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REPORTABLE

IN THE SUPREME COURT OF INDIA

   CIVIL APPELLATE  JURISDICTION

CIVIL   APPEAL  NO(S).  11584     OF 2016 (Arising out of SLP(C) Nos.  2865 OF 2015)

MAHANAGAR TELEPHONE NIGAM LTD.  Appellant

                               VERSUS

M/S. APPLIED ELECTRONICS LTD.              Respondent

J U D G M E N T

Dipak Misra, J.

Leave granted.

2. The present appeal, by special leave, calls in question the

legal tenability of the order dated 28th July, 2014 passed by the

High Court of Delhi wherein a Division Bench in CM No. 15530 of

2013 placing reliance on Satpal P. Malhotra & Ors. vs. Puneet

Malhotra & Ors.1 that  has  followed the  decision in  MCD vs.

International  Security  &  Intelligence  Agency  Ltd.2 has

1     Arbitration Appeal No. 12 of 2010 decided on 14th June, 2013 2  (2004) 3 SCC 250

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expressed the view that the Code of Civil  Procedure, 1908 (for

short 'the CPC') would be applicable to the proceedings under the

Arbitration and Conciliation Act, 1996 (for short ‘the 1996 Act).

Be it stated, while expressing the view that the CPC is applicable

to  an appeal  preferred under  Section 37 of  the  Act,  the  High

Court has in the impugned order opined that the cross objection

preferred  by  the  respondent  herein  was  maintainable  and

accordingly entertained the same after condoning the delay.   

3. Assailing the said order, it is submitted by Mr. N.K. Kaul,

learned Additional Solicitor General, appearing for the appellant,

that the scheme of the 1996 Act does not grant any space or

make any provision as regards the applicability of CPC unlike the

Arbitration Act, 1940 (for short 'the 1940 Act') and in the absence

of  any  express  provision,  the  legislative  intendment  is  not  to

make it applicable.   It is his further submission that Sections 5,

34, 37 and 50 of the 1996 Act constitute a complete code and it

clearly  provides  the  measures  for  adjudging  or  deciding  the

validity of  an award or even to adjudge the defensibility of  an

interim order.   It is urged by him that recourse to any other

mode under the CPC to challenge an order or the award passed

under the Act would create an anomalous situation and frustrate

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the intention of the legislature.  

4.  Learned  senior  counsel  would  submit  that  the

pronouncement  in  the  ITI  Ltd.  vs.  Siemens  Public

Communications Network Ltd.3 holds that the applicability of

CPC is not prohibited and, therefore, Section 5 of the 1996 Act

would  not  be  attracted  and  the  High  Court  can  exercise  the

revisional power to rectify an order passed by the District Court,

but the said verdict runs counter to the decision of the larger

Bench rendered in  SBP & Co.  vs. Patel Engineering Ltd. &

Anr.4 and other decisions, namely,  Pandey & Co. Builders (P)

Ltd. vs. State of Bihar & Anr.5 and Fuerst Day Lawson Ltd.

vs. Jindal Exports Ltd.6.    According to Mr. Kaul, the aggrieved

person  can  prefer  an  appeal  under  Section  37  exercising  his

independent right but cannot be allowed to take recourse to file

cross objection to advance his right that has been denied to him

by the Court in exercise of power under Section 34 of the 1996

Act.   For the said purpose he has drawn immense inspiration

from the authority in  Jamshed Hormusji Wadia vs. Board of

Trustees, Port of Mumbai & Anr.7.

3  (2002) 5 SCC 510 4  (2005) 8 SCC 618 5  (2007) 1 SCC 467 6  (2011) 8 SCC 333 7  (2004) 3 SCC 214

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5. Mr. Arun Kumar Varma, learned senior counsel appearing

for the respondent, per contra, would contend that the decision

rendered in ITI Ltd. (supra) is absolutely unquestionable and a

binding precedent on this Court.  According to him, the principle

stated in  Jamshed Hormusji Wadia (supra) is not applicable,

inasmuch as it  deals  with an appeal  preferred after  obtaining

special leave under Article 136 of the Constitution.  It is further

propounded by him that the High Court of Bombay as well as the

High  Court  of  Delhi  has  correctly  relied  on  the  principle

enunciated by the three-judge Bench in International Security

Inteligence Agency Ltd. (supra).   

