Bangalore District Court
Mr. Riyaz Ahmed Sharif vs M/S Purvankara Project Ltd on 1 July, 2021
1
Com.A.S.149/2018
IN THE Court OF LXXXVII ADDL.CITY CIVIL & SESSIONS
JUDGE, (EXCLUSIVE DEDICATED COMMERCIAL COURT)
AT BENGALURU (CCH.88)
THIS THE 1st DAY OF JULY 2021
PRESENT:
SRI.CHANDRASHEKHAR U., B.Sc., LL.M.,
LXXXVII ADDL.CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
Com.A.S.No.149/2018
PLAINTIFFS/ 1. Mr. Riyaz Ahmed Sharif,
APPELLANT: S/o Sri. A.Aziz Shariff (late)
Aged about 60 years,
R/at No.548, 8th Main,
4th Block, Koramangala,
Bangalore 560 034.
2. Maaz Ahmed Sharif
S/o Sri. A.Aziz Shariff (late)
Karnataka Administrative Service (Rtd),
For himself and as POA of 1st appellant
R/at No.548, 8th Main,
4th Block, Koramangala,
Bangalore 560 034.
(Reptd by learned counsel, PS)
AND
DEFENDANTS/ 1. M/s Purvankara Project Ltd.,
RESPONDENTS: No.130/1, Ulsoor Road,
Bangalore. Represented by
Managing Director,
Sole Arbitrator
Hon'ble Justice (retd)
Sri. Patri Basavanna Gouda,
ISRO Road, Judicial Layout,
RMV II Stage,
Bangalore - 94.
2
Com.A.S.149/2018
Date of Institution of the 13.07.2018
suit
Nature of the suit (suit on
pronote, suit for
declaration & Possession, Arbitration Suit
Suit for injunction etc.)
Date of commencement of -
recording of evidence
Date on which judgment
was pronounced 01.07.2021
Total Duration Year/s Month/s Day/s
02 11 18
(CHANDRASHEKHAR U),
LXXXVII Addl.City Civil & Sessions Judge,
(Exclusive dedicated Commercial Court)
Bengaluru.
JUDGMENT
The appellants have filed the above petition under Section 34 of the Arbitration & Conciliation Act, 1996, (hereinafter called 'the Act') for setting aside the Arbitration Award, dated 17 th December 2012, passed by the second respondent in CMP No. 83/2016.
2. The appellants have filed the application by showing them as appellants in the cause title and in fact, it could be 3 Com.A.S.149/2018 treated as suit as per the Karnataka High Court (conducting of Arbitration proceedings) Rules, are in the nature of application challenging the Award under Section 34 of the Act.
3. The appellants have stated that alleged Memorandum of Understanding, dated 24.2.2003, in support of immovable property in Sy.No. 52/1-A of Haralakunte Village, Begur Hobali, Bangalore South Taluk and the second petitioner/appellant is made as a party though he is only the Power of Attorney be that as it may. On the basis of Arbitration clause in the alleged MOU, the respondent got appointed the 2nd respondent as Arbitrator to adjudicate the alleged claim of the 1 st respondent. It is further, stated that it was well within the knowledge of the respondents that the appellant is facing litigation on the basis of an agreement of sale, dated 2.12.2004 infavour of one Purushotam V.L. Though, it is the contention of the appellant that the agreement infavour of said Purushotham has been cancelled, the said Purushotham has approached the Hon'ble District & Sessions Judge, Bangalore in OS No.990/2006 seeking to enforce the said agreement. The first respondent was also a party to the said suit and the Hon'ble City Civil Court has passed an order of temporary injunction, restraining the appellant from alienating the said property, vide Order dated 2.12.2006. The 4 Com.A.S.149/2018 respondent has entered into appearance on 4.4.2006 and has been aware of the said order, has suppressed the same and got an award. Being aggrieved by the Arbitration Award, dated 17.12.2012, 1st and 2nd respondent, the present petition is filed on the ground that the impugned award is not enforceable or executable besides unsustainable either in law or on facts and circumstances of the case. The Award is one sided and an ex- parte order without properly adjudicating the mutual claims of the parties. The second respondent has failed to take into consideration whether the alleged MOU is legally enforceable, besides having regard to Section 3 of the Limitation Act. The second respondent ought to have judicially applied mind regarding the question of limitation. Further, in the background of injunction order passed by the Hon'ble City Civil Court in OS No.990/2006 which was within the knowledge of the 1 st respondent. The impugned Order could be passed was necessarily to be adjudicated by the 2nd respondent, having failed to do so, the impugned award render itself unenforceable or unsustainable. The impugned award is unsustainable as the appellant was under medical duress for which the records are resubmitted. The impugned award is unsustainable as the appellant was not given proper notice and reasonable 5 Com.A.S.149/2018 opportunity of the proceedings, which disabled the appellant to present this case. The second respondent was pressurising the appellant for the sitting fees and the Advocate for the appellant had no other choice but to retire as the appellant was unable to instruct the advocate owing to the ill-health of the appellant. Further, non-payment of the sitting fees cannot entitle the respondent No.1 to get a decree, without considering the issue of Section 22 of the Specific Relief Act, more so, in the background of the order of injunction of a competent Court. The copy of the award was not given as per Section 31(5) of the Arbitration & Conciliation Act, 1996 and therefore, the limitation does not begin for the purpose of this appeal as such the appeal is in time. Accordingly, they have prayed for setting aside the award.
