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2018 DIGILAW 2260 (JHR)

State of Jharkhand v. Anil Sharma

2018-10-11

APARESH KUMAR SINGH

body2018
ORDER : 1. Heard learned counsel for the parties. 2. Award dated 8th December, 2013 rendered by the sole Arbitrator appointed by this Court was made subject-matter of challenge in Miscellaneous Case No. 08 of 2014 before learned Civil Judge (Sr. Division) No. -I, Ranchi by the petitioner-State of Jharkhand and its official. Claimant/respondent herein had raised a dispute under different Heads in respect of Agreement No. JHWB-0502 dated 20th December, 2005 for construction and maintenance of rural road from REO Road to Raksha; Baniyari More to Baniyari and Manthakeso More to Mathakeso in Saraiyahat Block in the district of Dumka. After contest Award was delivered by the sole Arbitrator holding that State of Jharkhand is liable to pay under different Heads for a total amount of Rs.43,46,749.73 Paise from 1.1.2010. Award was received by the parties on the same date i.e., 8th December, 2013. Application under Section 34 was filled before learned Court of Civil Judge (Sr. Division) No. -I, Ranchi on 26th March, 2014 i.e., beyond 3 months period stipulated under Section 34(3) of the Arbitration and Conciliation Act, but before expiry of further 30 days period therefrom. In effect, it was filled within 120 days. The application suffered from several defects which were cured before the matter was taken up on 30th January, 2017 by learned Court when the order impugned was passed. 3. Applicant/petitioner herein filed a petition for condonation of delay of 17 days beyond 90 days period in preferring the application on 1st September, 2014 invoking Section 5 of the Limitation Act. Another application for condonation of delay also under Section 5 of the Limitation Act was filed on 27th January, 2015. Section 34 application and two limitation petitions are part of the affidavit containing preliminary objection filed herein on behalf of respondent/ claimant on 11th April, 2018. Learned Civil Judge considered the prayer for condonation of delay as also certain defects which were pointed out by Shristedar earlier and observed that filing of subsequent application for condonation of 90 days delay and the defective affidavit outside the Court premises showed non-seriousness of the State with regard to the present Award. Learned Court did not stop at that but ventured to enter into the merits of the challenge of the Award as well. Learned Court did not stop at that but ventured to enter into the merits of the challenge of the Award as well. It referred to Section 34 and the grounds provided under Section 34 2 (b) (i) and also went on to observe that the applicant had taken a ground which was with regard to the mental process in interpretation of evidence of the learned arbitrator which cannot be seen by the Court because it is not a Court of appeal of Arbitrator. Sufficiency of evidence cannot be proved in application under Section 34 to nullify the Award. Miscellaneous Application was dismissed both with observation in relation to merits of the challenge and delay in preferring the application. Learned Court while dismissing the Miscellaneous Application held as under : “Thus, in view of the aforesaid discussions, it is found by this Court that no public policy is being affected by the award which has been passed by the learned arbitrator on 08.12.2013 in arbitration application case No.31/09. Therefore, it is found and held that the objector have got no substantial ground for admission of the application. The petitioner under Section 5 of the Limitation Act is not worth acceptance in view of the established provision of law and therefore, application filed by the applicants under Section 34 of the Arbitration and Conciliation Act, 1996 for setting aside the arbitration award dated 08.12.2013 failed and not admitted and the Misc. case stands dismissed.” 4. Rival arguments have been made by learned counsel for the parties to question the impugned order and in support thereof. Learned counsel for the appellant has argued that learned Court has exceeded in its jurisdiction in rendering a composite order both on the grounds of delay and on the merits of the challenge. If the application was not entertainable on failing to show sufficient cause for condonation of delay, learned Court should not have ventured into merits of the grounds raised to challenge the Award. 5. Learned counsel submits that application under Section 34 was filed beyond 90 days but within 120 days from the date of receipt of Award which fact is not in dispute. 5. Learned counsel submits that application under Section 34 was filed beyond 90 days but within 120 days from the date of receipt of Award which fact is not in dispute. It is also not in dispute that an application for condonation of 17 days delay was filed on 1st September, 2014 taking specific grounds to explain the delay as the file had moved in the official hierarchy and after approval was granted the application was filed. Learned Court has not applied its mind to the cause shown by the petitioner and there is no discussion on that point. 