Bangalore District Court
K P Nirmala vs Ravindra Kumar D on 28 February, 2024
1
Com.AP.No.45/2022
KABC170013502022
IN THE COURT OF LXXXII ADDL. CITY CIVIL & SESSIONS
JUDGE, AT BENGALURU (CCH.83)
THIS THE 28th DAY OF FEBRUARY 2024
PRESENT:
SUMANGALA S. BASAVANNOUR., B.COM, LL.M.,
LXXXII ADDL.CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
Com.A.P.No.45/2022
BETWEEN:
1. Smt. K.P.Nirmala
W/o. Sri A Mahadeva Reddy
Aged about 43 years,
R/at No.952, Raja Palya, Hoodi,
Mahadevapura Post,
Bengaluru-560048
2. Sri. A Mahadeva
Reddy S/o. Anjinappa
Aged about 49 years,
R/at No.952, Raja Palya, Hoodi,
Mahadevapura Post,
Bengaluru-560048
2
Com.AP.No.45/2022
3. Sri. A Ramesh
S/o. Late Sri Appaiah,
Aged about 49 years,
R/at No.309, Basavanna
Nagar, Hoodi,
Mahadevapura Post,
Bengaluru-560048
4.Sri. A Vijayakumar
S/o. Late Sri Appaiah,
Aged about 41 years,
R/at No.309, Basavanna
Nagar, Hoodi,
Mahadevapura Post,
Bengaluru-560048 PLAINTIFFS
(Represented by Prasad
B. Advocates)
AND
1. Sri. Ravindra Kumar D
S/o. Late Sri. Mallikarjun
D aged about 52 years
R/at No.63/2, A Type
KPWD Quarters, Jeevan
Bheemanagar Main
Road, Bengaluru-560075
3
Com.AP.No.45/2022
2. Sri. Govind Rao
S/o. Sri. K.S.Srinivasa
Rao aged about 53
years. R/at No.1354, 32nd
Cross, 4th T Block,
Jayanagar, Bengaluru-
560041
3. Sri. H.M.Thyagaraja
S/o. Late Sri.
H.R.Muniswamy Setty,
Aged about 49 years,
R/at Muniswamy Setty
Layout, Hoodi,
Mahadevapura Post,
Bengaluru-560048
4. Sri. S.Siddalingesh
Sole Arbitrator
Arbitration Center-
Karnataka (Domestic
and International)
Bengaluru
DEFENDANTS
(Respondent No.1 & 2
represented by B.G.
Vasanth Kumar and
Respondent No.3
represented by Sri. K.S.
HArish Advocate)
4
Com.AP.No.45/2022
Date of Institution of the 23.05.2022
suit
Nature of the suit (suit on
pronote, suit for Petition for setting aside
declaration & Possession, Arbitral Award
Suit for injunction etc.)
Date on which judgment 28.02.2024
was pronounced
Total Duration Year/s Month/s Day/s
01 09 05
(SUMANGALA S. BASAVANNOR),
LXXXII Addl. City Civil & Sessions Judge,
Bengaluru.
JUDGMENT
This Petition is filed under Section 34 of the Arbitration & Conciliation Act, 1996 for setting aside the Award dated 10.04.2014 passed by the sole arbitrator/ 4 th defendant in arbitration case No.24/2013 by the Arbitral Tribunal.