4. The respondent No.1 has filed objection statement stating that application is not maintainable and it is baseless, frivolous and liable to be dismissed. It is further stated that appellants have suppressed and misrepresented various material facts in the Arbitration Suit, as such the claim made by the Appellants are hit by the principle of "Falsus in Uno Falsus in Omnibus" and that the petitioner is not entitled to seek for any discretionary and equitably from this Court. The appellants are 6 Com.A.S.149/2018 not entitled to seek for any relief in the Arbitration Suit, filed under Section 34 of the Arbitration and Conciliation Act, 1996. The appellant have not made out any grounds available under Section 34 of the Act regarding incapacity or Arbitration Agreement is not valid, the appellant were not given proper notice of the appointment of an Arbitrator or of the Arbitral proceedings, or arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to Arbitration or it contains the decision on mater beyond the scope of the submission to Arbitration. The composition of the Arbitral Tribunal or the Arbitral procedure was not in accordance with the Agreement entered into between the parties or subject matter of the dispute is not capable of settlement by arbitration under the law for the time being in force or Arbitral Award is in conflict with the public policy of India. As per the order of the Hon'ble High Court of Karnataka in CMP No.83/2006, respondent No.2 was appointed as Sole Arbitrator to adjudicate the dispute between the parties for which the Appellant No.1 was a part and participated in the said proceedings. Subsequent to the above, Appellant No.1 and Respondent No.1 was notified about the first sitting of the Arbitral Tribunal by Respondent No.2, vide Notice, dated 7 Com.A.S.149/2018 23.5.2011. Subsequently, the Appellant No.1 based on the aforesaid intimation, participated in the arbitral proceedings. Further, after notice was served, Mr. B.S. Ramaprasad, appeared for Appellant No.1 and Mr. Maaz Ahmed Sharief, GPA Holder who is arrayed as Appellant No.2, was also appeared from 9.2.2012 to 25.2.2012. Thereafter, after retirement of the first counsel, one Mr. P.N. Harish, Advocate appeared for Appellant No.1 on 25.2.2012 and continued Vakalath till conclusion of the Arbitral proceedings. Therefore, the contention that Appellant No.1 was not notified etc cannot be accepted. Learned Arbitrator has given enough opportunity for 1st respondent to file written statement and even after granting sufficient time and change of counsel, written statement was not filed and case was posted for evidence. Even after, the case was posted for evidence, the appellant No.1 has not filed any written statement nor participated in the proceedings. Learned Arbitrator with the consent of the advocate for the applicant and respondent No.1 fixed venue of Arbitration, secretarial assistance, and remuneration of Arbitrator and also time for commencement of the proceedings. Everything is done in accordance with rules, but it is r appellant No.1, who did not file the same and participated in the proceedings. Therefore, 8 Com.A.S.149/2018 learned Arbitrator taken the written statement as not filed and proceeded with the Arbitration case. The Appellant No.2, who is GPA holder of Appellant No.1 had appeared before the Arbitral Tribunal on 9.2.2012 with respect of IA-1 and did not mention any reason for not filing objection and counter claim. Learned Arbitrator has given sufficient opportunity for filing written statement and contest the case. Regarding ill-health of the Appellant No.1, there is nothing in the petition what was the ill- health of the Appellant No.1 and what prevented him to appear before the Arbitral Tribunal. Nothing is forthcoming from