Bombay High Court
Municipal Corporation Of Greater ... vs Walter Bau Ag(I.I.) on 7 October, 2019
Equivalent citations: AIRONLINE 2019 BOM 2034
Author: R.D. Dhanuka
Bench: R.D. Dhanuka
This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019
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26-NMCDL2257.19
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION (L) NO. 2257 OF 2019
IN
COMM. ARBITRATION PETITION (L) NO. 1111 OF 2019
Municipal Corporation of Greater )
Mumbai, )
Constituted under the provision of )
Mumbai Municipal Corporation Act, 1888,)
having its Office at Mahapalika Marg, )
Nagar Chowk, Fort, Mumbai - 400 001 )
through the Municipal Commissioner ) ..... Applicant
(Org.Petitioner)
IN THE MATTER BETWEEN
Municipal Corporation of Greater )
Mumbai, )
Constituted under the provision of )
Mumbai Municipal Corporation Act, 1888,)
having its Office at Mahapalika Marg, )
Nagar Chowk, Fort, Mumbai - 400 001 )
through the Municipal Commissioner ) ..... Petitioner
VERSUS
Walter Bau AG (i.I.), )
a company incorporated under the laws )
of Federal Republic of Germany, )
represented by the Insolvency Administrator,)
Mr.Werner Schneider, acting through )
his Power of Attorney holder )
Mr.Anthony Moonjely, having its office )
at Strabag India Private Limited, )
406, Southern Park, d2 District Centre, )
Saket, New Delhi, India 110017 )
(Authorised Representative of Dywidag )
International GmbH) ) ..... Respondent
Mr.Yashodeep Deshmukh, a/w. Mr.Sandeep Patil, i/b. Ms.Aruna Savla
for the Applicant/Petitioner.
Mr.Gaurang Mehta, a/w. Ms.Sneha Shukla, Ms.Vidya Chaudhari, i/b.
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This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019
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26-NMCDL2257.19
M/s.Chambers of Javed Gaya for the Respondent.
CORAM : R.D. DHANUKA, J.
DATE : 7th OCTOBER, 2019
ORAL JUDGMENT
By this notice of motion, the appellant (original petitioner) seeks condonation of delay of one day in filing Commercial Arbitration Petition (L) No.1111 of 2019 filed under section 34 of the Arbitration and Conciliation Act, 1996 against the impugned award dated 6 th March,2018 and corrected award dated 11th September,2018 and the majority award dated 12th April, 2019. Some of the relevant facts for the purpose of deciding this notice of motion are as under :-
2. The Arbitral Tribunal had rendered the arbitral award on 6 th March,2018. A copy of the arbitral award was received by the parties on the same day from the Arbitral Tribunal. The respondent herein thereafter filed an application under section 33(1) of the Arbitration Act on 2nd April,2018 inter alia praying for rectification and/or correction of certain errors in the original award dated 6th March,2018. There was no response filed by the applicant herein to the said application dated 2nd April,2018. On 11th September,2018, the Arbitral Tribunal passed an order correcting some of the errors in the original award. In paragraph (7) of the said order dated 11 th September,2018, the date mentioned in paragraph (25) as 6th August, 2013 was corrected as 25th August,2006. A copy of the said order dated 11th September,2018 was served upon both the parties by the Arbitral Tribunal.
3. The applicant herein thereafter made an application on 5 th October,2018 before the Arbitral Tribunal under section 33(1) of the Arbitration Act inter alia praying for making correction of the date ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 3/13 26-NMCDL2257.19 mentioned as 25th August, 2006 as 14th April,2015 in the order dated 11th September, 2018 which was the date of filing the statement of claim by the respondent. The said application was opposed by the respondent by filing an affidavit in reply dated 10 th October,2018. Two of the members of the Arbitral Tribunal passed an order on 12 th April,2019 rejecting the application filed by the applicant whereas one of the arbitrator passed a separate and dissenting order on 17 th April,2019 thereby correcting the date of the claim as prayed by the applicant in the said application under section 33. The petitioner has lodged this arbitration petition under section 34 of the Arbitration Act inter alia impugning the said award dated 6th March, 2018, order dated 11th September, 2018 and 17th June, 2018. There is delay of one day according to the applicant in filing the arbitration petition which is sought to be condoned in this notice of motion.
