Jitendra Chauhan. J.@mdashThis appeal has been filed under Clause X of the Letters Patent against the judgment dated 3.2.2010 passed in C.W.P. No.14806 of 2009, whereby the claim of respondent No.1/petitioner was allowed and the order dated 6.8.2009 passed by the appellant, vide which the retail outlet of respondent No.1/petitioner was terminated, was quashed.
2. Brief facts of the case are that respondent No.1 was allotted �B� site Retail outlet by the appellantCorporation in the year 2004 for running a petrol pump. Respondent No.1 made the land available to the appellantCorporation after taking the same on the basis of a registered lease deed dated 3.12.2003, between the petitioner (the lessee) and one Suresh Kumar (the lessor) for a period of 55 years @ Rs.4,000/ per month. The Retail Outlet was commissioned in February 2004. Till 18.1.2006, the status of the respondent No.1/petitioner was that of a lessee of Suresh Kumar. But on 19.1.2006, the respondent No.1/petitioner purchased the entire land from Suresh Kumar vide sale deed No. 1246 dated 19.1.2006. On the same day, the respondent No.1/petitioner sold the portion of the land on which Retail Outlet was situated (4K 0M) to one Balwant Singh, vide registered sale deed No.1248 dated 19.1.2006. The status of the lessor and the lessee changed on 19.1.2006. It was done without any approval of the appellantCorporation, which is alleged to be in violation of clauses 35 and 36 (a) of the terms and conditions of the Dealership Agreement dated 29.2.2004. On 1.5.2009, a show cause notice was issued to the respondent No.1/petitioner and vide letter dated 6.8.2009, the dealership of Retail Outlet was terminated. Aggrieved against which, the respondent No.1/the petitioner filed civil writ petition No. 14806 of 2009 seeking quashing of the decision of the appellantCorporation canceling the retail outlet dealership of petrol pump that had been issued to respondent No.1/petitioner under a contract between the parties through an agreement dated 29.2.2004. The appellant filed detailed written statement interalia stating that the writ petition is not maintainable as the respondent No. 1/petitioner has an alternative remedy of initiating arbitration proceedings. The said contention did not find favour with the learned Single Judge, who vide judgment dated 3.2.2010 allowed the writ petition and the same has been impugned in this appeal.
3. The short issue raised by the Appellant before us is concerning the maintainability of the civil writ petition preferred by the respondent No.1/petitioner in view of the express stipulation of the dealership agreement to the effect that for the determination of any dispute/claim or to judge the legality of any act or omission under the Dealership Agreement, the same shall be referred for decision to an Arbitrator under the Arbitration and Conciliation Act 1996.
4. The Learned Single Judge, in the course of considering the merits of the issue agitated by the parties, came to the conclusion that availability of an alternate efficacious remedy cannot bar the constitutional right provided to a citizen to approach the High Court for redressal of its grievance occasioned due to violation of his right, statutory or otherwise. The Ld. Single Judge, after considering the relevant law, further observed that there are certain circumstances, the existence of which would justify the exercise of extraordinary writ jurisdiction under Article 226 even if an efficacious and alternative remedy is available.
5. Learned counsel for the appellant has mainly emphasized that the respondent No.1/petitioner should have availed the alternative remedy of arbitration in consonance with Clause 69 of the Dealership Agreement, which stipulates that all disputes or differences of any nature whatsoever or regarding any right, liability, act, omission on account of any of the parties arising out or in relation to Dealership Agreement shall be referred to the sole Arbitration of the Director, Marketing of the AppellantCorporation. In this regard, he has placed firm reliance on the judgments of Hon''ble the Supreme Court rendered in the cases of Hindustan Petroleum Corporation Limited v. Pinkcity Midway Petroleums, 2003(3) PLR 746, Harbanslal Sahnia v. Indian Oil Corporation Ltd. (2003) 2 SCC 107 and of this Court in Regent Automobiles v. Indian Oil Corporation Limited and others (C.W.P. No. 17874 of 2007 decided on 12.2.2008). He has also urged that the cancellation of dealership is a determinative right which can be effectively adjudicated by the arbitrator in arbitration proceedings. He further argued that the Hon''ble Single Judge has not considered its earlier decision dated 11.1.2010 rendered in CWP No. 17443 of 2009 in a case titled as �Niranjan Singh v. Union of India� involving similar controversy concerning arbitration clause wherein it was held ''that a written contract that spells out a mechanism for resolution of dispute cannot be skirted for whatever reason by invoking a writ jurisdiction and dismissal of the writ petition does not mean that the petitioner has no remedy for alleged infringement of fundamental right but it only to deflect the petitioner to an appropriate remedy by recourse of procedure under the Arbitration and Conciliation Act,1996.'' The learned counsel for the appellant has also canvassed before us the grounds which have been taken in the memorandum of appeal to urge that the judgment of the learned Single Judge is not sustainable in law.