5Com.AP.No.45/2022
2. The Brief facts leading to the case are as follows:-
The 4th Defendant/ tribunal after hearing the parties passed an award 10.04.2014 awarding of Rs. 60,72,499/-. (a) expenses incurred as stated earlier amounting to Rs. 35,27,004/- (b) Damages payable for idle investment by way of expenses incurred on Rs. 11,70,000/- @ Per annum for a period of 5 years Rs. 5,26,500/-. (c) Amount eligible instead of as stated in para 25 of the claim statement @ Rs. 54,88,405/- and Rs. 20,18,995/-. Together with current and future interest from the date of the claim petition i.e., 09.12.2013 till the date of payment at 9% per annum. The Plaintiff's being aggrieved by the Impugned award begs to prefer this application. The award passed by the learned arbitrator/ 4th Defendant is bad in law and is in violation of the terms of the MOU executed between the parties and deserves to be set aside. The Plaintiff hence begs to prefer this application on the following among other grounds:
GROUNDS
a) The impugned award passed by 4th defendant is incorrect and opposed to public policy within the meaning of section 34 of the Arbitration and Conciliation Act, 1996.6
Com.AP.No.45/2022
b) The impugned award is patently illegal and squarely opposed to the terms of the MOU entered into between the parties, the facts of the case, the substantive law applicable to the disputes the evidence on record and the pleadings of the parties put forth respectively.
c) The impugned award is ultra virus the terms of reference and adjudicate matters that were beyond the scope of dispute and were otherwise not arbitral.
d) The MOU executed between the plaintiff, defendant No.3 and defendant No.1 and 2 was only for an area of 17,000 Sq. ft, amounting to 0-15.61 guntas that has been specifically mentioned in the MOU which is the binding contract. The respondent 1 and 2 in the Arbitration as admittedly converted an area of 30,677 Sq.ft, further in terms of the MOU the plaintiffs and defendant No.3 were only to bear a maximum sum of Rs.2,00,000/- towards getting the land converted from Agricultural to Non-Agricultural Residential purposes and any amount spent over and above Rs.2,00,000/- was the account of the defendant No.1 and 2. The learned arbitrator with utter disregard to the MOU has wrongly interpreted the MOU and even the additional cost incurred by the defendant No.1 and 2 has been 7 Com.AP.No.45/2022 burdened on the plaintiffs and defendant No.3. Hence any additional cost incurred towards conversion of the land and other expenses cannot be burdened on the plaintiffs and defendant No.3.
e) The learned arbitrator has ignored the provision under clause-1 sub para 2 read with para -5 of the MOU is unduly favoring the defendants No.1 and 2. This is patently illegal, as a clear reading of the para -1 sub- para 2 read with para-5 of the MOU cannot be interpreted in any manner other than that the plaintiffs and defendant No.3 were only to bear a maximum sum of Rs.2,00,000/- towards getting the loans converted from Agricultural to Non-Agricultural-Residential purposes and any amount spent over the above Rs.2,00,000/- was to the account of the defendant No.1 and 2. It is trite that any agreement, MOU or a contract should be read to harmonize the conditions and not to create conflict. The findings of the learned arbitrator in para-20 of the award is patently wrong in view of Para- 12 of the affidavit if CW-1 read with para-1 sub-para-2 and para-5 of the MOU. The learned arbitrator has failed to recognize the principles of interpretation of contract ignoring the specifically agreed terms. Hence the impugned award is liable to be set aside.
8Com.AP.No.45/2022
f) The learned arbitrator at para-22 of the impugned award has wrongly held against the provision of the MOU that the conversion cost includes all the expenses towards approval from competent authorities. The condition imposed by the office of the Deputy Commissioner for taking clearance from competent authorities was to the cost of the defendant No.1 and 2 and it cannot be burdened on the plaintiffs and defendant No.3 as per the MOU, since the maximum amount the plaintiffs and defendant No.3 were liable to pay is only Rs.2,00,000/- is a pre-estimated limit under the contract which alone could be burdened on the plaintiffs and defendant No.3 also, it is pertinent to mention that the condition imposed by the office of the Deputy Commissioner while issuing the order of conversion was not condition precedent but condition subsequent to obtain various clearance from other competent authorities. On account of an implacable interpretation of the contract as can be patently seen the impugned award suffers from patent illegally as it is against the terms agreed under the MOU.
