Bangalore District Court
M/S.Icici Securities Limited vs ) Sri.Laksminarayan on 14 September, 2016
IN THE COURT OF THE VI ADDL.CITY CIVIL & SESSIONS JUDGE
BENGALURU CITY
CCCH. 11
Dated this the 14th day of September, 2016
PRESENT: Sri.K.M.Rajashekar, B.Sc., LL.B.,
VI Addl. City Civil & Sessions Judge,
Bengaluru City.
A.S.NO: 77/2012
Applicant/ : M/S.ICICI SECURITIES LIMITED
Plaintiff A Company registered under the
Companies Act, 1956
Having its registered office at
Shree Sawan Knowledge Park,
Ground Floor, Plot No.D-507,
TTC Industrial Area, MIDC, Thurbe,
Navi Mumbai - 400 705.
Reptd.by its Authorised Representative &
Chief Manager-Ms.Pretti Abhay Bhardawaj
/Vs/
Respondents : 1) Sri.Laksminarayan,
Defendants S/o.Sri.Vijayraghaavan Vellur,
Aged about 66 years,
A-5, 514, Ghataprabha,
National Games Village, Koramangala,
Bengaluru-560 047.
2) Sri.G.Prabhakar,
The Arbitration Department,
Bombay Stock Exchange Limited,
Regional Office - South,
No.4, Vijaya Towers, 3rd Floor,
2 A.S.No.77/2012
Opp.Hotel Palm Gove,
Kodambakkam High Road,
Chennai - 600 034.
3) Sri.T.S.Gopinathan,
The Arbitration Department,
Bombay Stock Exchange Limited,
Regional Office - South,
No.4, Vijaya Towers, 3rd Floor,
Opp.Hotel Palm Gove,
Kodambakkam High Road,
Chennai - 600 034.
4) Sri.P.R.Aruloli,
The Arbitration Department,
Bombay Stock Exchange Limited,
Regional Office - South,
No.4, Vijaya Towers, 3rd Floor,
Opp.Hotel Palm Gove,
Kodambakkam High Road,
Chennai - 600 034.
5) The Arbitration Department,
Bombay Stock Exchange Limited,
Regional Office - South,
No.4, Vijaya Towers, 3rd Floor,
Opp.Hotel Palm Gove,
Kodambakkam High Road,
Chennai - 600 034.
6) Sri.T.N.C.Koushik,
Hon'ble Sole Arbitrator,
Chennai.
---
3 A.S.No.77/2012
JUDGMENT
The Plaintiff has filed this Arbitration Suit under Section 34 of the Arbitration and Conciliation Act, 1996, challenging the Arbitration award dated 07.08.2012 passed in Arbitration Appeal No.12A/2012 along with award dated 15.02.2012 passed in Ref.No.127/2011.
2) Nutshell of the Plaintiff's case is that, the Defendant herein opened a 3 in 1 account with the Plaintiff through a sub broker one Mr.Rajeev Bhansal, on 27.03.2009. The Defendant transferred a part of his portfolio maintained with M/s.Share Khan Ltd., to the de-mat account with the Plaintiff. On 31.03.2009 the shares were sold and the amounts were credited to the Defendant's linked account. The Defendant claims that he had not given any instructions to the sub broker to sell his shares nor deal in futures and options and it was done by the sub broker without his instructions and knowledge. When the Income Tax Department asked for returns, the Defendant came to know all these facts, and then he represented 4 A.S.No.77/2012 the matter to the Plaintiff and asked for redress. The Defendant represented before the Plaintiff that in earlier occasions he had paid Rs.10 lakhs to the sub broker for investment in gold bonds and issued a cheque for Rs.10 lakhs without making it payable to any particular dealing in gold bonds. This was used by the sub broker for his personal investment in Ms.Reena's name and issued post dated cheques to the Defendant and also assured them handsome return. But, the said cheques were dishonored, the Defendant did not take any legal action against the sub broker as he was not well and hospitalized for severe ailment. At the time of opening 3 in 1 account, the Defendant issued a blank uncrossed cheque to the sub broker to meet the expenses of account opening and other charges. The said cheque was issued against his linked account with ICICI Bank. On 02.04.2009 the said cheque was utilized by the sub broker to withdraw Rs.1,00,000/- in cash from the linked account. It was observed that the bank did not follow the due procedure in making payment to third parties. The linked account 5 A.S.No.77/2012 was credited with funds by selling the shares transferred by the Defendant from his existing portfolio. The Defendant came to know about the sale of shares and withdraw of cash from his linked account and brought it to the notice of the Plaintiff about the unauthorized transactions and also about bouncing of cheque. The Plaintiff contended that the sub broker dealt with these transactions in his personal capacity and hence, the Plaintiff will not be a part of the dealings and not liable for the losses suffered by the Defendant. The Defendant preferred an arbitral reference with BSE which was heard by the sole Arbitrator and passed award on 15.02.2012 holding that the Plaintiff is not responsible for the personal transaction