Unicol Bangladesh Blocks Thirteen and Fourteen and Ors. vs. Respondent: Maxwell Engineering Works Ltd. and Ors.

Jul 24, 2022

IN THE SUPREME COURT OF BANGLADESH (APPELLATE DIVISION)

Civil Petition for Leave to Appeal No. 1326 of 2002

Decided On: 21.06.2004

Appellants: Unicol Bangladesh Blocks Thirteen and Fourteen and Ors.
Vs.
Respondent: Maxwell Engineering Works Ltd. and Ors.

**Hon’ble Judges/Coram:**Md. Ruhul Amin, M.M. Ruhul Amin and Md. Tafazzul Islam, JJ.

Counsels:
For Appellant/Petitioner/Plaintiff: Amirul Islam, Senior Advocate and Rokanuddin Mahmud, Senior Advocate, Azizul Huq, Advocate and Tania Amir, Advocate instructed by Ataur Rahman, Advocate-on-Record

For Respondents/Defendant: Rafique-ul-Huq, Senior Advocate instructed by Md. Wahidullah, Advocate-on-Record

Subject: Arbitration

Catch Words

Mentioned IN

Relevant Section:
ARBITRATION ACT, 1940 [REPEALED] - Section 34

**Acts/Rules/Orders:**Code of Civil Procedure, 1908 (CPC) - Order XXXIX Rule 2; Code of Civil Procedure, 1908 (CPC) - Section 151; Code of Civil Procedure, 1908 (CPC) - Section 44A; Code of Civil Procedure, 1908 (CPC) - Section 9; Companies Act, 1994 - Section 379, Companies Act, 1994 - Section 384, Companies Act, 1994 - Section 385

Prior History:
From the Judgment and Order dated May 19, 2002 passed by the High Court Division in First Miscellaneous Appeal No. 259 of 2001

Citing Reference:

Discussed

 

 2

Mentioned

 

 6

Case Note:
Civil - Injunction - Grant of - Order XXXIX, Rule 2 read with Section 151 of Code of Civil Procedure (CPC) - Present petition for leave to appeal filed against judgment and order of High Court Division dismissing appeal filed against order passed in Title Suit granting temporary injunction upon petition filed under Order XXXIX, Rule 2 read with Section 151 of CPC restraining Defendant No. 1 from proceeding with Arbitration proceeding initiated by him - Whether judgment and order of High Court Division need interference - Held, judgment of High Court Division and order of trial Court reasonable - High Court Division while dismissing appeal directed trial Court to dispose of expeditiously petition filed by Defendant No. 1 for quashing arbitral award - No reason to interfere with judgment and order of High Court Division - Petition dismissed. [15]

JUDGMENT

Md. Ruhul Amin, J.

  1. This petition for leave to appeal has been filed against the judgment and order dated May 19, 2002 of a Single Bench of the High Court Division dismissing the First Miscellaneous Appeal No. 259 of 2001. The said appeal was filed against the order dated July 15, 2001 of the 1st Court of Joint District Judge, Dhaka passed in Title Suit No. 1 of 2001 granting temporary injunction upon a petition filed under Order XXXIX, rule 2 read with section 151 of the Code of Civil Procedure and thereby restraining the defendant No. 1 from proceeding with the Arbitration proceeding initiated by him in respect of the contract in suit before the Arbitral Tribunal in Singapore with Mr. Michael Hwang as Chairman and Mr. Neil Kaplan as nominated arbitrator of the defendant No. 1 and/or any other arbitrator(s) till the disposal of the suit. It may be mentioned at the first instance the trial Court passed an order of ad-interim injunction on January 3, 2001. The suit was filed seeking relief primarily for a decree of total amount of Taka 70, 18, 17, 737 against the defendant Nos. 1 and 2 severally and/or jointly, for a declaration that the enforcement on March 11, 1999 of the Performance Guarantee No. GTEDAK 970012 dated 6-4-1997 issued by the Hong Kong and Shanghai Banking Corporation Limited, Dhaka Main Office, Sonargaon Road, Dhaka by the defendant No. 1 was illegal, void, malafide and without any lawful authority and, as such, not binding upon the plaintiff and the defendant Nos. 1 and 2 are jointly and/or severally liable to pay to the plaintiff the said amount and for a declaration that the notice of termination dated May 10, 1999 of the contract executed between the plaintiff and defendant No. 1 on 7-4-1997 was illegal, void, malafide and without lawful authority and, as such, not binding upon the plaintiff and also for a declaration that initiation of the arbitration proceeding by the defendant No. 1 in Singapore against the plaintiff with Mr. Michael Hwang as the Chairman and Mr. Neil Kaplan as an Arbitrator and/or with any other arbitrator(s) and continuation thereof is illegal, void, malafide and not enforceable in Bangladesh and finally, a decree of permanent injunction restraining the defendant No. 1 from proceeding with the arbitration proceeding initiated by him at Singapore with Mr. Michael Hwang as the Chairman and Mr. Neil Kaplan as an Arbitrator and/or with any other arbitrator(s).

