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2018 DIGILAW 2681 (JHR)

Ekta Telecommunication System, Kharasa- Wan v. Union Of India

2018-12-06

APARESH KUMAR SINGH

body2018
JUDGMENT Aparesh Kumar Singh, J. - Heard learned counsel for the parties. 2. Respondent preferred an application under Section 34 of the Arbitration and Conciliation Act, 1996 before learned Court of Sub-Judge-I, Ranchi being Miscellaneous Case No. 11 of 2014 in order to lay challenge to the Award dated 18th May, 2012. Award was received by them on 19th June, 2012. However, instead of choosing to prefer an application under Section 34 of the Act, straightway they approached the Writ Court in W.P.(C) No. 6876 of 2012. Learned Court by order dated 29th April, 2013 (Annexure-6) dismissed the writ petition. It was also noticed that petitioners had an alternative remedy of appeal under the Act of 1996 and that writ petition was filed after the time limit for filing of such application under Section 34 of the Act of 1996 had expired. Respondent/writ petitioner had raised a plea that the Award was rendered by Jharkhand Micro and Small Enterprises Facilitation Council without due notice to it. On facts, however, it failed to establish that the order was passed without notice or affording opportunity of hearing to them. This was taken in appeal before learned Division Bench in L.P.A No. 200 of 2013. Appeal was disposed of with the following observations: "1. This Letters Patent Appeal has been preferred by the appellant (original petitioner) against the judgment and order delivered by the learned single Judge on 29.04.2013 passed in W.P.( C) No. 6876 of 2012. 2. The present appellant (original petitioner) had preferred W.P(C) No. 6876 of 2012, against an award passed by the Jharkhand Micro and Small Enterprises Facilitation Council order dated 19.06.2012 (Annexure-5 to this memo of Letters Patent Appeal. 3. Learned counsel appearing for the appellant submitted that in pursuance to Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 (hereinafter referred to as the Act, 2006 for the sake of brevity) was passed by the Council. Initially, for conciliation proceeding, the reference was made thereafter, an award has been given by the Council as an arbitrator. This is an ex-parte award and there are several violations of the provisions of the Act, 2006, as well as of the provisions of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act, 1996 for the sake of brevity). 4. This is an ex-parte award and there are several violations of the provisions of the Act, 2006, as well as of the provisions of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act, 1996 for the sake of brevity). 4. Nonetheless, counsel for the appellants fairly submitted that the appellants are having efficacious remedy to challenge the said award under Section 34 of the Act, 1996 to be read with Section 19 of the Act, 2006. Application shall be preferred for setting aside an arbitral award before the learned trial court within a period of 8 weeks, from the date of receipt of copy of this order. Let suitable direction be given to the learned trial court/competent court to dispose of the said application, within stipulated time, in accordance with law. 5. We have heard learned counsel for the respondents, who have no objection if this application is rendering before the learned trial court to prefer an application for setting aside the arbitral award, which is given by the Jharkhand Micro and Small Enterprises Facilitation Council, order dated 19.06.2012 but, it is submitted that as per Section 19 of the Act, 2006, the applicants shall have to deposit 75% of the amount in terms of the decree or award. 6. Having heard both the counsels and looking to the facts and circumstances of the case, it appears that the present respondents had supplied the goods thereafter, bills were raised, thus, bills remained unpaid and the claim was lodged by the respondents for the payment of the money, and still it is unpaid, and therefore, it appears that reference was made to Jharkhand Micro and Small Enterprises Facilitation Council on 20.05.2011 for realization of Rs. 39,34,112/- and thereafter the Council has passed an award on 19.06.2012. Learned counsel appearing for the appellants submitted that there was contract to supply 304 Uninterrupted Power Supply (U.P.S), out of which 282 U.P.S were installed, for which amount has already been paid and only for 22 U.P.S dispute is going on. 7. The appellants now want to challenge this award before the learned trial court by way of an application for setting aside the arbitral award under Section 34 of the Act, 1996 to be read with Section 19 of the Act, 2006. 7. The appellants now want to challenge this award before the learned trial court by way of an application for setting aside the arbitral award under Section 34 of the Act, 1996 to be read with Section 19 of the Act, 2006. If such applications preferred by the appellants before the competent trial court within a period of 8 weeks from the date of receipt of a copy of this order, the said competent trial court shall decide the application under Section 34 of the Act, 1996 to be read with Section 19 of the Act, 2006 and if any application is preferred under Section 9 of the Act, 1996, the same will be decided as early as possible, preferably within 12 weeks thereafter in accordance with law and at least adequate opportunity of hearing be given to the respondents. 8. This Letters Patent Appeal is disposed of in view of the aforesaid efficacious remedy to be availed by the respondents." 3. Section 34 application was preferred thereafter on 29th May, 2014 i.e. within 8 weeks period granted by learned Division Bench. Respondent herein also made pre-deposit as per Section 19 of Micro Small and Medium Enterprises Development Act, 2006. Claimant/objector/writ petitioner herein took preliminary objection both on the grounds of limitation and on the question of pre-deposit which according to it, was not as per Section 19 of the Act of 2006. Applicant had not deposited 75% of the amount as per Award i.e. Rs. 77,89,390/-. The plea of territorial jurisdiction was also raised. By the impugned order dated 25th July, 2015, learned Court held that the instant case was maintainable and not barred by law of limitation or res judicata. It also overruled the plea raised on non-compliance of pre-deposit of 75% of the awarded amount. 