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Grid Corporation of Orissa Ltd. Vs. the Aes Corporation and ors. - Court Judgment

SooperKanoon Citation
SubjectArbitration;Civil
CourtOrissa High Court
Decided On
Case NumberW.P. (C) No. 2194 of 2003
Judge
Reported inAIR2004Ori186; 2005(1)ARBLR115(Orissa); 98(2004)CLT304
ActsArbitration and Conciliation Act, 1996 - Sections 5, 9 and 37; Code of Civil Procedure (CPC) - Order 1, Rule 10 - Order 6, Rule 17; Constitution of India - Article 227
AppellantGrid Corporation of Orissa Ltd.
RespondentThe Aes Corporation and ors.
Appellant AdvocateN.C. Panigrahi, Adv.
Respondent AdvocateR. Mohapatra and D. Gupta
DispositionPetition dismissed
Cases ReferredSurya Dev Rai v. Ram Chander Rai and Ors.
Excerpt:
.....- district judge dismissed both petitions along with petition under section 9 of act - petitioner filed appeal - during pendency petitioner filed present petition against order of district judge wherein he dismissed two petitions - held, court is empowered only to grant such relief at interim stage, which it has power to grant as final relief at conclusion of proceeding - admittedly petition has already preferred and matter is sub judice - while adjudicating said appeal, this court can also decide questions ancillary to main relief - in view of fact that legislature has not provided any forum for challenging any interim order passed in arbitration case, it can be presumed that while deciding appeal arising out of final order of court below, appellate court can also look into propriety..........the main case. admittedly, the court below has disposed of the mjc itself and the petitioner has filed an appeal against the said order. the order passed in the two misc. petitions merged with the final order in mjc against which an appeal has been preferred. law is well settled that an appeal is a continuation of a proceeding. an appellate court has the same power as the original court against whose order the appeal has been preferred. thus, the conclusion is irresistible that the petitioner could raise the question of legality of the order passed in the two misc. petitions in the appeal itself, specially in view of the fact that the order is a composite one and disposed of the main case as well as the misc. petitions.17. it is no more res integra that a court is empowered only to.....
Judgment:

A.S. Naidu, J.

1. The GRID Corporation of Orissa Limited, hereinafter referred to as 'GRIDCO', represented through its Chairman-cum-Managing Director, has filed this Writ petition invoking jurisdiction of this Court under Article 227 of the Constitution of India praying for issuance of a Writ of Certiorari quashing the order dated 8th March, 2002 passed by the District Judge, Khurda at Bhubaneswar rejecting its applications filed under Order 1, Rule 10 and Order 6, Rule 17 of the Code of Civil Procedure in MJC No. 522 of 2001.

2. Admittedly MJC No. 522 of 2001 was filed by the present petitioner under Section 9(ii) (d) and (e) of the Arbitration and Conciliation, Act, 1996 in the Court of the District Judge, Khurda for securing and preserving the property in dispute in arbitration by restraining the opposite parties, particularly opposite party No. 1, from selling away or otherwise parting with the shares held by them in the Orissa Power Generation Corporation (for short 'OPGC') though its subsidiaries including any financial benefit accruing to them from such shares to any third party and from availing such financial benefit themselves and directing them for arranging and making funds available to Central Electricity Supply Company of Orissa Limited (for short 'CESCO') to meet its obligations to GRIDCO and enable the latter to discharge its obligations to OPGC and others pending arbitration. Along with the MJC petition, the petitioner had also filed an application under Order 39, Rules 1 and 2 read with Section 151 of the Code of Civil Procedure and Section 9 of the Arbitration and Conciliation Act praying for grant of ex parte and interim injunction restraining opposite party No. 1 from selling its shares in OPGC through its subsidiaries pending disposal of the MJC.

3. The District Judge by his order dated 10th December, 2001 directed issue of notice to the opposite parties to show cause and as an interim measure restrained respondent No. 1 AES Corporation from selling away its shares in OPGC held through its subsidiaries until 3rd January, 2002.

4. Opposite party Nos. 1 to 3 filed their objection to the MJC and also to the application for interim direction filed by the petitioner and took the following stand :

'..........It is respectfully submitted that prayer (i) is not liable to be granted at all as the shares in OPGC are admittedly not owned by respondent No. 1. The owners of these shares have not been made a party to the present proceedings and the petition deserves to be dismissed for non-joinder and mis-joinder of parties and on account of the reasons set out hereinbefore in the preliminary objection as well as in the detailed parawise reply on merits.'