  2. Facts, in short, in the background of which the aforesaid reliefs have been prayed for are that the defendant No. 1 entered into a production sharing contract with the Ministry of Energy and Mineral Resources, Government of Bangladesh and Petrobangla, that the plaintiff, a Private Limited Company, carries on business of all kinds of construction including construction of pipeline of gas transmission, that the defendant No. 1 awarded the contract to the plaintiff on February 19, 1997 to design, procure and construct a 22 kilometre gas line in Sylhet, officially known as Jalalabad off plot pipelines facilities bearing contract No. 5169 and the plaintiff on February 28, 1997 executed a subcontract agreement with the Gulf Inter State Engineering Company, a USA-based Company to execute design engineering work and procurement of materials for the project, that for unavoidable circumstances the 1st schedule completion date of the work would not be maintained and that revised schedule completion dated expired on 31-12-1998 but the project was not completed because of several reasons beyond the control of the plaintiff, that though the defendant No. 1 issued mechanical completion certificate on 4-1-1999 and 4-2-1999 but instead of making payment for the work so done the said defendant terminated the contract on May 10, 1999, that the plaintiff lodged formal claim by sending a notice on 30th May, 1999 demanding payment of outstanding bills and other dues under section 20 Article 30 of the contract signed between the plaintiff and the defendant No. 1, that in the contract there was an arbitration clause and in the light of the said clause defendant No. 1 proposed to refer the matter for Arbitration and Arbitrators were appointed by the parties to the contract it may be mentioned the venue of the arbitration was in Singapore. It is the case of the plaintiff that from the beginning of the arbitration the Chairman and the Arbitrator nominated by the defendant No. 1 were determined not to allow him to proceed with his case before the Arbitral Tribunal, that the Solicitor of the defendant No. 1 expressed the view that the papers filed by the plaintiff were forged documents, that though Solicitor of the defendant No. 1 confirmed in writing that they would have no objection to the production of the documents by the plaintiff but immediately after the commencement of hearing, defendant No. 1’s arbitrator as well as the Chairman challenged the documents as not genuine and started claiming that the documents of the plaintiff were forged documents, that the Chairman of the Tribunal passed an order that the Managing Director of the plaintiff should give unequivocal undertaking that all the documents to be produced by the plaintiff are genuine and he has personal knowledge of the same, that plaintiff was not allowed to place its document in support of its case, that the plaintiff called Project Manager of the defendant No. 1 as witness but the defendant No. 1 created a situation so that he could not dare to give his evidence, that plaintiff prayed for time to examine the documents for the purpose of giving undertaking but the prayer was refused, that in the aforesaid situation the Arbitrator nominated by the plaintiff withdrew himself from the Arbitral Tribunal on the application of the plaintiff, that the Chairman and the another Arbitrator of the Tribunal decided to proceed with the arbitration and directed the plaintiff to nominate its arbitrator immediately, that the said 2 Arbitrators were extremely biased and, as such, it was not possible for the plaintiff to pursue its claim before the said Tribunal, that award even if any given would not be enforceable in Bangladesh, that arbitration proceeding in Singapore was excessively expensive and that it was not possible for the plaintiff to continue with such an expensive proceeding, that defendant Nos. 1 and 2 have their offices in Dhaka and that for all practical purposes the Court in Bangladesh is the most appropriate and competent Court to try the subject matter of the suit.