4. Mr.Deshmukh, learned counsel for the applicant invited my attention to the original award rendered by the Arbitral Tribunal dated 6th March,2018 and more particularly paragraph 25(c) and would submit that though the date of the claim made by the respondent was 14th April,2015, the Arbitral Tribunal had inadvertently mentioned the said date as 6th August,2013. He submits that even while considering the application for correction made by the respondent under section 33 of the Arbitration Act though this inadvertent error was pointed out by the learned counsel for the applicant herein, in the order of correction made by the Arbitral Tribunal, the date of claim was not corrected as 14th April,2015 but was corrected as 25th August, 2006. The applicant was thus required to file a separate application under section 33 of the Arbitration Act inter alia praying for correction of the date which was mentioned in the original award as 6th August,2013 and subsequently ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 4/13 26-NMCDL2257.19 corrected as 25th August,2006 and not as 14th April,2015.
5. Learned counsel invited my attention to the averments made by the applicant in the said application before the Arbitral Tribunal on 5th October,2018 and the averments made therein, the reply filed by the respondent on 10th October,2018 and the order passed by the two arbitrators rejecting the application filed by the applicant and the third arbitrator allowing the application filed by the applicant. He submits that since there was an inadvertent error crept in the original arbitral award as well as in the order regarding the date of claim, an application filed by the applicant herein under section 33(1) was maintainable.
According to the learned counsel the error crept in the original arbitral award and the order dated 11th September, 2018 insofar as the date of claim mentioned was clerical error or the error of similar nature.
6. It is submitted by the learned counsel that the period of limitation prescribed under section 34(3) of the Arbitration Act thus would commence from the date of receipt of the signed copy of the additional award/order dated 12th April, 2019/17th April, 2019 passed under section 33(2) of the Arbitration Act which was received by the applicant. Within a period of three months and 31 days from the date of receipt of the signed copy of the said orders, on 20 th June, 2019 the applicant filed this petition under section 34 of the Arbitration Act i.e. belatedly by one day. He submits that the applicant has made out a case for condonation of delay of one day in filing arbitration petition for the reasons recorded in the affidavit in support of the notice of motion.
7. Mr.Mehta, learned counsel for the respondent strongly opposed ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 5/13 26-NMCDL2257.19 the notice of motion for condonation of delay of one day on various grounds. It is submitted by the learned counsel that the application for correction in the date of statement of claim made by the applicant itself was not maintainable and would not fall under any of the ground available under section 33 of the Arbitration Act. He submits that the application made by the applicant was based on the premise that what was orally transpired before the Arbitral Tribunal in the meeting held on 20th August,2018 was not translated in the order dated 11 th September, 2018 rendered on the application made by the respondent. It is submitted that since the application itself was not in accordance with the section 33(1)(a), the order passed by the Arbitral Tribunal on such application would not extend the period of limitation prescribed under section 34(3) of the Arbitration Act. In support of this submission, learned counsel invited my attention to the averments made in paragraph (2) of the application dated 5 th October,2018 filed by the applicant. He also strongly placed reliance on the judgment of Supreme Court in case of State of Arunachal Pradesh vs. M/s.Damani Construction in Appeal (Civil) No.1099 of 2007 and in particular paragraphs on pages 3 and 4.