6. In  course  of  hearing,  we  have  been  apprised  that  the

decision  rendered  by  the  High  Court  of  Bombay  has  been

challenged before this Court and leave has been granted, and the

matter  is  pending  for  adjudication.   However,  we  intend  to

express our view with regard to the submissions advanced at the

Bar.  The statement of objects and reasons of the 1996 Act read

as follows:-

“The  law  on  arbitration  in  India  is  at  present substantially contained in three enactments, namely, the Arbitration Act, 1940, the Arbitration (Protocol and Convention)  Act,  1937  and  the  Foreign  Awards (Recognition and Enforcement) Act, 1961. It is widely felt that the 1940 Act, which contains the general law

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of  arbitration,  has  become  outdated.  The  Law Commission of India, several representative bodies of trade  and  industry  and  experts  in  the  field  of arbitration have pro-posed amendments to this Act to make  it  more  responsive  to  contemporary requirements. It is also recognised that our economic reforms  may  not  become  fully  effective  if  the  law dealing  with  settlement  of  both  domestic  and international commercial disputes remains out of tune with such reforms. Like arbitration, conciliation is also getting  increasing  worldwide  recognition  as  an instrument  for  settlement  of  disputes.  There  is, however, no general law on the subject in India.

2.  The  United  Nations  Commission  on  International Trade Law (UNCITRAL) adopted in 1985 the Model Law on International Commercial Arbitration. The General Assembly of the United Nations has recommended that all countries give due consideration to the said Model Law, in view of the desirability of uniformity of the law of  arbitral  procedures  and  the  specific  needs  of international  commercial  arbitration  practice.  The UNCITRAL also adopted in 1980 a set of Conciliation Rules.  The  General  Assembly  of  the  United  Nations has  recommended  the  use  of  these  Rules  in  cases where the disputes arise in the context of international commercial  relations  and  the  parties  seek  amicable settlement of their disputes by recourse to conciliation. An important feature of the said UNCITRAL Model Law and Rules is that they have harmonised concepts on arbitration and conciliation of different legal systems of the  world  and  thus  contain  provisions  which  are designed for universal application.

3. Though the said UNCITRAL Model Law and Rules are  intended  to  deal  with  international  commercial arbitration  and  conciliation,  they  could,  with appropriate  modifications,  serve  as  a  model  for legislation  on  domestic  arbitration  and  conciliation. The present Bill seeks to consolidate and amend the law  relating  to  domestic  arbitration,  international commercial arbitration, enforcement of foreign arbitral

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awards and to define the law relating to conciliation, taking into account the said UNCITRAL Model Law and Rules.

4. The main objectives of the Bill are as under:--

(i)  to  comprehensively  cover  international  and commercial  arbitration  and  conciliation  as  also domestic arbitration and conciliation;

(ii) to make provision for an arbitral procedure which is fair, efficient and capable of meeting the needs of the specific arbitration;

(iii) to provide that the arbitral tribunal gives reasons  for its arbitral award;

(iv) to ensure that the arbitral tribunal remains within the limits of its jurisdiction;

(v) to minimise the supervisory role of courts in the  arbitral process;

(vi)  to  permit  an arbitral  tribunal  to  use  mediation, conciliation  or  other  procedures  during  the  arbitral proceedings to encourage settlement of disputes;

(vii) to provide that every final arbitral award is  enforced in the same manner as if it were a decree of  the court;

(viii) to provide that a settlement agreement reached by the parties as a result of conciliation proceedings will have the same status and effect as an arbitral award on  agreed  terms  on  the  substance  of  the  dispute rendered by an arbitral tribunal; and

(ix)  to  provide  that,  for  purposes  of  enforcement  of foreign awards, every arbitral award made in a country to  which  one  of  the  two  international  Conventions relating to foreign arbitral awards to which India is a

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party applies, will be treated as a foreign award.