6. Learned counsel for the respondent No.1 has, however, vehemently opposed the submissions made by learned counsel for the appellant and urged to maintain the judgment passed by Hon''ble Single Judge. He has also placed reliance on Union of India v. Tantia Constructions Pvt. Ltd. JT 2011 (5) SC 59, rendered by Hon''ble the Supreme Court, wherein it has been held that the existence of an arbitration clause in an agreement does not bar the parties from invoking the writ jurisdiction of the High Court and the Supreme Court without exhausting the alternative remedies available to them. Learned counsel for respondent No.1 has again reiterated the contentions raised in the writ petition to substantiate that the dealership was wrongly canceled and the learned Single Judge has rightly entertained the writ petition and restored the petrol pump dealership, without first resorting to the remedy of arbitration proceedings as stipulated in the agreement dated 2004 entered into between the parties.
7. We have heard the learned counsel for the parties and perused the record with their able assistance. We have thoughtfully considered arguments raised by the learned counsel for the parties. After going through the various decisions rendered by Hon''ble the Supreme Court as also decisions of this Court on the issue of Arbitration i.e. the effect of an Arbitration Clause as a bar to invoking the writ jurisdiction of High Court, we are unable to find ourselves in agreement with the reasoning arrived at by the Learned Single Judge in so far as the maintainability of the civil writ petition is concerned. Hon''ble the Supreme Court in Harbanslal Sahnia and Another v. Indian Oil Corpn. and Others, AIR 2003 SC 2120, has observed as under:
�So far as the view taken by the High Court that the remedy by way of recourse to arbitration clause was available to the appellants and therefore the writ petition filed by the appellants was liable to be dismissed. Suffice it to observe that the rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion. In an appropriate case in spite of availability of the alternative remedy, the High Court may still exercise its writ jurisdiction in at least three contingencies: (i) where the writ petition seeks enforcement of any of the Fundamental Rights; (ii) where there is failure of principles of natural justice or, (iii) where the orders or proceedings are wholly without jurisdiction or the vires of an Act and is challenged (see Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. (1988) 8 SCC.�
8. It is patently clear that when the aforesaid test is applied to the facts of the present case then there seems to be no justification for exercising of the extraordinary writ jurisdiction by the learned Single Judge in view of the arbitration clause, as stipulated in the agreement. There is no violation of principles of natural justice resulting into infringement of fundamental rights guaranteed by Article 14. We could hardly see any violation of any other fundamental right.
9. Further reliance was placed by the ld. counsel for the Appellant on Hindustan Petroleum Corporation Ltd. v. M/s Pinckcity Midway Petroleums, 2003(3) RCR (Civil) 686, in which it was laid down that once it is established that there is an arbitration clause in the agreement, in view of the mandatory language of section 8 of the Arbitration Act, the court is bound to refer the dispute to the Arbitrator.
10. The ld. Counsel also cited Division Bench judgments of this Court rendered in CWP no. 12366 of 2007 decided on 22.2.2008 and 2009 (154) PLR 110, one of which was rendered by a Division Bench of which one of us (M.M. Kumar, J.) was a member. It has been held that the existence of an Arbitration Clause would ordinarily bar the invoking of the writ jurisdiction of the High Court. Another judgment delivered by the learned Single Bench of this Court in CWP no. 17443 of 2009 decided on 11.1.2009, also affirms the settled proposition of law that exceptions apart, in case there exists an arbitral clause in an agreement, the parties must be relegated to that remedy.
11. Mr. Amar Vivek, learned counsel for respondent No. 1/petitioner has placed firm reliance on a judgment rendered by Hon''ble the Supreme Court in the case of Tantia Construction Pvt. Ltd. (supra) and argued that arbitration clause may not always be a barrier to the exercise of equitable jurisdiction. There cannot be any quarrel with the aforesaid proposition. In fact Hon''ble the Supreme Court in para 27 has virtually reiterated the view taken in the earlier judgments. It would be profitable to read para 27 which is as under:
"27. Apart from the above, even on the question of maintainability of the writ petition on account of the Arbitration Clause included in the agreement between the parties, it is now wellestablished that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr. Chakraborty would clearly indicate that the constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities. Injustice, whenever and wherever it takes place, has to be struck down as an anathema to the rule of law and the provisions of the Constitution. We endorse the view of the High Court that notwithstanding the provisions relating to the Arbitration Clause contained in the agreement, the High Court was fully within its competence to entertain and dispose of the Writ Petition filed on behalf of the Respondent Company."
12. A perusal of the aforesaid para would show that a writ Court could reach the injustice where it lies unfairness, unreasonable, injustice and patent illegality(s) are various facets. There is no difficulty to exercise jurisdiction if principles of natural justice have not been followed or the conscious of the Court suffers a shock. In this case transaction is commercial in nature and there are allegations/counter allegations concerning breach of contract. In such cases functions of an arbitration clause is more pronounced and significant. It is not possible for the Court to fathom the injustice because neither there is any patent illegality nor there is any violation of fundamental rights. Therefore, we have no hesitation in rejecting the aforesaid submission of the learned counsel.
13. In view of the above discussion we are of the considered opinion that once an agreement contains an Arbitration clause, unless an exception is carved out for invoking the writ jurisdiction of the High Court as laid down by the Hon''ble Supreme Court in Harbans Lal Sahania case (supra) by applying the prescribed test, the parties are required to be referred to invoke arbitration proceedings.
14. Accordingly, this LPA is allowed and the judgment of the Learned Single Judge is set aside with no order as to costs. The parties are accordingly given liberty to initiate arbitration proceedings in the matter without prejudice to their respective rights.
15. All the pending CMs in this appeal are disposed of accordingly.