  3. After the initiation of the suit plaintiff filed an application for temporary injunction and the Court by the order dated January 3, 2001 passed an order of ad-interim injunction.

  4. The defendant Nos. 1 and 2 entered appearance in the suit and filed written objection denying the averments made in the petition for temporary injunction and have stated, inter alia, that the subject matter of the suit, in which prayer for injunction has been made, arising out of a dispute over a claim and counter-claim between the parties under a contract signed on April 7, 1997 between the plaintiff and the defendant No. 1 for engineering, procurement and construction of gas pipeline and condense line is pending before an Arbitral Tribunal in Singapore and, as such, the suit is not maintainable, that the award, if any, passed in the arbitration can very much be enforced in Bangladesh and that the award can be registered as a judgment of Singapore High Court and that will create a debt at common law which can be enforced by the Courts in Bangladesh as per provision of section 19 of Singapore International Arbitration Act, 1995, alternatively, the award can be registered in England as a judgment and then can be enforced through Courts in Bangladesh making the same Rule of the Court in a manner similar to the enforcement of the judgment in the English Court, that in view of the provision of law the Court has no jurisdiction to entertain the suit, that the balance of convenience and inconvenience is in favour of the defendant No. 1 and that in case the injunction is granted the defendant No. 1 would suffer huge loss and that defendant No. 1 would be deprived of the opportunity of resolving the dispute in the manner which has been agreed under the contract, that plaintiff has withdrawn from the arbitration since he realised that without forged document he would not be able to substantiate his claim before the Arbitral Tribunal, that to frustrate the arbitration the plaintiff has made unfounded allegations against the Chairman of the Tribunal and the Arbitrator nominated by the defendant No. 1 as well as against the Solicitor of the defendant No. 1, that the plaintiff has made the untenable pleas only to escape an arbitration proceeding and is trying to shift the entire case to the Court in Bangladesh by resorting to foul means and various tactics, that by filing the suit plaintiff is out to frustrate the sole object of settling the dispute between the parties at an early date.

  5. It may be mentioned that the defendant Nos. 1 and 2 have filed an application under section 34 of the Arbitration Act, 1940 for staying the proceeding of the suit.

  6. The learned Joint District Judge after hearing the parties made the order of injunction upon observing that there is strong prima facie case for granting injunction and that the balance of convenience and inconvenience is in favour of the plaintiff, that if injunction is not granted plaintiff will suffer irreparable loss and injury and that there shall be multiplicity of proceedings, that a foreign award will not be enforceable in Bangladesh, that the Court in Bangladesh has got jurisdiction to entertain the suit.

  7. As against the order of the trial Court the defendant Nos. 1 and 2 filed appeal, being First Miscellaneous Appeal No. 259 of 2001, before the High Court Division. In support of the appeal, it was urged that trial Court was in error in granting the order of injunction since plaintiff had no prima facie case for having an order of injunction against the proceedings of International Arbitral Tribunal, that the balance of convenience and inconvenience is in favour of the defendant Nos. 1 and 2 since arbitration proceeding has already been started in Singapore before the Arbitral Tribunal and the plaintiff-respondent has appeared before the Tribunal and participated in the proceeding of the Tribunal, that plaintiff will not suffer any loss or injury, that if the order of injunction is allowed to continue then foreign investors like the defendants will be discouraged to invest in Bangladesh and that the order of injunction offends the public policy, that if award is passed by the Arbitral Tribunal in Singapore that would be enforceable in Bangladesh as per provisions of Arbitration Act of 2001, that even if the suit so filed is maintainable the application for injunction was not maintainable because of the provision of Arbitration Act, 2001 and, as such, trial Court erred in law in granting injunction, that Arbitration clause in the contract remains in force even after coming to end of the contract after performance or termination of the contract and, as such, dispute arising out of the contract is to be settled by the Arbitral Tribunal.

  8. The learned Counsel, representing the plaintiff-respondent in supporting the order of the trial Court granting temporary injunction, submitted that the order passed by the trial Court is a speaking one, that under section 9 of the Code of Civil Procedure the Court has got jurisdiction to entertain the suit, that the suit was filed in the 1st week of January, 2001 while the Act 1 of 2001 came into force on April 10, 2001, that as per provision of section 59(2) of Act 1 of 2001 the provision of Arbitration Act, 1940 shall be applicable in respect of the dispute between the parties, that the plaintiff has been able to establish strong prima facie case in support of his prayer for temporary injunction and that the balance of convenience and inconvenience is in favour of the plaintiff and that in the absence of an order of injunction the plaintiff will be seriously prejudiced and would suffer irreparable loss and injury, that in making the order of temporary injunction the trial Court has not committed any error of law or illegality.

