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1990 DIGILAW 1037 (ALL)

NEW OKHLA INDUSTRIAL DEVELOPMENT AUTHORITY v. TANDON CONSTRUCTION CO.

1990-11-15

N.N.MITHAL, SURYA PRASAD

body1990
JUDGMENT N. N. Mithal & Surya Prasad, JJ. - The only point raised in this appeal under Section 39 of the Arbitration Act is that the award made by the Arbitration which has been made the Rule of the Court had been filed beyond time and the same could not have been made Rule of the Court. 2. The relevant facts are that a contract had been given for construction of certain building to the respondent and certain dispute having arisen between the parties, the same were referred to an Arbitrator by the court in proceedings under Section 20 of the Arbitration Act. The Arbitrator entered upon a reference and after hearing the parties gave its award and filed the same in court in 10th August, 1989. On behalf of the appellant, an objection was taken that this award was filed beyond time and as such it could not be made the rule of the court. 3. It is not disputed between the parties that the extended time for giving the award was only upto 5th August, 1989. It is also not disputed that the parties had made a joint application for extending time for filing the award on 31st July, 1989. The time was sought to be extended until 13th August, 1989 to enable the Arbitrator to submit its award. The grievance made by the appellant is that no orders on this application have been passed by the court and, therefore, unless there is a specific order passed, it can not be deemed that time has been extended for filing the award. The argument is countered by the other side by submitting that when the application was jointly made for extending time by the parties within time, it must be assumed that there was consent of the parties and, therefore, under Section 28(2), it will be deemed that time has been extended. 4. The learned court below has accepted the contention of the respondent and has recorded a finding that there was consent of the parties for extending time and as such the award has been filed within time. The objection of the appellant was, therefore, over-ruled. Aggrieved by the order passed by the court below present appeal and three other connected appeals have been filed which are all being disposed of by this order. 5. The objection of the appellant was, therefore, over-ruled. Aggrieved by the order passed by the court below present appeal and three other connected appeals have been filed which are all being disposed of by this order. 5. According to para 3 of the First Schedule, the Arbitrator should the award within four months from the date of entering upon a reference or within such extended time as the court may allow. The argument of the appellant is precisely based on the language of this para and it is submitted that unless an order is passed by the court allowing extension of time, the award cannot be said to have been filed within time. This, however, ignores an amendment which has been brought about in its application to the State of U.P. As a matter of fact, para 2 as amended in U.P. will read as under : "The Arbitrator shall make their awards within four months after entering on the reference and after having called upon to Act by notice in writing from any party to the arbitration agreement or within such extended time as the parties to the reference agree to, and in the absence of such agreement as the court may allow." In view of the amended provision applicable in U.P. it is quite obvious that it is only where the parties do not give consent that the intervention of the court is required for extension of time for giving the award. As a matter of fact the amendment brought in para 3 of the First Schedule is in consonance with Section 28(2) which deals with the power of the court to enlarge time for making the award, Section 28(2) is in this form : "Any provision an arbitration agreement whereby the Arbitrator or umpire may, except with the consent of the parties to the agreement, enlarge the time for making the award, shall be void and of no effect." Under this provision, therefore, the Arbitrator or the umpire have no power to extend time except where consent has been given by the parties. A reading of Section 28(2) with amended provision of para 3 of the First Schedule leaves no room for a doubt that the parties to the agreement can always by mutual consent extend time for filing of the award. This is precisely what has been done in this case. A reading of Section 28(2) with amended provision of para 3 of the First Schedule leaves no room for a doubt that the parties to the agreement can always by mutual consent extend time for filing of the award. This is precisely what has been done in this case. The mere fact that the court for some reason has not been able to pass any specific order on the application moved by the parties jointly can have no adverse effect. As a matter of fact the consent of the parties for extension of time is inherent in the joint application. Even if no orders on this application have been passed, it will be assumed that the parties have given consent for extension of time for the filing of the award. 6. Learned counsel for the appellant places reliance on the decision of the Supreme Court rendered in Hindustan Steel Works Construction Ltd. v. C. Aajamekhar Rao (1987 SCC Vol. IV 93). In that case, to Supreme Court observed as follows : "The policy of law is that the arbitration proceedings should not be unduly prolonged. The arbitrator, therefore, has to given the award within the time prescribed or such time as the court concerned may in its direction extend. The court alone has been given the power to extend time for giving the award." This will, however, be not applicable in U.P. because of the amendment which has been brought about in para 3 of the First Schedule. Ordinarily it is for the court to extend time but by mutual consent the parties also can extend time particularly in view of the amended provision in para 3 of the First Schedule to the Arbitration Act. In view of the above, we find no force in this appeal which is accordingly dismissed. The other connected appeals are also disposed of. Appeal dismissed.