4. In this writ petition petitioner has while assailing the impugned order on all these three counts reiterated the submission made before the learned court below. Adverting to observations made at paragraph No. 7 passed in L.P.A. No. 200 of 2013 order dated 25th March, 2014, it is submitted that even if the appellate court gave liberty to the appellant-Union of India to file an application within a period of 8 weeks under Section 34 of the Act of 1996, but at the same time it directed the learned Court to decide it in accordance with law. In view of the judgment of the Apex Court rendered in the case of Union of India v. Popular Construction Co., (2001) 8 SCC 470 , the period of limitation prescribed under Section 34(3) of the Act of 1996 is not condonable or extendable by resorting to the provisions of Section 5 of the Limitation Act. As such, the application was barred in time which the learned Court has failed to appreciate. 5. Learned counsel for the petitioner has also endeavoured to show that computation of interest over the awarded amount in terms of Section 16 of the Act of 2006 required much more amount to be deposited by the applicant/respondent herein. It is, therefore, not inconformity with the requirement of Section 19 of the Act of 2006. He further submits that since the cause of action falls within the jurisdiction of district of Saraikella where the supply was undertaken, learned Court of Sub-Judge-I, Ranchi did not have territorial jurisdiction to decide the case. Therefore, interference has been called for. 6. Learned counsel for the Union of India has opposed the prayer. He submits that the application under Section 34 of the Act has been filed pursuant to liberty granted by learned Division Bench of this Court within 8 weeks period from the date of the order. This order was passed in presence of the present writ petitioner/claimant. He has referred to Para-5 passed in L.P.A No. 200 of 2013, wherein the respondents did not object to an application being preferred for setting aside the Award subject to deposit of 75% of the amount in terms of the decree of award. The order was a consent order from which the claimant could not derogate. He further submits that computation of 75% of the awarded amount has been correctly done and they have complied the requirement of pre-deposit. Learned Court has considered this objection and rightly overruled it. Such computation should not be made subject of further scrutiny at every stage when the main proceeding is pending adjudication before the learned Court. It would defeat the very purpose of the expeditious remedy provided under the Act of 2006 read with the provisions of Arbitration and Conciliation Act, 1996 for the benefit of Micro, Small and Medium Enterprises. Such computation should not be made subject of further scrutiny at every stage when the main proceeding is pending adjudication before the learned Court. It would defeat the very purpose of the expeditious remedy provided under the Act of 2006 read with the provisions of Arbitration and Conciliation Act, 1996 for the benefit of Micro, Small and Medium Enterprises. He submits that learned Court had territorial jurisdiction to entertain challenge to the award impugned as it has been passed by the Facilitation Council at Ranchi, since part of the cause of action also occurred at Ranchi. 7. Learned counsel for the petitioner in reply referred to the provisions of Section 24 of the Act of 2006 as per which the provisions of Sections 15 to 23 shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. According to him, this would override the provisions of Civil Procedure Code also so far this question of jurisdiction of the learned Court under CPC is concerned. 8. Considered the submission of learned counsel for the parties and gone through the relevant materials on record taken note above. In the present challenge made by the claimant herein on the preliminary objection raised under Section 34 Application, in the aforesaid background facts, it fails to reason as to how this plea of limitation is being raised by the petitioner when petitioner himself consented or rather did not object to such liberty being granted to the appellant/respondent herein by learned Division Bench of this Court in L.P.A. No. 200 of 2013. The order passed in L.P.A. has attained finality as no challenge was made thereto. The observations made at paragraph 7 of the order dated 25th May, 2014 quoted hereinabove are quite explicit and unambiguous. Appellant was allowed 8 weeks'' time to prefer an application under Section 34 of the Act of 1996 read with Section 19 of the Act of 2006. If the application was made within this time, in the light of the observations made by learned Division Bench learned Sub-Judge-I, Ranchi had no choice to non-suit the applicant on the ground of limitation. This Court also cannot sit over the observations made to that effect by learned Division Bench. Remedy of the writ petitioner, if aggrieved by the order of learned Division Bench lied elsewhere. 9. This Court also cannot sit over the observations made to that effect by learned Division Bench. Remedy of the writ petitioner, if aggrieved by the order of learned Division Bench lied elsewhere. 9. Adverting to the plea of pre-deposit, once the Court has after application of mind come to a finding that the applicant had deposited 75% of the awarded amount as per provisions of Section 19 of the Micro, Small and Medium Enterprises Development Act, 2006, this plea based on computation of writ petitioner, does not deserve scrutiny at this stage, more-so when the proceeding before learned Sub-Judge are pending and are to be decided in an expeditious manner as per the aims and objects of the Act 2006 under Section 34 of the Act of 1996. 10. The last plea of territorial jurisdiction raised by the petitioner also does not stand to reason since the award impugned was delivered by the Facilitation Council at Ranchi. Petitioner has raised a plea of territorial jurisdiction on the ground that the supply in question was effected in the district of Seraikella. The agreement between the parties is not on record. Therefore, whether the terms of the agreement provided for an exclusive seat of arbitration also cannot be gone into in this proceedings. In these facts and circumstances, considered in totality, this Court does not find any reason to interfere in the impugned order. Accordingly, writ petition is dismissed.