  9. The High Court Division dismissed the appeal on the findings that the suit so filed in spite of the provision of section 32 of the Arbitration Act, 1940 is maintainable in view of the provision of section 9 of the Code of Civil Procedure, that the plaintiff has been able to establish the basic principles i.e. a prima facie case, balance of convenience and inconvenience and apparent chance of suffering loss and injury, governing the matter of granting temporary injunction in a pending suit, that the suit has been filed making allegations against the Chairman and the member nominated by the defendant No. 1 of the Arbitral Tribunal and, as such, in the background of the said fact, the court is very much competent to make an order of injunction restraining the arbitrators from proceeding with the arbitration, that as the award, if any, passed would not be enforceable in Bangladesh the suit so filed for the adjudication of the claim and counter-claim of the parties is entertainable by the court in Bangladesh and that the Court has jurisdiction to adjudicate the dispute even if at one stage the same was the subject matter of arbitration, but because of terminating the contract between the parties by the defendant No. 1 the clause providing arbitration as was in the contract ceased to be an operating one, that as the Court has jurisdiction to entertain the suit so filed and, as such, so long the suit is not thrown out as being not maintainable the Court is competent to entertain an application for temporary injunction and make order thereupon in the affirmative or negative.

  10. The learned Counsel for the appellants upon referring to the provision of sections 3(3) and 7 of Act 1 of 2001, hereinafter referred to as the Act, has submitted as the said provisions shall govern the proceeding (the suit) in question and, as such, the order of injunction passed by the trial Court and upheld by the High Court Division restraining the Arbitrators from proceeding with the arbitration already initiated is not sustainable in law in view of the provision of section 10(3) of the Act. The learned Counsel also submitted that because of the provision of section 20(4) of the Act the High Court Division as well as the trial Court were in serious error in granting temporary injunction. The learned Counsel continued that as the plaintiff-respondent has not filed any petition before the High Court Division under section 20 of the Act, as such, averments made in the plaint relating to the matter of expenses in the matter of proceeding with the arbitration in Singapore would in no way be the matter for consideration and adjudication and, as such, order of temporary injunction passed by the trial Court upon taking said matter into consideration and affirmed by the High Court Division was erroneous one, that there is no contemplation in the Act for staying arbitration proceeding after coming into operation of the said Act and that even if the Court is competent to issue an order of injunction but for that the plaintiff has no vested right to get an order of injunction when the same is barred under the law i.e. as per provision of the Act, that the High Court Division without considering the aforesaid aspect of the matter and that being totally oblivious that by initiating the proceeding in question and that by the order of injunction arbitration proceeding has been stopped, has proceeded on the concept of prima facie case, balance of convenience and inconvenience and chance of suffering irreparable loss and injury, that the High Court Division as well as the trial Court were in error in holding that the award, if any, passed in the arbitration proceeding initiated in Singapore would not be enforceable in Bangladesh specially when the provisions of sections 45 to 47 of the Act provide for enforcement of the award made in foreign country or outside Bangladesh, that the provision of section 34 of the Arbitration Act, 1940 is no longer the law as regard the matter of arbitration and that the law governing matter of arbitration is provided in section 10 of the Act, that the Court is always hesitant in granting injunction as regard arbitration proceeding and that in view of the provision of the Act Court is not competent to pass an order restraining the arbitrators from proceeding with the arbitration or stopping the proceeding of the arbitration, that although the agreement between the plaintiff and the defendant No. 1 has been terminated but for that the arbitration clause has not become inoperative or, in other words, it is not correct to say that because of the termination of the contract the arbitration clause in the contract has become inoperative and that scope for arbitration no longer exists.