g) The learned arbitrator has failed to appreciate that the conversion of the land was obtained by the claimants on 13.11.2008, wherein the land was 9 Com.AP.No.45/2022 converted from Agricultural to Non-Agricultural commercial purposes. The claimant had represented that they would get the claim schedule property converted from Agricultural to Non-Agricultural residential purposes as per the MOU at para 1 but they were able to secure conversion of the claim Schedule Property to commercial purposes. The claimant have adduced a document in their evidence of the city municipal corporation, Mahadevapura (CMC) exhibit PRO who apparently has permitted the usage of the commercially converted land to be put into residential use; in the instant case the competent authority to permit the change of land use in the Bengaluru Development Authority to permit the change of land use in the Bengaluru Development Authority and not the CMC.
h) At para-27 of the impugned award the learned arbitrator has included heads from (a) to (i) amounting to a total of Rs.35,27,004/- it is very pertinent to bring to the notice to this court that what was agreed in the MOU is only for the cost of conversion which is at Sl. No.(a) amounting to Rs.1,26,514/- under the MOU. All other costs from Sl. No.(b) to (i) as determined by the learned arbitrator are cost which are incidental, subsequent to 10 Com.AP.No.45/2022 obtaining conversion that cannot to construed par seas conversion cost as agreed under MOU. Even then there is a cap of Rs.2,00,000/- for the conversion cost which the petitioner and respondent Nos 3 to 6 have agreed under the MOU. Hence the only amount that can be awarded is Rs.1,26,514/- towards conversion. It is absolutely illegal to award all subsequent or remote costs as conversion cost. Hence, the award is liable to be set aside.
i) The learned arbitrator has wholly misunderstood the MOU and interpreted that the petitioner and respondents 3 to 6 are liable to pay an amount more than Rs.2,00,000/-also even without a JDA having been made. A plain reading of the MOU, para-5 makes it very clear that the total capping on the amount refundable by the petitioner and respondents 3 to 6 is only Rs.2,00,000/-. The learned arbitrator having observed that when the flats are constructed and divided at a ratio of 60:40 this amount was to be adjusted but that stage has not been reached. Under such circumstances the award of any amount more than Rs.2,00,000.
j) The learned arbitrator under issue-3 discussed at para- 25 to para 27 has assessed expenses incurred by way of 11 Com.AP.No.45/2022 salary paid to the employees of the defendant No.1 and 2 organization towards Liaoning work and other works at Rs.8,78,000/-. The learned arbitrator has failed to appreciate that claimants or their witnesses examined as CW-2 and CW-3 have not place even a shred of a document to show that they were employees of the claimant and were receiving salaries as alleged by them.
k) The learned arbitrator under Issue-3 discussed at para 7 has assessed fee payable to the Architect at Rs.1,50,000/- though the claimants have categorically agreed that they have not paid the said amount is only an estimate. The learned arbitrator has failed to appreciate that fact that the claimants have not even place the quotation of the Architects, professional charges but has yet considered the same to be as reasonable to recover from the petitioner and respondents 3 to 6. As such the impugned award is patently illegal and against the agreed MOU and hence this award is liable to be set aside.
l) The learned arbitrator has failed to appreciate that the respondent No.1 in his cross examination has denied his signature on the plan sanction (Exhibit P11 and P11(a). in the present instance, the burden is cast upon the 12 Com.AP.No.45/2022 claimants to lead the evidence of the handwriting expert to prove that the signature on plan sanction was infact that of the respondent No.1. The claimants have failed to lead the evidence of the hand-writing expert. As such, it has to be presumed that the respondent No.1 did not sign on the plan sanction or the Hon'ble Arbitrator had to verify the same and give a finding on the same.
l) The learned arbitrator under issue -3 para -31 to 34 has assessed remote damage including the interest computed at 9% p.a. on the damages for idle investment, damages towards dead investment, expenses incurred by way of salary paid to the employees of the defendant No.1 and 2 towards Liaoning work. All these are remote to the contract and not in terms of the contract where only conversion fee with a cap of Rs.2,00,000/- would be payable. As such the impugned award is patently illegal and against the agreed MOU and hence this award is liable to be set aside.
m) The plaintiffs No.1, 2 and 4 have represented before the 4th defendant through their counsel, thereafter they have not contested the case. The plaintiff No.3.