5. The Bill seeks to achieve the above objects.”

7. Section 5 of  the  1996 Act  provides  the  extent  of  judicial

intervention.  It reads as follows:-

“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.”

The  aforesaid  provision  is  specific  and  has  a  definite

purpose.   The  language  employed  in  the  aforesaid  provision

provides the exclusive path for judicial intervention and does not

countenance  any  other  method.   The  same  would  be  clearly

demonstrable when we appreciate the scheme of the Act.  

8. Section 9 of the 1996 Act provides for interim measures etc.

by Court. Section 11 of the 1996 Act deals with appointment of

Arbitrators. Chapter 4 that contains Sections 16 & 17 deals with

jurisdiction  of  the  Arbitral  Tribunals.  Section  34  provides  for

application  for  setting  aside  arbitral  Award.   Section  37

stipulates about the appealable orders.  It reads as follows:-

“37.  Appealable  orders—(1)  An appeal  shall  lie  from the following orders (and from no others) to the Court authorised  by  law  to  hear  appeals  from  original

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decrees of the Court passing the order, namely:—

(a)refusing  to  refer  the  parties  to  arbitration  under section 8;

(b)granting  or  refusing  to  grant  any  measure  under section 9;

(c)setting  aside  or  refusing  to  set  aside  an  arbitral award under section 34.

(2) An appeal shall also lie to a Court from an order granting of the arbitral tribunal.—

(a)  accepting  the  plea  referred  in  sub-section  (2)  or sub-section (3) of section 16; or

(b) granting or refusing to grant an interim measure under section 17.

(3)  No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall  affect  or  take away any right  to appeal  to the Supreme Court.”

9. Part II of the 1996 Act provides for enforcement of certain

Foreign Awards. Section  50  of  the  said  part  provides  for

appealable orders.  The said provision reads as follows:-

“50.  Appealable orders.—(1) An appeal shall lie from the order refusing to—

(a) refer the parties to arbitration under section 45;

(b)enforce a foreign award under section 48, to the court authorised by law to hear appeals from such order.

(2)No second appeal  shall  lie  from an order  passed in appeal  under  this  section,  but  nothing  in  this  section shall  affect  or  take  away  any  right  to  appeal  to  the

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Supreme Court.”

10. Relying  on  the  aforesaid  provisions,  it  is  proponed  by

Mr. Kaul that it is a complete code from all angles and hence, the

CPC  would  not  have  any  application  and  once  CPC  is  not

applicable, entertaining a cross objection under Order XLI Rule

22 is totally impermissible.  In this context, we may usefully refer

to Section 41(a) of the 1940 Act.  The said provision dealt with

procedure and powers of court. For the sake of completeness, we

extract the same:-

“41   Procedure  and  powers  of  Court  –  Subject  to  the provisions of this Act and of rules made thereunder –  

(a) the provisions of the Code of Civil Procedure, 1908, shall apply to all proceedings before the Court, and to all appeals, under this Act, and

(b)  ……

11. On a perusal of the said provision, in juxtaposition with the

provisions  contained  in  1996  Act,  it  seems  to  us  that  the

legislature has intentionally not kept any provision pertaining to

the applicability of the CPC.   On the contrary, Section 5 of 1996

Act lays the postulate, that notwithstanding anything contained

in any other law for the time being in force in matters covered by

Part I,  no judicial  authority shall  intervene except so provided

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wherever under this Act.