6. Learned counsel for the petitioner submits that the explanation shown by the applicant ought to have been properly considered as it was sufficient to explain the delay. Leaned Court ought not to have been guided by nomenclature of the application under Section 5 of the Limitation Act, if the substance of the application was properly considered. Nomenclature of the application for condonation of delay was not at all attributable to the applicant, but may be an error in drafting by learned lawyer which should not have prejudiced the case of the petitioner from consideration on the substantive grounds taken for condonation of delay. Filing of a subsequent application for condonation of delay was also unnecessary act which may be based on improper legal advise, for which the applicant should not have been made to suffer. Learned Court was required to consider whether the grounds taken are sufficient to explain the delay in filing this application after 90 days of the delivery of the Award but before 120 days thereof. It is not a case where the application under Section 34 was filed after 120 days of receipt of the Award. Award imposes huge liability upon the State. Since the delay has not been considered by the learned Court properly, it has entailed grave prejudice to the case of the petitioner. Technicalities of procedure should not have come into the way in deciding the case on merits when there was a delay of only 17 days beyond 90 days in filing 34 applications. Time consumed in curing the defects pointed out by Shristedar also should not be taken to the disadvantage of the applicant if defects were cured when the matter was taken up. As such, the impugned order deserves to be set aside for reconsideration by learned Court on merits. Time consumed in curing the defects pointed out by Shristedar also should not be taken to the disadvantage of the applicant if defects were cured when the matter was taken up. As such, the impugned order deserves to be set aside for reconsideration by learned Court on merits. 7. Learned counsel for the claimant/ respondent herein has seriously opposed the prayer. He submits that learned Court had duly applied its mind to the application for condonation of delay filed by the petitioner and found its overall conduct as non-serious for the reasons recorded therein. There were certain fundamental defects in the application. Such as absence of signature; required affidavit was not sworn at the Civil Court, Ranchi; verification of application was also not there. It was not in compliance with Rule 202 of Civil Court Rules whereunder the provisions of Civil Procedure Code have been made applicable. The requirement of Order-VI, Rules 14 and 15 relating to verification had not been complied with. Learned counsel further submits that non-seriousness of the applicant was writ large in the manner in which the application under Section 34 was filed without accompanying delay condonation petition. Delay condonation petition was filed twice first on 1st September, 2014 and then second on 27th January, 2015 seeking condonation of 17 days delay in first instance and 90 days in second instance. Those applications were filed under Section 5 of the Limitation Act. Provisions of Section 5 of Limitation Act are not applicable in a proceeding under Section 34 of Arbitration and Conciliation Act, 1996. Reliance is placed on the case of Union of India v. Popular Construction Co., reported in 2001 (3) JCR 330 (SC) : (2001) 8 SCC 470 in support of the aforesaid contention. Since the provision itself contains limitation of 30 days beyond 90 days in filing such an application and no more, delay beyond that is condonable. 8. Learned counsel for the respondent has further placed reliance upon the judgment of Hon'ble Supreme Court in the case of Consolidated Engineering Enterprises v. Principal Secretary, Irrigation Department and others, reported in (2008) 7 SCC 169 , in support of his submission that there is no applicability of Section 5 of Limitation Act in condoning the delay in filing an application under Section 34 of Arbitration and Conciliation Act, 1996. Learned counsel submits that if the application for condonation of delay was not accompanied with 34 applications then mere filing of such application was no filing in the eye of law. Learned counsel for the respondent submits that the provisions of Order XLI would also be applicable to the case at hand. If the application for condonation of delay has been filed much beyond the period of 120 days by the applicant, then the requirement of law as contemplated under Section 34 of the Act is not made out. He submits that the applicant has not been diligent in prosecuting the application before learned Court. Learned Civil Court has rightly rejected the application. Learned Court has only made reference to the provisions under Section 34 which contains the grounds on which such a challenge can be made to award. The order impugned does not show any more discussion on the merits of the grounds of challenge. In substance, the application was dismissed on grounds of delay and non-applicability of Section 5 of Limitation Act. 9. I have considered the submissions of learned counsel for the parties and the grounds urged in the facts and circumstances of the case noted above. 