JUDGMENT
Ramesh Madhav Bapat, J.
1. The petitioner in both the revision petitions is common and respondents are also common. Therefore, both the revision petitions are disposed of by a common order. The petitioner herein is referred as a contractor and respondent No. 1 herein is referred as a Company.
2. It appears from the record that the Company had entrusted the work of construction of certain buildings to the Contractor in the year 1982-83. Three agreements were executed between the parties and the Contractor started constructions of the buildings and completed by 1987. As stated earlier three agreements were executed between the parties and in all the three agreements there was a covenant that in case of dispute between the parties, the matter be settled by an Arbitrator who will be appointed by respondent No. 1 herein as per Clause 52 of the General Conditions of Contract. After completion of work, the Company refused to make payment. Therefore, a dispute arose between the Contractor and the Company. The Contractor moved the Company for appointment of an Arbitrator. Accordingly, the Company appointed respondent No. 3 herein as the sole Arbitrator. The Arbitrator entered reference on 22-3-1992. The time for completion of arbitration reference was four months and there was also a covenant in the contract that the time for completion of reference can be extended by mutual consent, as we find under Section 28 of the Indian Arbitration Act, 1940. It further appears from the record that in all 22 sittings were held between 22nd April, 1992 to 7th March, 1993.
3. On 7th March, 1993, the entire recording of evidence and arguments of both parties were over. Only the work of passing an award was left out. Therefore, the sole arbitrator asked both the parties to extend the time by 30th April, 1993, as the time was not sufficient for him to pass an award before 31st March, 1993. The Contractor herein gave a consent letter agreeing to extend the time for passing the award upto 30th April, 1993, whereas the Company stated that they would send the consent letter from the Head Office. But instead of keeping the said promise, they filed an application before the IV Assistant District Judge, Alipore under Section 28 of the Arbitration Act, for extension of time. The Court granted the relief on 22nd March, 1993, extending the time of complete the arbitration work upto 30th April, 1993. The said order was sent to the Arbitrator by Courier. The said letter was dated 23-3-1993 which was addressed by an Advocate. Finally, the award was passed on 28-4-1997 (sic 28-4-1993). It further appears from the record that the Company had filed a petition as stated earlier in the Court of IV Assistant District Judge, Alipore, in Miscellaneous Petition No. 12/93. The interim order was passed by the IV Assistant District Judge, Alipore extending the time upto 30th April, 1993. It was in ex parte order and no notice was issued to the Contractor before the interim order was passed.
4. The sole arbitrator passed an award granting approximately Rs. 78 lakhs to the Contractor. Thereafter, the Contractor filed the suit in O.S. No. 322 of 1993 in the Court of Principal Sub-Judge, Ranga Reddy District on 15-5-1993 claiming two reliefs :
(1) to direct the arbitrator to produce the award into Court, and
(2) to make the award the rule of the Court in terms of Sections 14 and 17 of Indian Arbitration Act.
It further appears from the record that thereafter the Company filed the suit in O.S. No. 28/94 in the same Court alleging misconduct on the part of the sole arbitrator with a request to set aside the award under Section 30 of the Arbitration Act. It was also contended by the Company in the suit that since the Company had moved the Court of IV Assistant District Judge, Alipore in M.A. 12./93, the Principal Sub-Court, Ranga Reddy District had no jurisdiction to entertain O.S. No. 322 of 1993. Both the matters were heard by the Sub-Judge on merits and O.S. 322/93 filed by the Contractor was returned to the Contractor for filing the Court of TV Asstt. District Judge, Alipore and the same order was passed in O.S. 28/94 and both the suits were returned by a common order. Aggrieved by the order passed in the aforesaid suit, the Contractor had preferred the present revision.
5. The learned Counsel for the petitioner Mr. Prabhakar appearing on behalf of the revision petitioner herein submitted at the Bar that the Company had issued the tenders from its Unit Office at Ranga Reddy District, then the contract and the agreements were executed at Moulali in Ranga Reddy district and the work was also executed in Ranga Reddy District. The Contractor completed the work and thereafter the made a claim for the money. Thus, it was submitted by the learned Counsel that the cause of action arose within the jurisdiction of the Court at Ranga Reddy District. Therefore, the proceedings filed by the Company in M.A. 12/93 in the Court of the IV Assistant District Judge, Alipore, is without jurisdiction and that the said Court is not the competent Court as defined in Section 2(c) of the Indian Arbitration Act, 1940, read with Section 20 C.P.C. The learned Counsel further submitted that the IV Assistant District Judge, Alipore, passed an order extending the time for finalising the award without notice to the petitioner-Contractor and therefore, the said order is not binding upon the Contractor and moreover the said order could not have been passed by the said court in view of Section 41 of the Arbitration Act with reference to Second Schedule. Section 41 of the Arbitration Act reads as follows :
“Section 41 : Procedure and powers of Court :
Subject to the provisions of this Act and of Rules made thereunder :
(a) the provisions of the Code of Civil Procedure, 1908 (5 of 1908) shall apply to all proceedings before the Court and to all appeals under this Act, and
(b) the Court shall have, for the purpose of, and in relation to, arbitration proceedings, the same power of making orders in respect of any of the matters set out in the Second Schedule as it has for the purpose of and in relation to, any proceedings before the Court.
