Judgment:
ORDER
N. Kumar, J.
1. This petition is filed under Section 11 of the Arbitration and Conciliation Act, 1996, for short hereinafter referred to as the 'Act', for appointment of arbitrator, in view of the arbitration clause in the agreement between the parties dated 31st January, 2003.
2. The petitioner owns The Leela Palace Kempinski, which is a Five-Star Deluxe Hotel situated at Airport Road, Bangalore. The petitioner also owns a shopping plaza which forms an integral part of the said Hotel and it is called 'The Leela Galleria'. The respondent under a Licence Agreement dated 31st January 2003 has taken an area of 4236 sq. feet in the said Leela Galleria. Annexure-B is the original agreement. According to the petitioner, the period agreed came to an end by 17th March 2006. Therefore, they addressed a letter dated 19th January, 2006 calling upon the respondent to vacate and deliver the vacant possession of the property. When the respondents did not comply with the said demand, they were constrained to issue notice dated 18th March, 2006 invoking the arbitration clause in the agreement between the parties and suggesting the name of the arbitrator to resolve the dispute between the parties. The respondent instead of agreeing to the arbitrator suggested by the petitioner or suggesting any other name filed a petition under Section 11 of the Act before the Calcutta High Court for appointment of an arbitrator during April 2006. The present petition is filed on 1st June, 2006 by the petitioners for appointment of an arbitrator. There is no dispute between the parties that this petition is filed subsequent of the petition filed by the respondents before the Calcutta High Court.
3. After service of notice the respondent entered appearance and has filed detailed statement of objections. In addition, an application is also filed for dismissal of this petition, as the respondent has already approached the Calcutta High Court for appointment of an arbitrator, Objections are filed to the said application by the petitioner.
4. The learned Senior Counsel Sri. Uday Holla, appearing for the petitioner contended that no part of the cause of action has arisen within the jurisdiction of Calcutta High Court, the arbitration clause specifically provides that the seat of arbitration and jurisdiction of the agreement shall be at Bangalore. The property in dispute is situated at Bangalore. In spite of the same, mischievously, a frivolous petition is filed in the Calcutta High Court to stall the proceedings being filed by the petitioner before this Court. There is inherent lack of jurisdiction to entertain any claim by the Calcutta High Court. In such matters, this Court can ignore the petition filed in the Calcutta High Court and hold that this Court has got the jurisdiction and proceed to appoint an arbitrator.
5. Per contra, Sri. Naganand, learned Senior Counsel appearing for the respondents contended that even assuming that the Calcutta High Court has no jurisdiction to entertain the petition filed by the respondents as contended by the petitioner, it is not open to this Court to rule regarding the jurisdiction of the Calcutta High Court. This Court can rule only about its jurisdiction. In view of the express provision in Section 11(11) of the Act, if a request for appointment of arbitrator is made by the parties in two Courts, it is the Court to which such request is made at first in point, of time alone shall have the jurisdiction and the High Court to which request is made subsequent to that has no jurisdiction. Therefore, he submits that the petition filed for appointment of arbitrator before this Court is liable to be dismissed.
6. The dispute between the parties revolves round the provisions contained in Section 11(11) of the Act which reads as under:
Where more than one request has been made under Sub-section (4) or Sub-section (5) or Sub-section (6) to the Chief Justices of different High Courts or their designates, the Chief Justice or his designate to whom the request has been first made under the relevant sub-section shall alone be competent to decide on the request.
7. A reading of the aforesaid provision makes it clear, that, when more than one request is made invoking the arbitration clause under an agreement before different High Courts, the High Court to which the request has been first made shall alone be competent to decide on the request. Impliedly it follows that the High Court to which such request is made subsequently will have no jurisdiction to entertain such application. Therefore, what is to be ascertained in such a circumstances is to find out the date on which such requests are made in different High Courts and then find out in point of time which is the High Court which is first approached, and it is that High Court alone, shall have jurisdiction to decide the request for appointment of arbitrator. Thus the jurisdiction of the other High Court is barred.
8. It is pointed out relying on Section 11(12)(b) that the Court which will have the jurisdiction to decide such dispute after the appointment, is made by the High Court shall be the Court referred to in Clause (e) of Sub-section (1) of Section 2 is situate. Therefore, it was contended that the territorial jurisdiction of the Court is to be found out from the provision of Code of Civil Procedure as if the party has chosen to file a civil suit, which Court would have had jurisdiction. In this regard Section 16 of the Code of Civil Procedure was pressed into service to contend that for recovery of immovable property with or without rent or profits, the suit shall be instituted in the Court within the local limits of whose jurisdiction the property is situate. Further it was pointed out that in view of Section 42 of the Act, with respect to an arbitration agreement, any application has been made in a Court, that Court alone shall have the jurisdiction over the arbitral proceedings and all subsequent applications arising out of the agreement and the arbitral proceedings shall be made in that Court and in no other Court. Therefore it was contended that it is open to the Court to ignore such proceedings initiated in a Calcutta High Court and proceed to consider the request of the petitioner on merits.
9. Section 2(1)(e) of the Act defines the 'Court' thus:
court' means the principal civil court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the subject-matter of the arbitration if the same had been the subject-matter of a suit, but does not include any civil court of a grade inferior to such principal civil court, or any court of small causes.
10. The subject matter of the arbitration is an area of 4236 sq. feet of accommodation in Leela Galleria. The Court has to find out. under Section 16 of the Code of Civil Procedure, where the subject matter is situated and under Section 42 of the Act, which Court the parties have approached. However, under Section 11(11) of the Act, what is to be considered is the Court to which the request has been made first in point of time. Therefore, in a petition under Section 11 of the Act, when the same is opposed on the ground that it is hit by Sub-section (11) of Section 11 of the Act, it is not open to this Court to go into the territorial jurisdiction of the Courts. It would be out side the scope of the enquiry having regard to the nature of objection taken. In view of the clear language employed by the Parliament in Section 11(11) of the Act when once a request is made for appointment of an arbitrator to different High Courts, it is the High Court to which such a request is made earlier in point of time alone will have the jurisdiction and the other Court will have no jurisdiction to entertain such a request, as long as the earlier petition for appointment of arbitrator is pending in another Court. This is based on public policy. It is to avoid both the courts appointing arbitrators and to avoid conflicting decisions on the question of jurisdiction.
11. Merely because, an application is filed in Calcutta High Court, that does not mean that the Calcutta High Court, will appoint an arbitrator as prayed for by the respondent. Before such an appointment is made, first the Calcutta High Court has to rule on its jurisdiction to appoint an arbitrator. That is a matter to be decided by the Calcutta High Court before passing any orders at the request of the respondent. The petitioner can very well raise this objection of territorial jurisdiction before the Calcutta High Court and if the objection is upheld and the petition dismissed, they can approach this Court for appointment of arbitrator. But it is not proper for this Court to pronounce upon the jurisdiction of the Calcutta High Court.
12. In that view of the matter, as the respondents have approached the Calcutta High Court for the same relief earlier in point of time and this petition having filed subsequent thereto, this petition is not maintainable. All the contentions urged by the parties are left open to be agitated at the appropriate forum, if and when they are raised. No costs.