12. In  ITI  Ltd. (supra)  the assail  was to  the   judgment  and

order of the 10th Additional City Civil Judge, Bangalore passed in

a Misc. Appeal. The said appeal was preferred against an interim

order  passed by the  arbitral  tribunal.   The principal  question

that  emerged for  consideration before  this  court  is  whether  a

revision petition under Section 115 of the CPC lies to the High

Court  against  an order  made by the Civil  Court  in an appeal

preferred under Section 37 of the Act.  It is necessary to note

here that the appellant therein instead of moving the High Court

had approached this court directly.  Be that as it may.  Hegde, J

in his opinion, analysing the scope of Section 5 has opined thus:-

“We also do not find much force in the argument of learned counsel for the appellant based on Section 5 of the Act.  It  is  to be noted that it  is  under this Part, namely, Part I of the Act that Section 37(1) of the Act is found, which provides for an appeal to a civil  court. The term ’Court’  referred to  in  the said provision is defined under Section 2(e) of  the Act. From the said definition,  it  is  clear  that  the  appeal  is  not  to  any designated  person  but  to  a  civil  court.  In  such  a situation, the proceedings before such court will have to  be  controlled  by  the   provisions  of  the  Code, therefore,  the  remedy  by  way  of  a  revision  under Section 115 of the Code will not amount to a judicial intervention not provided for by Part I of the Act. To put it in other words, when the Act under Section 37 provided  for  an  appeal  to  the  civil  court  and  the application of Code not having been expressly barred, the  revisional  jurisdiction  of  the  High  Court  gets

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attracted. If that be so, the bar under Section 5 will not  be  attracted  because  conferment  of  appellate power on the civil court in Part I of the Act attracts the provisions of the Code also.”  

13. Thereafter the learned judge has expressed as follows:-

“For  the  aforesaid  reasons,  while  holding  that  this Court  in  an  appropriate  case  would  entertain  an appeal directly against the judgment in first appeal, we hold that the High Court also has the jurisdiction to entertain a revision petition, therefore, in the facts and circumstances of this case, we direct the appellant to first approach the High Court. For the said reasons, this  appeal  fails  and the  same is  hereby dismissed. We, however, make it clear that should the appellant present a revision petition within 30 days from today, the same will be entertained by the High Court without going into the question of limitation, if any.”

14. Dharmadhikari, J in his concurring opinion stated that:-

“Provisions of Section 37 of the Act of 1996 bar second appeal and not revision under Section 115 of the Code of Civil Procedure.  The power of appeal under Section 37(2) of the Act against order of the Arbitral Tribunal granting  or  refusing  to  grant  an interim measure is conferred on the court.  “Court” is defined in Section 2(e)  meaning  the  “Principal  civil  court  of  original jurisdiction”  which  has  “jurisdiction  to  decide  the question forming the subject matter of the arbitration if the same had been the subject-matter of the suit”. The  power of appeal having conferred on a civil court all procedural provisions contained in the Code would apply to the proceedings in appeal.  Such proceedings in appeal are not open to second appeal as the same is clearly barred under sub- section(3) of Section 37.  But I agree with the conclusion reached by Brother Hegde, J.  that  the supervisory and revisional  jurisdiction of the High Court under Section 115 of the Code of Civil Procedure  is  neither  expressly  nor  impliedly  barred

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either by the provisions of Section 37 or Section 19(1) of the Act.  Section 19(1) under Chapter V of Part I of the Act merely states that the Arbitral Tribunal shall not be bound by the Code of Civil Procedure.  The said action has no application to the proceedings before the civil  court  in  exercise  of  powers  in  appeal  under Section 39(2) of the Act.”