10. Here is a case where parties do not dispute the factual position that an application under Section 34 was filed before the competent Court of learned Civil Judge (Senior Division) No.1, Ranchi after 17 days beyond the three months period stipulated under Section 34(3) of the Arbitration and Conciliation Act but before the expiry of the further 30 days period there from. In effect it was filed within 120 days from the date of receipt of the award dated 8th December, 2013. Parties also do not dispute that the defects in the application were cured before the matter was taken up by learned Civil Judge on 30th January, 2017 and the order impugned was passed. It is also not in dispute that application for condonation of 17 days delay was filed on 1st September, 2014 but under Section 5 of the Limitation Act, 1963. For wholly inexplicable reasons another application for condonation of delay of 90 days was filed by the applicant/appellant herein on 27th January, 2015 again under Section 5 of the Limitation Act. It is also not in dispute that application for condonation of 17 days delay was filed on 1st September, 2014 but under Section 5 of the Limitation Act, 1963. For wholly inexplicable reasons another application for condonation of delay of 90 days was filed by the applicant/appellant herein on 27th January, 2015 again under Section 5 of the Limitation Act. The application dated 1st September, 2014 seeking condonation of delay of 17 days sought to explain the delay through its averments in the following manner :- “2. That the applicant has not filed any other limitation for the condonation of delay which has occurred in filing the instant appeal. 3. That it is submitted that the award under challenge was passed on 08.12.13 and the copy of the award was handed over to the counsel for the respective parties on the same date. 4. That it is submitted that after the passing of the award the counsel for the State informed the Executive Engineer, Dumka regarding the passing of the said award. 5. That the Executive Engineer, Dumka obtained a copy of the said award on 15.12.13 from the counsel for the State. 6. That the Executive Engineer, Dumka went through copy of the award and forwarded the same to the Superintending Engineer, Dumka Division on 22.12.13. 7. That through the proper channel the copy of the award was forwarded to the Principal Secretary, Rural Works Department in the first week of January 2014. 8. That after going through the file the Principal Secretary of the Department asked for the entire file relating to the arbitration case which was placed before the Principal Secretary on 20.01.14. That during this time the Principal Secretary of the Department was busy with regard to the preparation of the Republic Day and hence consultation with the Principal Secretary of the Department could not take place. 9. That it is noteworthy that since the matter related to Dumka meeting with the Principal Secretary could take place only when the Executive Engineer came down to Ranchi from Dumka. This took considerable time. Due to heavy work load it was not possible for the Executive Engineer to come down to Ranchi every now and then. 10. 9. That it is noteworthy that since the matter related to Dumka meeting with the Principal Secretary could take place only when the Executive Engineer came down to Ranchi from Dumka. This took considerable time. Due to heavy work load it was not possible for the Executive Engineer to come down to Ranchi every now and then. 10. That in the first week of February the Principal Secretary of the Department held a meeting with the Executive Engineer and before giving any decision the Principal Secretary of the Department asked for the entire file relating to the dispute. 11. That the file was requisitioned from Dumka and was handed over to the Principal Secretary of the Department on 17.02.14. 12. That on 28.02.14 the Principal Secretary handed over the file back to the Executive Engineer with a direction to make preparation for filing an appeal under Section 34 of the Arbitration and Conciliation Act, 1996. 13. That on 03.03.14 the Executive Engineer, Dumka contacted his advocate at Ranchi and instructed him to file an application under Section 34 of the Arbitration and Conciliation Act, 1996. 14. That before drafting the memo of appeal to be filed under the Act the counsel for the appellants wanted to go through the entire file. However, since certain documents were not on record, he called for the same. These documents were obtained from Dumka and handed over to the counsel on 12.03.14. 