Holding

Clause 20 of the trust deed does not constitute a valid arbitration agreement within the meaning of Section 7 of the Arbitration and Conciliation Act, 1996, and the Trust Act implicitly bars arbitration of such disputes, rendering the Section 11 application non‑maintainable.

Summary

The appellants and respondents are beneficiaries of a family trust created by a deed that contains clause 20, which purports to refer any disputes among beneficiaries to arbitration under the Indian Arbitration Act, 1996. The respondents filed an application under Section 11 of the Arbitration and Conciliation Act, 1996 seeking appointment of an arbitrator, which the High Court allowed. The appellants challenged the maintainability of the application, arguing that the trust deed does not constitute a valid arbitration agreement because it fails to meet the strict requirements of Section 7, 2(b) and 2(h) of the Act, and that the Indian Trust Act, 1882 provides an exclusive civil‑court remedy, implicitly excluding arbitration. The Supreme Court held that the trust deed clause is not an arbitration agreement, that the Trust Act bars private arbitration of such disputes, and consequently dismissed the Section 11 application. The appeal was allowed and the High Court order set aside.

Issues considered

Whether clause 20 in the trust deed satisfies the requirements of an arbitration agreement under Section 7, 2(b) and 2(h) of the Arbitration and Conciliation Act, 1996.
Whether the Indian Trust Act, 1882 implies an exclusion of the Arbitration Act for disputes arising under a trust.
Whether the application filed under Section 11 of the Arbitration Act is maintainable.

Legislation cited

Arbitration and Conciliation Act, 1996s. 11, s. 2(b), s. 2(h), s. 7
Indian Trust Act, 1882s. 11, s. 34, s. 36, s. 41, s. 45, s. 46, s. 49, s. 53, s. 7, s. 71, s. 72, s. 73, s. 74

Subjects

Arbitration agreementTrust deedArbitration and Conciliation Act 1996Indian Trust Act 1882Section 11 applicationJurisdictionStatutory interpretationNon‑arbitrable disputes

Judgment

[2016] 7 S.C.R. 102

A SHRI VIMAL KISHOR SHAH & ORS.
v.
MR. JAYESH DINESH SHAH & ORS.
(Civil Appeal No. 8164 of2016)
B AUGUST 17, 2016
[J. CHELAMESWAR AND ABHAY MANOHAR SAPRE, JJ.)
Arbitration and Conciliation Act, 1996 - ss.2(b), 2(h), 7 and
11 - Application u/s. 11 for appointment of arbitrator - In view of
arbitration clause in a Trust Deed - For resolving the dfapute
c between the beneficiaries - Maintainability of the application -
Held: Application u/s. 11 is maintainable only when there is valid,
binding and enforceable 'arbitration agreement' within meaning of
s. 7 of the Act - The Trust Deed including the arbitration clause
does not satisfj; the requirements u/ss. 2(b), 2{h) rlw. s. 7 and hence
D cannot be construed as an 'arbitration agreement' inter se
beneficiaries within the meaning of s. 7 - Trust Act specifically
provides forjurisdiction of civil court in respect of disputes regarding
the trust, thus impliedly excludes applicability of Arbitration Act -
Therefore, the application uls. 11 is not maintainable - Trust Act,
1882.
E
Interpretation of Statutes:
The law which ousters jurisdiction of courts, cannot be
inferred readily - It requires strict rule of interpretation.
1f a statute provides for a specific remedy, it thereby forbids a
remedy of any other form than that given in the statute.
F
Allowing the appeal, the Court
HELD: 1.1 In order to constitute a valid, binding and
enforceable arbitration agreement, the requirements contained
in Section 7 have to be satisfied strictly. These requirements,
G apart from others, are (I) there has to be an agreement (2) it has
to be in writing (3) parties must sign snch agreement or in other
words, the agreement mnst bear the signatures of the parties
concerned and (4) snch agreement mnst contain an arbitration
clanse. Failure to satisfy any of the four conditions would render
the arbitration agreement invalid and unenforceable and, in
H consequence, would resnlt in dismissal of the application filed
102
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 103
SHAH & ORS.

under Section 11 of the Act at its threshold. The Trust Deed A
including the arbitration clause does not satisfy the requirements
of Section 2(b) and 2(h) read with Section 7 of the Act and hence,
the Trust Deed cannot be construed as an "arbitration agreement"
within the meaning of Section 7 of the Act. [Paras 23, 24, 35]
[111-G-H; 112-A-B; 116-C-D]
B
Vijay Kumar Sharma Alias Manju v. Raghunandan
Sharma Alias Baburam & Ors. 2010 (1) SCR 582 :
2010 (2) sec 486 - relied on.
Bijoy Ballav Kundu & Anr. v. Tapeli Ranjan Kundu,
AIR 1965 Calcutta 628 - approved. c
1.2 There is always a proposal and then its acceptance in
the case of every agreement, which is not required in the case of
creation of the Trust becnuse in the case of a Trust, the trustee
and beneficiary though accept its creation but by such acceptance,
they merely undertake to carry out' the terms of the Trust Deed D
in so far as the same may be in accordance with law. The clause
relating to arbitration in the Trust Deed is one of the several
clauses. The other clauses which deal with several types of
directions to the trustees and beneficiaries such as how the Trust
should be managed, how the amount of the Trust should be spent
etc. are not in the nature of agreement between the trustees E
or/and beneficiaries. In other words, by accepting the Trust Deed,
it cannot be said that the trustees or beneficiaries have agreed
amongst themselves as to how they should spend the money or
how they should manage the affairs of the Trust or receive any
benefit. There cannot, therefore, be any agreement inter se F
trustees or beneficiaries to carry out any such activity. If that
were to be so then the trustees/beneficiaries would have to give
proposal and acceptance in respect of each clause of the Trust
Deed inter se. It would be then a sheer absurdity and hence such
situation, cannot be countenanced. [Paras 41 and 42] [119-D-G]
G
1.3 The clause in an agreement, which provides for deciding
the disputes arising out of such agreement through private
arbitration, affects the jurisdiction of the Civil Court and the
ouster of jurisdiction of Courts cannot be inferred readily. The
Arbitration Act is one such law, which provides for ouster of
jurisdiction of the Civil Courts. The Act, inter "Ii", provides a H
104 SUPREME COURT REPORTS [2016] 7 S.C.R.