where he was taking treatment. After recording evidence and hearing the parties, learned Arbitrator has passed award on 17.12.2012 and typographical error was corrected on 18.12.2012 and copy of the Award was sent to the Appellant No.1 by registered post. Regarding the suit filed in OS No.990/2006 by one V.L. Purushotam is of known fact, because the MOU was executed prior to the alleged sale agreement dated 2.12.2004. In order to defeat the rights of respondent no. 1, orders on IA-1, was obtained by 1st respondent with active connivance of said Purushotham. Accordingly, the Appellant No.2 has no personal interest and therefore he should not have joined as party in the present suit. Infact, Appellant No.1 entered into an MOU with 9 Com.A.S.149/2018 the respondent No.1 in respect of sale of the schedule property and subsequently, failed to perform contract and therefore, as per the arbitration clause available in MOU, by moving the High Court of Karnataka, Arbitrator was appointed, who conducted the Arbitration proceedings as per the Arbitration Tribunal rules and in accordance with the provisions of the Act, and therefore, the claim of the Appellant cannot be accepted. Accordingly, it has prayed for dismissal of the suit.
5. The Appellants have also filed IA-2 under Section 34(3) of the Arbitration & Conciliation Act, 1996 r/w Section 151 of CPC, seeking permission to raise additional grounds available under Section 31(5) of the Act. He has stated that for IA-2, the GPA holder of 1st Appellant sworn to an Affidavit stating that they were not aware of the passing of the award by the 2 nd respondent as no notice of the award has been sent to them. There was no occasion for the appellants to approach the Hon'ble Court, earlier. The award is one sided without appreciating Section 20 of the Specific Relief Act and Arbitrator has passed the award without giving notice and therefore, the same cannot be accepted. Since, the proceeding was conducted in the absence of the appellant, he has to incorporate the defence available under Section 31(5) of the Act. Regarding 10 Com.A.S.149/2018 notice, conducting proceedings and service of award copy, he has stated that there is no delay in approaching the Court and if he is not permitted to add additional grounds, he will be put to loss and accordingly he has prayed for allowing the application.
6. The respondent No.1 has filed objection stating that the application is not maintainable either in law or on facts. Appellant No.2 Mr. Maaz Ahmed Shariff, as a Power of Attorney Holder of appellant No.1, has filed the above appeal under Section 34 of the Act, seeking to set aside the Award, dated 17.12.2012 passed by the 2 nd respondent. Further it is stated that respondent No.1 has filed the above written statement, it may be treated as the part of the objection. Since, the date of transaction entered into with the respondent No.1, from the year 1990 to till date, appellant No.2 has been representing the appellant No.1, conducting the proceedings, including arbitral proceedings and defending the appellant No.1. All the communications for and on behalf of appellant No.1 has been made by the appellant No.2 at his address mentioned in the cause title. There is no question of raising /adding additional grounds when the very application itself is not maintainable. The appellants with clear knowledge of Arbitration proceedings, passing of award under Section 34 of the Act, kept 11 Com.A.S.149/2018 quiet, and have come before the Court belatedly. Accordingly, it has prayed for dismissal of the IA-2.
7. The appellants have filed IA-3 under Rule 12 of Karnataka Arbitration (Proceedings before Courts) Rules 2001 r/w Order 41 Rule 27 of CPC for permitting them to produce the additional documents for consideration.
