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International Air Transport Association (IATA), represented by its duly authorized Aviation Industry Analyst, Shri Vinay Gulshan Kakkar, Mumbai v/s Indrani Air Travels Pvt Ltd, Represented by its Director Shri Jai Prakash Sharma & Another

    CRP/474 of 2015

    Decided On, 03 March 2022

    At, High Court of Gauhati

    By, THE HONOURABLE MR. JUSTICE ROBIN PHUKAN

    For the Petitioner: D. Senapati, Advocate. For the Respondents: P.K. Roychoudhury, Advocate.



Judgment Text

1. This application under Article 227 of the Constitution of India read with Section 115 and Section 151 of the Civil Procedure Code is preferred by the petitioner, namely, International Air Transport Association (IATA), for setting aside and quashing of the order dated 20.07.2015, passed by the learned Civil Judge No. 1, Kamrup (Metro), Guwahati, in Petition No. 6363/2014 filed under Section 8 of the Arbitration and Conciliation Act, 1996, in M.S. No. 53/2014. It is to be noted here that vide impugned order, the learned Civil Judge No. 1, Kamrup (Metro), Guwahati has rejected the petition No. 6363/14 on the ground that the petitioner has failed to produce the copy of the original agreement or a duly certified copy thereof, even though the entire case of the respondent no. 1 is based upon the Passenger Sales Agency Agreement (PSSA), dated 15.06.2006.

2. The factual background leading to filing of the present petition is Page No.# 3/11 adumbrated herein below:-

"...The respondent no. 1, Indrani Air Travels Pvt. Ltd. is an agent of the petitioner-International Air Transport Association (IATA) and respondent no. 2-Pantheon Data Service Pvt. Ltd. on the strength of an agreement dated 15.06.2006. The respondent no. 1 instituted a Money Suit being Money Suit No. 53/2014 against the petitioner and respondent no. 2, claiming a sum of Rs. 64,57,311/- (Rupees Sixty Four Lakh Fifty Seven Thousand Three Hundred and Eleven) before the learned Civil Judge No. 1, Kamrup(M) Guwahati. The petitioner, having entered appearance, filed a petition, being Petition no. 6363/2014, under Section 8 of the Arbitration and Conciliation Act, bringing to the notice of the Court that in view of the agreement for arbitration between the parties, regarding resolution of dispute, the Court did not have the jurisdiction to try the Suit. The learned Court below, after hearing the parties, dismissed the petition on the ground that sub-section 2 of Section 8 of the Arbitration and Conciliation Act has not been complied with. Being highly aggrieved, the petitioner approached this Court by filing the present revision petition".

3. I have heard Mr. D. Senapati, learned counsel for the petitioner. Also, heard Mr. P. K. Roychoudhury, learned counsel for the respondent.

4. Mr. D. Senapati, learned counsel for the petitioner, submits that some disputes in respect of financial matters arose between the petitioner and the respondent no. 1 and the respondent no. 1, filed one money suit before the Court of learned Civil Judge Kamrup, being Money Suit no. 53/2014 against the petitioner. Thereafter, the petitioner appeared before the learned Court of Civil Page No.# 4/11 Judge No. 1, Kamrup and filed a petition being Petition no. 6363/2014, under Section 8 of the Arbitration and Conciliation Act, 1996 and pleaded that the suit filed by the plaintiff is not maintainable in law as well as in fact as the same has been filed by suppressing material facts. Mr. Senapati further submits that the petitioner and the respondent no. 1 entered and executed one Passenger Sales Agency Agreement, dated 15.06.2006 with the respondent no. 1 and pursuant to Section 2.1(a) of the Passenger Sales Agency Agreement (hereinafter, referred to as PSSA), the terms and condition governing the relationship between them are set forward in the Regulations contained in the Travel Agent's Handbook, published from time to time under the authority of the Administrator. It is further submitted that Section 1 of the Resolution 820e, as incorporated in the PSSA, provides that an application before the Travel Commissioner is a condition precedent in dispute or difference between the plaintiff and the defendant, which reads as under "all disputes or difference arising out of or in connection with matters enumerated in the present Section shall be finally settled, subject to review by arbitration pursuant to Section 4 herein, by the Commissioner, in accordance with this Resolution and as such, Mr. Senapati submits, the Court should exercise the power under Section 8 of the Arbitration and Conciliation Act, 1996. Mr. Senapati also referred to two case laws, Rashtriya Ispat Nigam Limited & Anr. vs M/S Verma Transport Company, reported in 2006 SCC 275 and Parampal Singh and Ors. Vs. Punjab State Ware house Corporation reported in AIR 2000 P H 53, to contend that production of the original agreement or duly certified copy thereof is not necessary and that the learned Court below has rejected the application under Section 8 on the ground of non furnishing of certified copy with the application under Section 8. Mr. Senapati, learned counsel further submits that Page No.# 5/11 the grounds so assigned by the learned Court below is erroneous and therefore, Mr. Senapati contended to set aside the impugned order.