A forum for deciding the disputes inter se parties to an agreement
through arbitration. Such clause, requires strict rule of
interpretation to find out whether it provides an ouster of
jurisdiction and, if so, to which Courttrribunal/Authority as the
case may be. In the present case, when this principle of
interpretation is applied, it is found that clause 20 enables the
B
arbitrator to assume the jurisdiction to decide the disputes arising
between the beneficiaries. Thus, clause 20 does not satisfy the
rigour of Sections 2(b), 2(h) and 7 of the Act. [Para 43] 1119-H;
120-A-C]
1.4 Clause 20 in the Trust Deed, which provides for
c settlement of disputes/differences arising between the
beneficiaries of the Trust, does not constitute an arbitration
agreement inter se beneficiaries within the meaning of Section 7
of the Act. [Para 44] [120-D]
2.1 Legal remedies available to the author of the Trnst/
D scttlor, Trustees and the beneficiaries for ventilating their several
grievances in respect of their rights duties, removal and
obligations under the Trust Deed and the Trust Act are
specifically provided in Sections 7, 11, 34, 36, 41, 45, 46, 49, 53,
71, 72, 73 and 74 of the Trust Act. These sections, in specific
E terms, confer jurisdiction on Civil Court and provides that an
aggrieved person may approach the principal Civil Court of
Original Jurisdiction for adjudication of his grievances. This
clearly shows the intention of the legislature that the legislature
intended to confer jurisdiction only on Civil Court for deciding
the disputes arising under the Trust Act. [Para 54) [123-D-E]
F
Booz Allen & Hamilton Inc. vs. SB/ Home Finance Ltd.
& Ors. 2011 (7) SCR 310 : (2011) 5 SCC 532 - relied
on.
Dhulabhai etc. vs. State of Madhya Pradesh & Am: AIR
G 1969 SC 78 : 1968 SCR 662 - followed,
2.2 Though the Trust Act docs not provide any express
bar in relation to applicability of other Acts for deciding the
disputes arising under the Trust Act yet, there exists an implied
bar of exclusion of applicability of the Arbitration Act for deciding
the disputes relating to Trust, trustees and beneficiaries through
1-1
SHRI YI MAL KI SHOR SHAH & ORS. v. MR. JAYESH DIN ESH 105
SHAH & ORS.

private arbitration. In other words, when the Trust Act A
exhaustively deals with the Trust, Trustees and beneficiaries and
provides for adequate and sufficient remedies to all aggrieved
persons by giving them a right to approach the Civil Court of
principal original jurisdiction for redressal of their disputes arising
out of Trust Deed and the Trust Act then, any such dispute
B
pertaining to affairs of the Trust including the dispute inter se
Trustee and beneficiary in relation to their right, duties,
obligations, removal etc. can not be decided by the arbitrator by
taking recourse to the provisions of the Arbitration and
Concilialtion Act. Such disputes have to be decided by the Civil
Court as specified under the Trust Act. [Para 58) (124-F-H] c
2.3 It is the principle of interpretation that where a specific
remedy is given, it thereby deprives the person who insists upon
a remedy of any other form of remedy than that given by the
statute. The principle is applicable in the present case, because
the Trust Act creates an obligation and further specifies the rights D
and duties of the settlor, Trustees and the beneficiaries apart
from several conditions specified in the Trust Deed and further
provides a specific remedy for its enforcement by filing
applications in Civil Court. Therefore, since sufficient and
adequate remedy is provided under the Trust Act for deciding
the disputes in relation to Trust Deed, Trustees and beneficiaries, E
the remedy provided under the Arbitration Act for deciding
such disputes is barred by implication. [Para 59] [125-A, B-D]
The Premier Auto111obiles Ltd. v. Kamlakar Sha11tara111
Wadke & Ors. AIR 1975 SC 2238: 1976 (1) SCR 427
- relied on. F

Principles of Statutory Interpretation by G.P. Singh, l2 1h
Edition, Pages 763-764 - referred to.
3. The disputes relating to Trust, trustees and beneficiaries
arising out of the Trust Deed and the Trust Act are not capable of G
being decided by the arbitrator despite existence of arbitration
agreement to that effect between the parties. A fortiori - it is held
that the application filed by the respondents under Section 11 of
the Arbitration and Concilialtion Act is not maintainable on the
ground that firstly, it is not based on an "arbitration agreement"
.within the meaning of Sections 2(b) and 2(h) read with Section 7 H
106 SUPREME COURT REPORTS [::O 16] 7 S.C.R.

A of the Act and secondly, assuming that there exists an arbitration
agreement (clause 20 of the Trust Deed) yet the disputes
specified therein are not capable of being referred to private
arbitration for their adjudication on merits. The application filed
by the respondents under Section 11 of the Act is liable to be
dismissed as not maintainable. [Paras 61 and 65) [125-F-G; 126-
B
C-D]
MC. Chacko v. State Bank of Travancore Trivandrum
1969 (2) SCR 953: (1970) 1 SCC 658 - distinguished.
Case Law Reference
c 2010 (1) SCR 582 relied on Para 25
AIR 1965 Calcutta 628 approved Para36
2011 (7) SCR 310 relied on Para 48
1968 SCR 662 followed Para55
1976 (1) SCR 427 relied on Para 59
D
1969 (2) SCR 953 distinguished Para 60
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 8164
of2016.
From the Judgment and Order dated 06.03.2013 of the High Court
E of Judicature at Bombay in Arbitration Application No. 278of2012.
Shekhar Naphade, Sr. Adv., Jay Savla, Tushar Goradia, Ms. Shi Ipi
Chowdhary, Advs. for the Appellants.
Gaurav Agrawal, Ms. Yasmin E. Tovasia, Abhikalp Pratap Singh,
Advs. for the Respondents.
F
The Judgment of the Court was delivered by
ABHAY MANOHAR SAPRE, J. I. Leave granted.
2. This appeal is filed against the final judgment and order dated
06.03.2013 of the High Court of Judicature at Bombay in Arbitration
G Application No. 278 of 2012 whereby the High Court allowed the
arbitration application under Section 11 of the Arbitration and Conciliation
Act, 1996 (hereinafter referred to as "the Act") filed by respondent
Nos. 1 to 3 herein and appointed Shri S.R. Shah, former Judge of the
Bombay City Civil Court, as sole Arbitrator to arbitrate the disputes
between the paities.
H
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 107
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