  11. In the background of the submissions made by the learned Counsel for the petitioners, grounds urged in support of the petition for leave to appeal are:

“I. For that having regard to the fact that the plaintiff invoked the arbitration clause and referred the matter to the arbitration in accordance with the arbitration agreement and voluntarily appointed/nominated its arbitrator and submitted to the jurisdiction of the Arbitration Tribunal accepting all the three arbitrators including the Chairman and thereupon, having participated in the arbitration by submitting its pleadings, document, witness statements, etc and thereafter, having appeared and participated in the hearing, the plaintiff is precluded by law and the principles of waiver, acquiescence and estoppel from filing a suit in Bangladesh covering the subject matter as that of the arbitration proceeding pending in Singapore and, as such, the High Court Division was wrong in upholding the order of injunction passed by the learned Joint District Judge upon a finding that the plaintiff has right to file the suit on the same subject matter in Bangladesh and the suit is maintainable and therefore the arbitration proceeding should be restrained.

III. For that the High Court Division was wrong to hold that the suit is maintainable in Bangladesh despite the on-going arbitration proceeding in Singapore voluntarily invoked and participated by the plaintiff, upon the finding that the suit is permitted under section 9 of the Code of Civil Procedure and that such right as granted in section 9 could not be taken away except by expressed provision or necessary implication and that section 32 of the Arbitration Act, 1940 does not bar, as such, a suit brought to contest or establish the existence or validity of a contract which includes an arbitration clause, inasmuch as the question involved is not the maintainability of the suit, but whether the arbitration proceeding which covers the subject matter of the suit should be retained or not in the facts and circumstances of the case.

VI. For that the High Court Division while holding that the foreign award is not enforceable in Bangladesh misinterpreted the decision in the British Airways case reported in 49 DLR (AD) 187 inasmuch as in the said decision the question of enforceability of the foreign award in Bangladesh was kept open and in that view of the matter the High Court Division was wrong to hold that the foreign award was not enforceable by placing reliance in the case of Haji Azam reported in 27 DLR 583 inasmuch as the said decision of the High Court Division is no longer valid after the observation made in the British Airways case.”

  1. The learned Counsel entering caveat for the respondent No. 1 submitted that in view of the provision of section 3(1) of the Act, the provision of the Act is applicable only in the case of arbitration which is being held in Bangladesh and as the arbitration in question is not being held in Bangladesh provisions as in sections 7, 10 and 20 of the Act have no manner of application as regard the proceeding initiated by the respondent No. 1 The learned Counsel also submitted that the very provisions of sections 7 and 10 of the Act have not barred the suit relating to matters of arbitration and, as such, the suit so filed being quite maintainable the High Court Division as well as the trial Court were not in error in the background of the materials placed on record in passing the order of temporary injunction and that High Court Division was quite correct in dismissing the appeal since the trial Court did not commit any error or illegality in passing the order of injunction. The learned Counsel further submitted that because of section 2 of Article 33.8 of the contract after termination of the contract arbitration provided in section 2 of Article 30.2 ceased to exist and, as such, as the proceeding of the arbitration initiated by the defendant No. 1 at Singapore cannot be legally proceeded with, the court in passing the order of injunction has committed no illegality and has quite legally passed the order of injunction restraining the Chairman and the Arbitrator nominated by the defendant No. 1 from proceeding with the arbitration proceeding initiated in Singapore. The learned Counsel continued that the parties in the suit and the parties in the arbitration being not same and the relief prayed for in the suit being also not the same or similar to that of the arbitration initiated in Singapore the suit so filed is quite maintainable, that in view of the decision reported in 27 DLR, 583 and also because of the provision in Explanation 3(b) of section 44A of the Code of Civil Procedure award in foreign country as is not enforceable in Bangladesh, as such, the suit so filed seeking the reliefs, even if, though not conceded, some of those or part of those, are the subject matter of award the suit is quite maintainable, that the petitioners have taken contradictory stands in that they have taken stand that the provision of law as in the Act shall govern the matter of arbitration including the one which is the subject matter of the contract dated April 7, 1997, but in the suit they have filed an application under section 34 of the Arbitration Act, 1940, that in view of the provision of section 59(2) of the Act the matter of arbitration between the parties is to be governed by the provision of Arbitration Act, 1940 and, as such, High Court Division has quite legally made the direction to the trial Court to dispose of on merit the application filed under section 34 of the Arbitration Act, 1940 at the earliest.

