercise by  

judicial authority in reference to Section 8. The  

amendment was also aimed to do away with special or  

additional remedies is not decipherable from any  

material. The Law Commission 246th Report, the Statement  

and Objects of Bill and the notes on clauses do not  

indicate that amendments were made for overriding  

special/additional remedies provided under different  

statutes. In the event, the interpretation as put by  

the learned counsel for the petitioner is accepted,  

Section 8 has to be read to override the law laid down  

by this Court in reference to various  

special/additional jurisdictions as has been adverted  

to and noted in judgment of this Court in Booz Allen

51    

and Hamilton Inc.(supra) which was never the intent of  

amendment in Section 8.   

 52. The amendment in Section 8 cannot be given such  

expansive meaning and intent so as to inundate entire  

regime of special legislations where such disputes were  

held to be not arbitrable. Something which legislation  

never intended cannot be accepted as side wind to  

override the settled law. The submission of the  

petitioner that after the amendment the law as laid  

down by this Court in National Seeds Corporation  

Limited(supra) is no more a good law cannot be  

accepted. The words “notwithstanding any judgment,  

decree or order of the Supreme Court or any Court” were  

meant only to those precedents where it was laid down  

that the judicial authority while making reference  

under Section 8 shall entitle to look into various  

facets of the arbitration agreement, subject matter of  

the arbitration whether the claim is alive or dead,  

whether the arbitration agreement is null and void. The  

words added in Section 8 cannot be meant for any other  

meaning. Reference is also made to the judgment of this  

Court in Vimal Kishor Shah and others vs. Jayesh Dinesh

52    

Shah and others, (2016) 8 SCC 788. This Court in the  

above case had occasion to consider the provisions of  

Section 8 of the Act, 1996 in reference to special  

remedy provided under Trusts Act, 1882. This Court  

noticed the judgment of this Court in Booz Allen and  

Hamilton Inc.(supra) with approval in paragraphs 40 and  

42 which is to the following effect:    

 “40. Before we examine the scheme of the Trusts  Act, 1882, we consider it apposite to take note  of the case law, which has a bearing on this  issue. The question came up for consideration  before this Court in Booz Allen & Hamilton Inc.  v. SBI Home Finance Ltd. as to what is the  meaning of the term “arbitrability” and  secondly, which type of disputes are capable  of settlement by arbitration under the Act.  Their Lordships framed three questions to  answer the question viz.: (SCC p. 546, para 34)    

(1) Whether the disputes having regard to  their nature could be resolved by a  private forum chosen by the parties  (Arbitral Tribunal) or whether such  disputes exclusively fall within the  domain of public fora (courts)?;    

(2) Whether the disputes are covered by the  arbitration agreement?; and    

(3) Whether the parties have referred the  disputes to arbitrator?”  

  42. The question to be considered in this  

appeal is whether the disputes relating to  affairs and management of the Trust including  the disputes arising inter se trustees,  beneficiaries in relation to their

53    

appointment, powers, duties, obligations,  removal, etc. are capable of being settled  through arbitration by taking recourse to the  provisions of the Act, if there is a clause in  the trust deed to that effect or such disputes  have to be decided under the Trusts Act, 1882  with the aid of forum prescribed under the said  Act?”  

53.   After noticing the issues which have arisen in  

the above case this Court laid down following in  

paragraphs 51 and 53:  

“51. The principle of interpretation that  where a specific remedy is given, it thereby  deprives the person who insists upon a remedy  of any other form of remedy than that given by  the statute, is one which is very familiar, and  which runs through the law, was adopted by this  Court in Premier Automobiles Ltd. v. Kamlekar  Shantaram Wadke while examining the question  of bar in filing civil suit in the context of  remedies provided under the Industrial  Disputes Act (see G.P. Singh, Principles of  Statutory Interpretation, 12th Edn., pp. 763- 64). We apply this principle here because, as  held above, the Trusts Act, 1882 creates an  obligation and further specifies the rights and  duties of the settlor, trustees and the  beneficiaries apart from several conditions  specified in the trust deed and further  provides a specific remedy for its enforcement  by filing applications in civil court. It is  for this reason, we are of the view that since  sufficient and adequate remedy is provided  under the Trusts Act, 1882 for deciding the  disputes in relation to trust deed, trustees  and beneficiaries, the remedy provided under  the Arbitration Act for deciding such disputes  is barred by implication.  

54    

53. We, accordingly, hold that the disputes  relating to trust, trustees and beneficiaries  arising out of the trust deed and the Trusts  Act, 1882 are not capable of being decided by  the arbitrator despite existence of  arbitration agreement to that effect between  the parties. A fortiori, we hold that the  application filed by the respondents under  Section 11 of the Act is not maintainable on  the ground that firstly, it is not based on an  “arbitration agreement” within the meaning of  Sections 2(1)(b) and 2(1)(h) read with Section  7 of the Act and secondly, assuming that there  exists an arbitration agreement (Clause 20 of  the trust deed) yet the disputes specified  therein are not capable of being referred to  private arbitration for their adjudication on  merits.”  

54. This Court held that disputes within the trust,  

trustees and beneficiaries are not capable of being  

decided by the arbitrator despite existence of  

arbitration agreement to that effect between the  

parties. This Court held that the remedy provided under  

the Arbitration Act for deciding such disputes is  

barred by implication. The ratio laid down in the above  

case is fully applicable with regard to disputes raised  

in consumer fora.  

55. We may, however, hasten to add that in the event a  

person entitled to seek an additional special remedy  

provided under the statutes does not opt for the  

additional/special remedy and he is a party to an

55    

arbitration agreement, there is no inhibition in  

disputes being proceeded in arbitration. It is only the  

case where specific/special remedies are provided for  

and which are opted by an aggrieved person that  

judicial authority can refuse to relegate the parties  

to the arbitration.   

56. We, thus, do not find that any error has been  

committed by the NCDRC in rejecting the application  

filed by the appellant under Section 8. No exception  

can be taken to the dismissal of the appeals by this  

Court against the judgment of NCDRC. No ground is made  

out to review the order dated 13.02.2018. The review  

petitions are dismissed.  

......................J.                               (  UDAY UMESH LALIT  )  

......................J.                               ( ASHOK BHUSHAN   )  

 New Delhi,   December 10, 2018.