15. In  International  Security  &  Intelligence  Agency  Ltd.

(supra), a three- Judge bench was dealing with maintainability of

a cross objection under Order XLI Rule 22 of the CPC.  It is apt to

mention here that the controversy arose in the context of 1940

Act.  While dealing with the same, the three-Judge bench ruled

thus:-

“14.Right of appeal is creature of statute.  There is no inherent right of appeal.  No appeal can be filed, heard or  determined  on  merits  unless  the  statute  confers right on the appellant and power on the Court to do so.  Section 39 of the Act confers right to file appeal, in  so  far  as  the  orders  passed  under  this  Act  are concerned,  only  against  such  of  the  orders  as  fall within one or other of the descriptions given in clauses (i)  to  (vi)  of  sub-Section  (1)  of  Section  39.   The Parliament has taken care to specifically exclude any other  appeal  being  filed,  against  any  order  passed under  the  Act  but  not  covered  by  clauses  (I)  to  (vi) abovesaid,  by inserting the expression "and from no others" in the text  of  sub-Section (1).   Clause (a)  of Section 41 extends applicability  of  all  the provisions contained in the Code of Civil Procedure, 1908 to (i) all proceedings before the Court under the Act, and (ii) to all  the  appeals,  under  the  Act.   However,  the applicability of such of the provisions of the Code of Civil  Procedure  shall  be  excluded  as  may  be inconsistent with the provisions of the Act and/or of

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rules  made  thereunder.   A  bare  reading  of  these provisions  show  that  in  all  the  appeals  filed  under Section  39,  the  provisions  of  the  Code  of  Civil Procedure,  1908 would be applicable.     This would include  the  applicability  of  Order  41  including  the right to take any cross objection under Rule 22 thereof to appeals under Section 39 of the Act.

15. Right to prefer cross objection partakes of the right to  prefer  an  appeal.  When  the  impugned  decree  or order  is  partly  in  favour  of  one  party  and partly  in favour of the other, one party may rest contended by his partial success with a view to giving a quietus to the  litigation.  However,  he  may  like  to  exercise  his right of appeal if he finds that the other party was not interested in burying the hatchet and proposed to keep the lis alive by pursuing the same before the appellate forum. He too may in such circumstances exercise his right to file appeal by taking cross objection. Thus taking  any  cross  objection  to  the  decree  or  order impugned  is  the  exercise  of  right  of  appeal  though such right  is  exercised in  the form of  taking  cross objection.  The substantive right is the right of appeal; the form of cross objection is a matter of procedure.

20. Once we hold that by taking cross objection what is  being exercised is the right of appeal itself, it follows that the subject-matter of cross objection and the relief sought  therein  must  conform to  the  requirement  of Section 39(1). In other words, a cross objection can be preferred if  the  applicant  could  have  sought  for  the same relief by filing an appeal in conformity with the provisions  of  Section  39(1)  of  the  Act.   If  the subject-matter  of  the  cross  objection  is  to  impugn such an order which does not fall within the purview of any of the categories contemplated by clauses (i) to (vi)  of  sub-Section  (1)  of  Section  39  of  the  Act,  the cross objection shall not be maintainable.”

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16. After  so  stating,  the  Court  adverted to  the  fate  of  cross-

objections  if  the  appeal  itself  is  held  not  competent  or  not

maintainable.   We  are  not  concerned  with  the  aforesaid

delineation and, therefore, construe it inessential to advert to the

said facet.  Suffice it to mention that the decision was rendered

in the backdrop of 1940 Act and hence, it is distinguishable.   

17. In  Pandey  &  Co.  Builders  (P)  Ltd. (supra),  the  Court

reproduced  a  passage  from  the  treatise  “Law  and  Practice  of

Arbitration and Conciliation” wherein the learned authors have

stated thus:-

“In  the  context  of  this  Act,  Section  37(3)  barring second  appeal  against  an  appellate  order  under Section  37(1) and  (2) is really superfluous.  This Act has not enacted any provision analogous to s 41 of the previous  Act.  It is radically different from the Act of 1940.   Therefore,  the Code of Civil  Procedure 1908 proprio vigore does not apply to the proceedings before the  court  in  its  original  or  appellate  jurisdiction. Section  5  imposes  a  blanket  ban  on  judicial intervention of any type in the arbitral  process except 'where so provided under Part I of  this Act.  Pursuant to  this  provision,  Section  37(1)  provides  appeals against  certain  orders  of  the   court,  while  s  37(2) provides appeal against certain orders of the arbitral tribunal.  However,  Section  37(3) prohibits a second appeal against the appellate order under Section 37(1) and (2).  However, in view of the provisions of s 5, a second  appeal  against  the  appellate  order  under  s 37(1) and (2) would not be  permissible, even if s 37(3) had not  been enacted.   It  was,  therefore,  not  really necessary to enact this provision, and it seems to have been enacted by way of abundant caution.”