  2. The learned Counsel for the petitioners, in support of the contention that in spite of termination of the agreement between the parties the clause providing arbitration in the said agreement remains operative, has referred to the decision in the case of Damodar Valley Corporation vs. KKK Kar reported in (1974) 1 SCC 141. In the background of the provision in section 2 of Article 33.8 of the agreement which runs as:

“33.8: The provisions of Articles 11, 15, 16, 17, 18, 19, 20, 25 and 28 of the Contract are continuing ones and their continuing, binding effect shall survive the final settlement or termination of the Contract for any reason”

the applicability of the decision in the aforesaid case, as we are of the view, may be the matter at the time of disposal of the application filed under section 34 of the Arbitration Act. The other 3 cases referred to i.e. case reported in (1996) 1 SCC, 54 (Indian Drugs & Pharmaceuticals Ltd. vs. Indo Swiss Synthetics Gem Manufacturing Company Ltd. and others) and the case reported in (2001) 6 SCC, 365 (Fuerst Day Lawson Ltd. vs. Jindal Exports Ltd.) and the case reported in AIR 1959 SC, 1362 (The Union of India vs. Kishorilal Gupta and Brothers) are not relevant as regard the points raised in the instant matter and yet to be finally disposed of by the trial Court."

  1. It may be mentioned learned Counsel for the petitioners has referred to the case reported in (2001) 6 SCC, 365 in connection with the contention as to enforcement of the award made in foreign country. Suffice it to say the said matter in Bangladesh at the moment is actually governed by the decision reported in 27 DLR, 583 (Haji Azam vs. Singleton Binda & Co Ltd. Binder). In that view of the matter, the decision so referred to is of no help to the petitioner for the purpose of substantiating the contention that the award, if any, as passed in the arbitration as initiated in Singapore is very much enforceable. The other contention that because of the provision of sections 45-47 of the Act award, if any, made in foreign country would very much be enforceable in Bangladesh can all together be considered correct in view of the provision in the Explanation 3(b) of section 44A of the Code of Civil Procedure. In view of the provision of section 2(g) and section 3(1) and 3(4) of the Act of 2001 the contention of the learned Counsel as to maintainability of the suit because of the provisions in sections 7, 10 and 20 of the Act is not legally well founded. It may be mentioned in the suit there are averments as regards the defendants other than the defendant No. 1 in support of the reliefs prayed in the suit. In that view of the matter parties in the arbitration and the parties in the suit being not same and moreover, relief being also not the same and similar to that of the arbitration, the decision as to maintainability of the suit by the High Court Division as well as the trial Court appears to be correct. The learned Counsel for the petitioners has referred to the decision reported in 49 DLR (AD) 187 (Bangladesh Air Service (Pvt) Ltd. vs. British Airways PLC) in connection with the submissions that agreeing to hold arbitration in foreign country is not opposed to public policy and that an award obtained in foreign country is enforceable in Bangladesh. Suffice it to say, in the reported case the correctness of the decision reported in 27 DLR, 583 (relating to enforcement of foreign award) has been kept open and, as such, the contention of the learned Counsel that award, if any, passed in the arbitration proceeding initiated in Singapore would very much be enforceable in Bangladesh is yet to be authoritatively pronounced by the highest Court of the country in either way i.e. approving or disapproving the decision reported in 27 DLR 583. The other contention that award in spite of termination of the agreement of contract and because of the provision in section 2 of Article 33.8 would be very much enforceable, in our opinion, is a matter which can very much be taken at the time of disposal of the petition filed before the trial Court under section 34 of the Arbitration Act, 1940. On reading the provision of section 2, Article 33.8 of the contract it can all together be not said that section 2, Article 30.2 is a continuing one. We leave this question open for the trial Court, if it is raised for disposal, at the time of hearing of the petition filed under section 34 of the Arbitration Act. The other contention relating to the applicability of the provision of section 34 of the Arbitration Act, 1940 is also kept open for decision by the trial Court in the background of the provision of section 59(2) of the Act. The contention of the learned Counsel for the petitioners that Courts are always slow in granting injunction in an arbitration matter is not absolute one since in an appropriate case the Court is very much competent to make an order of injunction in the background of the facts of a particular case. It may be mentioned in the background of the averments made in the plaint and the statements made in the petition for temporary injunction the High Court Division as well as the trial Court, keeping in view the matter(s) that weigh with the Court in disposing of an application for temporary injunction or in granting an order of injunction, have found those present in the instant case. In assailing the findings and decisions of the High Court Division and the trial Court relating to the matter that weighed with the Courts, the learned Counsel has submitted that the courts being totally oblivious of the provision of the Act were in error in considering the matter of injunction in the background of the aspect that generally weighs with the Court in considering the matter of temporary injunction and granting an order of temporary injunction cannot be considered well founded since we have already mentioned that the law as in sections 3(1) and 3(4) of the Act barring the Court from granting an order of injunction is limited in application as to the arbitration being held in Bangladesh, but not as to matter restraining a particular party from proceeding with arbitration in foreign country in respect of a contract signed in Bangladesh.