8. The Power of Attorney holder of appellant No.1 has sworn to an Affidavit stating that he is representing 1 st appellant and sworn to an affidavit on behalf of 1 st appellant. It is stated that due to work pressure being an Executive officer, Haj Committee, when the arbitration proceedings were going on, especially before, after and during the Ramzan months, there were lot of travels all over the state on priority basis. Further, he was Director, Personnel & Environment in KSRTC, additional charge of security & vigilance and due to two postings, he could not effectively represent the Arbitration proceedings. He has stated that his wife had serious illness and diagnosed with "cerebellum atrophy, ataxia, the treatment was taken in Manipal Hospital and thereafter at All India Institute of Medical Sciences, New Delhi. Further, he had to travel to Rajastan for "Divine intervention" at Ajmir, Rajasthan and constrained to consult at 12 Com.A.S.149/2018 Sri. Gangaram Hospital, New Delhi and also consulted Dr Peter Newman, at Middleborough, United Kingdom. Regarding treatment of his wife, he has produced all the documents regarding illness of his wife and it requires a lot of time to take his wife to united Kingdom for treatment. Documents produced are necessary to prove the same under Rule 12 of Karnataka Arbitration (Proceedings before courts)Rules 2001.
9. The respondent No.1 has filed detailed objection to IA-3 stating that the application is not maintainable either in law or on facts and it is incompetent and devoid of merits and it has not met any of the conditions stipulated under Order 41 Rule 27 of CPC and appellant No.2 Maaz Ahmed Shariff as a Power of Attorney holder of Appellant No.1 has filed the above application under Section 34 of the Act, challenging the award passed by respondent No.2. The applicants have after lapse of so many years from the date of conclusion of the Arbitration proceedings and also from the date of filing of arbitration application have filed the present application belatedly and therefore it is not maintainable. The applicants have not approached the Hon'ble Court with clean hands and they have suppressed the material facts. The scope of Section 34 is very limited and in order to fill up the lacuna and latches on their side, the present application 13 Com.A.S.149/2018 is filed and there is no scope of production of documents. Admittedly applicant had appeared in Arbitration proceedings and had ample opportunity to produce these documents before the Arbitrator and conduct the case, however, the opportunity was not utilized. Though, the appellant No.2 was prevented from attending the Court, what was the bar for appellant No.1 to appear personally, is not forthcoming. There is nothing to show that what prevented appellant No.1 to appoint any other agent for conducting the case through said application. Therefore, the present application is not genuine one and made only to protract the proceedings. In view of the Section 25(b) and (c) r/w Section 4 and Section 32 of Act 1996, the Arbitral Award is final and binding on both parties. The applicants herein have waived off their right and have rights to appear and produce documentary evidence before the Arbitrator, despite being given ample opportunities. Under Order 41 Rule 27 of CPC, additional documents can be allowed only any of these situations have arrived, such as (a) when the trial Court has illegally refused the evidence although it ought to have been permitted. (b) When the evidence, sought to be adduced by the party was not available to it, despite the exercise of due diligence. (c) When additional evidence is necessary in order to 14 Com.A.S.149/2018 enable the appellate Court to pronounce the Judgment or any other substantial cause of similar nature. However, none of these situations are favourable in the circumstances, in the present case. No grounds are made out to produce these documents. Since application under Section 34 has limited jurisdiction, the documents cannot be received, unless it shows that there are not available inspite due diligence and those documents would not have played any role in adjudication of the case. There is no requirement of producing additional documents under Section 34 of the Act and it is nothing, but abuse of process of law and fraud on the Court. Accordingly, it has prayed for dismissal of the IA-3.
10. Heard, learned counsel for the plaintiff and defendant on IA-1 to 3 and main matter. When the case was posted for reply arguments, if any, learned counsel for the plaintiff did not appear. Accordingly, case was posted for Judgment by directing him to file written arguments, if any by 24.5.2021. In the meantime, learned for plaintiff sought to address his reply arguments through V.C and accordingly he was heard through VC besides permitting him to file written arguments within 14.6.2021 and posted the case for judgment on 17.6.2021. On 17.6.2021, he sent a mail expressing his inability to file written 15 Com.A.S.149/2018 reply argument on account of he being in quarantine. Again, case was posted on 28.6.2021 for pronouncement of judgment. On that day, learned counsel for plaintiff did not appear and therefore, notice was sent to him by mail to be present on 1.7.2021 for pronouncing judgment.
11. Now, the points that arise for my consideration are:-
1. Whether the appellants have made out the sufficient grounds to set aside the award, dated 17.12.2012, passed by respondent No.2 in CMP No.83/2006 on the ground that it is opposed to public policy and other grounds urged in the application?
2. Whether the appellants have made out sufficient reasons for adding additional grounds by way of amendment ?
3. Whether the appellants have made out the sufficient grounds to receive additional documents in the present proceedings?