entered into with the sub broker. However, the Plaintiff should have issued contract notes in physical forms and take an acknowledgment from the Defendant since he had not given any email ID. The Plaintiff without authority used dummy email IDs for sending the contract notes and did not comply with bye law No.247A and the regulation of Exchange notice 6 A.S.No.77/2012 No.4914/96 dated 13.08.1996 and held that the Plaintiff should reinstate the shares or value of the shares to the Respondent within 4 weeks from the receipt of the order, against which, the Plaintiff herein preferred an appeal before the appellate authorities, wherein, the arbitral appeal was dealt by the appellate authority in appeal No.12A/2012 and confirmed the order of the sole Arbitrator holding that the Plaintiff herein is directed to remit to the Defendant a sum of Rs.4,65,000/- along with simple interest at 8% per annum from 15.-2.2012 till realization. Aggrieved by the said award, the Plaintiff herein preferred this suit under Section 34 of the Arbitration and Conciliation Act, 1996, among the following grounds amongst others.
The Plaintiff has challenged this award on the ground that the award is erroneous as the Arbitral Tribunal has passed the award which is opposed to public policy. The findings of the award are contradictory to the operative part of the award. All he allegations of 7 A.S.No.77/2012 Defendant No.1 have been found to be false and even then the award has bee passed against the Plaintiff. The learned Arbitral Tribunal BSE did not have the jurisdiction to decide either issues pertaining to other stock exchanges or the issues which were not being referred by the parties for adjudication. The Plaintiff as a trading member, does not accept payment in the form of cash and all trading activities of online clients and clients registered through sub brokers are carried out only upon a customer having a bank account with ICICI bank and only upon such customers giving instructions to the Plaintiff or sub brokers the transactions will be dealt. The award passed by the Appellate Tribunal is ex-facie illegal, against law, beyond jurisdiction and against public policy of India. The Arbitral Tribunal has failed to apply its mind while not appreciating that the conduct of Defendant No.1 throughout has not been upright and honest. The Tribunal ought not to have examined personal transactions of the Defendant No.1 which were not in any manner subject to the Rules, Bye laws and regulations. 8 A.S.No.77/2012 The Tribunal has exceeded its jurisdiction by passing unwarranted remarks against ICICI Bank Limited. The Tribunal has failed to follow the principles of natural justice and the Plaintiff has been denied an opportunity of fair and reasonable ground of hearing. The Tribunal has been biased against the Plaintiff on the erroneous pretext that the Plaintiff is a large brokerage house. The award of the sole Arbitrator and the Tribunal are wholly bereft of any reasoning of whatsoever and are perverse. The Tribunal has failed to appreciate the evidence of the Plaintiff. The impugned award passed by the learned Tribunal is patently illegal and opposed to public policy as the impugned award has self contradictions which clearly make the same bad both in law and facts, hence, sought for setting aside the arbitral award.
3) On service of notice, the Defendant No.1 entered his appearance through counsel and filed his written statement denying the plaint averments in general and para-wise. The Defendant contended that the Plaintiff is 9 A.S.No.77/2012 not coming out any documentary proof to evidence the suit claim. The Defendant contended that he has been trading with the Plaintiff from 13.03.2009 to 12.06.2009 without producing the order or instruction slips of the 1st Defendant and without producing the delivery instruction slips executed by the 1st Defendant. The Plaintiff has failed to give documentary evidence for placement of orders or instructions by the 1st Defendant to any one at any point of time for trading in his account and sought for dismissal of the suit.
The Defendants No.2 to 5 remained absence, hence, they have been placed exparte.
4) Heard. Perused the records.
5) The points that arise for my consideration are :
(1) Whether the Plaintiff proves that the impugned award is opposed to public policy and is rendered without jurisdiction?
(2) Whether Plaintiff proves any of the grounds under Section 34 of the 10 A.S.No.77/2012 Arbitration and Conciliation Act, to set aside the Arbitration award?
(3) What Order?
