High Court of Punjab and Haryana, Chandigarh
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Prem Chand v. Haryana State Industrial Development Cor - CR-1557-2004  RD-P&H 534 (3 February 2006)
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Civil Revision No.1557 of 2004
Date of Decision: 22.02.2006
Prem Chand ..Petitioner.
Haryana State Industrial Development Corporation Ltd. And Ors.
Coram: Hon'ble Mr. Justice Hemant Gupta.
Present: Mr.S.P.Garg, Advocate,
for the petitioner.
Mr.Ashok Aggarwal, Senior Advocate, with Mr.Vikram Aggarwal, Advocate,
for respondent No.1.
for respondent No.2.
Mr. M.L.Sarin, Senior Advocate, with
Mr.Vikas Suri, Advocate,
for respondent No.3.
CM Nos.93-CII of 06 and 5668-CII of 04 (2) and CR No. 1557 of 2004
The present case has chequered history. One Industrial Plot No.121, in Industrial Estate, Dundahera (now Udyog Vihar), Phase-I, Gurgaon was allotted to the petitioner on 21.7.1977. An agreement was executed between the petitioner and Haryana State Industrial Development Corporation-Respondent No.1 on 20.10.1977. In terms of the agreement, the petitioner was to complete the construction within 2 years and to commence production within a period of 3 years from the date of the allotment of the plot. Said agreement also contained an arbitration clause. As per the said clause any disputes or differences arising out of or in any way touching or concerning the agreement were required to be referred to the sole arbitration of the nominee of Secretary to Government of Haryana, Industries Department.
The allotment in favour of the petitioner was cancelled on 23.6.1981 and the plot resumed. Soon after the resumption the plot was re-allotted to Respondent No.2 on 15.12.1981.
The petitioner herein filed a Civil Suit challenging the said resumption order. An application was filed by respondent No.1 herein under section 34 of the Arbitration Act, 1940 (for short the Act) for the stay of the proceedings in view of the arbitration clause. Vide order dated CM Nos.93-CII of 06 and 5668-CII of 04 (3) and CR No. 1557 of 2004
16.5.1985, the learned Trial Court allowed the application filed by respondent No.1 and stayed further proceedings. The appeal against the said order was dismissed on 22.7.1985. To resolve the dispute between the parties Shri B.L.Tanwar, IAS was appointed as arbitrator but before he could proceed in the matter, Shri Tanwar retired. On 5.9.1988 Shri Y.P.Raheja, IAS, was appointed as an arbitrator. Even the said Arbitrator did not enter into the reference and did not proceed further with the arbitration.
On 14.8.1991, the petitioner filed CWP No. 14870 of 1991 before this Court challenging the resumption order dated 23.6.1981. The said writ petition was disposed of on 27.9.1991 with the following order:
"Learned counsel for the petitioner expressly stated before us that the petitioner consented to the appointment of the Arbitrator in pursuance of Annexure P.5. The Secretary, Haryana State Industrial Development Corporation Limited, is hereby directed to appoint an Arbitrator who shall proceed to decide the matter expeditiously as much delay has already been caused. The petition is accordingly disposed of." In compliance with the above directions of this Court, Shri CM Nos.93-CII of 06 and 5668-CII of 04 (4) and CR No. 1557 of 2004
J.M.Sethi, Advocate, was appointed as an Arbitrator. The Arbitrator so appointed made and published the award dated 27.8.1993. In terms of the said award, the resumption of the plot vide order dated 23.6.1981 was found illegal and was set aside.
The petitioner, thereafter, moved application dated 25.9.1993 under Section 14 read with Section 17 of the Act for directing the learned Arbitrator to file the award in Court to make it rule of the Court. Objections were filed by Respondent No.1 under Section 30 of the Act but the learned Trial Court dismissed the objections on 20.11.1995 and made the award dated 27.8.1993 as rule of the Court. Respondent No.2, who was allotted plot on 15.12.1981, was not impleaded as party to such proceedings. In appeal by Respondent No.1 before the learned District Judge, Chandigarh, Respondent No.2 was impleaded as party on her application under Order 1 Rule 10 of the Code of Civil Procedure.
The said appeal was allowed on 13.9.2001 by the learned District Judge, Chandigarh relying upon M/s Guru Nanak Foundation Vs.M/s Rattan Singhand Sons AIR 1981 Supreme Court, 2075. It was held by the learned Court that the application under Sections 14 and 17 of the Act could be filed only before this Court as a sole Arbitrator was appointed by this Court. Thus, it was concluded that the Civil Court at Chandigarh CM Nos.93-CII of 06 and 5668-CII of 04 (5) and CR No. 1557 of 2004
has no jurisdiction to try this matter. The learned Additional District Judge, Chandigarh, thus, ordered the return of the application under Sections 14 and 17 of the Act for presentation before the competent court.