13Com.AP.No.45/2022
n) Thus on all the claims awarded finally under para - 39 it is submitted that this amount of Rs.60,72,499/- is patently illegal and against the agreed MOU for the reasons stated above and hence this award is liable to be set aside.
o) The various calculations made in the impugned award and the quantum of compensation granted are contrary to the terms of the MOU, viewed from any angle the impugned award is patently illegal being in violation of the applicable Indian law and public policy of India.
p) The petition craves leave to they rely upon the contents of the said records and other materials placed before the Arbitral Tribunal, at the time of hearing.
q) The petitioner reserves the right to add, vary, modify elaborate, submission of additional supporting documents/correspondence as may be deemed appropriate and to make detailed submission based thereon.
r) The various grounds urged above are in the alternative and are raised without prejudice to one another.
14Com.AP.No.45/2022
s) The cause of action arose on 10.04.2014 when the arbitral tribunal passed and the impugned award awarding the defendants No.1 and 2 a sum of Rs.60,72,499/- together with current and future interest from the date of the claim petition i.e., 09.12.2013 till the date of payment at 9% p.a. holding issues 2 and 3 in favour of the defendants NO.1 and 2.
t) The MOU was executed in Bengaluru. As such this court has the jurisdiction to entertain this petition.
u) This application is not within the prescribed period of three months prescribed U/s. 34 of the Act, but is within the limitation prescribed under the proviso to sec. 34(3) of the Act. A separate application in this regard is preferred by the plaintiffs.
v) The plaintiff has not filed any other suit on the same cause of action, before any court of law either past, present.
3. The Respondent filed objection by stating that the grounds of the petition do not hold water. The Petitioners have made their appearance through their counsel before the Hon'ble Arbitrator and Respondent No.3 had vigorously 15 Com.AP.No.45/2022 contested the matter both before the arbitrator and also before the Hon'ble City Civil and Sessions Judge in both the stages either the Respondent No.3 or the petitioners did not come with such contention of unduly favouring paragraphs in the MOA dated 10.09.2005 but suddenly at belated stage after nearly 8 years of elapsed time period the petitioners are coming up with such statements and this shows the attitude of the petitioners in playing delay tactics and misleading the courts in several ways. The petitioners had such contentions they were free to take up such contentions before the Hon'ble Arbitrator but since the petitioners had slept over the said contentions for a period of more than 8 years and now it is not open for the petitioners to take such contention since they are estopped from taking such contentions at this belated stage. The Respondent No. 1 and 2 alone have not spent money of more than 2.00 lakhs without the knowledge of the petitioners and Respondent No.3. The Respondents No.1 and 2 have not done the conversion of land alone or have not alone got the permission from the various authorities before conversion it was very well approved and accepted by the petitioners and respondent No.3 by affixing their signatures on various applications made to the said various authorities and also have personally inspecting the developments made, on a 16 Com.AP.No.45/2022 regular basis with the Respondent No.1 and 2 and further the petitioners had also received a copy of the conversion order sent by the office of the Special Deputy Commissioner and had the knowledge of what approvals to be taken before conversion. The learned arbitrator in para-20 of the award are correct and have done after appreciation of evidence on record. The office of the Deputy commissioner had sent a copy of the conversion and hence the same is well within the knowledge of the petitioners and further more the petitioners did not object for the same in any manner and nor raised any objection in arbitration suit and led any evidence rebutting the same and hence in view of the same the petitioners is estopped form taking such contention. As per the version of the petitioners themselves that the land use was permitted to residential use by the CMC mahadevpura until and unless it was challenged the same will holds good and in view of the same the petitioners and respondent NO.3 cannot take undue advantage of the statement that the same could have been done by BDA and all these contentions could have been raised by appearing and contesting before the Hon'ble Arbitrator. The petitioners and Respondent No.3 had the full knowledge