AVN Oilfield Services v. Indiabulls Commercial Credit Limited
2017-02-14
RAJESH H.SHUKLA
body2017
DigiLaw.ai
JUDGMENT : Rajesh H. Shukla, J. 1. The present First Appeal is filed by the appellant-original opponent under Section 37 of the Arbitration & Conciliation Act, 1996 being aggrieved with the impugned order passed by the Additional District & Sessions Judge, Ahmedabad in Misc. Application No. 6 of 2016 dated 08.12.2016 upholding the order of the sole Arbitration regarding the recovery of the amount. 2. Heard learned advocate, Shri Anandodaya Mishra for the appellant and learned advocate, Shri Shivang Shukla for the respondent. 3. Learned advocate, Shri Mishra has referred to the papers at length and submitted that as per Section 31(5) of the Arbitration Act, signed copy of the award has not been served and, therefore, the issue of limitation could be considered only after it is served upon the party. Learned advocate, Shri Mishra has emphasized on two aspects that there is fundamental difference between the words "served" and "dispatched", which is required to be considered. He has also emphasized on a word "party" contending that statute has referred to word "party", meaning thereby, it has to be served to the party concerned. He referred to the papers at length to support his submission contending that there is no evidence that the signed award was served upon the appellant. For that purpose, he referred to the paper book which he had produced and pointedly referred to the acknowledgment slip of the post to contend that name of sender, Indiabulls Housing Finance Ltd. is not there nor name of Arbitrator and, therefore, acknowledgment slips, which have been produced, would not be sufficient to presume that award signed by the Arbitrator is served upon the appellant. In support of his submissions, he has referred to and relied upon the judgment of the Hon'ble Apex Court in case of Benarsi Krishna Committee & Ors. v. Karmyogi Shelters Pvt. Ltd., reported in (2012) 9 SCC 496 and pointedly referred to the observations made in the said judgment with much emphasis on Section 31(5) of the Arbitration Act. The provisions of Section 31(5) of the Arbitration Act, which provides, "31(5) After the arbitral award is made, a signed copy shall be delivered to each party." 4. Learned advocate, Shri Mishra therefore submitted that as the signed award has not been served upon, the impugned order passed by the Additional District & Sessions Judge, Ahmedabad at Mirzapur below application, Exh.
Learned advocate, Shri Mishra therefore submitted that as the signed award has not been served upon, the impugned order passed by the Additional District & Sessions Judge, Ahmedabad at Mirzapur below application, Exh. 6 in Execution Petition No. 856 of 2015 may be quashed and set aside and the present appeal may be admitted and the stay can be granted. 5. Learned advocate, Shri Mishra submitted that the Court below has committed an error in considering the aspect of limitation. For that, he referred to the observations made in the impugned judgment on Page No. 18 referring to the background as well as the fact that the award is served upon the appellant. Learned advocate, Shri Mishra also submitted that Section 3 makes it clear that it would not have any application to the judicial proceeding. He, therefore, submitted that the present appeal may be admitted and the interim relief as prayed for regarding stay of the operation of the impugned order may be granted. 6. Learned advocate, Shri Shukla has referred to the papers to emphasis that as discussed in the impugned judgment and order by the Arbitrator, the proceedings were conducted to the knowledge of the appellants and they did not participate or rather conveniently appear in some of the proceedings and, therefore, they cannot be permitted to say that award has not been served or no opportunity in the arbitration proceedings has been given to the appellants. He submitted that if they have not remained present as observed, the award could not be said to be bad as the opportunity has been given but the appellants have failed to availed of such opportunity by not remaining present and, therefore, award cannot be said to be bad. He also referred to the papers to emphasis that copy of the award which is required to be served by the Arbitrator, has been served, for which, he has referred to the papers. He submitted that even the respondent has also served, for which, acknowledgment is produced. He submitted that Section 114 of the Evidence Act read with Section 27 of the General Clauses Act would make it clear that burden is on one, who claims that it has not been served once it is established that copy was dispatched.