After the said order, the petitioner moved an application before the learned Trial Court on 24.7.2002 to seek the return of the application for presentation to the proper Court. The application was returned to the petitioner on 31.7.2002. The petitioner filed an application under Section 14 read with Section 17 of the Arbitration Act before the Civil Court, Gurgaon on 8.8.2002. The said application was filed before Gurgaon Court on the ground that the plot in question is situated within the jurisdiction of the said Court. The petitioner also filed a suit for permanent injunction claiming a restraint order, against the defendants including Mrs. Usha Chopra, not to interfere into the lawful and peaceful possession of the plaintiff. The learned Trial Court vide order dated 22.7.2003 dismissed the application for the grant of ad- interim injunction and held that the petitioner should have moved an application under Section 14 read with Section 17 of the Act before this Court alone and that the petitioner has not been prosecuting his case with due diligence. After the said order, on 2.12.2003 the petitioner CM Nos.93-CII of 06 and 5668-CII of 04 (6) and CR No. 1557 of 2004
moved an application to withdraw/return the original application under Section 14 read with Section 17 of the Act for presentation to this Court.
The application was returned on 6.12.2003. Subsequently, the petitioner withdrew the suit for permanent injunction filed before the Civil Court, Gugaon on 26.10.2004. It may be noticed that the petitioner has earlier filed an application before the Civil Court at Chandigarh to execute the order dated 20.11.1995 whereby the award, holding the resumption as illegal was made rule of the Court. The said execution was transferred to Civil Court at Gurgaon in which respondent No.1 herein has filed objections but vide order dated 27.7.2002, the execution was dismissed as infructuous.
The petitioner filed the present petition invoking the jurisdiction of this Court under Article 227 of the Constitution of India claiming alternative reliefs. The petitioner has challenged the order passed by the Additional District Judge, Chandigarh on 13.9.2001 and for the restoration of the order passed by the trial Court on 20.11.1995 and in the alternative to entertain the application under Sections 14 and 17 of the Act by this Court and pass an appropriate order thereon. The said petition was accompanied with an application under Section 14 of the Limitation Act, 1961 for excluding the period spent at Gurgaon Court CM Nos.93-CII of 06 and 5668-CII of 04 (7) and CR No. 1557 of 2004
under mistaken belief and a wrong advice. Respondent No.3 has filed an affidavit controverting the reliefs sought by the petitioner. The petitioner has also moved an application bearing CM No. 93-CII of 2006 to place on record original application under Sections 14 and 17 of the Act on the ground that the original could not be inadvertently placed on record.
In the above factual back ground, it is the case of the petitioner that the order passed by the learned Additional District Judge, Chandigarh on 13.9.2001 is patently illegal and has caused manifest injustice to the petitioner. The Arbitrator was not appointed by this Court as found by the learned Court. Therefore, the finding recorded that the Civil Court at Chandigarh has no jurisdiction is perverse finding and not sustainable in law. It is contended that under mistaken belief and wrong advice, the petitioner was advised to seek the return of the application from the Civil Court at Chandigarh and then advised to present it at Civil Court at Gugaon. Even the application for return of the application was filed through an Advocate at Chandigarh and same was filed at Civil Court Gurgaon by engaging an Advocate. Therefore, the petitioner who is not well versed in legal technicalities and has to depend upon the advice of the counsel and that he cannot be made to suffer on account of technicalities. Though the petitioner approached this Court CM Nos.93-CII of 06 and 5668-CII of 04 (8) and CR No. 1557 of 2004
under Article 227 of the Constitution of India on 3.3.2004 after the order was passed by the learned Additional District Judge on 13.9.2001 but the petitioner was not sitting back in his home but prosecuting his remedy in different courts as per the advice given to him. There is no delay in representation of the petition at Gurgaon on 8.8.2002 after the same was received by the petitioner from the Civil Court at Chandigarh on 31.7.2002. The petitioner has thereafter received the petition back from the Civil Court Gurgaon on 6.12.2003 but the same was filed before this Court on 3.3.2004 though without original application. It cannot be said that presentation of such petition before this Court is so grossly delayed which could lead to inference that the petitioner has given up his rights in respect of the dispute pending between the parties.