3. In order to appreciate the issue involved in this appeal, which A
lies in a narrow compass, it is necessary to set out the relevant facts in
brief infra.
4. One Shri Dwarkadas Laxmichand Modi executed a family Trust
Deed called "Deed ofKaydee Family Trust" on 06.04.1983 as author of
the Trust hereinafter called as "settlor" in relation to his properties. The B
settlor formed this Trust out oflove and affection in favour of six minors
(now major), namely, I) Master Vi ma I Kishor Shah, 2) Master Nainesh
Kishor Shah, 3) Kumar Grishma Kishor Shah, 4) Master Jayesh Dinesh
Shah, 5) Master Utpal Dinesh Shah and 6) Master Mon ii Dinesh Shah,
(hereinafter referred to as the "beneficiaries") in the Trust Deed. To
manage the affairs of the Trust and its properties, the sett Ior appointed c
two persons - Shri Dinesh Nandlal Shah and Smt. Saryu Kishor Shah as
Managing Trustees.
5. Clause 20 of the Trust Deed, which is relevant for the disposal
of this case, provides that every dispute or differences regarding the
interpretation of any of the clauses or provisions or the contents of the D
Trust Deed or any dispute illfer se trustees or disputes between the
trustees and beneficiaries or disputes between beneficiaries inter seas
a•.d when arise, •1ie same would be resolved in pursuance of the provisions
of the Indian Arbitration Act, 1940 and the decision of arbitrator(s) shall
be final and binding on the parties to the arbitration. E
6. Unfortunately, as it appears from the record of the case and
from the conduct of the parties, the wish of the settlor could not be
fulfilled in letter and spirit for which he had formed the Trust and soon
after its formation somewhere from 1989-90 onwards, the differences
cropped up inter se beneficiaries with respect to the manner in which F
the affairs and the business of the Trust were being carried on. This led
to tendering of the resignation by one trustee from Trusteeship. It was
followed by exchange of legal notices inter se beneficiaries through
their lawyers making therein allegations and counter allegations against
each other about the manner of functioning of the Trust, its affairs and
demanding accounts of the Trust etc. A demand was also made in the G
notice that since parties have not been able to amicably resolve their
disputes/differences, therefore, all such disputes/differences be referred
to the arbitrator for his decision as per clause 20 of the Trust deed.
7. Since the parties could not settle the disputes/differences and
nor could they agree for the appointment of the arbitrator amicably, H
108 SUPREME COURT REPORTS [2016} 7 S.C.R.

A respondent Nos. I to 3 (one set of beneficiaries) filed an application
under Section 11 of the Act being Arbitration Application No. 278/2012
in the High Court of Bombay against the appellants (other set of
beneficiaries) praying for referring all disputes/differences, which had
arisen between the parties, to the arbitrator in terms of clause 20 of the
Trust Deed. The application was founded on the aforementioned facts
B
for claiming the reliefs.
8. The appellants herein (respondents before 'the High Court)
contested the application. Apa1t from other grounds, the main legal ground
of contest was that the application filed under Section 11 of the Act is
not maintainable. It was contended that when admittedly the appellants
c and the respondents are neither parties to the Trust Deed and nor its
signatories having signed the Trust Deed, they cannot be termed as "party"
to such Trust Deed and nor can such Trust Deed be termed as an
"agreement" much less an "arbitration agreement" within the meaning
of Section 2(b) and 2(h) read with Section 7 of the Act. It was contended
D that the sine qua 11011 for invoking the jurisdiction under Section 11 of
the Act is existence of a valid and enforceable arbitration agreement,
which is lacking in this case, and hence the application filed under Section
11 of the Act is not maintainable and is liable to be dismissed on this
ground alone.
E 9. The learned designated Judge, by impugned judgment, allowed
the application. He hl'id that since parties to the application were minors
at the time of execution of the Trust Deed, they were incapable of signing
the Trust Deed. He further held that now all the parties have become
major and have taken benefit of the Trust Deed as beneficiaries throughout
their minority and then on attaining the majority, they should be held as
F ''party" to the Trust Deed within the meaning of Section 2(h) of the Act.
He also held that once the beneficiaries are held parties to the Trust
Deed, they have a right to take recourse to proceedings under Section
11 of the Act for appointment of arbitrator by invoking clause 20 of the
Trust Deed for deciding the disputes arising between them relating to
G the affairs of the Trust.
I 0. With these findings, the learned Judge proceeded to invoke
clause 20 of the Trust Deed and appointed Shri S.R.Shah - former
Mumbai City Civil Judge as a sole arbitrator for deciding the disputes/
differences which had arisen between the parties to the application. It is
H
against this order, the respondents, who as stated above, are other group
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 109
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

of beneficiaries, have felt aggrieved and filed this appeal by way of A
special leave before this Court.
11. Heard Mr. Shekhar Naphade, learned senior counsel for the
appellants and Mr. Gaurav Agrawal, learned counsel for the respondents.
12. Mr. Shekhar Naphade, learned senior counsel appearing for
the appellants while assailing the legality and correctness of the impugned B
order has made three-fold submissions.
13. In the first place, learned senior counsel submitted that the
learned designated Judge erred in allowing the application filed under
Section 11 of the Act. In his submission, the application was liable to be
dismissed as not maintainable. c
14. In the second place, learned senior counsel submitted that
when admittedly parties to the application, who are beneficiaries of the
Trust, did not sign the Trust Deed, they could not be held pa1iies to such
Trust Deed. Learned counsel urged that the first and foremost
requirement for filing an application under Section 11 of the Act is that D
there has to be in existence a valid and enforceable arbitration agreement
and such agreement, according to him, should be reduced in writing and
lastly, it must be signed by the parties to tl1c· application as provided
under Section 2(h) read with Section 7(4) of the Act. It was urged that
since the respondents have not been able to prove this basic requirement
oflaw, the application filed by the respondents under Section 11 of the E
Act was liable to be dismissed for want of non-compliance of the
requirement of Section 2(b) and 2(h) read with Section 7 of the Act.
15. In the third place, learned senior counsel submitted that apart
from what is urged above, since the creation, affairs of the Trust, rights,
obligations, removal, duties and legal remedies to seek redressal of F
grievances by the Settlor, Trustees and beneficiaries are governed by
the Indian Trust Act, 1882 (hereinafter referred to as "the Trust Act"),
which is a complete code in itself to deal with the aforementioned matters,
the provisions of the Arbitration Act for deciding any dispute relating to
affairs of the Trust including dispute inter se the stakeholders mentioned G
above are not applicable and the remedy of the stakeholders would be to
. take recourse to the provisions of the Trust Act for ventilating their
grievances in an appropriate forum specified in the Trust Act.
16. It is these submissions, which were elaborated by the learned
senior counsel in his argument, with reference to the Scheme of the
H
110 SUPREME COURT REPORTS [2016) 7 S.C.R.

