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2005 DIGILAW 3126 (RAJ)

The Rajasthan Rajya Vidyut Utpadan Nigam Ltd. v. Subhash Chandra

2005-11-24

VINEET KOTHARI

body2005
Judgment Dr. Vineet Kothari, J.- This appeal is directed against the order dated 14.01.2005 passed by the learned District Judge, Bikaner in Civil Misc. Case No. 152/2002 rejecting the application under Section 34 of the Arbitration and Conciliation Act, 1996 of the appellant Rajasthan Rajya Vidyut Utpadan Nigam Ltd. 2. Section 34 of the said Act which is re-produced here for ready reference. 34: Application for setting aside arbital award. (1) Recourseto a Court against an arbitral award may be made only by an application for setting aside such award in accordance with Sub-section (2) and Sub-section (3). (2) An arbitral award may be set aside by the Court only if- (a) the party making the application furnishes proof that- (i) the party was under some incapacity, or (ii) the arbitration agreement is not valid under the law to which the parties have subjected it or failing any indication thereon, under the law for the time being in force; or (iii) theparty making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case, or (iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, it contains decisions on matters beyond the scope of the submission to arbitration: Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside, or (v) the composition of the arbitral Tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part, or (c) the Court finds that- (i) thesubject matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or (ii) the arbitral award is in conflict with the public policy in India. Explanation:-Without prejudice to the generality of Sub-clause (ii) it is hereby declared, for the avoidance of any doubt, that an award is in conflict with the public policy of India if the making of the award is in induced or affected by fraud or corruption or was in violation of Section 75 or Section 81. (3) Anapplication for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under Section 33, from the date on which that request had been disposed of by the arbitral Tribunal: Provided that if the Court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months it may entertain the application within a further period of thirty days, but not thereafter. (4) On receipt of an application under Sub-section (1), the Court may, where it is appropriate and it is so requested by a party, adjourn the proceedings for a period of time determined by it in order to give the arbitral Tribunal an opportunity to resume the arbitral proceedings or to take such other action as in the opinion of arbitral Tribunal will eliminate the grounds for setting aside the arbitral award.” 3. From the perusal of the said provision it is very clear that the Arbitration award can be set aside on very limited grounds enumerated in Section 34(2). More over, making a drastic departure from the earlier law of Arbitration Act, 1940 the new Act of Arbitration and Conciliation Act, 1996 envisages minimal interference by Court of law in arbitration proceedings governed by the Act of 1996 and, therefore, very limited scope as specified in the said Act only is available for Courts to interfere in such arbitration proceedings under Section 34 of the Act of 1996. 4. In the appellants present case it is submitted that since no points of reference were decided while appointing the Arbitrator in the present case by letter dated 18.09.2000, therefore, there was a violation of Section 23 of the said Act and, therefore, the award should to be held invalid in law and the same should be set aside. 5. 4. In the appellants present case it is submitted that since no points of reference were decided while appointing the Arbitrator in the present case by letter dated 18.09.2000, therefore, there was a violation of Section 23 of the said Act and, therefore, the award should to be held invalid in law and the same should be set aside. 5. A bare perusal of Section 23 of the Act shows that there is no requirement in the present Act of 1996 for specifying the terms of reference or points of dispute at the time when the dispute is referred to the Arbitrator under the said Act of 1996. Sub-section (1) of Section 23 of Act of 1996 provides that: “23. Statement of Claim and Defence: (1)“within the period of time agreed upon by the parties or determined by the arbitral Tribunal, the claimant shall state the facts supporting his claim, the points at issue and the relief or remedy sought, and the respondent shall state his defence in respect of these particulars, unless the parties have otherwise agreed as to the required elements of those statements”. 6. Thus, there is no requirement in Section 23 for points of dispute or terms of reference to be decided before hand at that time of making a reference to the Arbitrator under this Act of 1996. 7. Learned Counsel also sought to urge that the payment of certain works awarded by the Arbitrator were under the wrong part of (G) schedule etc. These disputes are hardly of any relevance at this stage of the present case or even the Court below where the application under Section 34 was being considered which can be considered only on the limited grounds, as indicated above. 8. Learned Counsel further submitted that the Arbitrator has committed error in awarding the interest for the pre-reference period as there was delay on the part of the claimant himself . 9. I am afraid no point touching the merit of the award can be raised even in an application under Section 34 before the learned District Judge much less in a appeal before this Court particularly when no such point was even raised before the Arbitrator and the Court below. I do not find any force in the present appeal and the same is hereby dismissed.