8. The next submission of the learned counsel is that the limitation for filing an application under section 34 would commence from the date of disposal of the application under section 33 and not from the date of receipt of signed copy of the order from the Arbitral Tribunal. He submits that the order passed by the Arbitral Tribunal even if considered as supplementary award which was passed by the majority arbitrators on 12th April,2019 and passed by the third arbitrator on 17 th April,2019, the arbitration petition is filed beyond the period of three months and 30 days and thus delay being more than 30 days after ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 6/13 26-NMCDL2257.19 expiry of three months from the date of disposal of the application filed by the application under section 33, delay cannot be condoned by this court. In support of this submission, learned counsel placed reliance on the order dated 8th August,2018 passed by the Hon'ble Supreme Court in case of M/s.Ved Prakash Mithal and Sons vs. Union of India in Petition(s) for Special Leave to Appeal (C) No(s) 20195 of 2017.
9. Mr.Mehta, learned counsel for the respondent also placed reliance on an unreported judgment of this court in case of Dr.Writer's Food Products Pvt. Ltd. & Ors. vs. The Cosmos Co-operative Bank Limited in Commercial Arbitration Petition No.486 of 2017 and in particular paragraphs 12 to 15. It is submitted that since the application filed by the applicant for correction of the alleged error in the order dated 11th September, 2018 itself was not maintainable, the applicant would not get extension of time to file arbitration petition under section 34 upon receipt of the order dated 12th April, 2019/17th April, 2019.
10. Learned counsel placed reliance on an unreported judgment of this court in case of Schokhi Industrials Pvt. Ltd. vs. Maharashtra State Power Generation Co. Ltd. in Notice of Motion No.468 of 2018 in Commercial Arbitration Petition (L) No.484 of 2017 and in particular paragraphs 12 to 14 in support of the submission that the application under section 33 itself being not maintainable, no fresh period of limitation would be available to the petitioner for filing petition under section 34. It is submitted by the learned counsel that the order passed by the Arbitral Tribunal on the application filed by the respondent and on the application filed by the applicant could not be treated as supplementary award contemplated under section 33(4) of the Arbitration Act.
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11. Learned counsel for the applicant in rejoinder would submit that since the applicant had applied for correction of the inadvertent date of claim mentioned in the original award which error continued even in the order passed on the application filed by the respondent no.1, the same would fall under section 33(1)(a) of the Arbitration Act and thus application filed by the applicant was maintainable.
12. Insofar as submission of the learned counsel for the respondent that the period of limitation for filing the petition would commence only from the date of disposal of the application under section 33 is concerned, it is submitted by the learned counsel that under section 33(7) of the Arbitration Act, the Arbitral Tribunal was bound to serve a signed copy of the order passed under section 33 as contemplated under section 31(5) of the Arbitration Act, limitation would commence only upon service of signed copy of the supplementary award or an order under section 33 passed by the Arbitral Tribunal. In support of this submission, Mr.Deshmukh, learned counsel placed reliance on the judgment of Supreme Court in case of Anilkumar Jinabhai Patel (D) Thr. LRs. vs. Pravinchandra Jinabhai Patel & Others decided on 27th March,2018 in Civil Appeal Nos. 3313, 3314 of 2018 and in particular paragraphs 15 and 16.
REASONS AND CONCLUSION
13. A perusal of the record indicates that the original arbitral award was rendered on 6th March,2018. In paragraph 25(C), the Arbitral Tribunal has awarded interest in favour of the respondent (original claimant) at the rate of 12% per annum on the sum awarded in ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 8/13 26-NMCDL2257.19 paragraph 25(b) from the date of the claim mentioned as 6th August,2013 till the date of realization. The respondent had made an application under section 33(1) for correcting various inadvertent errors as claimed by the respondent in their application filed before the Arbitral Tribunal. The respondent also applied for correction of date of claim mentioned in para 25(c) as 6th August,2013 to 25th August,2006. On 11th September,2018, the Arbitral Tribunal corrected various inadvertent errors in paragraphs 1 to 6 of the said order dated 11 th September,2018. However in paragraph (7) of the said order dated 11 th September, 2018, the date mentioned in paragraph 25 as 6th August,2013 was corrected as 25th August, 2006 as prayed in the application filed by the respondent under section 33(1) filed by the respondent.