A Trust Act and its various provisions and the decisions, which dealt with
these issues.
17. In reply, Mr. Gaurav Agrawal, learned counsel for the
respondents, supported the reasoning and the conclusion arrived at by
the designated Judge and prayed for its upholding calling no interference
B therein in this appeal. He also elaborated his submissions by referring to
some provisions of the Act and case law.
18. Having heard learned counsel for.the parties and on perusal
of the record of the case, we find force in the submissions of Mr. Shekhar
Naphade, learned senior counsel for the appellants.
c 19. The basic question, which arises for consideration in this appeal,
is whether a clause in a Trust Deed, which provides for resolving the
disputes arising between the beneficiaries of the Trust through arbitration,
can constitute an "arbitration agreement" within the meaning of Section
2(b) and 2(h) read with Section 7 of the Act and whether the application
D filed by the respondents under Section 11 of the Act can be held as ·
maintainable?
20. Section 2(b) and 2(h) and Section 7 of the Act are relevant to
examine the question involved in the case. These Sections read as under:
2. Definitio11s.-(l) ........................................ .
E (a) •••••.••••••••••.•••••••••••••••••••••••••••••••••••
(b) "arbitration agreement" means an agreement referred
to in section?;
(h) "party" means a party to an arbitration agreement.
7. Arbitration agreement.-(1) In this Part, "arbitration
F agreement" means an agreement by the parties to submit
to arbitration all 01· certain disputes which have arisen or
which may arise between them in respect of a defined legal
relationship, whether contractual or not.
(2) An arbitration agreement may be in the form of an
G arbitration clause in a contract or in the fo1·m of a separate
agreement.
(3) An arbitration agreement shall be in writing.
(4) An arbitration agreement is in writing if it is contained
in-
H (a) a document signed by the parties;
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 111
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.)

(b) an exchange of letters, telex, telegrams or other means A
of telecommunication which provide a record of the
agreement; or
(c) an exchange of statements of claim and defence in which
the existence of the agreement is alleged by one party and
not denied by the other. B
(5) The reference in a contract to a document containing
an arb:tration clause constitutes an arbitration agreement
if the contract is in writing and the reference is such as to
make that arbitration clause part of the contract."
21. Section 2(b) defines "arbitration agreement" and stipulates c
that arbitration agreement means arbitration agreement referred to in
Section 7 whereas Section 2(h) defines the word "party" to mean a
party to an arbitration agreement.
22. Section 7 defines "arbitration agreement". It has five sub-
sections. Sub Section (I) provides that arbitration agreement means an D
agreement by the parties to submit to arbitration all or certain disputes
which have arisen or may arise between them in respect of a defined
legal relationship, whether contractual or not. Sub-section (2) provides
that an arbitration agreement may be in the form ofan arbitration clause
in a contract or it may be in the form of a separate agreement. Sub-
section (3) says that an arbitration agreement shall be in writing. Sub- E
section ( 4) which has three clauses (a), (b) and (c) says that a document
which contains an arbitration agreement is to be signed by the parties.
Clause (b) recognizes an arbitration agreement by exchange of letters,
telex, telegrams or other means of telecommunication which provide a
record of such agreement and clause (c) also recognizes an arbitration
F
agreement by an exchange of statements of claim and defence in which
existence of the agreement is alleged by one party and not denied by the
other.
23. A reading of the aforementioned sections in iuxtaposition
goes to show that in order to constitute a val id, binding and enforceable
G
arbitration agreement, the requirements contained in Section 7 have to
be satisfied strictly. These requirements, apart from others, are (I) there
has to be an agreement (2) it has to be in writing (3) parties must sign
such agreement or in other words, the agreement must bear the
signatures of the parties concerned and (4) such agreement must contain
an arbitration clause. H
112 SUPREME COURT REPORTS [2016] 7 S.C.R.

A 24. In other words. aforementioned four conditions are sine qua
non for constituting a valid and enforceable arbitration agreement. Failure
to satisfy any of the four conditions would render the arbitration
agreement invalid and unenforceable and, in consequence, would result
in dismissal of the application filed under Section 11 of the Act at its
threshold.
B
25. The question as to what are the conditions which are necessary
for constituting a valid and enforceable arbitration agreement came up
for consideration before this Court in Vijay Kumar Sharma Alias Manju
vs. Raghunandan Sharma Alias Baburam & Ors., 20 I 0 (2) SCC
486. In this case, a question arose in the context as to whether a clause
c in a Will, which provides that in the event of any dispute arising in relatio:1
to the properties bequeathed by the testator would be settled by named
arbitrator, can such a clause or/and the Will be considered as an arbitration
agreement within the meaning of Section 2(b) read with Section 7 of the
Act for the purpose of invoking the jurisdiction of the High Court under
D Section 11 for appointment of an arbitrator for resolving the disputes.
This question arose on the following facts.
26. The father executed a Will in favour of his one son whereby
he bequeathed to him his one house. He had another son to whom he did
not give any share in the said house. In the Will, father appoimed two
E executors and expressed that if any dispute arises in relation to the
bequeathed property, one named arbitrator will decide such dispute.
On the death of the father, one son filed a suit for declaration of his l/6 111
share in the bequeathed property and also demanded partition whereas
the other son filed a suit on the strength of the Will and claimed his
exclusive ownership to the exclusion ofall his brothers and sisters. The
F suits were clubbed for trial.
27. The two executors, who were also made parties to the suits,
filed an application under Section 8 of the Act contending therein that
the testator had declared in the Will as also in one separate declaration
that in the event of any dispute arising in relation to the bequeathed
G house, the same will be referred to a named arbitrator for his decision. It
was, therefore, contended that in the light of this, the two civil suits filed
by the parties are liable to be dismissed as being not maintainable with a
liberty to be granted to the parties to submit themselves to the jurisdiction
of the named arbitrator so as to enable the arbitrator to decide the disputes
H as per arbitration clause contained in the Will/declaration.
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 113
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

28. The Trial Court allowed the application filed by the executors A
under Section 8 of the Act and, in consequence, dismissed the suits with
a liberty granted to the parties to approach the named arbitrator. One
party, accordingly, submitted himself to the jurisdiction of the named
arbitrator and filed his claim whereas the other party objected to the
jurisdiction of the arbitrator. He contended that there was neither any
B
arbitratio1~ agreement between the parties for appointment of any
arbitrator and nor he ever signed the Will or any declaration, if made, by
his late father and nor gave his consent for appointment of any named
arbitrator. He, therefore, challenged the very initiation of arbitration
proceedings before the arbitrator as being without jurisdiction.
29. This led to named arbitrator withdrawing from the arbitral c
proceedings which, in turn, gave rise to the filing of the application by
one son under Section 11 of the Act before the High Court ofRajasthan.
He pray~d therein for appointment of new arbitrator in place of earlier
named arbitrator. The application was contested by other son reiterating
the same objection, which he had raised earlier, namely, that there is no D
valid and enforceable arbitration agreement between the parties and
neither the Will and nor the declaration constitute any arbitration
agreement for decidin'g any dispute between them in relation to the house
in suit.
30. The learned designate ofChiefJustice overruled the objection E
and allowed the application and appointed new arbitrator for deciding
the disputes arising between the parties to the application in relation to
the house. It is this order, which was impugned in the special leave to
appeal before this Court. Allowing the appeal and setting aside of the
order of the High Court, this Court held that firstly, the Will did not contain
any such clause; Secondly, even assuming that it had any such clause F
then also it was merely an expression of the wish by the testator that the
disputes relating to bequeathed property should be settled by the arbitrator
and nothing more. It was held that in no case the Will could be considered
as constituting an arbitration agreement; Thirdly, even ifthere was some
declaration made by the testator subsequent to the execution of Will to G
this effect yet since it was a unilateral declaration made by the father
and hence by no stretch of imagination such declaration could be
considered as an arbitration agreement among his children. It was further
held that at best such declaration could be taken as an expression of a
fond hope of a father that his children should get the disputes settled in
H
114 SUPREME COURT REPORTS [2016] 7 S.C.R.