On the other hand, Mr. M.L.Sarin, Senior Advocate appearing for respondent No.3, the purchaser from respondent No.2 in September, 2003, submitted that respondent No.3 is bona fide purchaser for valuable consideration. It is submitted that the finding recorded by the learned First Appellate Court on 13.9.2001 that only High Court has the jurisdiction to entertain is based upon an averment made in the application itself that the sole Arbitrator was appointed on the orders of this Court. Therefore, the finding recorded by the first Appellate Court CM Nos.93-CII of 06 and 5668-CII of 04 (9) and CR No. 1557 of 2004
cannot be said to be suffering from any patent illegality or material irregularity which may warrant interference by this Court. Still further, the petitioner has accepted such order when he moved an application on 24.7.2002 for return of the application under Sections 14 and 17 of the Act. Said application was filed almost 10 months after the passing of the order. Thus, the petitioner impliedly consented to the order passed by the learned Additional District Judge, Chandigarh and therefore, it is not open to the petitioner to challenge the order in revision petition. Still further, the petitioner has not attached any affidavit of any of his Advocates of having advised in the manner alleged by the petitioner, when the petitioner invoked the jurisdiction of Civil Court at Gurgaon.
In the absence of any such affidavit, it is not open to the petitioner to plead that it was under mistaken belief and wrong advice that he has approached the Civil Court at Gurgaon. Still further, the finding was recorded by the Civil Court in a suit for injunction filed by the petitioner on 22.7.2003 that the petitioner has not been prosecuting his case with due diligence but thereafter, the petitioner has taken more than 7 months to file the present petition before this Court. Therefore, the petitioner is not entitled to any indulgence from this Court. Reliance was placed upon Union of India and others Vs. Aradhana Trading Co. & Ors.
CM Nos.93-CII of 06 and 5668-CII of 04 (10) and CR No. 1557 of 2004
(2002) 4 Supreme Court Cases 447; P.K.Vasudeva and others Vs.Zenobia Bhanot (1999) 7 Supreme Court Cases 377; and State of Punjab and Ors. Vs.Krishan Niwas (1987) 9 Supreme Court Cases 31.
Mr. Ashok Aggarwal, learned senior counsel appearing for respondent No.1. has argued that the petitioner has not impleaded respondent No.2 in the proceedings initiated by the petitioner under Sections 14 and 17 of the Act nor impleaded respondent No.2 in the arbitration proceedings. The award given by the Arbitrator is unreasoned and non-speaking award, therefore, such award could not be made rule of the Court.
The non-filing of original application along with the present petition filed on 3.3.2004 could only be by inadvertence as the petitioner has filed an application under Section 14 of the Limitation Act along with the petition under Article 227 of the Constitution of India for excluding the period spent in prosecuting the other remedy. Thus, CM No.93-CII of 2006 filed by the petitioner is allowed.
The petitioner has sought exclusion of time spent in pursuing his remedy before the wrong forum vide CM No. 5668-CII of
2004. After the order dated 13.9.2001 was passed by learned Additional District Judge, the petitioner has sought return of the application filed CM Nos.93-CII of 06 and 5668-CII of 04 (11) and CR No. 1557 of 2004
under Sections 14 and 17 of the Act. Said application has been filed on behalf of the petitioner by an Advocate. Such application under Section 14 has been received by an Advocate. There is nothing on record to suggest that the petitioner is well versed in the legal technicalities and was competent to decide by himself the further course of action. Soon after the application was withdrawn from the Civil Court at Chandigarh, the same was filed at Gurgaon. Though in view of the findings recorded, the same should have been filed before this Court but the application before the Civil Court Gurgaon was again filed through the Advocates engaged by the petitioner. The petitioner has pleaded that he is approaching the Gurgaon Court in view of the fact that the property is situated at Gurgaon. In fact, the execution of the award, after the same was made rule of the Court, was pending at Gurgaon. The invocation of jurisdiction of different forums for redresssal of the grievance of the petitioner, in fact, shows that he was prosecuting his remedy, may be not before the correct forum. Therefore, it cannot be said that the conduct of the petitioner was not such which could give an inference that he has given up his rights. There is nothing on record that he was to gain materially anything by not approaching the right forum at the earliest. Therefore, Civil Misc. No.5668-CII of 2004 is also allowed.
CM Nos.93-CII of 06 and 5668-CII of 04 (12) and CR No. 1557 of 2004
Even otherwise, the remedy under Article 227 of the Constitution of India is the supervisory jurisdiction of this Court and there is no limitation prescribed for exercise of such jurisdiction, therefore, I am of the opinion that the doors of this Court cannot be shut for the petitioner keeping in view the facts enumerated above.