of what the respondent No.1 and 2 were doing and the said conversion is done with the due consent of petitioners and Respondent 17 Com.AP.No.45/2022 No.3 have to sign on several documents in order to procure the said conversion and this itself is a conclusive evidence to come to conclusion that the said conversion cannot be done without being obtained signatures of petitioners and respondent No.2 on this ground alone the petitioner is liable to be dismissed. The scope of the Section 34 of the Arbitration and Conciliation Act 1996 is very limited and brief it is not open for the petitioners to go deeply into merits or conducting of trial by the Hon'ble Arbitrator. The manner in which the section 34 is applicable has been clearly stated in the said arbitration and conciliation Act 1996 and the contentions taken by the petitioners in this petition are not within ambit of section 34 of the Act and there is no scope for detailed trial. There is an appeal pending before the Hon'ble High Court of Karnataka in MFA 849/2020 challenging the judgment and award in A.S. 81/2014 passed by Hon'ble VI Addl City Civil and Sessions Judge, Bangalore and in the said appeal the appellant have been ordered on 31.05.2022 to deposit 50% of the awarded money within 3 weeks but the said fact has been hided in the petition intentionally in order to mislead this court and interestingly the petitioners are also parties in the said appeal and the said petitioners intentionally avoided their appearance with a malafide intention of filing this frivolous 18 Com.AP.No.45/2022 petition. The petitioners had very well represented before the Hon'ble City Civil and Sessions Judge in Ex.2441/2014 from past several years and it is well within their knowledge about the existing litigation's but the Petitioners have malafidely pleading their ignorance about the proceedings only with an intention to drag the proceedings by taking undue advantage of the laws of the country and this amounts sheet abuse of process of law and hence the petition is liable to be dismissed at the first instance itself. Viewed from any angle the petition is meritless and mischievous and therefore it is liable to be dismissed.
(a). It is pertaining to note that along with plaint the Plaintiff has filed I.A. No.2 under Section 5 of limitation Act and prays that to condone the delay of 2830 in preferring the arbitration suit before this court.
(b). In enclosed affidavit Plaintiff stated on oath that in arbitration proceedings in the 4 th Defendant, the Defendants 1 and 2 have managed to obtain the impugned order dated 10.04.2014. The Defendant No. 1 and 2 has played a foul game/misrepresentation and managed to obtain the impugned order. They have not contested before the 4 th Defendant/sole arbitrator. The impugned order is one-sided one. The Plaintiffs came to know about the impugned order 19 Com.AP.No.45/2022 through some well wishers and later on enquiry came to know that the Defendants and 2 are trying to execute the impugned order of the 4th Defendant by filing execution petition before the court in Ex. No. 2441/2014. The Plaintiffs have obtained the certified copy of the order from the 4 th Defendant and engaged the counsel and preferring this arbitration suit challenging the order of the 4 th Defendant before this court. An opportunity of being heard may be given to us to establish our defence. The Defendants No.1 and 2 have suppressed the real and material facts before the 4th defendant. They were unaware of the order passed by the 4th Defendant, they were under financial crisis, and also health issues, due to the cheat and fraud played by the Defendants No.1 and 2 and they incurred huge loss during corona pandemic, that was adding fuel to fire. Hence there is a delay of 2830 days in preferring this appeal. Hence, he prays to allow the application.
4. Heard arguments and perused the records
5. Based on the above contentions of both parties, and the arguments of both Advocates, following Points arise for my consideration:-
20Com.AP.No.45/2022
1. Whether there are grounds to set aside the Impugned Award under Section 34 of the Arbitration & Conciliation Act?
2. What Order?
6. My findings on the above points are as follows:-
Point No.1:- In the Negative.
Point No.2:- As per the final Order for the following reasons.
REASONS
7. Point No.1: - The settled position in law that in proceedings under Section 34 of the Act, the Court does not sit in appeal over the Award. Thus, an Arbitral Award passed by an Arbitrator shall not be interfered with lightly. The Court can neither sit in appeal nor reassess or re-appreciate the evidence and the Arbitral Award can only be interfered with grounds stipulated in Section 34(2) of the Act.