A case if they arise between them by means of arbitration but certainly it
did not partake the nature of an arbitration agreement within the meaning
of Section 2(b) read with Section 7 of the Act. Justice Raveendran,
speaking for the Bench, succinctly dealt with this issue in paras 18 to 22
and held as under:
B "18. In this case, admittedly, there is no document signed
by the parties to the dispute, nor any exchange of letters,
telex, telegrams (or other means of telecommunication)
referring to or recording an arbitration agreement between
the parties. It is also not in dispute that there is no exchange
of statement of claims or defence where the allegation of
c existence of an arbitration agreement by one party is not
denied by the other. In other words, there is no arbitration
agreement as defined in Section 7 between the parties.
19. In J"gdislt C/umder v. R"meslt Clt"11der, (2007) 5 SCC
719, this Court held: (SCC p. 726, para 11)
D
"11. The existence of an arbitration agreement as defined
under Section 7 of the Act is a condition precedent for
exercise of power to appoint an arbitrator/Arbitral Tribunal,
under Section 11 of the Act by the Chief Justice or his
de~ignate. It is not permissible to appoint an arbitrator to
E adjudicate the disputes between the parties, in the absence
of an arbitration agreement or mutual consent."
20. While the respondents rely upon the will, the appellant
denies the existence of any such will. The validity of the
will is pending consideration in the two civil suits filed by
F the appellant and the first respondent, referred to above.
The alleged will, admittedly, does not contain any provision
for arbitration, though tbe learned designate bas proceeded
on an erroneous assumption that the will provides for
arbitration. Even if the will had provided for reference of
Q disputes to arbitration, it would be merely an expression of
a wish by the testator that the disputes should be settled
by arbitration and cannot be considered as an arbitration
agreement among the legatees.
21. In this case, according to the respondents, the provision
for arbitration is not in the will but in a subsequent
H
SHRI VIMAL K!SHOR SHAH & ORS. v. MR. JAYESH DINESH 115
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

declaration allegedly made by Durganarayan Sharma, stating A
that ifthere is any dispute in regard to his will dated 28-12-
2003, it shall be referred to his friend, U.N. Bhandari,
Advocate, as the sole arbitrator whose decision shall be
final and binding on the parties. A unilateral declaration by
a father that any future disputes among the sons should be
8
settled by an arbitrator named by him, can by no stretch of
imagination be considered as an arbitration agreement
among his children, or such of his children who become
parties to a dispute. At best, such a declaration can be an
expression of a fond hope by a father that his children, in
the event of a dispute, should get the same settled by c
arbitration. It is for the children, if and when they become
parties to a dispute, to decide whether they would heed to
the advice of their father or not. Such a wish expressed in a
der!aration by a father, even if proved, cannot be construed
as an agreement in writing between the parties to the
D
dispute agreeing to refer their disputes to arbitration.
22. We are therefore of the view that there is no arbitration
agreement between the parties and the learned designate
committed a serious error in allowing the application under
Sections 11 and 15(2) of the .Act and holding that there is
an arbitration agreement between the parties to the dispute E
and appointing an arbitrator." ·
31. When we examine the facts of the case at hand keeping in
view the facts and the law laid down in the case ofVijay Kumar Sharma ·
(supra), we find similarity on facts and law.
F
32. Though case of Vijay Kumar Sharma dealt with a case
relating to execution of a "Will" whereas the case at hand deals with
execution of the "Trust Deed" yet, in our considered view, it does not
make any significant difference so far as the applicability of the principle
of law laid down in Vijay Kumar Sharma to the facts of the case at
.hand is concerned. G
33. The reasons are not far to seek. In the case of a Will, the
testator executes the Will in favour of lcgatee(s) whereas in the case of
a Trust, the sett Ior executes the deed in favour of the beneficiaries. In
both the cases, it is the testator/settler who signs the document alone.
That apart, both the deeds convey the interest in the estate in favour of H
116 SUPREME COURT REPORTS [2016) 7 S.C.R.

A the legatees or/and beneficiaries. However, since legatee/beneficiaries
do not sign the document or we may say are not required to sign such
document, they ,are not regarded as party to such deed despite legatee/
beneficiaries/trustees accepting the deed. Such deed, therefore, in our
opinion, does not partake the nature of an agreement between such
parties.
8
34. We are, therefore, of the view that ifthe Will is held not to
constitute an arbitration agreement despite containing an arbitration clause
therein - a.fortiori, the Trust Deed can also not be held to constitute an
agreement much less an arbitration agreement despite containing an
arbitration clause therein.
c
35. In the light of foregoing discussion, we hold that the Trust
Deed including the arbitration clause (clause 20) does not satisfy the
requirements of Section 2(b) and 2(h) read with Section 7 of the Act and
hence, the Trust Deed cannot be construed as an "arbitration agreement"
within the meaning of Section 7 of the Act.
D
36. The aforesaid issue can be examined from yet another angle
as was examined by the High Court of Calcutta in Bijoy Ballav Kundu
& Anr. Vs. Tapeti Ranjan Kundu, AIR 1965 Calcutta 628.
37. The facts of the Bijoy Ballav Kundu's case (supra) were
E that One Dhananjay Kundu, a resident of Calcutta was the owner of a
house. He executed a trust/settlement deed wherein he nominated two
trustees to manage the affairs of the Trust. He conveyed his house
together with Rs.500/- to the trustees as the corpus of the Trust to carry
on its activities for the benefit of the beneficiaries. The Trust Deed had
several clauses providing therein as to how trustee and beneficiaries
F should carry out the activities of the Trust, how they shoui.'. manage the
Trust affairs and maintain its accounts etc. Clause 12 provided that in
the event of any dispute/differences arising between the trustees
concerning management and the affairs of the Trust, the same shall be
referred to named arbitrator who would decide the disputes in accordance
G with the provisions oflndian Arbitration Act, 1940.
38. After some time, the disputes arose between the trustees
concerning the affairs and the management of the Trust. They were
accordingly referred to the arbitrator in tenns of clause 12 for his decision.
One trustee, however, objected to making of the reference to the
arbitrator. The arbitrator, however, delivered the award. One trustee,
H
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 117
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