6) My answer to the above points are :-
Point No.1 - In the Negative;
Point No.2 - In the Negative;
Point No.3 - As per final order, for the following :
REASONS
7) Point No.1 and 2 : Since these points are inter related to each other, they are taken up together to avoid repetition of facts and for convenience of the court.
Upon going through the materials available on record, it is seen that this suit is filed for setting the arbitral award dated 07.08.2012 passed in Arbitration Appeal No.12A/2012 along with award dated 15.02.2012 passed in Ref.No.127/2011.
The undisputed facts of this case indicates that on 27.03.2009 the Defendant opened a 3 in 1 account with 11 A.S.No.77/2012 the Plaintiff through one Mr.Rajeev Bhansal, a sub broker and transferred a part of his portfolio maintained with M/s.Share Khan Ltd., to the de-mat account with the Plaintiff, on 31.03.2009 the shares were sold and the amounts were credited to the Defendant's linked account, the allegations of the Defendant is that he had not given any instructions to the sub broker to sell his shares but was done by the sub broker without his instructions and knowledge, the corpus was used by the sub broker for his personal investment in Ms.Reena's name and issued post dated cheques which were dishonoured, at the time of opening 3 in 1 account, the Defendant issued a blank uncrossed cheque to the sub broker against his linked account with ICICI Bank, the said cheque was utilized by the sub broker to withdraw Rs.1,00,000/- in cash from the linked account, the linked account was credited with funds by selling the shares transferred by the Defendant from his existing portfolio; after coming to know the Defendant brought it to the notice of the Plaintiff about the unauthorized transactions and also about bouncing of 12 A.S.No.77/2012 cheque, the Plaintiff refuses to indemnify the losses suffered by the Defendant claiming that the sub broker dealt with these transactions in his personal capacity, hence, the Defendant preferred an arbitral reference with BSE which was heard by the sole Arbitrator and passed award on 15.02.2012 holding that the Plaintiff is not responsible for the personal transaction entered into with the sub broker. However, held that the Plaintiff should reinstate the shares or value of the shares to the Respondent within 4 weeks from the receipt of the order, against which, the Plaintiff preferred an appeal before the appellate authorities, wherein, the arbitral appeal was dealt by the appellate authority in appeal No.12A/2012 and confirmed the order of the sole Arbitrator holding that the Plaintiff is directed to remit to the Defendant a sum of Rs.4,65,000/- along with simple interest at 8% per annum from 15.02.2012 till realization. Aggrieved by the said award, the present suit is filed. 13 A.S.No.77/2012
8) Before taking the case on merits, it is significant to note that the parties to the arbitration proceedings have very limited scope to challenge the arbitration award. The Arbitration and Conciliation Act, 1996, provides very limited scope for setting aside the arbitral award. The aggrieved parties can challenge the arbitral award only on the grounds envisaged under Section 34 of the Arbitration and Conciliation Act, 1996. For the sake of convenience, the provisions of Section 34 of the Arbitration and Conciliation Act, 1996, is reproduced herewith :
" 34. Application for setting aside arbitral award.- (1) Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub- section (3).
(2) An arbitral award my be set aside by the Court only if -
(i) a party was under some incapacity, or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law for the time being in force; or
(iii) the party making the application was not given proper notice of the appointment of an 14 A.S.No.77/2012 Arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration:
Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provisions of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part; or
(b) the Court finds that -
(i) the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or
(ii) the arbitral award is in conflict with the public policy of India.
Explanation.- Without prejudice to the generality of sub-clause (ii) it is hereby declared, for the avoidance of any doubt, that an award is in conflict with the public policy of India if the making of the award was induced or affected by fraud or corruption or was in violation of Section 75 or Section 81."
15 A.S.No.77/2012The Arbitration and Conciliation (Amendment) Act, 2015 provides :
"18. In Section 34 of the Principal Act.-
(I) In sub-section (2), in clause (b), for the Explanation, the following Explanations shall be substituted, namely :-
(i) the making of the award was induced or affected by fraud or corruption or was in violation of Section 75 or section 81; or
(ii) it is in contravention with the fundamental policy of Indian law; or
(iii) it is in conflict with the most basic notions of morality or justice.