14. It is the case of the applicant that since the Arbitral Tribunal had awarded the interest from the date of claim which was admittedly filed on 14th April,2015, the Arbitral Tribunal not having corrected the said date even in the order passed under section 33 which error having continued in the original award as well as in the order passed under section 33, the applicant filed the said application under section 33(1)
(a) for correction of the date of the claim.
15. In the application filed by the applicant, the applicant has also recorded what was allegedly transpired in the meeting held before the Arbitral Tribunal on 20th August, 2018 insofar as the date of institution of the claim is concerned. It is the case of the applicant that the Arbitral Tribunal had confirmed in the said meeting that the said date would be corrected in paragraph (c) and the said date would not be corrected to 25th August,2006. Two of the arbitrators rejected the ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 9/13 26-NMCDL2257.19 application filed by the applicant on the ground that the same was not within the parameters of section 33(1) of the Arbitration Act. The third arbitrator made a dissenting order and allowed the application filed by the applicant.
16. The first question that arises for consideration of this court is whether the application filed by the applicant was within the parameters of section 33 of the Arbitration Act or not.
17. A perusal of the original award dated 6th March,2018 clearly indicates that the Arbitral Tribunal had while allowing the claim for interest at the rate of 12% per annum on the amount awarded in paragraph 25(b) from the date of claim, the Arbitral Tribunal however had inadvertently mentioned the date of claim as 6 th August,2013. The respondent had applied for correction of the date as 25th August,2006 as against 6th August,2013. The Arbitral Tribunal even in the said order dated 11th August,2018 did not clarify that the date of claim was 14 th April, 2015 though appears to have been canvassed by the applicant before the Arbitral Tribunal while hearing the application filed by the respondent under section 33.
18. In my view, since the interest awarded by the Arbitral Tribunal in the original award dated 6th March, 2018 was from the date of claim, which was mentioned as 6th August,2013 in the original award, it was at the first instance an inadvertent error or a case of typographical error or error of similar nature which could be corrected by the Arbitral Tribunal under section 33(2). The said error however was not corrected even in the application filed by the respondent under section 33 though appears to have been pointed out by the applicant. The ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 10/13 26-NMCDL2257.19 applicant therefore was required to file an application under section 33(1)(a) of the Arbitration Act for correction of the same error which originally crept in the original award and thereafter in the order passed in the application filed by the respondent. In my view there is thus no substance in the submission made by Mr.Mehta, learned counsel for the respondent that the application filed by the applicant was not within the parameters of section 33(1) of the Arbitration Act.
19. The judgment of the Supreme Court in case of State of Arunachal Pradesh (supra) pressed in service by the learned counsel is clearly distinguishable in the facts of this case and would not assist the case of the respondent. Similarly the judgment of this court in case of Schokhi Industrials Pvt. Ltd. (supra) and in case of Dr.Writer's Food Products Pvt. Ltd. & Ors. (supra) would also not assist the case of the applicant for the similar reasons.
20. Insofar as judgment of this Court in case of Dr.Writer's Food Products Pvt. Ltd. & Ors. (supra) is concerned, this court had considered a situation where the application for correction of the award under section 33 was made beyond the period of limitation itself by one of the party. In the facts of that case this court accordingly held that since the application for correction was made under section 33 beyond the period of 30 days from the date of receipt of the signed copy of the award and admittedly after 16 years from the date of service of signed copy of the original award, the time for filing petition under section 34 was not extended. The facts before this court in case of Dr.Writer's Food Products Pvt. Ltd. & Ors. (supra) were totally different and thus are clearly distinguishable in the facts of this case.