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18. We may immediately state that Mr. Kaul has commended

the said passage to highlight that the same has been given the

stamp of approval by this Court.  We have referred to the said

passage only to emphasise the effect and impact of Section 5 of

1996 Act.  In the said decision, it has also been ruled that even if

the bar under Section 37(3) of  1996 Act would not have been

provided by the legislature, Section 5 would have been adequate

enough to bar a second appeal.

19. In  Fuerst  Day  Lawson  Limited (supra),  the  issue  that

arose  for  consideration  is  whether  an  order,  though  not

appealable under Section 50 of the 1996 Act, could nevertheless

be subject to appeal under the relevant provisions of the Letters

Patent of the High Court.  We are absolutely conscious that the

said judgment was delivered in the context of Part II of the Act.

Section 5, as noticed earlier, does not relate to Part II.  However,

analysing  various  authorities  relating  to  maintainability  of

Letters  Patent  Appeal,  the  court  pointed  out  the  distinction

between the language of the 1940 Act and the 1996 Act.  In this

context, it is profitable to quote para 89 in its entirety:-

“89. It is thus, to be seen that Arbitration Act, 1940, from its inception and right through to 2004 (in P.S.

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Sathappan) was held to be a self-contained code.  Now, if  the  Arbitration  Act,  1940   was  held  to  be  a self-contained  code,  on  matters  pertaining  to arbitration, the Arbitration and Conciliation Act, 1996, which  consolidates,  amends  and  designs  the  law relating to arbitration to bring it, as much as possible, in harmony with the UNCITRAL Model must be held only to be more so.  Once it is held that the Arbitration Act  is  a  self-contained code and exhaustive,  then it must  also  be  held,  using  the  lucid  expression  of Tulzapurkar,  J.,  that  it  carried  with  it  “a  negative import that only such acts as are mentioned in the Act are  permissible  to  be  done  and  acts  or  things  not mentioned therein are not permissible to be done”.  In other words, a letters patent appeal would be excluded by the application of the one of the general principles that  where the  special  Act  sets  out  a  self-contained code  the  applicability  of  the  general  law  procedure would be impliedly excluded.”

20. Slightly  earlier,  we  have  mentioned  that  the  court  has

referred to a series of decisions with regard to the maintainability

of a Letters Patent Appeal.  The two-Judge Bench has referred to

the Constitution Bench decision in  P.S. Sathappan (dead) by

Lrs. vs. Andhra bank Ltd. And Others8 and other decisions.

In  paragraph  36  of  the  judgment,  the  Court  has  culled  out

certain principles.  For the present case, the sub clause (vii) of

paragraph 36 is significant.  It reads as follows:  

“36(vii)  The  exception  to  the  aforementioned  rule  is where the special  Act sets out a self-contained code and in that event the applicability of the general law procedure would be impliedly excluded.  The express

8 (2004) 11 SCC 672

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provision need not refer to or use the words “letters patent” but if on a reading of the provision it is clear that all further appeals are barred then even a letters patent appeal would be barred.”

21. It  is  interesting  to  note  that  in ITI  Ltd. (supra)  the

two-Judge bench has held that  solely because a second appeal

is  not  maintainable,  it  would  not  debar  the  exercise  of

jurisdiction  under  Section  115  of  the  CPC,  because  under

Section  115  of  the  CPC  the  court  exercises  its  power  of

supervisory or revisional jurisdiction.

