GREAVES COTTON LIMITED versus UNITED MACHINERY AND APPLIANCES.

Citation: [2016] 12 S.C.R. 193 · Decided: 14-12-2016 · Supreme Court of India · Bench: JASTI CHELAMESWAR · Disposal: Appeal(s) allowed
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Judgment (excerpt)

(2016] 12 S.C.R. 193 
GREAVES COTTON LIMITED 
v. 
UNITED MACHINERY AND APPLIANCES. 
(Civi!Appeal No. 12066of2016) 
DECEMBER 14, 2016 
[J. CHELAMESWAR AND PRAFULLA C. PANT, JJ.] 
Arbitration and Conciliation Act, 1996 - s.5 rlw s.8 - Re-
spondent filed a civil suit seeking decree towards loss and damage 
suffered by it on account of alleged breach of contract on the part 
of the appellant - High Court issued summons - In respoilse, 
appellant filed application seeking extension of time to file written 
. statement and invoked arbitration clause by sending a letter to the 
respondent - Respondent objected to invocation of arbitration on 
ground of pendency of civil suit in High Court - Thereafter, 
appellant filed application u/s. 5 rlw s.8 to get dispute referred to 
arbitral tribunal - High Court rejected the application on th,e_ ground 
that appellant by filing an application for extension of time to file 
written statement 'submitted first statement on the substance of the 
dispute' and waived its right to seek arbitration - On appeal, held: 
Merely moving an application seeking further time to file written 
statement without replying to the allegations of the plaint would not 
amount to making first statement on the substance of the dispute -
Also, it does not appear from the language of s.8(1) of the 1996 Act 
that legislature intended to include a step like filing simple application 
of seeking extension of time to file written statement as first 
statement on the substance of the dispute - Therefore, appellant 
did not waive right to object to the jurisdiction of judicial authority. 
Allowing the appeal, the Court 
HELD: 1. It is difficult to agree with the High Court that in 
the present case merely moving an application seeking further 
time of eight weeks to file the written statement would amount 
to making first statement on the substance of the dispute. Further, 
filing of an application without reply to the allegations of the plaint 
does not constitute first statement on the substance of the dispute. 
It does not appear from the language of sub-section (1) of Section 
8 of the Arbitration and Conciliation Act, 1996 that the Legislature 
193 
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E 
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194 
A 
B 
c 
SUPREME COURT REPORTS 
r2o 161 12 s.c.R. 
intended to include such a step like moving simple application of 
seeking extension of time to file written statement as first 
statement on the substance of the dispute. Therefore, in the 
facts and circumstances of the present case, it cannot be held 
that the appellant, by moving an application for extension of time 
of eight weeks to file written statement, has waived right to object 
to the jurisdiction of judicial authority. [Para 12) · [199-D-F) 
2. The impugned order also reflects that before disposing 
of application under Section 8 of the 1996 Act, the High Court 
has not looked into questions as to whether there is an agreement 
between the parties; whether disputes which are subject-matter 
of the suit fall within the scope of arbitration; and whether the 
reliefs sought in the suit are those that can be adjudicated and 
granted in arbitration. Therefore, the High Court is requested 
to decide the application afresh in the light of law laid down by 
Supreme Court in para 19 of the judgment in Booz Allen mu/ 
D Hamilton Inc. v. SB/ Homes Finance Limited mu/ others except 
the point, which has already been answered in the present case. 
[Paras 13, 14] [199-G-H; 200-A, BJ 
Rashtriya !spat Nigam Ltd. and another v. Verma 
Transport Co. (2006) 7 SCC 275 : 2006 (4) Suppl. 
E 
SCR 332; Boaz Allen and Hamilton Inc. v. SB! Homes 
Finance Limited and others (2011) 5 SCC 532 : 2011 
(7) SCR 310 - relied on. 
F 
Manna Lal Kedia and ors. v. State of Bihar and ors. 
AIR 2000 Pat 91; - referred to. 
Case Law Reference 
AIR 2000 Pat 91 
2006 (4) Suppl. SCR 332 
2011 (7) SCR 310 
referred to 
relied on 
relied on 
.l?ara 7 
Paras 
Para 10 
G 
CIVILAPPELLATL JURISDICTION: Civil Appeal No. 12066 
of2016. 
From the Judgment and Order dated 16.09.2015 of the High Court 
ofCalcut~a in GA No. 2998 of2015 with CS No. 2 of2015. 
B. Adinarayan Roy, Sr. Adv., Deepak Khurana, Umesh Kumar 
H 
Khaitan, Ad vs. for the Appellant. 
GREAVES COTTON LIMITED v. UNITED MACHINERY AND 
195 
APPLIANCES 
Guru Krishna Kumar, Sr. Adv., Ms. Sanjana Saddy, Mohan Raj, 
A 
Ritesh Agrawal, Advs. for the Respondent. 
The Judgment of the Court was delivered by 
PRAFULLA C. PANT, J. I. Leave granted. 
2. This appeal is direct
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