4. What Order ?
12. My findings on the above Points are as under:
Point No.1 :- In the Negative.
Point No.2 :- In the Negative Point No.3 :- In the Negative Point No.4 :- As per the final Order for the following reasons.16
Com.A.S.149/2018 REASONS
13. POINT Nos.1 to 3: Learned counsel for the plaintiff would argue that though the Award was passed on 17.12.2016 by the respondent No.2, appellants were kept in dark without receiving copy of the award and also the notice of Arbitration proceedings. According to learned counsel for the plaintiff, Appellant No.2 was representing Appellant No.1 as per the General Power of Attorney and since learned Arbitrator insisted the counsel who was appearing for the 1 st appellant as his fee was not paid, there was no other go for his counsel to retire from the case. Since, his counsel retired, subsequently, without further notice, the order came to be passed and in fact, the Appellants were kept in dark about the further proceedings in the case and also award for non-compliance of Section 31(5) by the learned Arbitrator. When execution application was filed by the 1st respondent on the file of City Civil Court, Appellants came to know about award passed by the 2 nd respondent and immediately, they filed the present application. Therefore, there is no bar of limitation. Further, the appellant No.2 was prevented from appearing on behalf of the appellant No.1 for the reason that the wife of appellant No.2 was suffering from 17 Com.A.S.149/2018 some neurological disability, for which he had to attend her and take her to various hospitals including Gangaram Hospital, New Delhi and All India Institute of Medical Sciences, New Delhi. Wife of the 1st appellant was suffering from "cerebella atrophy, ataxia, and he had to consult a Dr. Peter Newman, at Middleborough, United Kingdom and he had to go there and therefore, he was prevented from appearing before learned Arbitrator in the arbitration proceedings. Regarding admission and other things, he has produced the documents along with application and those documents were considered, then, learned Arbitrator would not have passed award without hearing the appellants. Further, there was no notice of proceedings, as well as service of copy of award, the appellant wanted to take additional grounds available under Section 31(5) of the Act, which is condition precedent for enforcement of award. If the copy of the award is not furnished, then there is no question of enforcement of the same. Further, if the documents are not allowed to be produced, then appellants cannot prove that they were prevented from sufficient reasons in appearing before learned Arbitrator. In support of his argument, he took the court to the award passed by learned Arbitrator, wherein at running page No.30, wherein, the Arbitrator has signed the Award on 18 Com.A.S.149/2018 17.12.2012 and copy of the Award furnished to the claimant on the same day and since delivery was not effected on 17.12.2012 on the respondent i.e., appellant No.1 after correcting typographical error on 18.12.2012, copy was sent to the respondent. So, according to him, the endorsement in the last page of the Award by learned Arbitrator goes to show that award was corrected on 18.12.2012 and therefore, the said date has to be taken into consideration and further stamp duty was paid after 6 months and therefore, his application is within time from the date of knowledge. After referring to the award, learned counsel for the plaintiff took the Court to order sheet of the arbitration proceedings, right from the date of fixing the venue. After fixing Venue on 23.5.2011 notice was sent to the appellant as well as 1st respondent. The order sheet which is available in running page No.23 (53) , which is the order dated 17.12.2012 and the Arbitral Proceedings came to be terminated and signed copy of the award to be delivered to both the parties under Section 31(5) of Arbitration & Conciliation Act, 1996. On the right side of said note, claimant gave cheque No.675159, dated 18.12.2011 drawn on Allahabad Bank for Rs.27,000/- after deduction of TDS of Rs.15,000/- towards remuneration and it is also shown that the Award copy was sent 19 Com.A.S.149/2018 to respondent by RPAD on 17.12.2012 itself. If really correction was set right on 18.12.2012, then, sending of copy on 17.12.2012 appears to be false and again there is a note on the left side of the order sheet by showing the date as 18.12.2012, wherein, learned Arbitrator has written that "under Section 33(3) of the Arbitration & Conciliation Act, 1996, one word on operative portion of the award, a typographical error ("as per Court due to typographical error typed )" already notice was issued while making a note in the order sheet, the same was corrected under Section 31(5) of the Act, these corrected copy of the above order is being given to the parties, additional copy to be sent by courier to respondent again. So, learned counsel for the plaintiff harp upon the conduct of the Arbitrator in passing the award hurriedly that too, without service on the respondent. So, in order to prove all these aspects and inability on the part of the appellants to appear before the Arbitrator, the documents are necessary and if they are not allowed the appellant will be put to hardship.
