Madras High Court
S.A.Mohideen vs S.A.Fasluddin on 2 August, 2018
Author: Pushpa Sathyanarayana
Bench: Pushpa Sathyanarayana
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 02.08.2018 CORAM THE HONOURABLE MRS.JUSTICE PUSHPA SATHYANARAYANA O.P.No.310 of 2018 and O.A.Nos.257 and 258 of 2018 and A.No.2450 of 2018 S.A.Mohideen .. Petitioner Vs. 1. S.A.Fasluddin 2. S.A.Sherfuddin 3. Siyauddin 4. Hazeena 5. Basheera .. Respondents * * * Prayer : Petition filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, praying to reconstitute the Arbitral Tribunal. * * * For Petitioner : Mr.V.Kuberan for M/s.Rank Associates For Respondents : Mr.S.Y.Masood O R D E R
The parties are in the third round of litigation before this Court.
2. A brief history of the earlier rounds of litigation would run thus :
(i) The petitioner and the respondents are blood relations. They are children of one Haji.S.M.Abdul Majid. There was an arbitration agreement dated 16.11.2008 between them, which includes the father of the parties, namely, Haji.S.M.Abdul Majid. The reason for entering into such an agreement, as per the recitals of the said agreement, was that several disputes and differences have arisen between them and also expected to arise in respect of the properties morefully described in the scheduled annexed to the said agreement. As per the agreement, an Arbitral Tribunal consisting of three members, presided over by a retired Judge of this Court was constituted to settle all the disputes and differences, having its seat at Chennai.
(ii) A claim statement was filed before the Arbitral Tribunal on 02.01.2009 and the second statement was filed on 14.01.2009. A reply statement was filed on 12.01.2009 and additional claim statement was filed on 03.10.2011. The petitioner also filed an additional counter statement on 03.10.2011. In the meanwhile, Haji.S.M.Abdul Majid, father of the parties herein, died on 15.02.2009.
(iii) Pending arbitration, the parties filed a number of applications before this Court seeking various reliefs. All the applications were disposed of by this Court on 30.08.2011 directing the parties to agitate their disputes before the Arbitral Tribunal. Even thereafter, the matter was prolonged for sometime and O.S.A.Nos.320 and 321 of 2011 was also filed against the said order, which were dismissed on 11.10.2011. Thus, the first round of litigation before this Court came to an end.
(iv) The Arbitral Tribunal passed an award on the same day, i.e., 11.10.2011, when the above original side appeals were dismissed. It is pertinent to mention here that the foot note of the award dated 11.10.2011 goes to show that the award was prepared on 07.10.2011 and one of the Arbitrators, who was expected to be present for pronouncing the award on 11.10.2011, died in a road accident, and hence, the learned Presiding Arbitrator and the third Arbitrator have signed in the arbitral award.
(v) Respondents 1 and 2 herein assailed the award dated 11.10.2011 before this Court in O.P.No.59 of 2012 under Section 34 of the Arbitration and Conciliation Act, 1996. This Court vide its order dated 07.11.2013 refused to interfere with the award and thus, dismissed the original petition.
(vi) Respondents 1 and 2 took the said order in appeal before the Division Bench of this Court in O.S.A.No.173 of 2014. The first respondent herein/first appellant therein was removed from the array of parties, as per the order of the Court dated 05.04.2017.
(vii) The First Bench of this Court allowed the appeal on 19.12.2017 holding that :
.... 35. In no circumstances could an Arbitral Tribunal of two Arbitrators proceed to make and pronounce an award upon the death of the third Arbitrator. The mandate of the Arbitral Tribunal came to an end by reason of the event of the death of the third Arbitrator and the Arbitral Tribunal became functus officio. The award made after the death of the third Arbitrator is, thus, null and void, even though the draft may have been prepared while the third Arbitrator was alive.
(viii) Consequent to the order of the First Bench of this Court dated 19.12.2017 in the second round of litigation before this Court, the petitioner, through his counsel, sent a notice dated 13.02.2018, suggesting three names and sought consent for appointment of one among the said three persons as the Sole Arbitrator reconstituting the Arbitral Tribunal. However, the second respondent through his counsel sent a reply notice dated 27.02.2018 rejecting the suggestion of appointing a Sole Arbitrator and sought for appointment of three arbitrators from the local area.
(ix) Now the parties are before this Court in this third round seeking reconstitution of the Arbitral Tribunal.
2. The petitioner also filed O.A.Nos.257 and 258 of 2018 and A.No.2450 of 2018, wherein, notice was ordered by this Court on 20.03.2018. The prayers made in these applications are as follow :
(i) O.A.No.257 of 2018 : ... to pass an order of injunction restraining the respondents 1 and 2 from in any manner alienating, encumbering or otherwise dealing with the properties, morefully described in the schedule hereunder, pending disposal of the arbitration proceedings.
(ii) O.A.No.258 of 2018 : .... to pass an order appointing a Receiver to take charge of the properties mentioned in the Schedule to manage, maintain and render accounts to this Court, pending disposal of the arbitration proceedings.
(iii) A.No.2450 of 2018 : .... to pass an order directing the respondents 1 and 2 to render a proper account of the income and expenditure relating to the properties described in the schedule, from the date of death of the petitioner's father till date, pending disposal of the arbitration proceedings.
3. Resisting the above said claims of the petitioner, the respondents filed a common counter affidavit dated 19.06.2018 in these applications.
4. Heard both sides.
5. Admittedly, pleadings are complete before the erstwhile Arbitral Tribunal. The only ground on which the Arbitral award was set aside by the First Bench of this Court is that the mandate of the Arbitral Tribunal came to an end upon the demise of the third Arbitrator and the Arbitral Tribunal became functus officio, and accordingly, the award passed by the Tribunal is null and void. Hence, it is imperative to reconstitute the Arbitral Tribunal.
6. In such circumstances, upon consent, this Court constitute Arbitral Tribunal consisting of :
(i) Hon'ble Mr.Justice K.N.Basha, Judge (Retd.), Madras High Court, Flat No.F-1, STAR, No.25/1, Dr.Ambedkar Road, (Old ICF Link Road), North Thirumalai Nagar, Villivakkam, Chennai-600 049 ;
(ii) Hon'ble Mr.Justice G.M.Akbar Ali, Judge (Retd.), Madras High Court, No.6, 9th Cross Street, Senthil Nagar, Kolathur, Chennai-600 099 ; and
(iii) Mr.M.K.Kabir, Senior Advocate, APT.C, Sree Illam, AJ 124, 1st Street, Off.9th Main Road, Anna Nagar, Chennai-600 040;
to enter upon reference and adjudicate the disputes inter se the parties, considering the fact that the dispute is within the members of the family and it is the second round of adjudication. The learned Arbitrators may, after issuing notice to the parties and upon hearing them, pass an award as expeditiously as possible, preferably within a period of six months from the date of receipt of the order. The learned Arbitrators are at liberty to fix the remuneration and other incidental expenses. The proceedings may be conducted in accordance with the Madras High Court Arbitration Rules.
7. It is to be stated that there is no interim order granted by this Court in O.A.Nos.257 and 258 of 2018 and A.No.2450 of 2018. It is open to the parties to seek appropriate interim relief before the Arbitral Tribunal.
8. The Original Petition is, accordingly, allowed, leaving the parties to bear their own costs. Consequently, all the pending applications shall stand closed.
02.08.2018 gg PUSHPA SATHYANARAYANA, J.
gg O.P.No.310 of 2018 & O.A.Nos.257 and 258 of 2018 and A.No.2450 of 2018 02.08.2018