15. That thereafter the memo of appeal was drafted and handed over to the Executive Engineer on 20.3.2014. Before filing the memo of appeal it was necessary to get the approval of the Principal Secretary of the Department. The Principal Secretary after going through the memo of appeal suggested certain changes on 22.03.14. 16. That after incorporating the changes the memo of appeal was filed on 25.03.14. Thus, a delay of about 17 days has occurred in filing the said appeal. 17. That the delay in preferring the appeal has occurred inadvertently and due to reasons beyond the control of the appellants.” 11. The explanation furnished by the applicant cannot be said to be perfunctory or casual. The delay was of 17 days only. The movements of file had been graphically explained by the applicant to explain delay. The learned Court has however not dealt with the specific explanation furnished by the applicant in the order impugned. The explanation furnished by the applicant cannot be said to be perfunctory or casual. The delay was of 17 days only. The movements of file had been graphically explained by the applicant to explain delay. The learned Court has however not dealt with the specific explanation furnished by the applicant in the order impugned. Naming of a wrong provision in a delay condonation application could not be attributed to the applicant but was an error on the part of the counsel drafting the same. This error on its own should not have weighed upon the Court to reject the prayer, though the delay was only 17 days beyond 90 days and the application was within 120 days period prescribed under Section 34(3) of the Act of 1996. Filing of another application for condonation of delay of 90 days under Section 5 of the Limitation Act was again an error which cannot be attributed to the applicant but on poor draftsmanship. If the explanation is considered, the delay appears to have been properly explained. Wrong mentioning or non-mentioning of a provision should not invalidate an order passed by a Court and/or statutory authority if it had requisite jurisdiction therefor. In the case of P.K. Palanisami v. N. Arumugham, reported in (2009) 9 SCC 173 , the Apex Court at paragraphs 27 to 29 of the report held as under : “27. Section 148 of the Code is a general provision and Section 149 thereof is special. The first application should have been filed in terms of Section 149 of the Code. Once the Court granted time for payment of deficit court-fee within the period specified therefor, it would have been possible to extend the same by the Court in exercise of its power under Section 148 of the Code. Only because a wrong provision was mentioned by the appellant, the same, in our opinion, by itself would not be a ground to hold that the application was not maintainable or that the order passed thereon would be a nullity. It is a well settled principle of law that mentioning of a wrong provision or non-mentioning of a provision does not invalidate an order if the Court and/or statutory authority had the requisite jurisdiction therefor. 28. In Ram Sunder Ram v. Union of India it was held: (SCC pp. 260-61, para 19) "19. .... It is a well settled principle of law that mentioning of a wrong provision or non-mentioning of a provision does not invalidate an order if the Court and/or statutory authority had the requisite jurisdiction therefor. 28. In Ram Sunder Ram v. Union of India it was held: (SCC pp. 260-61, para 19) "19. .... It appears that the competent authority has wrongly quoted Section 20 in the order of discharge whereas, in fact, the order of discharge has to be read having been passed under Section 22 of the Army Act. '9. It is sell-settled that if an authority has a power under the law merely because while exercising that power the source of power is not specifically referred to or a reference is made to a wrong provision of law, that by itself does not vitiate the exercise of power so long as the power does exist and can be traced to a source available in law.' (See N. Mani v. Sangeetha Theatre, SCC p. 280, para 9.) Thus, quoting of wrong provision of Section 20 in the order of discharge of the appellant by the competent authority does not take away the jurisdiction of the authority under Section 22 of the Army Act. Therefore, the order of discharge of the appellant from the army service cannot be vitiated on this sole ground as contended by the learned counsel for the appellant." 29. In N. Mani v. Sangeetha Theatre, it is stated : (SCC p. 280, para 9) "9. It is sell-settled that if an authority has a power under the law merely because while exercising that power the source of power is not specifically referred to or a reference is made to a wrong provision of law, that by itself does not vitiate the exercise of power so long as the power does exist and can be traced to a source available in law." 12. The respondent herein has based his submission on the point of delay on the judgment of the Apex Court in the case of Popular Construction Co. (supra). On perusal of the judgment in the case of Popular Construction Co. The respondent herein has based his submission on the point of delay on the judgment of the Apex Court in the case of Popular Construction