8. It is settled position in law that an Award could be set aside if it is contrary to:-
(a) fundamental policy of Indian law; or
(b) the interest of India ; or 21 Com.AP.No.45/2022
(c) justice or morality ; or
(d) in addition, if it is patently illegal.
9. The illegality must go to the root of the matter and if the illegality is of trivial nature, it cannot be held that the award is against the public policy. Award could also be set aside, if it is so unfair and unreasonable that it shocks the conscience of the Court. Such an award is opposed to public policy and is required to be adjudged void.
10. Before going to the merits of this case, we have to consider application filed under section 5 of Limitation Act. In the present case the Petitioner has stated that the Defendants 1 and 2 have managed to obtain the impugned order dated 10.04.2014. The Defendant No. 1 and 2 has played a foul game/ misrepresentation and managed to obtain the impugned order. They have not contested before the 4th Defendant/sole arbitrator. The impugned order is one-sided one. The Plaintiffs came to know about the impugned order through some well wishers and later on enquiry came to know that the Defendants and 2 are trying to execute the impugned order of the 4 th Defendant by filing execution petition before the court in Ex. No. 2441/2014. The Plaintiffs have obtained the certified copy 22 Com.AP.No.45/2022 of the order from the 4th Defendant and engaged the counsel and preferring this arbitration suit challenging the order of the 4th Defendant before this court. They were unaware of the order passed by the 4th Defendant, they were under financial crisis, and also health issues, due to the cheat and fraud played by the Defendants No.1 and 2 and they incurred huge loss during corona pandemic, that was adding fuel to fire. Hence there is a delay of 2830 days in preferring this appeal.
11. The Respondent has stated that the petitioners were not in financial crises and infact the petitioners have sold some portion of the suit schedule property and had earned huge amount of money and this fact is reflected in the encumbrance certificate and as far the health issues is concerned there is o utterance of a single about the health issue either in arbitration proceedings, in appeal or in execution which were represented by some and contested by some of the petitioners. The huge loss during corona period is a filament of imagination and cooked up story because the liability and dispute for money started as long as in the year 2014 and pandemic had hit in the year 2020 and there is no clear and proper explanation for the huge delay of 2830 days and the reasons given are far beyond imagination and cooked up stories for the purpose of filing this false petition and only with an intention to harass by taking 23 Com.AP.No.45/2022 undue advantage of the due procedure of law. The Respondent No.1 and 2 will suffer irretrievable injury if the amount is not recovered since their hard earned money is lying idle and dead from past 17 long years ie. from the date of MOA which executed on 10.09.2005 and since then there has been no fruits yielded out the said investment and if the amount compared to today's escalation in price in the reality industry the same is peanuts and respondent No.1 and 2 would have earned much more big money if they had invested in other real estate projects and hence the recovery of the awarded money is very much needed for respondent No.1 and 2 since after losing so much of money respondent No.1 and 2 have literally suffered huge financial loss and are paying huge debts for having bought the money from friends relatives at the time of investing the same with the petitioners. Therefore, the petitioners are not entitled for any equitable relief of condonation of delay of huge number of 2830 days.
12. Section 34 (3) of Arbitration and Conciliation Act is reads as under :
"an application for setting aside an award shall not be entertained by the Court if it is made after three months have elapsed from the date on which the applicant had received the arbitral award".24
Com.AP.No.45/2022
13. The Respondent also produced Certified copy of the MFA filed by the Respondent No.3 before Hon'ble High Court of Karnataka in MFA No. 849/2020 under Section 37 (1) of the Arbitration and Conciliation Act 1998.
14. On perusal of the order passed in A.S. No. 81/2024, it reveals that the petition filed for setting aside the arbitral award dated 10.04.2014 passed in A.C. No. 24/2013 and also discloses that the HM Thyagaraja i.e., Respondent No.3 in the present case has filed the said petition under Section 34 of Arbitration and conciliation Act. Further, the order sheet also discloses that the present petitioner and respondent No. 1,2 and 4 all are the parties to this petition. Defendants though marked appearance through their counsel, have not chosen to file their written statement in this petition. Further, it reveals that the 6th Addl. City Civil and Sessions Judge has dismissed the petition filed by the Respondent No.3.