22. In  Patel  Engineering  Ltd. (supra)  the  majority,  while

dealing  with  the  power  under  Articles  226  and  227  of  the

Constitution, has ruled that:-

“45. It is seen that some High Courts have proceeded on  the  basis  that  any  order  passed  by  an  arbitral tribunal during arbitration, would be capable of being challenged  under  Article  226  or  227  of  the Constitution of India.  We see no warrant for such an approach.  Section  37  makes  certain  orders  of  the arbitral  tribunal  appealable.   Under  Section 34,  the aggrieved  party  has  an  avenue  for  ventilating  his grievances against the award including any in-between orders  that  might  have  been passed  by  the  arbitral tribunal acting under Section 16 of the Act.  The party aggrieved by any order of the arbitral tribunal, unless has a right of appeal under Section 37 of the Act, has to wait until the award is passed by the Tribunal.  This appears  to  be  the  scheme of  the  Act.   The  arbitral tribunal is after all, the creature of a contract between the parties, the arbitration agreement, even though if the occasion arises, the Chief Justice may constitute it

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based on the contract between the parties.   But that would not alter the status of the arbitral tribunal.   It will  still  be  a  forum  chosen  by  the  parties  by agreement.   We,  therefore,  disapprove  of  the  stand adopted by some of  the High Courts that  any order passed  by  the  arbitral  tribunal  is  capable  of  being corrected by the High Court under Article 226 or 227 of the Constitution of India.  Such an intervention by the High Courts is not permissible.

46. The  object  of  minimizing  judicial  intervention while the matter is in the process of being arbitrated upon, will certainly be defeated if the High Court could be approached under Article 227 of the Constitution of India or under Article 226 of the Constitution of India against  every  order  made  by  the  arbitral  tribunal. Therefore,  it  is  necessary  to  indicate  that  once  the arbitration  has  commenced  in  the  arbitral  tribunal, parties  have  to  wait  until  the  award  is  pronounced unless, of course, a right of appeal is available to them under Section 37 of the Act even at an earlier stage.”

23. We are absolutely conscious that the principle stated in the

aforesaid  verdict  pertaining  to  interference  of  exercise  of

jurisdiction was in relation to any order passed by the arbitral

tribunal. However, we have referred to the same to exposit and

underline the stress on the minimal intervention of the court. In

essence  it  has  to  be  remembered that  the  concept  of  dispute

resolution under the law of arbitration, rests on the fulcrum of

promptitude.

24. In ITI Ltd. (supra), it has been held that the jurisdiction of

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the civil court to which a right to decide a lis between the parties

has  been  conferred  can  only  be  taken  away  by  a  statute  in

specific  terms and  exclusion  of  such right  cannot  be  inferred

because  there  is  always  a  strong  presumption,  that  the  civil

courts have the jurisdiction to decide all questions of civil nature

and on that basis the court held that it cannot draw inference

merely because the Act has not provided CPC to be applicable

and thus it should be held that the CPC is inapplicable.   

25. In Fuerst Day Lawson Ltd. (supra), the two-Judge Bench

placing reliance on a series of authorities has drawn a distinction

between the 1940 Act and 1996 Act and has opined that once the

1996 Act is regarded as a self contained and exhaustive code, it

should be held that it carries with it a negative import that only

such acts either mentioned in the Act are permissible to be done

and acts or things not mentioned therein are not permissible to

done.   The 1996 Act,  as it  manifests,  provides restrictions for

challenging the award.  It also lays the postulate to assail the

award and thus emphasis is on expeditious disposal.  It does not

permit a second appeal  to be entertained as per the language

employed in Section 37(3) and also under Section 5 of the 1996

Act.  The two-Judge Bench has reproduced a lucid expression of

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Tulzapurkar, J. to make home the point ― “a negative import that

only such acts as are mentioned in the Act are permissible to be

done  and  acts  or  things  not  mentioned  therein  are  not

permissible to be done”.