5. On the other hand, Mr. P. K. Roychoudhury, learned counsel for the respondent, submits that jurisdiction under Article 227 can be exercised when there is jurisdictional error but here in this case, no jurisdictional error has been committed by the learned Court below by rejecting the petition under Section 8(2) of Arbitration and Conciliation Act. Mr. Roychoudhury further submits that before referring the matter to arbitration tribunal, it has to be first addressed to the Commissioner and if any of the parties are not agreed to the decision of the Commissioner, then the matter has to be referred to Arbitration Tribunal and it cannot be directly sent to the Arbitrator, ignoring the Commissioner. Mr. Roychoudhury further submits that as the impugned order has been passed in compliance of the provision of Section 8(2) of the Arbitration and Conciliation Act, the impugned order suffers from no jurisdictional error and therefore, it is contended to allow the petition.

6. Having heard the submission of learned counsels of both sides, I have carefully gone through the petition and the documents enclosed therewith and also, I have carefully gone through the case law referred by Mr. Senapati. Also I have carefully gone through the Passenger Sales Agency Agreement entered into by the petitioner and also by the respondent, dated 15.06.2006 and Travel Agent's Handbook, Resolution 818g Edition and it appears from the agreement that rules, resolutions and provisions have been incorporated therein and that Clause-14 of the said agreement deals with Arbitration, where it is provided that "if any matter is reviewed by arbitration pursuant to the Sales Agency Rules, the agent hereby submit to arbitration in accordance Page No.# 6/11 with such rules and agrees to observe the procedure therein provided and to abide by any arbitration award made thereunder". It also appears from the Travel Agent's Handbook that Section 12 provides for Arbitration and Section 12.1 deals with right to arbitration, and Section 12.1.1 provides that "any party to a dispute settled in accordance with Resolution 820e shall have the right to submit the Travel Agency Commissioner's decision to denovo review by arbitration in accordance with this section". Section 12.2 provides for agreement to arbitrate and Section 12.2.1 provides that "all disputes arising out of or in connection with a decision rendered by a Travel Agency Commissioner shall be finally settled under the Rules of Arbitration of The International Chamber of Commerce by one or more arbitrators appointed in accordance with the said rules and judgment upon the award may be entered in any Court having jurisdiction thereof".

7. Further, Resolution 820e sub-section 1 provides for jurisdiction of the Commissioner which provides that "all disputes arising out of or in connection with the matters enumerated in the present section shall be finally settled, subject to review by arbitration pursuant to Section 4 herein by the Commissioner in accordance with this resolution". Section 4 provides for review by arbitration and Section 4.1 provides that "an agent or applicant, which consider itself aggrieved by decision of the Commissioner taken under the provision of these resolution shall have the right to have such decision, reviewed by arbitration in accordance with the procedure set out in the Passenger Sale Agency Rules" and Section 14 provides for arbitration and it provides that "if any matter is reviewed by arbitration pursuant to the Sale Agency Rules, the agent hereby submits to arbitration in accordance with such rules and agrees to observe the procedure therein provides and to abide by any arbitration award Page No.# 7/11 made there under".

8. It is to be noted here that existence of arbitration clause in the agreement dated 15.06.2006, between the petitioner and the respondent, is not in dispute here in this case. Rather, the respondent no. 1 in the plaint in paragraph no. 3 has admitted existence of the Agreement, dated, 15.06.2006. Mr. P. K. Roychoudhury, learned counsel for the respondent also has not disputed the same. Now the question is whether non-submission of the original or the certified copy of the agreement is a ground for rejection of the petition under Section 8 of the Arbitration and Conciliation Act, 1996. While dealing with the issue, Punjab and Haryana High Court in the case of Parampal Singh and Ors. (Supra) held as under:

"The provision of the 1996 Act that the copy of the Arbitration agreement or duly certified copy thereof should be produced along with the application for referring the matter to the Arbitrator cannot be interpreted to mean that if the copy of the same was not produced earlier though by the other party, the application should be dismissed. Take for instance, a case where such copy of the arbitration agreement is produced earlier and the application to refer to the matter to the Arbitrator has been filed later on, by the same party viz., the defendant, then it cannot be said that the provision of sub- section (2) of Section 8 of the 1996 Act was not complied with. This is because the copy of the arbitration agreement was already produced on record by the defendant in the given case. Similarly, in the said case also a copy of the arbitration agreement has been produced on record by the plaintiffs themselves and the application for referring the matter to the Arbitrator was filed by respondent-defendant. This being the position the appellants cannot be allowed to raise this technical plea of non-compliance of provision of sub-section (2) of Section 8 of the 1996 Act."

9. In the case of Rashtriya Ispat Nigam Limited & Anr. vs M/S Page No.# 8/11 Verma Transport Company, reported in 2006 SCC 275, Hon'ble Supreme Court, interpreting Section 7 of the Arbitration Act held as under:

"In the instant case, the existence of a valid agreement stands admitted. There cannot also be any dispute that the matter relating to termination of the contract would be a dispute arising out of a contract and, thus, the arbitration agreement contained in clause 44 of the contract would be squarely attracted. Once the conditions precedent contained in the said proceedings are satisfied, the judicial authority is statutorily mandated to refer the matter to arbitration. What is necessary to be looked into therefore, inter alia, would be as to whether the subject-matter of the dispute is covered by the arbitration agreement or not."