No doubt, the petitioner has pleaded in his application under Sections 14 and 17 of the Act, that the Arbitrator was appointed by this Court, but none of the counsel for the parties could even suggest that such averment is factually correct. The order passed by this Court reproduced above is not even remotely suggestive of such an inference.
Learned first Appellate Court was, therefore, not justified in law in mechanically accepting such plea which has no legal or factual foundation. The order passed by the first Appellate Court is factually and legally incorrect. The Arbitrator was appointed by the Corporation/State Government. Earlier, the proceedings in Civil Court was stayed on an application filed by the Corporation. Two arbitrators were appointed in terms of the agreement even prior to the directions of this Court. Therefore, the Corporation failed to act fairly and to point out correct legal and factual position to the first Appellate Court when the petition was ordered to be returned to the petitioner for the lack of CM Nos.93-CII of 06 and 5668-CII of 04 (13) and CR No. 1557 of 2004
jurisdiction. Since the order is patently illegal and such illegality is apparent on record, mere fact that some time has passed, this Court will not permit the illegalities to be perpetuated.
The petitioner has sought the return of the application under section 14 of the Act, but such return is immaterial and inconsequential as the order passed by the first Appellate Court is patently illegal. The technicalities in seeking remedy by the petitioner cannot be used to defeat the right which vested with the petitioner on the basis of award rendered by an Arbitrator in terms of agreement between the parties. It was the objection of respondent No.1 that the matter required to be decided by an Arbitrator and once the Arbitrator has decided the matter, it was not open to the said respondent to dispute the award except on legally permissible ground. The plot was allotted to Respondent No.2 within six months of its resumption. The plot was resumed within 4 years of allotment. Respondent No.2 has been orffered physical possession of the plot vide letter dated 26.4.2002. She transferred the same in September, 2003 in favour of Respondent No.3. Since Respondent No.2 was not in physical possession of the plot, therefore, the allotment in her favour was only a paper transaction which does not confer any right in favour of the said respondent. Therefore, even if Respondent No.2 was CM Nos.93-CII of 06 and 5668-CII of 04 (14) and CR No. 1557 of 2004
not made party in the proceedings, it is wholly inconsequential. The dispute, referred to an Arbitrator, was that of the petitioner with the Corporation. The Corporation was to justify the order of cancellation of the plot. It could not be pointed out that any objection was raised in respect of non-impleading of proper parties either before the Arbitrator or before the Court in proceedings for making the award rule of the Court. The only other objection against the award is that it is a non- speaking and unreasoned award. In view of the judgment of Hon'ble Supreme Court in Raipur Development Authority etc. etc. Vs. M/s Chokhamal Contractors etc. etc. AIR 1990 Supreme Court 1426 said objection is without any merit.
Respondent No.3 is a purchaser during the pendency of the litigation and therefore, the plea that he is a bona fide purchaser is not available to him. Since the entire controversy has snowballed on account of the conduct of respondent No.1, it is for respondent No.1 to find a solution of the consequences of its action.
The arguments raised by Mr. Sarin that the petitioner has submitted to the order passed by the learned Additional District holding that only the High Court has jurisdiction to entertain the petition, therefore, it is not open to the petitioner to now challenge the said order.
CM Nos.93-CII of 06 and 5668-CII of 04 (15) and CR No. 1557 of 2004
As discussed above, the order passed by the learned Additional District Judge is factually incorrect. Therefore, if the petitioner has sought the return of the application under mistaken advice, this Court cannot allow the illegalities to be perpetuated. Once the applications are signed by the Advocates, it was not necessary for the petitioner to produce affidavits of the Advocates engaged by him. Signing of such application indicates that such counsel has taken approval. Therefore, it is open to the petitioner to challenge the said order before this Court. The principles laid down in the judgments referred to by the learned counsel for the respondents are not in dispute but such principles are not applicable in the facts of the present case.
Therefore, I am of the opinion that the order passed by the learned Additional District Judge, Chandigarh on 13.9.2001 suffers from patent illegality and irregularities which has caused substantial injustice to the petitioner. Consequently, the said order is set aside. The order passed by the learned Trial Court on 20.11.1995 is ordered to be restored. Respondent No.3 is at liberty to seek his remedy against his vendor in accordance with law in appropriate proceedings.
February ,2006 (Hemant Gupta)
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