5. After going through the aforesaid objection of opposite parties 1 to 3, it is averred, the present petitioner filed a petition under Order 6, Rule 17, CPC for amendment of the MJC petition and another petition under Order 1, Rule 10(2), CPC for impleading OPGC as well as its two wholly-owned subsidiary companies which held shares in OPGC as parties to the MJC. The respondents filed objection to the said petitions.

6. As stated earlier, the District Judge heard the parties on the aforesaid petitions filed by the petitioner as well as the main MJC petition, and by a common order dated 8th of March, 2002 dismissed both the petitions. The District Judge also rejected the petition filed by the petitioner under Section 9 of the Arbitration and Conciliation Act on the same day. The petitioner thereafter preferred a Miscellaneous Appeal before this Court under Section 37(1) of the Arbitration and Conciliation Act and the same was registered as M.A. No. 426 of 2002. In this Writ Petition the petitioner seeks to challenge the portion of the aforesaid order dated 8th March, 2002 of the District Judge rejecting the two petitions filed by it under Order 1, Rule 10 and Order6, Rule 17, CPC.

7. On 10.4.2004 when the Writ Petition was listed, the petitioner made an oral prayer to implead (1) OPGG, represented through its Managing Director, (2) AES-OPGC Holding (Mauritius), and (3) AES India Pvt. Ltd. through its Chief Executive, as opposite parties 5, 6 and 7 respectively. The said prayer was allowed on the basis of an undertaking that an appropriate application to that effect would be filed. Notice was directed to be issued to the said newly added opposite parties.

The petitioner and also filed Misc. Case No. 397 of 2003 inter alia praying for grant of interim injunction and this Court directed the opposite parties to file their show-cause. By order dated 17.12.2003 this Court directed to list aforesaid Misc. Appeal No. 426 of 2002 along with this Writ Petition forfinal hearing.

8. The opposite parties have entered appearance and have filed separate counter-affidavits, more or less taking the stand that this Writ Petition under Article 227 of the Constitution of India challenging a portion of the impugned order, while filing of a Miscellaneous Appeal against the main order under Section 37(1) of the Arbitration and Conciliation Act is not maintainable and filing of this Writ Petition is an attempt to circumvent the provisions of the said Act and it is a fit case where the Writ Petition should be dismissed in limine.

9. The petitioner has filed a rejoinder repudiating the stand taken by the opposite parties in their respective counter-affidavits and taking the stand that in consonance with the objection of the respondents before the Court below that the MJC and the Misc. Case were not maintainable due to non-joinder of necessary parties, the petitioner was constrained to file a petition under Order 6, Rule 17, CPC for amendment of the MJC petition and a petition under Order 1, Rule 10, CPC for impleading the necessary parties as pointed out in the objection. It is further stated that as there is no provision in the Arbitration and Conciliation Act to challenge an order rejecting a petition filed under Order 1, Rule 10, CPC the petitioner was constrained to seek redress invoking jurisdiction of this Court under Article 227 of the Constitution of India and thus the Writ Petition is maintainable.

10. In course of hearing, Mr. Panigrahi, learned counsel for the petitioner, forcefully reiterated the stand taken by the petitioner in the Writ petition and the rejoinder affidavit. According to Mr. Panigrahi, the petition under Order 1, Rule 10, CPC to implead the necessary parties and the petition for amendment of the MJC petition under Order 6, Rule 17, CPC were filed to obliterate the stand taken by the respondents in their respective objections filed before the Court below to the extent that the MJC petition and the injunction petition were not maintainable due to non-joinder of necessary parties. He submitted that after raising objection that the controversy could not be decided in absence of some of the necessary parties named in the objections, the opposite parties are estopped from taking the plea that the parties sought to be impleaded under Order 1, Rule 10, CPC are strangers to the arbitration proceeding and should not be impleaded as parties. They are also estopped from challenging the decision taken by the District Judge rejecting the petitions under Order 1, Rule 10, CPC and under Order 6, Rule 17, CPC by which the petitioner sought to implead the parties who, according to the objection filed by the respondents, were to have been impleaded as parties. Mr. Panigrahi also submitted that the decision of the District Judge rejecting the petitions filed under Order 1, Rule 10, CPC and under Order 6, Rule 17, CPC is illegal, unjust and as there is no provision in the Arbitration and Conciliation Act to challenge the said order in appeal, the petitioner has rightly filed the present Writ Petition.

