Gagandeep Khurana v. M/S Sham Jewels And Infra And Others





    
   

 



 
  









     




 

 


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>  The scope and ambit of the power and jurisdiction of 'court' defined under Section 2(e) of the 1996 Act is circumscribed to certain specified extent as set out in Sections 8, 9, 14, 27, 34, 36, 37, 39, 42, 43, 47, 48, 49, 50, 56, 58 and 59. A comparative consideration of the 1940 Act and 1996 Act disclose the extent of control and operation of a Court under the former Act was far more intensive and elaborate than the latter Act. The more significant distinction as between the 1940 Act and the 1996 Act is clear to the position that the former Act does not merely stop with the initiation and enforcement of an Arbitration and its award, but effectively provides for intervention at every stage of the Arbitral proceedings upto its final

 consideration and enforcement as if it were a regular civil suit, whereas under the 1996 Act, the scope of intervention is not that of a Civil Court as it could do in the matter of a suit. Such clear distinction could be discerned from the reading of the various provisions of both the Acts. Therefore, in the light of such distinctive features that prevail in respect of an Arbitral proceeding which emanated under the 1940 Act, this Court held in Jagdish Chander case (supra) to the effect that an Arbitral proceedings governed by 1940 Act would squarely fall under the category of 'other proceedings' as specified in Section 69(3) of the Partnership Act.

To be more precise, in Jagdish Chander case (supra), in as much the initiation of the proceedings were under Section 8 of the 1940 Act before a Civil Court having jurisdiction to decide the question forming the subject matter of suit and the respondent therein being an unregistered Partnership Firm, the ingredients set out in Section 69(1) to (3) of the Partnership Act applied in all force and consequently held that the prohibition set out in the said Section squarely applied.

28.

We only wish to add that though in the said decision in Jagdish Chander case, this Court did not specifically mention as to the requirement of pendency of a proceeding in the nature of a suit in a Civil Court as the basic ingredient to be satisfied as stipulated in subsections (1) & (2) of Section 69 in order to extend the specific prohibition even to 'other proceedings' under sub- section (3), this Court

 was fully aware of the fulfillment of those mandatory requirement having regard to the nature of proceedings that existed under the provisions of the 1940 Act. Therefore, our conclusion based on the interpretation of Section 69 on the whole as set out in paragraphs 10 to 18 are fully supported by the above decision. We have therefore no hesitation to hold that the ratio laid down in Jagdish Chander case does not in any way conflict with the view which we have taken herein, having regard to the advent of the 1996 Act, under which the nature of Arbitration Proceedings underwent a sea change as compared to the 1940 Act, what is stated in Jagdish Chander case can have application in the special facts of that case and that it can have no application to a proceedings which emanated under the 1996 Act, for which the interpretation to be placed on Section 69(3) will have to be made independently with specific reference to the provisions of the 1996 Act, where the role of the Court is limited as noted earlier to the extent as specified in Sections 8, 9 etc."

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