Calcutta High Court
Development Consultants Pvt.Ltd vs Rama Engineering on 9 October, 2015
Author: Sanjib Banerjee
Bench: Sanjib Banerjee
OD-32
AP No.202 of 2015
IN THE HIGH COURT AT CALCUTTA
Ordinary Original Civil Jurisdiction
ORIGINAL SIDE
DEVELOPMENT CONSULTANTS PVT.LTD.
Versus
RAMA ENGINEERING
BEFORE:
The Hon'ble JUSTICE SANJIB BANERJEE
Date : 9th October, 2015.
Appearance:
Mr. Debojyoti Dutta, Adv.
Mr. Rishad Medora, Adv.
Mr. S. Mukherjee, Adv.
Mr. J. Chowdhury, Adv.
Mr. Sagnik Basu, Adv.
Mr. Nidhi Bahal, Adv.
The Court : The petition purports to be under Section 34 of the Arbitration
and Conciliation Act, 1996.
The impugned award has been passed by the arbitral tribunal under the
Micro, Small, Medium Enterprises Development Act, 2006.
Section 19 of the said Act of 2006 mandates that "No application for setting
aside any ...award ... made ... by the Council shall be entertained by any Court unless
the appellant (not being a supplier) has deposited with it 75% of the amount in terms of
the ... award ..."
The impugned award was passed on January 29, 2013. The petitioner
claims that since the petitioner was not favoured with a copy of the award and came to
be aware thereof only upon execution being levied by the award-holder, the present
challenge has been made within the period envisaged under Section 34(3) of the 1996
Act, reckoned from the date of receipt of a copy of the award by the petitioner herein.
2
The respondent says that the West Bengal Micro and Small Enterprises
Facilitation Council Rules, 2006 require a party to make an application and obtain a copy of the award. The respondent suggests that it was the obligation of the petitioner herein to obtain a copy of the award, particularly since the petitioner was aware of the reference. The petitioner, however, denies being aware of the passing of the award.
It does not appear that the rules of the Council could have overridden the mandate under Section 31(5) of the said Act of 1996 that obliges an arbitral tribunal to deliver a copy of the arbitral award to a party thereto. However, such aspect of the matter need not be conclusively dealt with, in view of the failure of the petitioner to deposit the 75% of the value of the award in terms of Section 19 of the Act of 2006.
The petitioner says that in course of the execution of the arbitral award, the executing Court directed the petitioner herein to file its affidavit of assets. An appeal from such order resulted in the appellate Court accepting the petitioner's offer of furnishing a bank guarantee for 75% of the value of the award. The appellate order of September 1, 2015, which arose from an order of August 6, 2015, passed in the execution proceedings, gave liberty to the petitioner herein "to prosecute the restoration of the application for setting aside the award within two weeks from date in accordance with law."
This petition had been dismissed for default on June 22, 2015. It was restored for the mere asking on September 23, 2015 and nothing further than the restoration of the petition was considered in the order of September 23, 2015.
The petitioner submits that in view of the bank guarantee that has been offered to be furnished and the time wherefor now stands extended till October 15, 2015, the present petition should be received and adjudicated on merits. 3
It is evident from the appellate order of September 1, 2015, that the bank guarantee offered to be furnished by the petitioner herein in the appeal arising from an order passed in course of execution of the award was for the purpose of dispensing with the direction of the executing court to furnish the balance sheets of the petitioner company and excusing the presence of its director in Court. The appellate Court had no occasion to consider, given the scope of the appeal before it, Section 19 of the Act of 2006.
In any event, Section 19 requires a deposit. Such deposit has not yet been made. Till such time that the deposit is made, the petition cannot be received. It cannot be accepted that to arrest the clock of limitation a petition would be regarded to have been validly filed, though the statutory pre-condition thereto is not complied with.
Since it is the admitted position that no deposit in terms of Section 19 of the said Act of 2006 has yet been made and Section 19 of the said Act makes such a deposit a condition precedent to a petition for setting aside an award passed under such Act being entertained, AP No.202 of 2015 is dismissed as not maintainable.
There will be no order as to costs.
Urgent certified website copies of this order, if applied for, be supplied to the parties subject to compliance with all requisite formalities.
(SANJIB BANERJEE, J.) bp.