11. At the other hand, Mr. Gupta, learned counsel appearing for the opposite parties, strenuously contended that the present Writ Petition under Article 227 of the Constitution of India is not maintainable, more so when the petitioner has already preferred a statutory appeal invoking jurisdiction under Section 37 of the Arbitration and Conciliation Act, registered as Miscellaneous Appeal No. 426 of 2002. Relying upon a decision of the Supreme Court in the case of Laxmikant R. Bhojwani v. Pratapsing M. Pardeshi, (1995) 6 SCC 576, learned counsel submitted that High Court should not extend its jurisdiction under Article 227 of the Constitution of India in the present case, as the dispute is governed under the provisions of the Arbitration and Conciliation Act which is a special legislation. The legislature has, in its wisdom, not provided a second appeal or revision to High Court against such orders passed by a District Judge. The object is to give finality to the decision of the Court. In such eventuality, it is submitted, the High Court should not assume unlimited prerogative exercising jurisdiction under Article 227 of the Constitution of India to correct all species of hardship or wrong decisions. According to the learned counsel, even if for the sake of argument it is presumed that the District Judge committed any error, in absence of any provision under the Arbitration and Conciliation Act, this Court should not assume jurisdiction under Article 227 of the Constitution of India to correct such error as such action would be contrary to the intention of the Legislature in the special legislation, i.e. the Arbitration and Conciliation Act of 1996.

Referring to Clause 2.3 of the agreement, it is further submitted that even otherwise opposite parties 5, 6 and 7 are not necessary parties and the District Judge has rightly rejected the two petitions filed by the petitioner.

12. In consonance with the observations of the Supreme Court in Laxmikant R. Bhojwani case (supra) we hold that as the Arbitration and Conciliation Act itself is a special legislation which governs the disputes arising out of arbitration proceedings and as Legislature has, in its wisdom, not provided any appeal or revision against an order passed on any miscellaneous petition filed before the Court below, this Court in exercise of its jurisdiction under Article 227 of the Constitution of India should not assume jurisdiction to correct a wrong decision of the Court below as a matter of course. Such jurisdiction, however, must be restricted to cases of grave dereliction of duty and fragrant abuse of fundamental principles of law and justice where grave injustice would be done unless the High Court interferes.

13. We have heard learned counsel for the parties patiently, looked to the provisions of the statute minutely, gone through the pleadings of the parties meticulously and considered the submissions diligently. Admittedly the dispute arises out of a petition filed by the petitioner before the Court below under Section 9(ii) (d) and (e) of the Arbitration and Conciliation Act. Section 37 of the said Act deals with appeals and reads as follows :

'37(1) An appeal shall lie from the following orders (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order, namely :

(a) granting or refusing to grant any measure under Section 9;

(b) setting aside or refusing to set aside an arbitral award under Section 34.'

Thus an order passed on a petit ion filed under Order 1, Rule 10 or on a petition filed under Order 6, Rule 17, CPC is not covered by the provisions of Section 37. So far as the order passed under Section 9 of the Act is concerned, the petitioner admittedly has filed Miscellaneous Appeal No. 426 of 2002 before this Court.

14. Section 5 of the Arbitration and Conciliation Act, 1996 reads as follows :

'5. 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 extent of judicial intervention has been thus circumscribed by Section 5 to the extent as provided in the Act itself. In other words, judicial intervention is prohibited except as provided for in the Act. Thus, judicial intervention having been limited, the Court cannot interfere at any or every stage or on a ground other than those available in the Act itself. The Act of 1996 has been enacted in order to reduce the time and avoid the procedural hazards of an ordinary litigation before a Court.

15. If higher Courts would intervene with the order passed by a Court below at every stage of the litigation on the ground that the orders are not appealable, the very purpose and object of enacting the 1996 Act would become infructuous and ineffective. The Certiorari Jurisdiction though available is not to be exercised as a matter of course. The High Court would be justified in refusing the Writ of Certiorari if no failure of justice has occasioned and/or an error occurred can be rectified in subsequent proceedings.

It has been held by the Supreme Court in the case of Surya Dev Rai v. Ram Chander Rai and Ors., AIR 2003 SC 3044 as follows :

'The Supreme Court stated the broad general difference in exercise of jurisdiction to command a writ of certiorari or to exercise supervisory jurisdiction under Article 227. Firstly, the writ or certiorari is an exercise of its original jurisdiction by the High Court, exercise of supervisory jurisdiction is not an original jurisdiction and in this sense it is akin to appellate, revisional or corrective jurisdiction. Secondly, in a writ of certiorari, the record of the proceedings having been certified and sent up by the inferior Court or Tribunal to the High Court, the High Court if inclined to exercise its jurisdiction, may simply annul or quash the proceedings and then do no more. In exercise of supervisory jurisdiction the High Court may not only quash or set aside the impugned proceedings, judgment or order but it may also make such directions as the facts and circumstances of the case may warrant, may be by way of guiding the inferior Court or Tribunal as to the manner in which it would now proceed further or afresh as commanded to or guided by the High Court. In appropriate cases the High Court, while exercising supervisory jurisdiction may substitute such a decision of its own in place of the impugned decision, as the inferior Court or Tribunal should have made. Lastly, the jurisdiction under Article 226 of the Constitution is capable of being exercised on a prayer made by or on behalf of the party aggrieved; the supervisory jurisdiction is capable of being exercised suo motu as well.'

