Delhi High Court
Aurum Infocomm Limited vs Sh. Desh Raj Mangal on 27 March, 2014
Author: Valmiki J. Mehta
Bench: Valmiki J.Mehta
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ FAO No. 479/2013
% 27th March, 2014
AURUM INFOCOMM LIMITED ......Appellant
Through: Mr. Sanjay Kumar, Adv.
VERSUS
SH. DESH RAJ MANGAL ...... Respondent
Through: Mr. Shiv Kumar Gupta, Adv.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA
To be referred to the Reporter or not?
VALMIKI J. MEHTA, J (ORAL)
CM No. 20177/13 (delay) For the reasons stated in the application, delay is condoned. CM stands disposed of.
FAO No. 479/2013 & CM No. 20175/2013 (stay)
1. This first appeal is filed under Section 37 of the Arbitration and Conciliation Act, 1996 (in short 'the Act') impugning the judgment of the court below dated 29.8.2013 by which the objections filed by the appellant under Section 34 of the Act against the Award of the arbitrator dated FAO 479/2013 Page 1 of 5 12.1.2013 were dismissed. By the Award, the arbitrator awarded a sum of Rs.1 lac in favour of the respondent-claimant against the appellant/objector with interest at 12% per annum pendente lite and future.
2. The facts of the case are that the respondent opened a credit account with the appellant-company/Registered Broker for the Multi Commodities Exchange. The account was opened at Jalandhar on 20.5.2009 and the respondent deposited a sum of Rs.1 lac, but within 15 days, the amount stood totally depleted. Respondent contended that he never knew about the transactions carried out in his account, and aggrieved by the loss, the claim petition was filed.
3. There were two points which were to be considered by the arbitrator as to (1) whether the claim of the respondent was within limitation and (2) whether the appellant had indulged in unauthorized trading in the respondent's account.
4. So far as the aspect of limitation is concerned, the arbitrator held the claim to be within limitation for filing of the claim petition on the ground that the time for filing of claims was extended by the Multi Commodities Exchange to 3 years as per circular w.e.f. 31.3.2012, and the defence of the appellant with respect to lack of retrospective operation of the FAO 479/2013 Page 2 of 5 circular was rejected. Independent of the findings of the arbitrator, I would like to refer to the judgment of a learned Single Judge of this Court in the case of Smt. Biba Sethi & Mr. Nitin Sethi Vs Dyna Securities Ltd. 2009 (3) ARb. L.R 494 (Delhi) which while dealing with similar provision under the National Stock Exchange held that curtailing any period of limitation with respect to invoking of arbitration proceedings prior to a period of 3 years is hit by the amended Section 28 of the Indian Contract Act, 1872 which holds that the period of limitation and the rights within the period of limitation cannot be extinguished in a period less than the period provided under the Limitation Act. Therefore, on this ground I reject the contention of the appellant that the arbitration proceedings were time barred.
5. So far as merits as to whether the appellant did the trades on instructions of the respondent or without any instructions is concerned, it will be necessary at this stage to state that a court hearing objections under Section 34 of the Act does not sit as an appellate court to reappraise the findings of facts and conclusions arrived at by the arbitrator in terms of the evidence on record. Courts only interfere under Section 34 when the Award is against the contractual provisions or against the law or perverse. This is held by the Supreme Court in the case of ONGC Ltd. Vs. Saw Pipes Ltd. FAO 479/2013 Page 3 of 5 (2003) 5 SCC 705. If a court hearing objections under Section 34 has limited jurisdiction, then, this Court hearing an appeal against the judgment dismissing objections will have a further limited scope of hearing.
6. The arbitrator has found as a matter of fact that no evidence has been led by the appellant that any instructions were given by the respondent for conducting the alleged trades. Appellant did not file any telephonic record or relied upon any telephonic record with respect to issuing of any instructions for the trades by the respondent to the appellant. Arbitrator also notes that trades on certain days were so vast in number that it is not possible that such instructions could have been given on phone and transactions could only have been undertaken only if the transactions were being done online by the respondent, and which is not the case.
7. So far as the sending of notice by the appellant to the respondent is concerned, the arbitrator notes that contract notes if were sent in the electronic form, the respondent was entitled to contend that since no instructions for carrying out trades were given, he did not check the electronic account more so because the respondent was not a computer savvy person. So far as sending of any contract notes by post is concerned, appellant admittedly did not file any evidence that the alleged contract notes were sent to the respondent by post.
FAO 479/2013 Page 4 of 5
8. Therefore, at best there were two views possible in the situation. If out of the two possible views, arbitrator adopts one possible and plausible view, such a decision of the arbitrator cannot be said to be perverse for being interfered with under Section 34 of the Act, much less for this Court to entertain an appeal dismissing the objections under Section 34 of the Act.
9. In view of the above, there is no merit in the appeal, and the same is therefore dismissed, leaving the parties to bear their own costs.
MARCH 27, 2014 VALMIKI J. MEHTA, J.
ib
FAO 479/2013 Page 5 of 5