Explanation 2.- For the avoidance of doubt, the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.", (II) after sub-section (2), the following sub- section shall be inserted, namely :-
"2(A) An arbitral award arising out of arbitrations other than international commercial arbitrations, may also be set aside by the Court, if the Court finds that the award is vitiated by patent illegality appearing on the face of the award:
Provided that an award shall not be set aside merely on the ground of an erroneous application of the law or by re-appreciation of evidence."16 A.S.No.77/2012
To add to this, in a land mark judgment rendered by the Hon'ble Supreme Court of India in Civil Appeal No.10531/2014 reported in AIR 2015 SC 620 between Associate Builders Vs. Delhi Development Authority dated 25.11.2014 extends a wider scope to Section 34 of the Arbitration and Conciliation Act, 1996. Their Lordships have clearly mandated that :
" an extent of judicial intervention notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part. (Section 5) It is important to note that, the 1996 Act was enacted to replace the 1940 Arbitration Act in order to provide for an arbitral procedure which is fair, efficient and capable of meeting the needs of Arbitration; also to provide that the tribunal gives reasons for an arbitral award; to ensure that the tribunal remains within the limits of its jurisdiction; and to minimize the supervisory roles of courts in the arbitral process.
Therefore, in our view, the phrase "public policy of India" used in Section 34 in context is required to be given a wider meaning. It can be stated that the concept of public policy connotes some matter which concerns public good and the public interest. What is for public good or in public interest or what would be injurious or harmful to the public good or public interest has varied from time to time. However, the award which is, on 17 A.S.No.77/2012 the face of it, patently in violation of statutory provisions cannot be said to be in public interest. Such award is likely to adversely affect the administration of justice. Hence, in our view in addition to narrower meaning given to the term "public policy" in Renusagar case is required to be held that the award could be set aside if it is patently illegal. The result would be, award could be set aside if it is contrary to :
(a) Fundamental policy of Indian law; or
(b) The interest of India; or
(c) Justice or morality, or
(d) In addition, if it is patently illegal.
Illegality must go to the root of the matter and if the illegality is of trivial nature it cannot be held that 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 award is opposed to public policy and is required to be adjudged void.
103. Such patent illegality, however, must go to the root of the matter. The public policy, indisputably, should be unfair and unreasonable so as to shock the conscience of the court. Where the Arbitrator, however, has gone contrary to or beyond the expressed law of the contract or granted relief in the matter not in dispute would come within the purview of Section 34 of the Act.
35. Without meaning to exhaustively enumerate the purport of the expression "fundamental policy of Indian law", we may refer to three distinct and fundamental juristic principles that must necessarily be understood as a part and parcel of the fundamental policy of Indian law. The first and foremost is the principle that in every determination whether by a court or other authority that affects the rights of a citizen or leads to any civil consequences, the court or authority concerned is 18 A.S.No.77/2012 bound to adopt what is in legal parlance called as "judicial approach" in the matter. The duty to adopt a judicial approach arises from the very nature of the power exercised by the court or the authority does not have to be separately or additionally enjoined upon the fora concerned. What must be remembered is that the importance of a judicial approach in judicial and quasi-judicial determination lies in the fact that so long as the court, tribunal or the authority exercising powers that affect the rights or obligations of the parties before them shows fidelity to judicial approach, they cannot act in an arbitrary, capricious or whimsical manner. Judicial approach ensures that the authority acts bona fide and deals with the subject in a fair, reasonable and objective manner and that its decision is not actuated by any extraneous consideration. Judicial approach in that sense acts as a check against flaws and faults that can render the decision of a court, tribunal or authority vulnerable to challenge.
The third juristic principle is that a decision which is perverse or so irrational that no reasonable person would have arrived at the same is important and requires some degree of explanation. It is settled law that where-
1. a finding is based on no evidence, or
2. an arbitral tribunal takes into account something irrelevant to the decision which it arrives at; or
3. ignores vital evidence in arriving at its decision.
such decision would necessarily be perverse.
A broad distinction has, therefore, to be maintained between the decisions which are perverse and those which are not. If a decision is arrived at on no evidence or evidence which is 19 A.S.No.77/2012 thoroughly unreliable and no reasonable person would act upon it, the order would be perverse. But if there is some evidence on record which is acceptable and which could be relied upon, howsoever compendious it may be, the conclusions would not be treated as perverse and the findings would not be interfered with.
It must clearly be understood that when a court is applying the "public policy" test to an arbitration award, it does not act as a court of appeal and consequently errors of fact cannot be corrected. A possible view by the Arbitrator on facts has necessarily to pass muster as the Arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon when he delivers his arbitral award. Thus an award based on little evidence or on evidence which does not measure up in quality to a trained legal mind would not be held to be invalid on this score.
A Court does not sit in appeal over the award of an Arbitral Tribunal by reassessing or re- appreciating the evidence. An award can be challenged only under the grounds mentioned in Section 34(2) of the Act.