He submitted that even the respondent has also served, for which, acknowledgment is produced. He submitted that Section 114 of the Evidence Act read with Section 27 of the General Clauses Act would make it clear that burden is on one, who claims that it has not been served once it is established that copy was dispatched. In support of his submissions, he has referred to and relied upon the judgment of the Hon'ble Apex Court in case of Kailash Rani Dang v. Rakesh Bala Aneja & Anr., reported in 2009 (4) GLR 2830 : (2009) 1 SCC 732 . 7. Learned advocate, Shri Shukla also submitted that the presumption would be attracted and such application may not be accepted in light of the provision of Section 27 of the General Clauses Act read with Section 114 of the Evidence Act. He has referred to and relied upon the judgment in case of Prajapati Oil Industry v. State of Gujarat, reported in 2004 (1) GLH 365 and pointedly referred to Head Note - B regarding the presumption and burden of proof. It was submitted that if the notice as required has been sent at the correct address written on it then, it is deemed to have been served to the sender unless it is proved otherwise. He submitted that the appellant has not remained present to contest though the proceedings before the Arbitrator were going on to the knowledge of the appellants. He has also referred to and relied upon the judgment in case of Basant Singh & Anr. v. Raman Catholic Missions, reported in (2002) 7 SCC 531 and emphasized the observations made in Paragraph No. 11. He, therefore, submitted that the present appeal may not be entertained and relief may not be granted, which is aimed to only protract the litigation to avoid payment. 8. In rejoinder, learned advocate, Shri Mishra referred to the papers with much emphasis on the aspect of non-service of the award. He also submitted that acknowledgment which is produced without the name of sender cannot be said to be relating to this service of the award. He again emphasized referring to Section 31(5) of the Arbitration Act that the burden lies on the Arbitrator or the opponent to serve the award and the presumption could be attracted provided there is any acknowledgment for the service of the award.
He again emphasized referring to Section 31(5) of the Arbitration Act that the burden lies on the Arbitrator or the opponent to serve the award and the presumption could be attracted provided there is any acknowledgment for the service of the award. He submitted that as there is no valid acknowledgment with regard to the service of the award, the presumption based on the General Clauses Act would not be available and, therefore, the present appeal may be admitted. He has also submitted that the Court at Patiala has dismissed the application with the observations and, therefore, as it was at the interim stage, the award by the Arbitrator may not be accepted. 9. Learned advocate, Shri Shukla has also referred to the papers and submitted that award has been signed once it is dispatched for which acknowledgment is produced and merely because the issue is sought to be joined with regard to the service of the award, it may not be a ground or handle to stall the proceeding of execution having failed to participate and contest on merits in the arbitration proceedings. He, therefore, submitted that the present First Appeal may not be entertained. 10. In view of these rival submissions, it is required to be considered whether the First Appeal deserves consideration. 11. Normally being a first Appellate Court, record would be examined, however in background of the facts, the issue involved is only on the aspect of service of the signed award by the Arbitrator and whether it can be said that the award has not been served upon the appellant, which has been submitted with much emphasis relying upon the provision of Section 31(5) of the Arbitration Act. Though the submissions have been made at length referring to Section 31(5) of the Arbitration Act, it is required to be stated that the provision of Section 3 of the Arbitration Act provides, "Receipt of written communications 3.