15. Further, it is also clear from the decree that this petition was filed on 11.08.2014 and petition was disposed off on 16.10.2019 and it also discloses that the Respondent No.5 is represented by advocate Sri. G. Papireddy i.e., Respondent No.5, A Ramesh in this case Petitioner No.3 25 Com.AP.No.45/2022
16. The Respondent also produced certified copy of the order sheet in Ex. No. 2441/2014 order sheet dated 29.05.2017 it discloses that the cause notice to JDR No's 2 to 5 served in person, but they are remained absent. Further, it is clear that the present petitioners have knowledge of the arbitration award passed in AC No. 24/2013 prior to 2019. Despite of the knowledge passing an award in Ac No. 24/2013, the present petition filed by the Petitioner under Section 34 of Arbitration and Conciliation Act on 18.05.2022 after 3 years. Though the Petitioners have knowledge of award passed in AC No. 24/2013 in the year 2019, but not filed the petition immediately after receiving the notice in AC No. 24/2013 and Ex. No. 2414/2014.
17. Section 31 (5) of Arbitration and Conciliation Act reads as under:
"After the arbitral award is made, a signed copy shall be delivered to each party."
18. The said provision is clearly indicates that a signed copy of award has to be delivered to the party. In the instant case the Plaintiff has not produced signed copy of the award. This petitioner is filed on the basis of photocopy of the award passed in AC No. 24/2013. Admittedly, this petition is filed delay in 2830 days. In this regard, as above stated, the Petitioner has 26 Com.AP.No.45/2022 stated due to financial crisis, and also health issues, due to the cheat and fraud played by the Defendants No.1 and 2 and they incurred huge loss during corona pandemic, that was adding fuel to fire. Hence there is a delay of 2830 days in preferring this appeal.
19. In this regard I relied upon a decision 2010 (4) AIR Kar R. 271 (DB) ( M/s Kotak Securities Limited vs. Chethan Bhandary and Others) in this decision the Hon' ble High Court held that the petition filed after 111 days from date of award, barred by limitation.
20. As per Section 34 (3) an application for setting aside an award shall not be entertained by the Court if it is made after three months have elapsed from the date on which the applicant had received the arbitral award, or if a request had been made under Section 33, from the date on which that request had been disposed of by the arbitral tribunal.
21. In this regard I relied upon a decision 2015 (4) AKR 593 (DB), (M/s M. Bhandari Metal and Alloy and others) it is held that the limitation would start from the date of actual receipt of arbitral award.
27Com.AP.No.45/2022
22. In the present suit there is no record before this court when the petitioner has received the arbitral award. According, to the Petitioner he has received the award immediately after knowing the filing of execution petition. The execution petition is filed in the year 2014. The cause notice was served on the JDR's/Petitioner as per order sheet of execution petition dated 29.05.2017. Even taking into considerations of service of cause notice in execution petition, it is clear that the petitioner have been obtained a certified copy of the award in the year 2017 itself. The present petition is filed in the year 2023. By looking to the any angle of this petition is not filed within limitation and petition is barred by limitation.
23. In Arbitration Appeal No. 26/2023 (Mathew P.J and another vs. Cholamandalam Investment and Finance Company Limited,), observed, "Insofar as challenge against arbitration award is concerned, the same is in accordance with Section 34 of the Arbitration and Conciliation Act, since specific period of limitation is provided therein. Therefore, Section 5 of the Limitation Act has no application to condone delay in filing a petition under Section 34 of the Arbitration and Conciliation Act. Section 34 of the Arbitration and Conciliation Act provides appeal to set aside an award."