The Courts have devised self-imposed rules or discipline on the Certiorari power under Article 227 of the Constitution. Supervisory jurisdiction may be refused to be exercised when an alternative efficacious remedy by way of appeal or revision is available to the person aggrieved. The Legislature in its wisdom has deliberately chosen certain orders and proceedings to be kept away from exercise of appellate and revisional jurisdiction in the hope of accelerating conclusion of the proceedings and avoid delay and procrastination which is occasioned by subjecting every order at every stage of proceedings to judicial review by way of appeal or revision. So long as an error is capable of being corrected by a superior Court in exercise of appellate or revisional jurisdiction, though available to be exercised only at the conclusion of the proceeding, it would be sound exercise of discretion on the part of the High Court to refuse to exercise power of superintendence. However, there may be cases where but for invoking the supervisory jurisdiction, the jurisdictional error committed by an inferior Court or Tribunal would be incapable of being remedied once the proceedings are concluded. Only in such eventuality, the High Court may consider to exercise its supervisory power.

The Supreme Court in Surya Dev Rai case (supra) also observed as follows :

'The parameters for exercise of jurisdiction under Articles 226 or 227 of the Constitution cannot be tied down in a strait-jacket formula or rigid rules. Not less than often the High Court would be faced with dilemma. If it intervenes in pending proceedings there is bound to be delay in termination of proceedings. If it does not intervene, the error of the moment may earn immunity from correction. The facts and circumstances of a given case may make it more appropriate for the High Court to exercise self-restraint and not to intervene because the error of jurisdiction though committed is yet capable of being taken care of and corrected at a later stage and the wrong done, if any, would be set right and rights and equities adjusted in appeal or revision preferred at the conclusion of the proceedings. But there may be cases where 'a stitch in time would save nine'. Thus, the power is there but the exercise is discretionary which will be governed solely by the dictates of judicial conscience enriched by judicial experience and practical wisdom of the Judge.'

16. The scenario of the facts and circumstances of the present case now considered in the touchstone of the position of law enumerated in the preceding paragraphs reveals that the petitioner seeks to challenge the order passed in the two Misc. petitions, i.e. one under Order 1, Rule 10 and another under Order 6, Rule 17, CPC filed in the MJC, the main case. Admittedly, the Court below has disposed of the MJC itself and the petitioner has filed an appeal against the said order. The order passed in the two Misc. petitions merged with the final order in MJC against which an appeal has been preferred. Law is well settled that an appeal is a continuation of a proceeding. An appellate Court has the same power as the original Court against whose order the appeal has been preferred. Thus, the conclusion is irresistible that the petitioner could raise the question of legality of the order passed in the two Misc. petitions in the appeal itself, specially in view of the fact that the order is a composite one and disposed of the main case as well as the Misc. petitions.

17. It is no more res integra that a Court is empowered only to grant such relief at an interim stage, which it has power to grant as the final relief at the conclusion of the proceeding. Admittedly the petition has already preferred a statutory appeal as stipulated under Section 37 of the Act before this Court, registered as Miscellaneous Appeal No. 426 of 2002, which is sub judice. While adjudicating the said Miscellaneous Appeal, this Court can also decide the questions ancillary to the main relief, such as whether, the main relief can be granted in the absence of any party and/or for an effectual adjudication of the dispute, presence of any other party would be necessary. While deciding such matters, this Court can also examine the correctness of the decision of the District Judge with regard to all petitions filed before him in course of adjudication of the main case. In view of the fact that Legislature has not provided any forum for challenging any interim order passed in the arbitration case, it can be presumed that while deciding an appeal arising out of the final order of the Court below, the appellate Court can also look into the propriety or otherwise of the order passed on the miscellaneous petitions by the Court below which have some bearing on the main controversy.

18. The present Writ Petition, according to us, does not satisfy the criteria stipulated by the Supreme Court in the case of Surya Dev Rai (supra), inasmuch as the appeal preferred against the final order is sub judice in this Court. The prejudice, if any, caused to the petitioner can also be set at naught in the appeal. Accordingly, we are not inclined to entertain this Writ Petition.

19. In the result, we dismiss the Writ Petition. We, however, direct that Miscellaneous Appeal No. 426 of 2002 should be heard and disposed of as expeditiously as possible.

Sujit Barman Roy, C.J.

20. I agree.


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