26. In  Arun Dev  Upadhyaya vs.  Integrated Sales  Service

Ltd. and Anr.9, the issue that arose for consideration is whether

an arbitration appeal was maintainable from an order passed by

the learned single Judge pertaining to execution of the award.  It

was urged before the Division Bench of the High Court, that an

appeal under Clause 10 was not available in arbitration matters

and Section 13 of the Commercial Courts, Commercial Division

and Commercial Appellate Division of the High Courts Act, 2015

would not be applicable to an arbitration appeal.  The High Court

opined that the appeal was maintainable. A two-Judge Bench of

the Court analyzing various provisions and the earlier precedents

came to hold that:-

“23. The aforesaid provision clearly lays down that a forum is created, i.e., Commercial Appellate Division. Section 50(1)(b) of the 1996 Act provides for an appeal. Section 50(1)(b) has not been amended by the Act that has come into force on 23.10.2015. Thus, an appeal under  Section  50(1)(b)  of  the  1996  Act  before  the Division Bench is maintainable.

24.  Thus  analysed,  we  find  that  the  impugned

9  2016 (9) SCALE 427

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judgment of  the learned Single Judge under Section 50(1)(b) of the 1996 Act is passed in the original side of the High Court. Be that as it may, under Section 13 of the  Act,  the  single  Judge  has  taken  the  decision. Section 13 bars an appeal under Letters Patent unless an appeal  is  provided under the 1996 Act.  Such an appeal is provided under Section 50 of  the Act.  The Letters Patent Appeal could not have been invoked if Section 50 of the 1996 Act would not have provided for an  appeal.  But  it  does  provide  for  an  appeal.  A conspectus reading of Sections 5 and 13 of the Act and Section  50  of  the  1996  Act  which  has  remained unamended leads to the irresistible conclusion that a Letters  Patent  Appeal  is  maintainable  before  the Division  Bench.  It  has  to  be  treated  as  an  appeal under Section 50(1) (b) of the 1996 Act and has to be adjudicated within the said parameters.”

The said decision was rendered in respect of appeal under

Section 50 which occurs in Part II but emphasis has been laid

with regard to adjudication of an appeal within the parameters of

Section 50(1)(b) of the 1996 Act.

27. As  is  manifest,  a  person  grieved  by  the  award  can  file

objection under Section 34 of the 1996 Act, and if aggrieved on

the order passed thereon, can prefer an appeal.  The court can

set aside the award or deal with the award as provided by the

1996 Act.  If a corrective measure is thought of, it has to be done

in accordance with the provision as contained in Section 37 of

the 1996 Act, for Section 37(1) stipulates for an appeal in case of

any grievance which would include setting aside of  an arbitral

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award under Section 34 of the Act.

28. Section  5  which  commences  with  a  non-obstante  clause

clearly stipulates that no judicial authority shall interfere except

where so provided in Part 1 of the 1996 Act.  As we perceive, the

1996 Act is a complete Code and Section 5 in categorical terms

along with other provisions, lead to a definite conclusion that no

other provision can be attracted.  Thus, the application of CPC is

not  conceived  of  and,  therefore,  as  a  natural  corollary,  the

cross-objection cannot be entertained.  Though we express our

view in the present manner, the judgment rendered in  ITI Ltd.

(supra) is a binding precedent. The three-Judge Bench decision

in  International Security & Intelligence Agency Ltd.  (supra)

can be distinguished as that is under the 1940 Act which has

Section 41 which clearly states that the procedure of CPC would

be applicable to appeals.  The analysis made in ITI Ltd. (supra)

to the effect that merely because the 1996 Act does not provide

CPC to be applicable, it should not be inferred that the Code is

inapplicable seems to be incorrect, for the scheme of the 1996

Act  clearly  envisages  otherwise  and  the  legislative  intendment

also so postulates.   

29. As we are unable to follow the view expressed in  ITI Ltd.

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(supra)  and  we  are  of  the  considered  opinion  that  the  said

decision deserves to be re-considered by a larger Bench.  Let the

papers be placed before the Hon'ble the Chief Justice of India for

constitution of an appropriate larger Bench.

30. The interim order to continue.

….........................J.                             (DIPAK MISRA)

…......................... J.

                   (AMITAVA ROY) NEW DELHI November 24, 2016