28Com.AP.No.45/2022
24. In Kawal Singh Akbar v. Baldeo Singh Akbar, AIR 1957 Nagpur 57, the Nagpur High Court observed "It was held that the application to take the additional ground should be treated as a new application to set aside the award and must be dismissed as it was barred by limitation. No quarter can, therefore, be given to the laches and delay which the appellant has been guilty of. The question, however, does notarise as Section 5 of the Indian Limitation Act does not apply to the proceedings under the Arbitration Act, and cannot, therefore, be invoked. We, therefore, affirm the finding of the court below that the application filed by the appellant to set aside the award was barred by limitation." In view of the aforesaid decisions, we are of the view that the court has no jurisdiction to condone the delay in filing an application to set aside the award under Section 33 of the Act. That would mean the Court has no power to invoke Section 5 of the Limitation Act in such situation. An application to set aside the award under Section 33 of the Arbitration Act is like an Original Suit. Section 5 of the Limitation Act does not apply to suits. In the present case, the application to set aside the award was filed in a suit by the respondent praying to pass a judgment and decree in terms of the award. Even in such situation the character of the application under Section 33 remains in tact. Further, the Arbitration Act does not provide that the powers contained in Section 5 of the Limitation 29 Com.AP.No.45/2022 Act would apply to the different proceedings under the said Act."
25. In the case of Union of India v/s. Popular Construction Co., reported in (2001) 8 SCC 470, wherein the Hon'ble Supreme Court apart from holding that the words "but not thereafter"
used in proviso to sub-section (3) of section 34 of the Arbitration and Conciliation Act, 1996 amount to an express exclusion within the meaning of section 29(2) of the Limitation Act, 1963, has also held that express exclusion can also be inferred from the history, scheme and objectives of the Arbitration and Conciliation Act, 1996. The Hon'ble Supreme Court after analyzing section 29(2) of the Limitation Act, 1963 and the scheme and object of the Arbitration and Conciliation Act, 1996 has held that section 5 of the Limitation Act, 1963 is not applicable to proceedings under section 34 of the Arbitration and Conciliation Act, 1996 for setting aside an arbitral award.
26. In Consolidated Engineering Enterprises v/s. Principal Secretary, Irrigation Department & Ors., reported in (2008) 7 SCC 169, wherein the Hon'ble Supreme Court has in paragraph 53 of its decision categorically held that the proviso to section 34(3) of the Arbitration and Conciliation Act, 1996, has the 30 Com.AP.No.45/2022 effect of excluding section 5 of the Limitation Act, 1963. In the said decision, the Hon'ble Supreme Court after confirming that in the decision in the case of Union of India v/s. Popular Construction Co. (Supra), a Division Bench of the Hon'ble Supreme Court has held that section 5 of the Limitation Act is not applicable to an application challenging an award under section 34 of the Arbitration and Conciliation Act, 1996 has proceeded to hold that the said decision cannot be construed to mean a ruling that the provisions of section 14 of the Limitation Act are also not applicable to an application challenging an award under section 34 of the Arbitration and Conciliation Act, 1996.
27. As above discussed, this petition is filed in delay of huge number 2830 days. In view of the Section 34 (3) of Arbitration and Conciliation Act, for setting aside an award shall not be entertained by the court if it is made after 3 months have elapsed from the date on which applicant had received the arbitral award. Further, in this case the petitioners have not produced certified copy of the award. Hence, the petition is not maintainable. Therefore, I answer this Point in the "Negative".
28. Point No. 2 :- Therefore, I proceed to pass the following Order.
31Com.AP.No.45/2022 ORDER The Petitions filed under Section 34 of the Arbitration and Conciliation Act, 1996, is dismissed.
The Office is directed to send copy of this judgment to both parties to their email ID as required under Order XX Rule 1 of the Civil Procedure Code as amended under Section 16 of the Commercial Courts Act.
( Dictated to the Stenographer, typed by her directly on computer, verified and then pronounced by me in open Court on this the 28th day of February, 2024).
(SUMANGALA S. BASAVANNOR), LXXXII Addl. City Civil & Sessions Judge, Bengaluru.