MUNICIPAL CORPORATION OF GREATER MUMBAI & ANR. versus PRATIBHA INDUSTRIES LTD. & ORS.

Citation: [2018] 14 S.C.R. 1143 · Decided: 04-12-2018 · Supreme Court of India · Bench: R.F. NARIMAN · Disposal: Disposed off
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Judgment (excerpt)

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MUNICIPAL CORPORATION OF GREATER
MUMBAI & ANR.
v.
PRATIBHA INDUSTRIES LTD. & ORS.
(Civil Appeal No. 11822 of 2018)
DECEMBER 04, 2018
[R. F. NARIMAN AND M. R. SHAH, JJ.]
High Courts – Power to recall its order – Appellant issued
Tender Notice for supply, installation and maintenance of water
meters – Tender Notice was accepted and parties entered into an
agreement, which included a clause (cl.13 of the General Conditions
of Contract) stating that “13.1 No Arbitration was allowed” –
Respondent filed an application u/s. 9 of the Arbitration and
Conciliation Act, 1996 seeking interim injunction, which was
allowed – Thereafter on the next date of hearing, a sole Arbitrator
was appointed with the consent of both the parties – Recall
application filed by the appellant stating that the concerned officer
of the appellant-Municipal Corporation was not empowered to take
decision regarding appointment of Arbitrator – Single Judge of the
High Court recalled the order observing that clause 13 of the
General Conditions of Contract and clause 22 of the Tender Notice
were not arbitration clauses – Division Bench of High Court set
aside the order of Single Judge on ground that there was no provision
in Part-I of the Act for any Court to review its own order – On
appeal, held: High Courts are courts of record, set up u/Art.215 of
the Constitution – These constitutional courts, being courts of record,
the jurisdiction to recall their own orders is inherent by virtue of
the fact that they are superior courts of record – If any apparent
error is noticed by the High court in respect of any orders passed
by it the High Court has not only power, but a duty to correct it –
Impugned judgment of the Division Bench of the High Court set
aside – Constitution of India – Art.215 – Arbitration and Conciliation
Act, 1996 – s.9.
National Sewing Thread Co. Ltd. v. James Chadwick &
Bros. Ltd. [1953] SCR 1028 ; Shivdev Singh & Ors. v.
State of Punjab and Others AIR 1963 SC 1909 ; M.M.
[2018] 14 S.C.R. 1143
1143
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1144                    SUPREME COURT REPORTS            [2018] 14 S.C.R.
Thomas v. State of Kerala and Another (2000) 1 SCC
666 : [2000] 1 SCR  33  – relied on.
Case Law Reference
[1953] SCR 1028
relied on
Para 12
AIR 1963 SC 1909
relied on
Para 13
[2000] 1 SCR 33
relied on
Para 14
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 11822
of 2018.
From the Judgment and Order dated 07.02.2018 of the High Court
of Judicature at Bombay in Commercial Appeal No. 177 of 2017.
Ranjit Kumar, Dhruv Mehta, S. Naphade, Sr. Advs.,  Ashish Wad,
Ms. Priti Puramdare,  Mrs. Jayashree Wad, Sidharth Mahajan,
Ms. Sukriti Jaggi, M/s. J S Wad And Co, Ms. Tamana Goyal, Chandra
Prakash, M/s. D.S.K. Legal, Vipin Kr. Jai, Vipul Jai, Ms. Shelly Dinkar,
Sanjay Kapur, Rajiv Kapur, Ms. Khushboo Kapur, C.M. Patel, Advs.
for the appearing parties.
The Judgment of the Court was delivered by
R. F. NARIMAN, J.
1. Leave granted.
2. The present appeal raises questions relatable to the High Court’s
power of recall of its orders.
3. By a Tender Notice dated 19.09.2008, supply, installation and
maintenance of water meters of various sizes were called for. The Tender
Notice contained Clause 22, which reads as under:-
“22. Jurisdiction of Courts:
In case of any claim, dispute or difference arising in respect of
the contract, the cause of action thereof shall be deemed to have
arisen in Mumbai and all legal proceedings in respect of any such
claim, dispute or difference shall be instituted in a competent court
in the city of Mumbai only.
If any dispute, difference or claim is raised by either party relating
to any matter arising out of the contract, the aggrieved party may
refer such dispute within a period of 7 (seven) days to the
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concerned Deputy Municipal Commissioner (DMC) of Municipal
Corporation of Greater Mumbai, who shall constitute a committee
comprising of 3 (three) MCGM Officers i.e., concerned DMC or
Director (ES & P), Chief Engineer other than the Engineer of
contract & concerned C.A. the committee shall give decision in
writing within 60 (sixty) days.
Appeal from the order of the Committee may be referred to
Municipal Commissioner (M.C.) of Municipal Corporation of
Greater Mumbai within 7 (seven) days. Thereafter, M.C. shall
constitute the committee comprising of 3 (three) DMC including
DMC in charge of finance Department. The decision given by
this Committee shall be final and binding upon the parties/bidders.”
4. Howev
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