who had objected to making of the reference to the arbitrator, challenged A
the legality of the award in the civil Court inter alia on the ground that
since there was no arbitration agreement between the parties (trustees)
to make reference to the arbitrator and hence the award passed by the
arbitrator is rendered withoutjurisdiction and is, therefore, liable to be
set aside. The Court upheld the objection and set aside the award. The
B
aggrieved trustee appealed to the Calcutta High Court.
39. The Division Bench of the High Court, by their well-reasoned
judgment, examined the issue thread bear in the context of the provisions
of the Trust Act and the Arbitration Act 1940 and while upholding the
order of the Trial Court dismissed the appeal. It is apposite to mention
the reasoning of Their Lordships hereinbelow: c
"5 ...................... The question however in this case is,
as to whether the trustees can be said to be a party to any
agreement at all for referring their disputes to arbitration.
The way Mr. Hasak argues is this: He says that the deed of
settlement directs that there shall be such a reference to D
arbitration and the trustees by their conduct in accepting
the trusteeship and agreeing to act as trustees must be
said to be parties to that agreement or to have become
parties to the agreement by their conduct. In other words,
once they accept the trust, they must be deemed to be E
parties to the agreement for reference to arbitration, which
according to the learned counsel is contained in the
arbitration clause. In my opinion, this contention is not
sound. In order to become an agreement there must be a
proposal and an acceptance. If we are to hold that the
arbitration clause constitutes the written agreement, then F
we must hold that each trustee has, at some point of time,
made a proposal to the other trustee or trustees as to
whether the disputes should be referred to arbitration and
each of them has accepted the same. In the circumstances
of this case, it can never be said that any such incident has G
ever happened. By accepting a trust, a trustee merely
undertakes to carry out the terms of the trust, in so far as
the same may be in accordance with law. The reference to
arbitration is only one of the many terms of the deed of
settlement. There are other directions, for example,
H
118 SUPREME COURT REPORTS [2016) 7 S.C.R.

A directions as to the amount that should be expended upon
diverse matters or diverse acts done. It can never be said
that in accepting the trust there is any question of the
trustees agreeing among themselves that such amount
should be expended or such acts done. Being trustees, they
are bound to carry out the provisions of the deed of
B
settlement. There can be no question of any agreement
amongst themselves; otherwise we are faced with this
absurd situation that with regard to every provisions in the
deed of trust we have to visualize the trustees agreeing
among themselves to carry it out by making a proposal and
c an acceptance. The learned Judge has pointed out that in
order to accept a trust it is not necessary to signify to the
other trustees any willingness to do so or to enter into any
agreement to do or abstain from doing anything. In other
words, no question of any proposal by one trustee or
acceptance of the same by another arises. It may be an
D
attractive argument to say that trustees having consented
to accept trusteeship under a deed of trust must have
agreed to carry out each and every term contained in it.
That however is quite different from saying that they have
entered into a written agreement amongst themselves to
E do so. The provision as to reference of disputes to
arbitration is a matter that concerns the jurisdiction of
courts. Ordinarily, the Courts arc zealous of their
jurisdiction and can only allow it to be curtailed by some
provision of law. The provisions of the Indian Arbitration
Act constitute such a law, but the provision must be strictly
F
construed. In order that there may be a reference to
arbitration which ousts the jurisdiction of Courts, the parties
must enter into an arbitration agreement. That is a matter
that must be governed by the law and in a given case it
must be shown that the parties have lawfully entered into
G such an_ agreement and there is in existence a lawful
agreement. Nothing short of it can support such an
agreement and any reference to arbitration or an award
consequent thereon, in contravention of the provisions of
the law cannot be supported and must be declared invalid.
In our opinion, the conclusions reached by the learned
H
SHR! V!MAL KISHOR SHAH & ORS. v. MR. JAYESH D!NESH 119
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

Judge are correct on that point and must be upheld. In the A
facts of this case it must be held that there was no arbitration
agreement and no valid reference to arbitration •.•••••"
40. We find that the facts of the case at hand and the one involved
in the case of Bijoy Ballav Kundu (supra) are identical. We are in
agreement with the aforesaid reasoning of Their Lordships which, in our B
opinion, lays down the correct principle of law on the subject. Indeed,
Their Lordships examined the issue in the context of definition of
"arbitration agreement" as defined in Section 2(a) of Arbitration Act,
1940 whereas the case at hand is required to be examined in the context
of definition of"arbitration agreement" as defined in Section 2(b) and
2(h) read with Section 7 of the Act 1996, which is quite different from
c
the earlier definition.
41. As rightly held by the Calcutta High Court in the case ofBijoy
Ballav Kundu (supra), there is always a proposal and then its
acceptance in the case of every agreement, which is not required in the
case of creation of the Trust because in the case of a Trust, the trustee D
and beneficiary though accept its creation but by such acceptance, they
merely undertake to carry out the terms of the Trust Deed in so far as
the same may be in accordance with law. The clause relating to arbitration
in the Trust Deed is one of the several clauses. The other clauses which
deal with several types of directions to the trustees and beneficiaries E
such as how the Trust should be managed, how the amount of the Trust
should be spent etc. are not in the nature of agreement between the
trustees or/and beneficiaries. In other words, by accepting the Trust
Deed, it cannot be said that the trustees or beneficiaries have agreed
amongst themselves as to how they should spend the money or how
they should manage the affairs of the Trust or receive any benefit. F
42. Indeed, in such case, the trustees or/and beneficiaries are only
required to carry out the provisions of the Trust Deed. There cannot,
therefore, be any agreement imer se trustees or beneficiaries to carry
out any such activity. If that were to be so then the trustees/beneficiaries
would have to give proposal and acceptance in respect of each clause G
of the Trust Deed inter se. It would be then a sheer absurdity and hence
such situation, in our view, cannot be countenanced.
43. As rightly held in Bijoy Ballav Kundu (supra) to which we
agree that the clause in an agreement, which provides for deciding the
H
120 SUPREME COURT REPORTS [2016] 7 S.C.R.