Provided that nothing in Clause (b) shall be taken to prejudice any power which may be vested in an arbitrator or umpire for making orders with respect to any of such matters.”
6. The Second Schedule of the said Act states the powers of Court in which the interim order can be passed by Arbitrator which read as follows :
“The second schedule : Powers of Court :
(1) The preservation, interim custody or sale of any goods, which are the subject matter of the reference. ef. Order XXXIX Rules 1 and 6, Code of Civil Procedure, 1908.
(2) Securing the amount in difference in the reference.
(3) The detention, preservation or inspection of any property or thing which is the subject of the reference or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon or into any land or building in the possession of any party to the reference, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence.
(4) Interim injunctions or the appointment of a receiver. ef. Order XXXIX Rules 1 and 2, and Order XL, Rule 1, Code of Civil Procedure, 1908.
(5) The appointment of a guardian for a minor or person of unsound mind for the purposes of arbitration proceedings. ef. Order XXXIX, Rules 3 and 15, Code of Civil Procedure, 1908. While Order XXXII makes provision for the appointment of a guardian of a defendant only, the court will have authority under this para to appoint a guardian of either said.”
7. Considering the provisions contained in Section 41 read with Second Schedule of the said Act this Court holds that the said order ought not to have been passed by the IV Assistant District Judge, Alipore and the said order is now held to be without jurisdiction.
8. The learned Counsel Mr. Venkataramana appearing on behalf of the Company submitted at the Bar that the Company’s Office is situated within the jurisdiction of the IV Assistant District Judge, Alipore and therefore, that Court had jurisdiction to entertain the application filed by the Company under Section 28 of the Arbitration Act.
9. This Court is not in agreement with the submission made by the Counsel. As stated earlier when the cause of action arose within the jurisdiction of Sub-Court of Ranga Reddy district, the provisions contained in Sections 2(c) and 41 read with Second Schedule of the Act will apply and it is that Court which will have jurisdiction. The IV Assistant District Judge, Alipore ought not to have passed such an order and therefore, the contention raised by Mr. Venkataramana is hereby rejected Mr. Venkataramana further pointed out the provisions contained in Section 31 of the Arbitration Act. Section 31 of the Arbitration Act read is follows :
“Section 31 : Jurisdiction :
(1) Subject to the provisions of this Act, an award may be filed in any Court having jurisdiction in the matter to which the reference relates.
(2) Notwithstanding anything contained in any other law for the time being inforce and save as otherwise provided in this Act, all questions regarding the validity, effect or existence of an award or an arbitration agreement between the parties to the agreement or persons claiming under them shall be decided by the Court in which the award under the agreement has been, or may be, filed, and by no other Court.
(3) All applications regarding the conduct of arbitration proceedings or otherwise arising out of such proceedings shall be made to the Court where the award has been, or may be filed, and to no other Court.
(4) Notwithstanding anything contained elsewhere in this Act or in any other law for the time being in force, where in any reference any application under this Act has been made in a Court competent to entertain it, that Court alone shall have jurisdiction over the arbitration proceedings and all subsequent applications arising out of that reference and the arbitration proceedings shall be made in the Court and in no other Court.”
10. With reference to sub-section (4) of Section 31, the learned Counsel submitted that as per the provisions of the said section the Court at Alipore is the competent Court to entertain the application filed by the Contractor. Now the question arises as to whether the Court at Alipore is the competent Court to entertain the application in respect of the subject matter which arose within the jurisdiction of Moulali Court and therefore, we have to go by again the provisions of Section 20 of C.P.C. and Section 2(c) of the Indian Arbitration Act.
Section 2(c) of Arbitration Act reads :
“Section 2(c) : “Court” means a Civil Court having jurisdiction to decide the questions forming the subject-matter of the reference if the same had been the subject matter of a suit, but does not, except for the purpose of the arbitration proceedings under Section 21, include Small Cause Court.”
Section 20 C.P.C. reads as follows :
“20. Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction :
(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides or carries on business, or personally works for gain; or
(b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the court is given or the defendants who do not reside or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution; or
(c) the cause of action, wholly or in part arises.”