The third ground of public policy is, if an award is against justice or morality. These are two different concepts in law. An award can be said to be against justice only when it shocks the conscience of the court. An illustration of this can be given. A claimant is content with restricting his claim, let us say to Rs.30 lakhs in a statement of claim before the Arbitrator and at no point does he seek to claim anything more. The arbitral award ultimately awards him 45 lakhs without an acceptable reason or justification. Obviously, this would shock the conscience of the court and the arbitral award would be liable to be set aside on the ground that it is contrary to "justice".
20 A.S.No.77/2012
If the Arbitrator commits an error in the construction of the contract, that is an error within his jurisdiction. But if he wanders outside the contract and deals with matters not allotted to him, he commits a jurisdictional error. Extrinsic evidence is admissible in such cases because the dispute is not something which arises under or in relation to the contract or dependent on the construction of the contract or to be determined within the award. The ambiguity of the award can, in such cases, be resolved by admitting extrinsic evidence. The rationale of this rule is that the nature of the dispute is something which has to be determined outside and independent of what appears in the award. Such a jurisdictional error needs to be proved by evidence extrinsic to the award.
The court while considering challenge to arbitral award does not sit in appeal over the findings and decision of the Arbitrator, which is what the High Court has practically done in this matter. The umpire is legitimately entitled to take the view which he holds to be the correct one after considering the material before him and after interpreting the provisions of the agreement. If he does so, the decision of the umpire has to be accepted as final and binding."
9) In the background of the above mandate of the provisions of Section 34 of Arbitration and Conciliation Act, 1996 and the ratios laid down by their Lordships in the above referred decision, if we analyze the present case it is seen that the sole ground urged by the Plaintiff is that, the impugned award is opposed to public policy and 21 A.S.No.77/2012 without jurisdiction. The plaint of this suit runs up to 85 pages. In his marathon pleading, the Plaintiff herein has narrated various aspects. It is significant to note that except filing a lengthy plaint the plaintiff did not took strain to substantiate it through his oral arguments, rather, in spite of giving sufficient opportunity the plaintiff did not came forward to address his oral arguments or filed written synopsis, hence, the arguments on plaintiff's side taken as not addressed. However, on careful perusal of the impugned award it is seen that the learned Arbitrator vide his crisp and short award has evaluated the claim of the parties and arrived at a conclusion that "The applicant had entered into a personal transaction with the Sub Broker late Mr.Rajeev Bansal for a sum of Rs. 1 lakh and the Respondent cannot be held liable for the personal transactions between the sub broker late Mr.Rajeev Bansal and the applicant herein. Further there has been transactions in the applicant Demat Account for which the Respondent ought to have sent the contract notes and obtain acknowledgment of the applicant along with the 22 A.S.No.77/2012 date of receipts on the counterfoils of the contracts notes and preserve the same for further reference as per the Bye law 247A of the Rules, Bye law and regulation of the Exchange and Exchange Notice No.4914/96 dated August 13 of 1996. Moreover the Respondent has sent contract notes through email and the email address is fake, the Respondent has mechanically sent emails to [email protected] and which is not the email id of the Applicant. On careful perusal of the email delivery list to other customers, the same email address appears to the other customers which clearly show that the Respondent had added the bogus email address for all the customers. Hence the Respondent is liable and directed to reinstate the shares or value of the shares to the Applicant account within 4 weeks of the receipt of the order."
10) On a careful perusal of the reasonings offered by the learned Arbitrator in his cute and short order, it appears that the learned Arbitrator in his clear wordings observed that, even though the Respondent there i.e. 23 A.S.No.77/2012 Plaintiff herein is not responsible for the transaction between Mr.Rajeev Bansal and the Defendant herein, the responsibility of the Plaintiff herein lies for contravening the bye law 247A of the Rules and Regulations, so also, plaintiff is guilt of making use of the fake email ID. It is significant to note that against the award of the sole Arbitrator, the Plaintiff herein preferred an appeal before the appellate authority in Appeal No.12A/12 making 7 grounds. The Appellate Authority adjudicated each and every grounds of the Plaintiff herein and negatives it and confirmed the order of the sole Arbitrator. The appellate authorities also makes it very clear that the Applicant i.e. Plaintiff herein should have obtained and maintained duplicate copy of the contract note with the Respondent's signature. This is more so when the applicant could not deliver the contract notes electronically. The appellate authority also made observation that "an internal audit report about book keeping, administration and procedural compliance prescribed by BSE as well as SEBI. This document listed out plenty of deficiencies in the sub 24 A.S.No.77/2012 broker's office and none of them was owned by the sub broker. By hearing both the parties and going through voluminous records produced at the hearing, we are of the opinion that the appellant had neither controlled their sub brokers nor taken any preventive or corrective action against them. This has resulted in the sub brokers defrauding innocent and gullible investors."
