Supreme Court: Deciding a short question as to what should be the approach of the Court, once an application is duly filed in terms of Section 8 of the Arbitration and Conciliation Act, 1996 before the civil court, the bench of MY Eqbal and Kurian Joseph, JJ held that the approach of the civil court should be not to see whether the court has jurisdiction but to see whether it’s jurisdiction has been ousted. The Court further held that once it is brought to the notice of the court that its jurisdiction has been taken away in terms of the procedure prescribed under a special statue, the civil court should first see whether there is ouster of jurisdiction in terms or compliance of the procedure under the special statute.
Regarding the general law approach that a court should first see whether it has jurisdiction or not, the Court, referring to generalia specialibus non derogant rule, said that Such approaches would only delay the resolution of disputes and complicate the redressal of grievance and of course unnecessarily increase the pendency in the court.
Section 8 of the Arbitration and Conciliation Act, 1966 comes into play when there is an agreement between the parties to refer the disputes or differences arising out of the agreement to arbitration, and either party, ignoring the terms of the agreement, approaches the civil court, the other party can, under the said Section, move the court for referring the parties to arbitration before the first statement on the substance of the dispute is filed. Sundaram Finance Ltd. v. T. Thankam, 2015 SCC OnLine SC 147, decided on 20.02.2015
I disagree with Sowmya Vinod's comment.
It is not that the Arbitration Act is not made for common man. It is that it is not commonly understood by the common man, who signs an agreement without knowing the ramifications of arbitration and acquiesces rather unknowingly to the appointment of a sole arbitrator by one party unilaterally.
The remedy is costly and time consuming and too often than not recourse is to be taken to the Civil courts, thereby defeating the very purpose of an alternate dispute resolution measure.
Perhaps, the way out is mandatory mediation by an independent mediator, to be followed by arbitration, if necessary.
Arbtration and conciliation Act is not made for common man. The provisions therein and its application are seems to be far from the interest and wellbeing of people… The significance of the Act based on the interest of Corporates etc…