14. Now, coming to the merits of the case, learned counsel for the plaintiff would argue that the award is against public policy and since there was no proper service, the appellant was prevented from appearing before the arbitration 20 Com.A.S.149/2018 proceedings, which is one of the grounds to challenge the Award. Further, the appellant has incapacity owing to ill-health of wife of the appellant No.2. Therefore, it is also one of the grounds and those grounds can be agitated only if documents are received and the additional grounds are ordered to be incorporated. So, according to him, the award is not sustainable.
15. Per contra, learned counsel for the defendant would argue that the appellants have filed the present appeal though it is not an appeal under Section 34 of the Act, have contended falsely about incapacity, inability , and who appeared before learned Arbitrator. In the said regard, he straight away took the Court to proceedings of the learned Arbitrator pursuant to order passed in CMP 83/2006. The first notice was issued by learned Arbitrator on 23.5.2011 for the parties for fixing remuneration of Arbitrator and other things. The parties were directed to appear before him at his Home Office, at Judicial Officers Layout, Sanjayanagar, Bangalore and they were directed to appear before him on 6.6.2011 at 5 pm and on 6.6.2011, learned Arbitrator sits in his Home Office and proceedings relating to that reveals that on behalf of the claimant one Mr. Suraj Govindaraj appeared along with the Manager of the claimant company. On behalf of the 1st respondent i.e., appellant No.1 21 Com.A.S.149/2018 herein, one Mr. Ramprasad , learned counsel for appellant company telephoned that he has met with an accident and he being shifted to hospital and requested for adjournment for the day, and it was rescheduled by 13.6.2012 on the same time and same venue. On 13.6.2011, both the counsel for the claimant and 1st respondent were appeared and it was agreed for the venue and other aspects and detail order sheet was prepared and advocate for claimant and respondent have signed the order sheet in the presence of learned Arbitrator. The claimant sent a cheque for Rs.88,500/- on 13.6.2011 for the fees and case was posted for filing claim settlement. After servicing notice to the respondent with copies of the claim settlement as well as other documents, the case was posted on 31.1.2012. On 13.1.2012, learned counsel for the respondent Sri. Ramprasad filed Memo of retirement for want of instruction. Accordingly, case was posted for further steps on 9.2.2012 and in the meantime, the 2nd respondent claiming to be a GPA Holder of 1st respondent prayed for time, accordingly, the case was posted on 24.2.2012 and on that day, one Mr. P.N. Harish, Advocate filed Vakalath on behalf of appellant No.1 herein. Thereafter, the case was posted on 26.3.2012. On that day, learned counsel for the appellant No.1 did not file written statement and 22 Com.A.S.149/2018 case was posted for evidence by stating that the defendant statement was not filed. The entire order sheet goes to show that the appellant No.1 appeared through appellant No.2 and also by senior counsel, but failed to file written statement, even after lapse of 9 months. So, according to learned counsel for the defendant, it is negligent on the part of the appellant to prosecute the case and therefore, the contention that they were prevented from sufficient cause etc cannot be accepted. Nowhere during the proceedings, it was submitted by appellant No.2 herein, that his wife was ill and therefore, he could not represent the appellant No.1 to file necessary documents. Even if, appellant No.2's wife was ill, appellant No.1 could have appointed some one else as GPA holder to prosecute the case and the non-appointment of another agent goes to show that willfully they avoided the proceedings and allowed learned Arbitrator to pass impugned order and therefore, the contention of the plaintiff cannot be accepted. Even after posting of the same for evidence, some more adjournments were taken by claimant. Therefore, the contention that the claimant counsel has taken original MOU by substituting copy is not a ground to blame the very order passed by learned Arbitrator. So, for every time, time was given that was not taken 23 Com.A.S.149/2018 note by respondent. Now, the arbitration proceedings was commenced from 23.5.2011 and continued till 18.11.2012. The medical documents produced by the appellants now, pertain to January 2009 to May 2011 and subsequent dates till 21.3.2012 and the last report is available is of the month December 2012. No doubt, there may be some documents, but which are not related to wife of the appellant No.1, but relates to the wife of the GPA holder. But, I do not know how these documents are relevant.