11) The observation of the learned Arbitrator as well as the Appellate Tribunal, it is seen that both the authorities have dealt with the matter in detail, verified the documentary evidence available on record exhaustively and arrived at a just and fair conclusion. Even though the Plaintiff has narrated his story in 85 pages, but except repeating the facts and figures of his case, absolutely no specific reasons are offered as to how this award is opposed to public policy. Even though the Plaintiff herein has made point to point reference and attacked the order of the learned Arbitrator on each wording of the award , but it is seen that the sole ground of awarding the relief in favor of the Defendant herein is based 25 A.S.No.77/2012 on contravening the bye law 247A of the Rules and exchange notice No.4914/96 by the Plaintiff herein. But Plaintiff herein not seriously attacked this ground, rather, he has opted to attack each and every word used by the learned Arbitrator in his award. Even though the plaintiff challenged the award on the grounds of jurisdiction, but as rightly argued by the learned counsel for the Defendant, the award passed by the learned sole Arbitrator is based on facts rules and regulations and bye laws of stock exchange, Regulation of SEBI and Securities Contracts Regulation Act 1956. Hence, the plaintiff cannot claim that BSE Ltd did not have jurisdiction to decide about the issues pertaining to other Stock Exchange. It is useful to note that only after giving clear consent of the parties and opting the selection of Arbitrator out of the panel and participation in the proceedings, the learned Arbitrator will look into the claim of the parties and the evidence supplied, then only proceed to pass the award. Hence, at this stage, i.e. after actively participating in the arbitration proceedings effectively, that too, preferring the appeal without questioning the jurisdiction and now questioning the 26 A.S.No.77/2012 jurisdiction in a suit under Section 34 of the Act, is not sustainable. Hence, as rightly argued by the learned counsel for the Defendant the motive and intention behind the allegations against the award is only on the ground that it has went against the Plaintiff cannot be ruled out.
12) Upon careful perusal of the materials available on record and the grounds urged by the Plaintiff for setting aside the arbitral award, I am of the opinion that, absolutely no grounds are made out by the Plaintiff to establish any of the grounds mentioned in the plaint or any of the grounds available to him under Section 34(b) of the Arbitration and Conciliation Act, 1996. The judgment referred supra rendered by the Hon'ble Supreme Court in Associate Builders Vs. Delhi Development Corporation makes it very clear that this court cannot sit on an appellate jurisdiction and the arbitral award cannot be set aside on trivial grounds. The Hon'ble Supreme Court consistently mandated that, if the Arbitrator wonders outside the work and deals with the matter not allotted to 27 A.S.No.77/2012 him, then only it can be termed as judicial error. Herein is the case, the learned Arbitrator has dealt the matter squarely within the four corners of the matter allotted to him. Added to that, no act is done by the learned Arbitrator which could be termed the award as perverse or unfair and unreasonable so as to shock the conscience of the court. The Plaintiff has utterly failed to establish that the learned Arbitrator has gone contrary to or beyond the expressed law of the contract or granted relief in the matter not in dispute. Under these circumstances, I hold that the Plaintiff has utterly failed in establishing that the award passed by the learned Arbitrator falls within any of the clauses of Section 34 of the Arbitration and Conciliation Act, 1996, much less, any of the grounds mentioned in the plaint is established or that the award is opposed to public policy or is rendered without jurisdiction, accordingly, I answer the above points in the negative.
28 A.S.No.77/2012
13) Point No.3 : For the foregoing reasons and answer to Point No.1 and 2, the present Arbitration suit fails. In the result, I proceed to pass the following :
ORDER The Arbitration suit filed by the Plaintiff under Section 34 of the Arbitration and Conciliation Act, 1996, for setting aside Arbitration award dated 07.08.2012 passed in Arbitration Appeal No.12A/2012 along with award dated 15.02.2012 passed in Ref.No.127/2011; is hereby dismissed.
Parties to bear their own costs.
(Dictated to the Judgment Writer, transcribed and computerized by her, transcript thereof corrected and then pronounced by me in open Court, dated this the 14th September, 2016.) (K.M.RAJASHEKAR) VI Addl.City Civil & Sessions Judge Bengaluru City.29 A.S.No.77/2012