Bombay High Court
Shri Balaji Sugars And Chemicals Pvt. ... vs Tamhankar Patil And Associates on 27 February, 2020
Author: G. S. Patel
Bench: G.S. Patel
901-CARBP1445-19.DOC
Arun
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
COMM ARBITRATION PETITION NO. 1445 OF 2019
Shri Balaji Sugars & Chemicals Pvt Ltd ...Petitioner
Versus
Tamhankar Patil & Associates ...Respondent
Mr Zubin Behramkamdin, with Mr Arzan Bulsara, Mr Rajesh
Poojary, Ms Poorva Garg and Mr Jehan Lalkaka, i/b Mulla &
Mulla & Craigie Blunt & Caroe, for the Petitioner.
Mr Sangram Singh Bhonsle, with Ms Samridhi Jain & Mr Abhishek
Salian, i/b Vidhi Partners, for the Respondent.
CORAM: G.S. PATEL, J.
DATED: 27th February 2020 PC:-
1. This Petition under Section 34 of the Arbitration and Conciliation Act 1996 assails part of an Award dated 6th August 2019. The present Respondent, Tamhankar Patil & Associates ("TPA") were the Claimants in arbitration. The present Petitioner, Shri Balaji Sugars & Chemicals Pvt Ltd ("BSCPL") was the Respondent. TPA is a partnership frm and is engaged inter alia in the construction of buildings for sugar factories. BSCPL runs one such sugar factory. It foated a tender on 13th February 2013 for the Page 1 of 6 27th February 2020 ::: Uploaded on - 28/02/2020 ::: Downloaded on - 29/02/2020 05:41:20 ::: 901-CARBP1445-19.DOC construction of a sugar factory in Bijapur District in Karnataka. TPA put in its tender. BSCPL issued a work order on 22nd March 2013 and on 8th July 2013 an Agreement was executed between the parties in regard to this project.
2. After disputes arose parties found themselves in Court and then, pursuant to an order under Section 11 passed on 28th April 2018, an Advocate of this Court was appointed as a sole Arbitrator.
3. TPA put in totally nine claims initially in the aggregate of Rs. 7,45,17,868.53/-. A tabulation is at page 25 of the paper book. Of these nine, Claim Nos. 2, 5, 7 and 9 were withdrawn during the course of the arbitration. Claim No. 6 was rejected and there is no challenge to that rejection by TPA. Of the remaining, Claim Nos. 1, 3, 4 and 8 were granted.
(a) Claim 1 was granted entirely in the amount of Rs.
8,40,922.43/-.
(b) Claim No. 3 in the amount of Rs.93,12,467.58/- (the entire amount of that claim).
(c) Claim No. 4 was originally in the amount of Rs.
52,02,569.00. The amount was Rs. 1,81,100.00 with some interest.
(d) Claim No. 8 for loss of proft was granted in full in the amount of Rs. 1,49,60,380.00.
4. Thus the two major claims are Claim No. 8 for loss of proft and Claim No. 3 in regard to the RA Bills.
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5. Mr Behramkamdin, learned Counsel on behalf of the Petitioner, BSCPL addressed me for some time. I will not express an opinion on the various arguments that he raised including on the threshold arguments of arbitrability in view of what follows.
6. Addressing himself to Claim No. 8, the one for loss of proft, Mr Behramkamdin pointed out that before the learned sole Arbitrator and indeed in the arbitral record as it now stands there is no evidence to support either the claim or the fnding returned. He drew my attention in particular to a statement annexed to the original statement of claim (page 32 of a compilation tendered across the Bar). This is an unsigned and unverifed computation. The Evidence Afdavits on behalf of TPA do not attest to its correctness. There are some entries in this table that undoubtedly required proof. But no such proof was ever led. Mr Behramkamdin's submission is that the fnding returned by the Arbitrator and his award granting the claim was based on no evidence at all.
7. It is at this stage that Mr Behramkamdin on instructions said that he had no objection if the matter was simply adjourned for some time to give the learned sole Arbitrator an opportunity to resume the arbitral proceedings (or to take such other steps as the learned Sole Arbitrator deems ft) to eliminate the grounds for setting aside the arbitral award. Obviously Mr Behramkamdin's chief focus has been on the award on the two claims 3 and 8. I have only set out his submissions in regard to Claim No. 8 because it is at this stage that the statement came to be made. I am expressing no Page 3 of 6 27th February 2020 ::: Uploaded on - 28/02/2020 ::: Downloaded on - 29/02/2020 05:41:20 ::: 901-CARBP1445-19.DOC opinion whatsoever on the merits of the rival contentions on both sides.
8. Section 34 (4) reads thus:
"34. Application for setting aside arbitral award.― ... ... ...
(4) On receipt of an application under sub-section (1), the Court may, where it is appropriate and it is so requested by a party, adjourn the proceedings for a period of time determined by it in order to give the arbitral tribunal an opportunity to resume the arbitral proceedings or to take such other action as in the opinion of arbitral tribunal will eliminate the grounds for setting aside the arbitral award."
9. I believe it would be appropriate to request the learned sole Arbitrator, if he deems ft and appropriate, to resume the arbitral proceedings to address this and any other grounds as required so as to eliminate any foundation for setting aside the arbitral award.
10. The public purpose embodied in Section 34(4) is plain. It is intended to give fnality to an arbitral award and to minimise judicial interference, an objective we also fnd not only in various reports of the Law Commission but statutorily embodied in Section 5 of the Arbitration and Conciliation Act 1996.
11. I note the submission made on behalf of TPA by Mr Bhonsle that there is already a fnding returned in TPA's favour that it is entitled in law to receive an amount towards its claim for loss of Page 4 of 6 27th February 2020 ::: Uploaded on - 28/02/2020 ::: Downloaded on - 29/02/2020 05:41:20 ::: 901-CARBP1445-19.DOC profts. I also note the submission that so far as Claim No. 3 is concerned, there is sufcient material on record.
12. An opportunity under Section 34(4) is not to be confused with or mistaken for an attempt to review an arbitral award. The ambit of Section 34(4) is restricted. It is to enable the arbitral tribunal to take such action as in its opinion will adequately 'eliminate the grounds for setting aside the arbitral award'. An arbitral tribunal given such an opportunity is, equally, not bound to so act. It may choose not to. Similarly, whether or not to allow further evidence, and if so to what extent and on what issue, given this background, are matters I leave for the decision of the arbitrator. All contentions are kept open.
13. Since I am adjourning the matter to a convenient date after the summer vacation in June so as to give the arbitral tribunal enough time, I am expressing no opinion whatsoever on the merits of the rival contentions on any of the other aspects in either the Petition or in the claim in arbitration.
14. In view of this, in fairness, Mr Bhonsle states that the award will not be put into execution until the learned sole Arbitrator has rendered a decision or opinion pursuant to this order.
15. The parties will appear before the learned sole Arbitrator on 6th March 2020 at 5.50 pm in his chambers.
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16. List the matter for directions on 15th June 2020.
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