Co. (supra). On perusal of the judgment in the case of Popular Construction Co. it is evident that the factual position in that case was that if the Limitation Act, 1963 and in particular Section 5 did not apply to Section 34 of the Act of 1996, then the objection to the award was time barred and appeal was bound to be dismissed. The award in that case was made by the arbitrator on 29th August, 1998. Under the impression that the Arbitration Act, 1940 applied, the original award was forwarded to the appellant with a request to file the award in the Bombay High Court so that a decree could be passed in terms of the award under the provisions of the Arbitration Act, 1940. The award was accordingly filed by the appellant in the Bombay High Court on 29th March, J 999. The appellant filed an application challenging the award on 19th April, 1999 under Section 30 read with Section 16 of the Arbitration Act, 1940. Subsequently, the application was amended by inserting the words "Arbitration and Conciliation Act, 1996" in place of "Arbitration Act, 1940". The application was dismissed by the learned Single Judge on 26th October 1999 on the ground that it was barred by limitation under Section 34 of the 1996 Act. The Division Bench rejected the appeal and upheld the findings of the learned Single Judge. In this context the question which arose for determination was whether the provisions of Section 5 of the Limitation Act, 1963 were applicable to an application challenging an award under Section 34 of the Arbitration and Conciliation Act, 1996. The Apex Court held in categorical terms that in view of the specific provisions contained in Section 34, sub-section (3), Section 5 of the Limitation Act, 1963 was not applicable to proceeding under Section 34 for setting aside arbitral award. The words "but not thereafter" used in the proviso to sub-section (3) amounts to an express exclusion within the meaning of Section 29(2) of the Limitation Act. This could be inferred from history, scheme and objectives of the 1996 Arbitration Act, one of whose main objectives is to restrict judicial intervention in arbitral matters as much as possible. 13. The words "but not thereafter" used in the proviso to sub-section (3) amounts to an express exclusion within the meaning of Section 29(2) of the Limitation Act. This could be inferred from history, scheme and objectives of the 1996 Arbitration Act, one of whose main objectives is to restrict judicial intervention in arbitral matters as much as possible. 13. In the present case the application for setting aside the award under Section 34 was not filed after 120 days from the date of receipt of the award. If it had been filed after 120 days from the date of receipt of the award, the delay was uncondonable by resort to the provision of Section 5 of the Limitation Act. In the instant case the application was within time though condonation of delay application was filed later on under a wrong provision i.e. Section 5 of the Limitation Act, 1963. Mere wrong mentioning of the provision could not denude the jurisdiction and power of the learned Court below to condone the delay if the explanation was sufficient and the main application was filed within the period of 120 days from the date of receipt of the award. As such the ratio laid down in the case of Popular Construction does not apply to fact s of the present case. Had the provision of Section 5 of the Limitation Act not been mentioned in the application for condonation of delay, could it be still said that the Court did not have power to condone the delay if it was properly explained. The learned Court has, therefore, committed an error in law in rejecting the application. It has also erroneously made observation on merits while rejecting application on the ground of delay. For both the reasons, the order impugned cannot be sustained in the eye of law. However, it needs to be mentioned that much more diligence was required on the part of the appellant in prosecuting the challenge before the Court of learned Civil Judge-I, Ranchi. As per their own case, the award imposes huge liability of Rs. 43.46 lakhs together with 18% interest from the date of the award. 14. For the reasons recorded herein above, the impugned order is set aside. The appeal is allowed with cost of Rs. 50,000/- to be paid to the respondents within a period of four weeks. As per their own case, the award imposes huge liability of Rs. 43.46 lakhs together with 18% interest from the date of the award. 14. For the reasons recorded herein above, the impugned order is set aside. The appeal is allowed with cost of Rs. 50,000/- to be paid to the respondents within a period of four weeks. The matter is remanded to the learned Court of Civil Judge (Senior Division) No.1, Ranchi for deciding the case on merits in a time bound manner. Parties are required to cooperate. In order to ensure that adjudication is not further delayed, the parties are directed to appear before the Court on 20th November 2018 when the learned Court would take up the matter. Appeal allowed.