16. Now, coming to the acceptance of documents under Order 41 Rule 27 of CPC. The same can be accepted only by Appellate Court, if it is shown that (a) the Trial Court has refused to receive the documents. (b) When the evidence sought to be adduced by the party was not available despite due diligence. (c) when additional evidence is necessary in order to enable the Appellate Court to pronounce the Judgment or any other substantial cause was made out. No doubt the documents pertain to the time of Arbitration proceedings, but what prevented appellant No.2 to produce them before the Arbitrator and seek further time is not stated. Further it is not the case that they were produced before the Arbitrator, but refused by the Tribunal. Moreover, this Court, is not acting as an Appellate 24 Com.A.S.149/2018 Court, so as to invoke Order 41 Rule 27 of CPC. Further, those documents are not necessary to decide the case by learned Arbitrator.
17. Now, coming to the contention of the work pressure of the appellant No.2 during Ramdan period. According to him, he was appointed as Executive Officer of Haj committee and on and after 10.7.2012 until said date he was holding two posts. The Arbitration proceedings began on 6.6.2011 and several sittings took place on 13.6.2011, 25.7.2011, 23.9.2011, 17.1.2012, 31.1.2012, 9.2.2012, 20.6.2012, 27.6.2012, 20.7.2012, 17.11.2012, 19.10.2012, 25.10.2012, 1,11,2012 and finally on 17.12.2012. These problems could have been avoided by appointing new Power of Attorney, which was not done.
18. Regarding the contention that amended award was not sent to the appellant cannot be accepted, as it was sent on 17.7.2012 vide Postal receipt No. RK 086976400IN and it is returned back with shara "unclaimed" on 8.1.2013. When the postman has sent intimation about registered post and it is not accepted then what is the position of law has been explained in the case of Crown Worldwide Holdigns Ltd., Vs. Crown Relocations Movers & Packers reported in 2016 SCC 25 Com.A.S.149/2018 OnLine 15503. In the said decision, by referring to earlier decision in the case of Ispat Industries Limited, has held that once the notice is issued to the correct address, if it is not claimed by addressee, then it means that notice is being held duly served.
19. He has also cited another decision in the case of C.C.Alavi Haji Vs. Palapetty Muhammed and another reported in (2007) 6 SCC 555, wherein, at para No.13 and 14, it is held that "Section 114 of the Evidence Act, 1897 is applied to communication sent by the Court, it enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. But, the presumption that is raised under Section 27 of the General Clauses Act, 1897 is a far stronger presumption. Further, while Section 114 of the Evidence Act refers to a general presumption, Section 27 of the Act, refers to a specific presumption. So, when there is a presumption that if notice is properly addressed, then, it is deemed to have been served as per Section 27 of the General Clauses Act. There must be something to show by the appellants here that they were not residing in the address given before learned Arbitrator or in the Vakalath. In the absence of denial of the address or if there is 26 Com.A.S.149/2018 some proof to show that the notice and award copies were sent to wrong address, then, ofcourse, Section 27 of the Act does not come into picture. Therefore, I am of the view that the contention of the appellants that they were not served with summons of arbitration proceedings or copy of the award cannot be accepted.
20. Now, coming to the merits of the case, learned counsel for the 1st respondent would argue that the scope under Section 34 of the Act is limited, the award can be challenged, if it is against the public policy, interest of India or patent illegality or that, the 1st respondent was prevented from certain incapacity or any other grounds mentioned in Section 34(1) & (2) of the Act. In the said regard, the decisions in the case of ONGC Ltd., Vs. Saw Pipes Ltd., and Associate Builders Vs Delhi Development Authority, reported in (2015) 3 SCC 49. The appellants have failed to show that how they are aggrieved by the award passed by learned Arbitrator. The Appellant No.1 and 2 having participated in the Arbitration proceedings failed to file written statement, even after lapse of 9 months, then, their contention cannot be accepted. Appellant No.1 has slept over his right. Therefore, this Court cannot come to his rescue at this stage.