A disputes arising out of such agreement through private arbitration, affects
the jurisdiction of the Civil Court and the ouster ofjurisdiction of Courts
cannot be inferred readily. The Arbitration Act is one such law, which
provides for ouster of jurisdiction of the Civil Courts. The Act, inter
alia, provides a forum for deciding the disputes inter se parties to an
agreement through arbitration. Such clause, in our opinion, requires strict
8
rule of interpretation to find out whether it provides an ouster of
jurisdiction and, if so, to which Court/Tribunal/Authority as the case may
be. In the case at hand, when we apply this principle of interpretation,
we do not find that clause 20 enables the arbitrator to assume the
jurisdiction to decide the disputes arising between the beneficiaries. In
c other words, clause 20 does not satisfy the rigour of Sections 2(b ), 2(h)
and 7 of the Act.
44. In the light of what we have discussed above, we are of the
considered opinion that clause 20 in the Trust Deed, which provides for
settlement of disputes/differences arising between the beneficiaries of
D the Trust, does not constitute an arbitration agreement inter se
beneficiaries within the meaning of Section 7 of the Act.
45. This takes us to consider the third argument of Mr. Shekhar
Naphade, learned senior counsel for the appellants. Though in view of
what we have held above, it may not be necessary to consider this
E argument yet we feel that since it arises out of this case and being a
pure legal question, the same can be decided in this appeal.
46. The argument oflearned counsel was that any dispute relating
to the management and affairs of the Trust including the disputes inter
se trustees and the beneficiaries in relation to the Trust, its affairs,
F management and properties cannot be decided by the arbitrator under
the Act even though there may be a clause to that effect in the Deed. It
was his submission that the remedy to get such disputes decided through
arbitration is impliedly barred, if not, expressly by virtue of the scheme
and the elaborate provisions of the Trust Act. Learned counsel pointed
out that the Trust Act is a complete Code in itself and provides a
G comprehensive machinery to deal with all issues relating to Trust, the
trustees and the beneficiaries including providing adequate forum (Civil
Court) for adjudication ofall such disputes arising between them and the
Trust, and hence, the jurisdiction of the Civil Court should be given
overriding effect to the exclusion of jurisdiction of private arbitration
H under the Act by applying implied bar ofjurisdiction recognized in law.
SHRI VIMAL KlSHOR SHAH & ORS. v. MR. JAYESH DINESH 121
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

47. Though learned counsel for the respondents countered the A
aforesaid submission oflearned senior counsel for the appellants but we
find merit in the submission of the learned counsel forthe appellants for
the reasons mentioned infra.
48. Before we examine the Scheme of the Trust Act, we consider
it apposite to take note of the case law, which has bearing on this issue. B
The question came up for consideration before this Court in the case of
Booz Allen & Hamilton Inc. vs. SBI Home Finance Ltd. & Ors.
(2011) 5 sec 532 as to what is the meaning of the term "arbitrability"
and secondly, which type of disputes are capable of settlement by
arbitration under the Act. Their Lordships framed three questions to
answer the question viz., - (1) whether the disputes having regard to
c
their nature could be resolved by a private forum chosen by the parties
(arbitral Tribunal) or whether such disputes exclusively fall within the
domain of pub Iic Fora (Courts); (2) Whether the disputes are covered
by the arbitration agreement; and (3) whether the parties have referred
the disputes to arbitrator? D
49. This Court speaking through Justice Raveendran answered
the questions. While answering question No. 1 with which we are
concerned here, Their Lordships carved out six categories of cases.
These six categories of cases were held as not capable for being decided
by private arbitration under the Arbitration Act even though parties agreed E
for their settlement through private arbitration. This is what Their
Lordships held in Paras 35 and 36:
"35. The Arbitral Tribunals arc private fora chosen
voluntarily by the parties to the dispute, to adjudicate their
disputes in place of courts and tribunals which are public F
fora constituted under the laws of the country. Every civil
or commercial dispute, either contractual or non-
contractual, which can be decided by a court, is in principle
capable of being adjudicated and resolved by arbitration
unless the jurisdiction of the Arbitral Tribunals is excluded
either expressly or by necessary implication. Adjudication G
of certain categories of 11roceedings are reserved by the
legislature exclusively for public fora as a matter of public
policy. Certain other categories of cases, though not
expressly reserved for adjudication by public fora (courts
and tl'ibunals), may by necessary implication stand excluded H
122 SUPREME COURT REPORTS [2016) 7 S.C.R.

A from the purview of private fora. Consequently, where the
cause/dispute is inarbitrable, the court where a suit is
pending, will refuse to refer the parties to arbitration, under
Section 8 of the Act, even if the parties might have agreed
upon arbitration as the forum for settlement of such
disputes.
B
36. The well-recognised examples of non-arbitrable
disputes are: (1) disputes relating to rights and liabilities
which give rise to or arise out of criminal offences; (ii)
matrimonial disputes relating to divorce, judicial separation,
restitution of conjugal rights, child custody; (iit) guardianship
c matters; (iv) insolvency and winding-up matters; (v)
testamentary matters (grant of probate, letters of
administration and succession certificate); and (vi) eviction
or tenancy matters governed by special statutes where the
tenant enjoys statutory protection against eviction and only
D the specified courts are conferred jurisdiction to grant
eviction or decide the disputes."
50. The question to be considered in this appeal is whether the
disputes relating to affairs and management of the Trust including the
disputes arising inter se trustees, beneficiaries in relation to their
E appointment, powers, duties, obligations, removal etc. are capable of
being settled through arbitration by taking recourse to the provisions of
the Act, if there is a clause in the Trust Deed to that effect or such
disputes have to be decided under the Trust Act with the aid of forum
prescribed under the said Act.

F 51. Keeping in view the aforesaid principle of law, let us now
examine the Scheme of the Trust Act. The Trust Act was enacted much
prior to independence with an object to define and amend the law relating
to private Trusts and the trustees. The Act consists of93 Sections, which
are divided, in IX chapters.
G 52. Chapter I deals with short title, commencement, repeal of
enactments and interpretation of words (Sections I to 3). Chapter II
deals with the creation of a Trust (Sections 4 to I 0). Chapter III deals
with the duties and liabilities of the Trustees (Sections 11 to 30). Chapter
IV deals with the rights and powers of the Trustees (Sections 31 to 45).
Chapter V deals with the disabilities of the Trustees (Sections 46 to 54).
H Chapter VI deals with the rights and liabilities of the beneficiaries
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 123
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