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21. Insofar as judgment of Supreme Court in case of M/s.Ved Prakash Mithal and Sons (supra) relied upon by the learned counsel for the respondent is concerned, Supreme Court in the said judgment had interpreted section 34(3) read with section 33(1) of the Arbitration Act and has held that the expression 'disposal' mentioned under section 34(3) has to be either by allowing the application under section 33(1) or dismissing it. The said judgment does not decide as to whether the limitation under section 34(3) of the Arbitration Act would commence from the date of service of the signed copy of the order under section 33 or not. The said judgment in my view thus would not apply to the facts of this case even remotedly.
22. Section 33(7) of the Arbitration Act clearly provides that section 31 shall apply to the correction or interpretation of the arbitral award or to additional award made under section 33. Section 31(5) of the Arbitration Act clearly provides that after the arbitral award is made, signed copy thereof shall be delivered to each party. In my view, there is no merit in the submission of the learned counsel for the respondent that time of filing of the arbitration under section 34 would commence upon the Arbitral Tribunal disposing of the application filed by the applicant in the month of April 2019 and not when the signed copy of the said order was served upon the applicant. This submission made by the learned counsel is also contrary to the judgment of Supreme Court in case of Anilkumar Jinabhai Patel (D) Thr. LRs. (supra).
23. Supreme Court in the said judgment adverted to the earlier judgment of Supreme Court in case of Union of India vs. Tecco Trichy Engineers and Contractors (2005) 4 SCC 239 in which it was held by ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 12/13 26-NMCDL2257.19 joint reading of section 34(3) and 31(5) of the Act it is clear that the limitation period described in section 34(3) would commence only from the date of the signed copy of the award delivered to the parties for making an application for setting aside the award. The principles laid down by the Supreme Court in case of Anilkumar Jinabhai Patel (D) Thr. LRs. (supra) would clearly apply to the facts of this case. In my view, till a signed copy of the order passed under section 33(2) is served upon the applicant as contemplated under section 31(5), the question of commencement of the limitation under section 34(3) of the Arbitration Act would not arise. In this case, an application filed by the applicant was dismissed by two of the arbitrators out of three arbitrators whereas third arbitrator passed dissenting order.
24. Section 34(3) which provides for limitation does not make any distinction in an order allowing or rejecting an application for correction and interpretation of award or for an additional award. There is thus no substance in the submission of Mr.Mehta, learned counsel for the respondent that fresh period of limitation under section 34(3) would not apply to an order passed under section 33(2) of the Arbitration Act.
25. The applicant has explained delay of one day in filing arbitration petition. In my view, the order dated 11 th September, 2018 and 12th April, 2019 have to be read with the original award dated 6 th March, 2018 for the purpose of limitation under section 34(3) of the Arbitration Act. In the facts of this case, the limitation under section 34(3) would commence from the date of service of the signed copy of the order dated 12th April, 2019 and 17th April, 2019 which were admittedly received by the applicant on 20th June, 2019. There is thus delay of one day in filing arbitration petition. I am inclined to accept ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 ::: This Order is modified/corrected by Speaking to Minutes Order dated 18/11/2019 kvm 13/13 26-NMCDL2257.19 the reasons recorded in the affidavit in support of the notice of motion for seeking condonation of delay of one day in the affidavit in support.
20. I, therefore, pass the following order :-
(a) Notice of motion is made absolute in terms of prayer clause (a) and (b). No order as to costs.
(b) The applicant is directed to remove all office objections if not removed within a period of two weeks from today and get the petition numbered. No order as to costs.
(c) The respondent would be at liberty to file affidavit in reply to the arbitration petition within four weeks from today and shall serve a copy thereof upon the petitioner's advocate.
(d) Rejoinder, if any, shall be filed within two weeks thereafter with a copy thereof to be served upon the respondent's advocate simultaneously.
(e) Both the parties are at liberty to file compilation of the pleadings and documents forming part of the record before the Arbitral Tribunal within four weeks from today.
[R.D.DHANUKA, J.] ::: Uploaded on - 15/10/2019 ::: Downloaded on - 20/04/2020 21:49:03 :::