2002 (4) TMI 791 - HC - Companies Law

Court dismisses appeal under Companies Act, upholds Arbitration Act's exclusivity, limits judicial intervention. Proceed to Company Law Board.

The court dismissed the appeal, ruling it as not maintainable under the Companies Act, 1956, and emphasizing the exclusive nature of the Arbitration and ... Company Law Board - Appeals against orders of Issues Involved:1. Maintainability of the appeal against the Company Law Board (CLB) order.2. Jurisdiction and applicability of the Companies Act, 1956 versus the Arbitration and Conciliation Act, 1996.3. Interpretation of Section 8 of the Arbitration Act, 1996.4. Interpretation of Section 37 of the Arbitration Act, 1996.5. Legislative intent and statutory interpretation.Detailed Analysis:1. Maintainability of the Appeal:The primary issue was whether the appeal against the CLB order dated 8th December 2000 was maintainable. The appellants argued that the appeal should be maintainable under Section 10F of the Companies Act, 1956, while the respondents contended that the Arbitration Act, 1996, excluded such an appeal.2. Jurisdiction and Applicability:The appellants claimed that the CLB exercised its powers under the Companies Act, 1956, and thus the appeal should be governed by the same Act. They argued that the Arbitration Act, 1996, was merely procedural. However, the court determined that the CLB, when deciding the application under Section 8 of the Arbitration Act, 1996, acted as a 'judicial authority' under the Arbitration Act, 1996. Therefore, the remedy must be sought within the provisions of the Arbitration Act, 1996.3. Interpretation of Section 8 of the Arbitration Act, 1996:The court examined whether the CLB's order under Section 8 of the Arbitration Act, 1996, was final or whether it could be appealed. The appellants argued that since Section 11(7) of the Arbitration Act, 1996, expressly provided finality for decisions made by the Chief Justice, the absence of such language in Section 8 implied that orders under Section 8 were not final. However, the court found that the legislative intent was to minimize judicial intervention in arbitration matters.4. Interpretation of Section 37 of the Arbitration Act, 1996:Section 37(1) of the Arbitration Act, 1996, lists specific orders that are appealable. The court concluded that the term 'orders' in Section 37(1) refers to orders passed under Part I of the Arbitration Act, 1996, and since an order under Section 8 is not included in Section 37, it is not appealable. The court emphasized the words 'and from no others' to indicate that the list of appealable orders is exhaustive.5. Legislative Intent and Statutory Interpretation:The court referred to the statement of objects and reasons of the Arbitration Act, 1996, and concluded that the Act was intended to be an exhaustive and comprehensive code, consolidating and amending the law relating to arbitration. Section 5 of the Arbitration Act, 1996, further emphasized the exclusivity of the Act by limiting judicial intervention to what is expressly provided within the Act.Conclusion:The court dismissed the appeal as not maintainable, concluding that the Arbitration Act, 1996, is an exhaustive code and that Section 37 excludes the remedy of appeal against an order passed under Section 8. The court directed the parties to appear before the CLB for further proceedings.