11. By looking into the above provisions, it is evident that for filing any suit or dispute in a competent Court of jurisdiction, it must be shown that the cause of action arose within the jurisdiction of the said Court or where respondent resides within the jurisdiction of that Court or carries on business in the jurisdiction of the said Court. But when the Company instituted the proceedings in the Court of IV Asstt. District Judge, Alipore, the Contractors were having their main office within the jurisdiction of Nellore district in Andhra Pradesh and work was carried out within the jurisdiction of the Sub-Judge at Ranga Reddy district and therefore the plaintiff-Company (sic Respondent Company) had no authority to file any proceedings before the Court of Alipore. Secondly, the cause of action arose as stated earlier within the jurisdiction of the Sub-Judge, R. R. district in the State of Andhra Pradesh. Considering these aspects, this Court is of the considered view that the learned Principal Sub-Judge Ranga Reddy district wrongly returned the plaint for filing in the proper Court.
12. The next question arises that if it is held that the Court at Alipore had no jurisdiction to entertain the application filed by the Company, then what is the effect of the order passed by the said court on the award. While replying the aforesaid querry, the learned Counsel for the petitioner Mr. Prabhakar invited my attention to the ruling reported in State of Punjab v. Hardyal , wherein their Lordships held as follows :
“The police of law seems to be that the arbitration proceedings should not be unduly prolonged. The arbitrator therefore has to give the award within the time prescribed or such extended time as the Court concerned may in its discretion extend and the Court along has been given the power to extend the time for giving the award. As observed earlier, the Court has got the power to extend the time even after the award has been given or after the expiry of the period prescribed for the award. But the court has to exercise its discretion in a judicial manner. The High Court, in our opinion, was justified in taking the view that it did. This power, however, can be exercised even by the appellate Court. The present appeal has remained pending in this court since 1970. No useful purpose will be served in remanding the case of the trial court for deciding whether the time should be enlarged in the circumstances of this case. In view of the policy of law that the arbitration proceeding should not be unduly prolonged and in view of the fact that the parties have been taking willing part in the proceedings before the arbitrator without a demour, this will be a fit case, in our opinion for the extension of time. We accordingly extend the time for giving the award and the award will be deemed to have been given in time.”
Considering the above position, this Court holds that the award which has already been passed is perfectly legal and it can be implemented subject to the objections raised by the Company.
13. As stated earlier when the arbitration proceedings were going on before the arbitrator, initially the time fixed was for four months but within the period of four months the entire proceedings of arbitration could not be completed and therefore, both the parties with their consent extended the time to complete the work of arbitration and as a matter of fact the entire work was completed by 7th March, 1993 and the time which was left out for the arbitrator to pass the award was upto 31st March, 1993. But the arbitrator thought that the time available at this disposal may not be sufficient for him to pass the award and therefore he had requested both the parties to extend the time. The Contractor immediately gave the letter dated 6th March, 1993 agreeing to extend the time for completion of arbitration work by 30th April, 1993. On earlier occasions the Company was also giving such type of letters. But when the Company realised that an award is going to be passed in favour of the Contractor, they chose to file Miscellaneous Application 12/93 in the Court of the IV Assistant District Judge, Alipore, so as to confer jurisdiction on the said Court and drag the Contractor to West Bengal for getting their grievances redressed. This Court holds that such action ought not to have been taken by the Company which is a public undertaking. In South East Asia Shipping Co. Ltd. v. Nav Bharat Enterprises Pvt. Ltd. and others , their Lordships observed in para 3 of the judgment as follows :
“It is settled law that cause of action consists of bundle of facts which give cause to enforce the legal injury for redress in a court of law. The cause of action means, therefore every fact, which is traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the Court. In other words, it is a bundle of facts, which taken with the law applicable to them, gives the plaintiff a right to claim relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action would possibly accrue or would arise.”
14. In the present case, as stated earlier, upto 7th March, 1993, both the parties were extending the time by mutual consent by giving a letter to the arbitrator expressing their willingness to extend the time for completion of arbitration proceedings. But at the last moment without any cause of action, the Company preferred to move the Court for getting the time extended by filing M.A. 12/93 which is not proper and also unnecessary. The learned Counsel for the respondent-Company contended that the Company had a right to file the proceedings before the Court at Alipore as the Company’s registered office is situated within the jurisdiction of the Court at Alipore. While rebutting the aforesaid argument, the learned Counsel for the petitioner Mr. Prabhakar relied upon a ruling in M/s. Patel Roadways Ltd. v. M/s. Prasad Trading Co. , which reads as follows :
“Civil P.C. (5 of 1908), Section 20-Civil Court-Territorial jurisdiction-Suit for damages against Corporation-Corporation having subordinate office in place where cause of action arose-Court at such place would have Jurisdiction-Parties cannot confer jurisdiction on Court where Corporation has its principal office.”
15. As already stated earlier, the cause of action arose within the jurisdiction of Ranga Reddy District. Considering the above facts, this Court directs the Principal Sub-Judge, Ranga Reddy District to go on with O.S. 28/94 and O.S. 322 of 1993 according to law. With this direction, both the revisions stand allowed. No costs.
16. Revisions allowed.