10. It is to be mentioned here that in the instant case, the existence of one agreement dated 15.06.2006 and the Arbitration Clause therein, and also the existence of Arbitration Clause in Travel Agent's Handbook is not disputed by the respondent. The petitioner along with the petition no. 6363/2014 under Section 8 of the Arbitration Act being the petition No. 6363/2014 has enclosed the certified copy of the agreement and the Travel Agents Handbook with the petition. Existence of Arbitration Clause in the said agreement and the Handbook in not in dispute and the nature of dispute between the petitioner and the respondent is duly covered by the Arbitration clause of the said agreement. Therefore, applying the law laid down by the Hon'ble Supreme Court in the case of Rashtriya Ispat Nigam Limited & Anr. (supra) and by the Punjab and Haryana High Court in the Case law Parampal Singh and Ors. (supra), it can safely be concluded that non-furnishing of the original copy of the Arbitration agreement is of no consequence here in this case as the existence of such a clause in the agreement is not in dispute.

11. In the case of Hindustan Petroleum Corpn. Ltd. vs. M/s. Pinkcity Page No.# 9/11 Midway Petroleums reported in (2003) 6 SCC 503, the Hon'ble Supreme Court has held as under:

"...This Court in the case of P. Anand Gajapathi Raju & Ors. v. P. V. G. Raju (Dead) & Ors. [2000 (4) SCC 539] has held that the language of Section 8 is peremptory in nature. Therefore, in cases where there is an arbitration clause in the agreement, it is obligatory for the Court to refer the parties to arbitration in terms of their arbitration agreement and nothing remains to be decided in the original action after such an application is made except to refer the dispute to an arbitrator. Therefore, it is clear that if, as contended by a party in an agreement between the parties before the Civil Court, there is a clause for arbitration, it is mandatory for the Civil Court to refer the dispute to an arbitrator. In the instant case the existence of an arbitral clause in the agreement is accepted by both the parties as also by the courts below but the applicability thereof is disputed by the respondent and the said dispute is accepted by the courts below. Be that as it may, at the cost of repetition, we may again state that the existence of the arbitration clause is admitted. If that be so, in view of the mandatory language of Section 8 of the Act, the courts below ought to have referred the dispute to arbitration."

12. In the case of M/S Sundaram Finance Limited and Anr. vs. T. Thankam, reported in (2015) 14 SCC 444, the Hon'ble Supreme Court has held as under :

"...Once there is an agreement between the parties to refer the disputes or differences arising out of the agreement to arbitration, and in case either party, ignoring the terms of the agreement, approaches the civil court and the other party, in terms of the Section 8 of the Arbitration Act, moves the court for referring the parties to arbitration before the first statement on the substance of the dispute is filed, in view of the peremptory Page No.# 10/11 language of Section 8 of the Arbitration Act, it is obligatory for the court to refer the parties to arbitration in terms of the agreement, as held by this Court in P. Anand Gajapathi Raju and others v. P.V.G. Raju (Dead) and others[1]."

Further, Hon'ble Supreme court held that:

"...Once an application in due compliance of Section 8 of the Arbitration Act is filed, the approach of the civil court should be not to see whether the court has jurisdiction. It should be to see whether its jurisdiction has been ousted. There is a lot of difference between the two approaches. Once it is brought to the notice of the court that its jurisdiction has been taken away in terms of the procedure prescribed under a special statue, the civil court should first see whether there is ouster of jurisdiction in terms or co

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mpliance of the procedure under the special statute. The general law should yield to the special law - 'generalia specialibus non derogant'. In such a situation, the approach shall not be to see whether there is still jurisdiction in the civil court under the general law. Such approaches would only delay the resolution of disputes and complicate the redressal of grievance and of course unnecessarily increase the pendency in the court." 13. Having tested the impugned order dated 20.07.2015 passed by the learned Civil Judge No. 1, Kamrup (Metro), Guwahati, in International Air Transport Association (IATA) vs. Indrani Air Travels Pvt Ltd ., in Money Suit No. 53/2014, on the touchstone of the principles discussed herein above, this Court is inclined to hold that the impugned order failed to withstand the test of propriety or correctness. 14. I have considered the submissions of the learned counsels of both sides and I find sufficient force in the submission of Mr. D. Senapati, learned counsel Page No.# 11/11 for the petitioner and the case laws referred by him also fortified his submission. On the other hand, the submissions advance by Mr. P. K. Roychoudhury, learned counsel for the respondent failed to impress this Court. 15. In the result, I find sufficient merit in this petition and accordingly, the same stands allowed. Consequently, the impugned order dated 20.07.2015 passed by the learned Civil Judge No. 1, Kamrup (Metro), Guwahati in Petition No. 6363/2014 filed under Section 8 of the Arbitration and Conciliation Act, 1996 in M.S. No. 53/2014, stands set aside. 16. Interim order, if any, stands vacated. The parties have to bear their own cost.
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