Document Fragment View

Matching Fragments

Mr. Sabyasachi Chowdhury, learned Counsel appearing on behalf of the respondent submits that the petitioner has suppressed an order passed in an application filed under Section 9 of the Arbitration and Conciliation Act before the Division Bench during the pendency of the appeal and the Hon'ble Division Bench disposed of the said application after the appeal was disposed of by passing an interim order. The Division Bench did not accept the submission made on behalf of the petitioner that by reason of setting aside of the award, the Court has no jurisdiction to pass any interim order. The learned Counsel has also relied upon a decision of the Hon'ble Supreme Court in 'McDERMOTT International Inc. vs. Burn Standard Co. Ltd. & Ors.' reported at (2006) 11 SCC 181 paragraph 52, for the proposition that even after quashing the award, the parties would be free to begin the arbitration proceedings again and it was precisely for this purpose that a fresh reference was sought for. It is submitted that the application became necessary by reason of death of the named arbitrator in the arbitration agreement.

"Mr. Kapur's submission that no interim order could have been passed as there was no arbitral lis pending between the parties, is also difficult to sustain. On a perusal of Section 9 of the 1996 Act, it is patently clear that interim relief might be obtained before commencement of arbitral proceedings, during the arbitral proceedings and even after termination of the arbitral proceedings, before the award is enforced under Section 36 of the 1996 Act."

The judgment of the Division Bench dated 20th May, 2016 passed in relation to the application under Section 9 of the Arbitration and Conciliation Act is not under challenge. This has been accepted by the petitioner. It is manifest from the said observation that the parties would be at liberty to seek a fresh reference consequent upon the observation made by the Division Bench otherwise the interim order dated May 20, 2016 could not have been passed. In view of the observation made by the Division Bench that the award is unconscionable and against the public policy since the petitioner who had enjoyed the premises was relieved without being saddled with any obligation gives rise to a cause of action to make a fresh reference for adjudication of such liability arising out of the agreement containing the arbitration clause. The respondent precisely for this purpose has issued a notice under Section 21 of the Arbitration and Conciliation Act. A bare reading of Section 34 of the Arbitration and Conciliation Act, 1996 makes it clear that no power has been invested by the Parliament in the Court to remand the matter to the Arbitral Tribunal except to adjourn the proceedings for the limited purpose mentioned in Sub-Section 4 of Section 34. This legal position has been expounded in the case of McDermott International Inc. (supra). In paragraph 8 of the said decision, the Court observed thus:

8........parliament has not conferred any power of remand to the Court to remit the matter to the arbitral tribunal except to adjourn the proceedings as provided under Sub-

Section (4) of Section 34 of the Act. The object of Sub-section (4) of the Section 34 of the Act is to give an opportunity to the arbitral tribunal to resume the arbitral proceedings or to enable it to take such other action which will eliminate the grounds for setting aside the arbitral award.

It is also apposite to refer to para 52 of the decision of the Supreme Court in McDermott International Inc. v. Burn Standard Co. Ltd. [MANU/SC/8177/2006: (2006) 11 SCC 181] relied on by the learned counsel for the respondent: