Indian Kanoon - Search engine for Indian Law

31. It is submitted by the learned senior counsel for the respondent that since the arbitral tribunal has allowed the time barred claims, such award can be also challenged under section 34(2) (b) (II) on the ground of public policy of India. He submits that the powers of court under section 34(2) (b) are distinct with its power provided under section 34 (2) (a) (I) to (V). It is submitted that the power of court under section 34(2) (b) are of higher pedestal and when the court is ceased of the matter, if the court comes to the conclusion that an award of any particular claim is patently illegal or is in conflict with public policy, the court cannot put its seal on such award. He submits that since the award shows patent illegality on the issue of limitation, it becomes duty of the court to set aside such arbitral award by exercising suo-moto power under section 34(2) (b) of the Arbitration Act.

44. Supreme Court in case of Steel Authority of India Limited vs. Gupta Brother Steel Tubes Limited (supra) has held that if an award is contrary to the Kvm ARBP267.11 substantive provisions of law, against the terms of the contract, it would be patently illegal.

45. Supreme Court in case of State of Orissa and Anr. vs. Mamata Mohanty, (supra) has held that once a court comes to the conclusion that a wrong order has been passed, it becomes solemn duty of the court to rectify the mistake rather than perpetuate the same. The Supreme Court has adverted to its earlier judgment reported in case of Hotel Balaji and Ors. vs. State of A.P. and Ors., AIR 1993 SC 1048 in which it was observed that to perpetuate an error is no heroism. To rectify it is the compulsion of judicial conscience.

50. Insofar as the judgment of the Supreme Court in case of Swan Gold Mining (supra) relied upon by learned senior counsel for the claimant is concerned, it is held by the Supreme Court that the power of the Court to set aside the award would be exercised only in cases where the Court finds that the arbitral award is on the face of it erroneous or patently illegal or in contravention of the provisions of the Act. There is no dispute about the proposition laid down by the Supreme Court in the said judgment. In my view, since every finding of the arbitral tribunal on the issue of limitation is ex-facie perverse, patently illegal, contrary to the provisions of the Limitation Act and is contrary to the well settled principles of law laid down by the Supreme Court and this Court, this Court has power to set aside such erroneous and patently illegal award under section 34 of the Arbitration & Conciliation Act, 1996.

56. In my view, since both the parties had raised the issue of limitation in respect of the claim made by each other on common ground and facts, and since this Court has in the later part of this judgment has come to the conclusion that each and every finding of the arbitral tribunal on the issue of limitation is contrary to law and patently illegal, this Court has power to set aside such patently illegal award and the finding rendered by the arbitral tribunal. In my view powers of court under section 34(2) (b) are distinct with its power under section 34(2)(i) to