27
Com.A.S.149/2018
21. During the course of arguments, learned counsel for the respondent No.1 filed a Memo submitting the copy of the order sheet in Ex.1764/2013 along with sale deed by stating that the award has been executed and the respondent No.1 has taken possession of the property by depositing the consideration amount of Rs.1,22,66,190/- on 30.1.2019 itself. So, in view of the facts, I find no merits in the case.
22. Now, coming to the aspect of limitation. According to learned counsel for the plaintiff, they came to know about the award only when execution case was filed and immediately they have filed the Arbitration application, which was subsequently converted as A S 149/2018. Initially it was filed in the year 2015, the date of award is 17.12.2012. The execution came to be filed in EP No. 1764/2013. The Award copy sent by RPAD, which was unserved on 8.1.2013. Thereafter, after filing of the above execution, the notice was served on the appellant No.1, who appeared through Advocate on 28.11.2013. Under Section 34(3) the Award has to be challenged within 90 days and in exceptional circumstances, within 120 days from the date of award or service of the award. If the service of award is taken as 8.1.2013, then it should have been filed on 8.5.2013. 28
Com.A.S.149/2018 However, the original A.A application was filed on 29.3.2015, which is filed belatedly and there is no explanation. No application is filed to condone the delay, which is available under Section 34(3) of the Act. Initially it was three months, now in view of new amendment, it is made as 6 months. Since, the award was passed prior to the amendment, the law applicable is prior to the amendment and therefore, it should have been filed within 120 days with the application to condone the delay. In this regard, the decision in the case of P.Radha Bai Vs Ashok Kumar and another reported in (2019) 13 SCC 445, is relevant, wherein, it is held that:
"Section 29(2) of the Limitation Act, is divided into two limbs. This is evident from the conjunctive and" in the said provision. The first part stipulates that the limitation period prescribed by the special law or local law will prevail over the limitation period prescribed in the Schedule to the Limitation Act. In this case, the Arbitration Act is a "special law", which prescribes a specific period of limitation in Section 34(3) for filing objections to an Arbitral award passed under the 1996 Act and consequently the provisions of the Arbitration Act would apply. There is no provision under the Limitation Act dealing with challenging an award passed under the Arbitration Act. The second part mandates that Sections 4 to 24 of the Limitation Act will apply for determining the period of limitation" only insofar as, and to the extent to which they are not expressly excluded by such special or local law". Thus, the extent of the application of Sections 4 to 24 of the Limitation Act will apply for determining the limitation period under the Arbitration Act only if they are not expressly excluded by the Arbitration Act".29
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23. When we peruse the entire decision, one thing is clear that when a special law provides for limitation and unless and until it is excluded by the special law, then the appellants cannot seek condonation of delay beyond 120 days prior to the amendment. So, when there is a bar to condone the delay beyond the stipulated period, then, the contention of the plaintiff cannot be accepted and I am of the view that the present application is barred by time. The appellants have failed to show the any of the grounds fall under Section 34(1) & (2) of the Act.
24. They were not interested in conducting the case. On the other hand, they are attributing certain allegation against Arbitrator without any proof. Since, the appellants appeared through their counsel, but failed to contest the case properly, now, at this stage, their documents cannot be received under the O 41 Rule 27 CPC, like appeal. There is nothing to show that they attempted to produce some documents before the Arbitrator and Arbitrator declined to accept it. There is nothing to show that, they are prevented from producing documents so as to add additional grounds under Section 31(5) of the Act as per IA-2. Further, there is inordinate delay in filing the case and 30 Com.A.S.149/2018 therefore, I am of the view that there are no grounds to set aside the Award. Accordingly, I answer point Nos.1 to 3 in the Negative.
25. Point No.4 :- For the aforesaid reasons, I proceed to pass the following Order.
ORDER The suit/petition filed by the plaintiff U/S. 34 of Arbitration & Conciliation Act, 1996 is dismissed with costs.
IA-II, and III are also dismissed.
(Dictated to the Stenographer, typed by him, corrected and then pronounced by me in open Court on this the 1st day of July, 2021).
(CHANDRASHEKHAR U), LXXXVII Addl.City Civil & Sessions Judge, (Exclusive dedicated commercial Court) Bengaluru.
31 Com.A.S.149/2018 sk