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2014 DIGILAW 256 (MP)

Ashok v. Sanghi Brothers (Indore) Ltd.

2014-02-28

PRAKASH SHRIVASTAVA

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Judgment: Prakash Shrivastava, J. 1. This writ petition under Article 227 of the Constitution of India is directed against the order of the Additional District Judge, Indore dated 6.9.2012, by which the petitioner's application for framing the issue has been rejected and the request for grant of time to file rejoinder has been turned down. In brief, in the arbitration proceedings between the petitioner and the respondent No. 1, the Arbitrator had passed the award on 7.9.2009, against which the petitioner had filed objection under Section 34 of the Arbitration and Conciliation Act, 1996 (for short "the Act") and when the matter was pending before the Additional District Judge, Indore, the petitioner had filed an application for framing the issues which has been rejected by the impugned order dated 6.9.2012. By this order the petitioner's prayer for further time to file the rejoinder was also rejected. 2. Learned counsel appearing for the petitioner referring to Rule 9(1) of the M.P. Arbitration Rules, 1997 and the Single Bench judgment of this Court in the matter of Lakme Limited, Mumbai Vs. Plethico Pharmaceuticals Ltd., Indore and others reported in 2000 (2) M.P.L.J. 35 has submitted that for deciding the objection under Section 34 of the Act, it was necessary for the Additional District Judge to frame issues and decide the same after permitting the parties to lead evidence. He has further submitted that the opportunity for filing the rejoinder should have been granted. 3. Counsel for the respondent No. 1 has opposed the petition and has submitted that the scope of the arbitration proceedings under Section 34 of the Act is limited and it is not mandatory to frame issues before deciding application under Section 34. He has further submitted that since inspite of opportunity rejoinder was not filed, therefore, the prayer for grant of time to file rejoinder has rightly been rejected. 4. I have heard the learned counsel for the parties and perused the record. 5. The main issue which arises for consideration before this Court is as to whether it is mandatory for the District Judge to frame issues and decide the same while considering objections under Section 34 of the Act. 6. Section 34 of the Act provides for application for setting aside the arbitral award on the grounds enumerated in that Section. 5. The main issue which arises for consideration before this Court is as to whether it is mandatory for the District Judge to frame issues and decide the same while considering objections under Section 34 of the Act. 6. Section 34 of the Act provides for application for setting aside the arbitral award on the grounds enumerated in that Section. The Act does not provide for any elaborate procedure for deciding the application under Section 34 of the Act. 7. Before the arbitrator the elaborate proceedings take place; where the issues may be framed by the arbitrator and the parties are permitted to adduce evidence and after considering the same, the arbitrator decides the dispute. Under Section 35 of the Act, arbitral award is final and binding. Under the scheme of the Act, minimum interference in the arbitral proceedings and award is required. See: P. Anand Gaiapathi Raju and others Vs. P.V.G. Raju (Dead) and others (2000) 4 SCC 539 . The arbitral matters covered under the Act are required to be decided promptly. Whole object and scheme of the act is to secure expeditious resolution of dispute. [See: Gas Authority of India Ltd. and Another Vs. Keti Construction. (I) Ltd. and others (2007) 5 SCC 38 ]. 8. The application under Section 34 of the Act has a limited scope of raising the grounds mentioned in Section 34. The District Judge is not be required to give any finding on independent factual issues apart from the grounds mentioned in Section 34 of the Act, therefore, it is not necessary to frame issues by the District Judge while deciding the objection under that Section. 9. The Supreme Court in the matter of Fiza Developers and Inter-Trade Private Limited Vs. AMCI (India) Private Limited and another reported in (2009) 17 SCC 796 has considered the above aspect of the matter and has expressed that:- "22........................ The grounds for setting aside the award are specific. Therefore, necessarily a petitioner who files an application will have to plead the facts necessary to make out the ingredients of any of the grounds mentioned in sub-section (2) and prove the same. Therefore, the only question that arises in an application under Section 34 of the Act is whether the award required to the set aside on any of the specified grounds in sub-section (2) thereof. Therefore, the only question that arises in an application under Section 34 of the Act is whether the award required to the set aside on any of the specified grounds in sub-section (2) thereof. Sub-section (2) also clearly places the burden of proof on the person who makes the application. Therefore, the question arising for adjudication as also the person on whom the burden of proof is places is statutorily specified. Therefore, the need for issues is obviated. 23. Framing of issues is necessary only where different types of material propositions of fact or law are affirmed by one party and are denied by the other and it is therefore necessary for the court to identify the issues and specify the party on whom the burden to prove the same lies. When this exercise has already been done by the statute, there is no need for framing the issues. 24. In other words, an application under Section 34 of the Act is a single issue proceeding, where the very fact that the application has been instituted under that particular provision declares the issue involved. Any further exercise to frame issues will only delay the proceedings. It is thus clear that issues need not be framed in applications under Section 34 of the Act. 30. Having regard to the object of the Act, that is, providing an expeditious alternative binding dispute resolution process with minimal court intervention, it is difficult to envisage proceedings under Section 34 of the Act as full-fledged regular civil suits under the Code of Civil Procedure." 10. 30. Having regard to the object of the Act, that is, providing an expeditious alternative binding dispute resolution process with minimal court intervention, it is difficult to envisage proceedings under Section 34 of the Act as full-fledged regular civil suits under the Code of Civil Procedure." 10. Learned counsel for the petitioner has placed reliance upon the Rule 9 of the M.P. Arbitration Rules, 1997 in support of his submission that Order 14 of the C.P.C. applies in the proceedings under Section 34 of the Act, therefore, it is necessary to frame issues but such a submission can not be accepted in view of the above judgment of the Supreme Court in the matte of Fiza Developers (supra), wherein the Supreme Court has considered Rule 4(b) and Rule 12 of the High Court of Karnataka (Proceedings before the Courts) Rules, 2001 which are much wider than the Rule 9 of the M.P. Arbitration Rules and has held that there is no wholesale or automatic import of all the provisions of the Code into proceedings under Section 34 of the Act, as that will defeat the very purpose and object of the Act. 11. Counsel for the petitioner has also placed reliance upon the Single Bench judgment of this Court in the matter of Lakme Limited (supra), but the view taken by the Single Bench of this Court in the matter of Lakme Limited (supra) runs counter to the judgment of the Supreme Court in the matter of Fiza Developers (supra). The judgment of the Supreme Court in the matter of Fiza Developers (supra) is binding on this Court under Article 141 of the Constitution. The settled decision of the Supreme Court can not be ignored by this Court and it is not open to this Court to follow the Single Bench judgment in the matter of Lakme Limiter (supra) of this Court which is contrary to the judgment of the Supreme Court. [See: (1997) 6 SCC 450 Dwarikesh Sugar Industries Ltd. Vs. Prem Heavy Engineering Works (P) Ltd. and Another] 12. Thus I am of the considered opinion that while deciding the objection under Section 34 of the Act, the Additional District Judge is not required to frame the issue and such an application need not be decided like a regular civil suit. 13. Prem Heavy Engineering Works (P) Ltd. and Another] 12. Thus I am of the considered opinion that while deciding the objection under Section 34 of the Act, the Additional District Judge is not required to frame the issue and such an application need not be decided like a regular civil suit. 13. So far as the question of granting time to the petitioner to file rejoinder is concerned, it is noticed that while considering the nature of proceedings, the learned Additional District Judge had granted last opportunity to the petitioner to file rejoinder and had fixed the case for final arguments on 6.9.2012. In spite of the last opportunity, the petitioner had not filed the rejoinder; therefore, no error has been committed by the learned Additional District Judge in refusing to grant further time for filing the rejoinder. Even otherwise counsel for the petitioner could not point out the necessity for filing the rejoinder in the proceedings under Section 34 of the Act. Thus, the impugned order does not suffer from any error. The writ petition is accordingly dismissed.