(Sections 55 to 69). Chapter VII deals with vacating the office of the A
Trustee (Sections 70 to 76). Chapter VIII deals with extinction of the
Trusts (Sections 77 to 79) and Chapter IX deals with certain obligations
in the nature of Trust (Sections 80 to 93).
53. Even cursory perusal of the headings of each Chapter including
what is provided in the Sections would go to show that the legislature B
has dealt with and taken care of each subject comprehensively and
adequately. It starts from the creation of the Trust, how it is required to
be created (deed), who can create (author of the Trust/settlor), who can
manage(trustees), for whose benefit it can be created (beneficiaries),
their qualifications for appointment:grounds for removal, rights and duties,
restrictions on their exercise of powers, obligations and legal remedies c
available to get the grievances settled etc. are all specified in the Trust
Act.
54. So far as legal remedies available to the author of the Trust/
settlor, Trustees and the beneficiaries for ventilating their several
grievances in respect of their rights duties, removal and obligations under D
the Trust Deed and the Trust Act are concerned, they are specifically
provided in Sections 7, 11, 34, 36, 41, 45, 46, 49, 53, 71, 72, 73 and 74 of
the Trust Act. These sections, in specific terms, confer jurisdiction on
Civil Court and provides that an aggrieved person may approach the
principal Civil Court of Original Jurisdiction for adjudication of his E
grievances. This clearly shows the intention of the legislature that the
legislature intended to confer jurisdiction only on Civil Court for deciding
the disputes arising under the Trust Act.
55. The Constitution Bench of this Cou11 in a leading case of
Dhulabhai etc. vs. State of Madhya Pradesh & Anr., AIR 1969 SC F
78 examined the question as to how the exclusion ofjurisdiction of Civil
Court in the context of express or implied bar created in any special law
should be decided. Their Lordships examined the question in the context
of Section 9 of the Code of Civil Procedure, 1908 and the bar created in
special law.
G
56. Justice Hidayatullah, the learned Chief Justice speaking for
the Bench laid down 7 conditions for determining the question of bar for
prosecuting the remedies in the Civil Court or judicial Tribunals/authorities
constituted under any special law. Though the issue examined in
Dhulabhai's case (supra) pertained to bar created in special law vis-a-
vis filing of the civil suit by an aggrieved party, yet the decision, in our
124 SUPREME COURT REPORTS [2016] 7 S.C.R.

A view, lays down the general principle as to how the courts should decide
the issue of express or/and implied bar in the context of the remedies
available in law.
57. So far as the question involved in the case at hand is concemed,
it is governed by condition No. 2 ofDhulabhai's case (supra) which
B reads as under:
"(2) Where there is an express bar of the jurisdiction of
the court, an examination of the scheme of the particular
Act to find the adequacy or the sufficiency of the remedies
provided may be relevant but is not decisive to sustain the
c jurisdiction of the civil court.
Where there is no express exclusion the examination of
the remedies and the scheme of the particular Act to find
out the intendmcnt becomes necessary and the result of
the inquiry may be decisive. In the latter case it is necessary
D to sec if the statute creates a special right or a liability and
provides for the determination of the right or liability and
further lays down that all questions about the said right and
liability shall be determined by the Tribunals so constituted,
and whether remedies normally associated with actions in
civil courts are prescribed by the said statute or not."
E
58. When we examine the Scheme of the Trust Act in the light of
the principle laid down in condition No. 2, we find no difficulty in concluding
that though the Trust Act do not provide any express bar in relation to
applicability of other Acts for deciding the disputes arising under the
Trust Act yet, in our considered view, there exists an imp! ied exclusion
F ofapplicability of the Arbitration Act for deciding the disputes relating to
Trust, trustees and beneficiaries through private arbitration. In other
words, when the Trust Act exhaustively deals with the Trust, Trustees
and beneficiaries and provides for adequate and sufficient remedies to
all aggrieved persons by giving them a right to approach the Civil Court
G of principal original jurisdiction for redressal of their disputes arising out
of Trust Deed and the Trust Act then, in our opinion, any such dispute
pertaining to affairs of the Trust including the dispute imer se Trustee
and beneficimy in relation to their right, duties, obligations, removal etc.
can not be decided by the arbitrator by taking recourse to the provisions
of the Act. Such disputes have to be decided by the Civil Court as
H specified under the Trust Act.
SHRI VIMAL KISHOR SHAH & ORS. v. MR. JAYESH DINESH 125
SHAH & ORS. [ABHAY MANOHAR SAPRE, J.]

59. The principle of interpretation that where a specific remedy is A
given, it thereby deprives the person who insists upon a remedy of any
other form ofremedy than that given by the statute, is one which is very
familiar, and which runs through the law, was adopted by this Court in
the case of The Premier Automobiles Ltd. vs. Kamlakar Shantaram
Wadke & Ors., AIR 1975 SC 2238 while examining the question of bar
B
in filing Civil suit in the context of remedies provided under the Industrial
Disputes Act (See GP. Singh, Principles of Statutory Interpretation,
12'h Edition, Pages 763-764). We apply this principle here because,
as held above, the Trust Act creates an obligation and further specifies
the rights and duties of the sett Ior, Trustees and the beneficiaries apart
from several conditions specified in the Trust Deed and further provides c
a specific remedy for its enforcement by filing applications in Civil Court.
It is for this reason, we are of the view that since sufficient and adequate
remedy is provided under the Trust Act for deciding the disputes in relation
to Trust Deed, Trustees and beneficiaries, the remedy provided under
the Arbitration Act for deciding such disputes is barred by implication.
D
60. Though learned counsel for the respondents made attempt to
support the reasoning and the conclusion arrived at by the High Court by
making some submissions but we find no merit in them especially in the
light of what we have held above. We, therefore, do not consider it
necessary to give our detailed reasoning for rejection of his submission
and nor consider it necessary to deal with the decision cited by him E
(M.C. Chacko vs State Bank of Travancore Trivandrum, ( 1970) 1
sec 658) which is distinguishable on facts.
61. We, accordingly, hold that the disputes relating to Trust, trustees
and beneficiaries arising out of the Trust Deed and the Trust Act are not
capable of being decided by the arbitrator despite existence of arbitration F
agreement to that effect between the parties. A fortiori - we hold that
the application filed by the respondents under Section 11 of the Act is
not maintainable on the ground that firstly, it is not based on an "arbitration
agreement" within the meaning of Sections 2(b) and 2(h) read with
Section 7 of the Act and secondly, assuming that there exists an arbitration G
agreement (clause 20 of the Trust Deed) yet the disputes specified
therein are not capable of being referred to private arbitration for their
adjudication on merits.
62. We thus add one more category of cases, i.e., category (vii),
namely, cases arising out of Trust Deed and the Trust Act, in the list of H
126 SUPREME COURT REPORTS [2016) 7 S.C.R.

A (vi) categories of cases specified by this Court in Para 36 at page 54 7 of
the decision rendered in the case of Booz Allen & Hamilton Inc.
(supra) which as held above can not be decided by the arbitrator(s).
63. In the light of foregoing discussion, we are unable to agree
with the reasoning and the conclusion arrived at by the learned designated
B arbitrator.
64. Before parting with the case, we consider it apposite to mention
that we have not examined the merits of the case set up by the parties in
these proceedings and hence parties would be at liberty to take recourse
to any legal remedies, as may be available to them, for adjudication of
C their rights.
65. The appeal thus succeeds and is hereby allowed. The impugned
order is set aside. As a result, the application filed by the respondents
under Section 11 of the Act is dismissed as not maintainable.
Kalpana K. Tripathy Appeal allowed.
D