Though the submissions have been made at length referring to Section 31(5) of the Arbitration Act, it is required to be stated that the provision of Section 3 of the Arbitration Act provides, "Receipt of written communications 3. (1) Unless otherwise agreed by the parties:-- (a) any written communication is deemed to have been received if it is delivered to the addressee personally or at his place of business, habitual residence or mailing address; (b) if none of the places referred to in clause (a) can be found after making a reasonable inquiry, a written communication is deemed to have been received if it is sent to the addressee's last known place of business, habitual residence or mailing address by registered letter or by any other means which provides a record of the attempt to deliver it. (2) The communication is deemed to have been received on the day it is so delivered. (3) This section does not apply to written communications in respect of proceedings of any judicial authority." 12. Though learned advocate, Shri Mishra has relied upon sub-section (3) of Section 3 that it is made clear that section does not apply to the written communication in the proceeding of judicial authority and, therefore, it would not be attracted, the submissions are devoid of merits as proceeding before the Arbitrator are in the nature of quasi judicial proceeding and it cannot be said that provision of Section 3 or rather Section 3(3) would not be attracted. 13. Another facet of submissions, which have been made, relying upon Section 31(5) of the Arbitration Act that it would be subject to Section 31(5) of the Arbitration Act and, therefore, Section 31(5) of the Arbitration Act will override the provision referring to the communication in Section 3 of the Arbitration Act and Section 31(5) referred to the form and contents of arbitral award and service. Therefore, the submissions which have been made, cannot be accepted as Section 31(5) of the Arbitration Act refers to only award, whereas Section 3 of the Arbitration Act refers to written communication. Therefore, the moot question which is required to be considered is whether the submissions made by learned advocate, Shri Mishra with regard to non-service of the signed award can be believed or accepted or not.
Therefore, the moot question which is required to be considered is whether the submissions made by learned advocate, Shri Mishra with regard to non-service of the signed award can be believed or accepted or not. For that purpose, apart from the reasons recorded by the Court below, Registered AD slip dated 13.08.2015 by the sole Arbitrator produced on record clinches the issue as it has been clearly referred by the sole Arbitrator, "in terms of Section 31(5) of the Arbitration & Conciliation Act, 1996, signed copy of the arbitral award on 13.08.2015 in the above matter is sent to you, kindly acknowledge the receipt". 14. It appears that it is sent with Registered AD and, therefore, the submissions which have been made by learned advocate, Shri Mishra are beating about the bushes on this issue has no merits. Again as rightly submitted and discussed in the award, once the award has been dispatched by the Arbitrator by Registered AD, it would lead to presumption that as provided under Section 7 of the General Clauses Act read with Section 114 of the Evidence Act, which have been pressed into service by learned advocate, Shri Shukla, the judgment of the Hon'ble Apex Court in case of Kailash Rani Dang (supra) clearly answers the contentions raised by learned advocate, Shri Mishra. In fact in this judgment, the Hon'ble Apex Court has referred to and relied upon the judgment of the Hon'ble Apex Court in case of Union of India v. Tecco Trichy Engineers & Contractors, reported in (2005) 4 SCC 239 referred to and relied upon by learned advocate, Shri Mishra. Much emphasis given by learned advocate, Shri Mishra on the observations made in the judgment of the Hon'ble Apex Court in case of Union of India (supra) is devoid of merits as this judgment has been distinguished in a subsequent judgment of the Hon'ble Apex Court in case of Kailash Rani Dang (supra). The Hon'ble Apex Court while making distinction with earlier judgment in case of Union of India (supra) has referred to special kind of organization like Railway and Government suggesting that the award is required to be served as in such organization, it may not reach the correct person or the authority.
The Hon'ble Apex Court while making distinction with earlier judgment in case of Union of India (supra) has referred to special kind of organization like Railway and Government suggesting that the award is required to be served as in such organization, it may not reach the correct person or the authority. It was made in that context, which has been considered by the Hon'ble Apex Court and, therefore, the observations made in a judgment in case of Union of India (supra) would not have any application in light of the judgment of the Hon'ble Apex Court in case of Kailash Rani Dang (supra). The observation referred to in that case would answer the contentions, which have been raised in the present matter. The Hon'ble Apex Court has also referred to the presumption in light of Section 27 of the General Clauses Act read with Section 114 of the Evidence Act. It is in this background, the submissions made by learned advocate, Shri Mishra cannot be believed or accepted. Therefore, the present First Appeal cannot be entertained. 15. At the cost of repetition, it is stated that normally the First Appeal may be considered, however in the background of the facts and considering the nature of the issue involved, it hardly requires any consideration and, therefore, it has been heard at length. 16. Therefore, the present First Appeal deserves to be dismissed in limine and accordingly stands dismissed. Notice is discharged. 17. In view of the dismissal of main First Appeal, Civil application does not survive and stands disposed of accordingly. Notice is discharged.