  2. The learned Counsel for the respondent No. 1 upon referring to the cases reported in 47 DLR (AD) 70, 49 DLR (AD) 46 and 5 MLR (AD) 45 has submitted that this Division has consistently refused to interfere with the order passed in respect of the interlocutory matter e.g. an order of injunction passed upon hearing both the parties, unless the discretion so exercised by the High Court Division in interlocutory matters is “wholly unjudicially or is so palpably wrong that it shocks the judicial conscience.” In the instant case from the judgment of the High Court Division, it is seen that the said Division while dismissing the appeal and thereby maintaining the order of temporary injunction passed by the trial Court has not committed an error of the kind calling for interference by this Division. In the background of the facts of the case and the materials brought on record, it can also be not said that the High Court Division and the trial Court exercised its discretion in the matter of granting temporary injunction ‘wholly unjudicially’ or that the order so passed by the trial Court “is so palpably wrong that it shocks the judicial conscience.” The learned Counsel for the respondent No. 1 in support of his contention that with the termination of the contract, particularly because of the provision in section 2 Article 33.8 the provision in section 2 Article 30.2 i.e. referring dispute/difference between the parties to the contract to the arbitration, became inoperative or ceased has referred to the unreported decision of this Division in CPLA Nos. 73-75 of 1982, 32 DLR 94 and clause 67 of FIDIC. We are restraining ourselves from expressing any view on the subject since a petition filed by the defendants before the trial Court under section 34 of the Arbitration Act, 1940 awaits disposal and, in all probability, this question is likely to come up for decision before the trial Court. From the judgment of the High Court Division and the order of the trial Court granting temporary injunction it is seen that the matters that weigh with the Court in considering prayer for temporary injunction those, after detailed discussions of the materials on record, have been found in favour of the plaintiff. The High Court Division while dismissing the appeal has directed the trial Court to dispose of expeditiously the petition filed by the defendant No. 1 under section 34 of the Arbitration Act, 1940. Learned Counsel for the respondent No. 1 upon referring to the provisions of sections 379, 384 and 385 of the Companies Act, 1994 has submitted that the petitioners, particularly petitioner No. 1, is not competent to proceed with petition for leave to appeal since petitioner No. 1 has not been incorporated legally or that certificate of change in the Constitution of the Company has not been submitted before the Registrar of Joint Stock Companies within the time prescribed and, in support of the aforesaid contention the learned Counsel has referred to the decision in the case of Engineer Mahmudul Islam and others vs. Government of Bangladesh and others, reported in 55 DLR 171. We are refraining ourselves from expressing any view as to the aforesaid contention since without addressing the said contention the petition for leave to appeal can be disposed of Since the judgment of the High Court Division and the order of the trial Court appear to be reasonable one that the contentions as to maintainability of the suit as well as barring the Court from granting injunction in view of the provision of the Act and also the matter as to whether the agreement is a continuing one in spite of section 2 Article 33.8 or not made by the learned Counsels for the parties can very much be gone into at the time of disposing of the application filed under section 34 of the Arbitration Act, we do not find any reason to interfere with the judgment and order of the High Court Division.

Accordingly, the petition is dismissed.

Gas Transmission Company Limited vs. Respondent: Drilltec-Maxwell Joint Venture
Government of the People's Republic of Bangladesh, Represented by the Deputy Commissioner, Jessore Vs.

Related Posts