Important pointJurisdiction of Court entertaining a petition for setting aside an arbitration award under Section 30 of Arbitration Act is extremely limited to grounds mentioned therein and that grant or refused of adjournment by Arbitrator does not come within the parameters of Section 30 of the Act.

Headnote:Arbitration Act, 1940—Section 30 —Arbitration award—Application by respondent to set aside the award on ground that applicant-respondent could not appear in the proceedings because of wrongly noted date for evidence and Arbitrator ought to have given him an opportunity to present the evidence—Award was set aside by Single Judge and matter was remitted to Arbitrators—Appeal filed by appellant was dismissed by Appellate Bench—Appeal—Whether High Court was justified in setting aside the award solely on ground that respondent who failed to appear before Arbitrator on day fixed for his evidence ought to have been granted another opportunity to produce his evidence?—Was High Court justified in interfering with discretionary jurisdiction of Arbitrator while entertaining petition under Section 30 of the Act to set aside the award? No.
       Held : In the above circumstances, the question for our consideration is; was the High Court justified in interfering with the discretionary jurisdiction of the arbitrators while entertaining a petition under section 30 to set aside an award. Section 30 of the Arbitration Act 1940 reads thus:
       “30. Grounds for setting aside award. An award shall not be set aside except on one or more of the following grounds, namely:
       (a) that an arbitrator or umpire has misconducted himself or the proceedings;
       (b) that an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceedings have become invalid under Sec. 35;
       (c) that an award has been improperly procured or is otherwise invalid.”
       A bare reading of the said section shows that the civil court has very limited jurisdiction to interfere with an award made by the arbitrators and it certainly does not permit the civil court including the High Court to interfere with the discretionary order of granting or refusing an adjournment. (Para 13)
       From the above it is seen that the jurisdiction of court entertaining a petition or application for setting aside an award under Section 30 of the Act is extremely limited to the grounds mentioned therein and we do not think that grant or refusal of an adjournment by an arbitrator comes within the parameters of section 30 of the Act. At any rate the arbitrator’s refusal of an adjournment sought in 1999 in an arbitration proceeding pending since 1995 cannot at all be said to be perverse keeping in mind the object of the Act as an alternate dispute resolution system aimed at speedy resolution of disputes. We think both the learned Single Judge and Division Bench have erred in setting aside the award only with a view to give an opportunity to the defaulting respondent to lead evidence which was rejected by the arbitrators by their reasoned order of 10.5.1999. (Paras 15 and 16)

Judgment

Santosh Hegde, J.—Heard learned counsel for the parties.

2. Leave granted.

These appeals are preferred against the common judgment and order passed by the Appellate Bench of the High Court of Judicature at Bombay whereby the said Bench dismissed the appeals filed by the appellants herein against the judgment and order of the learned Single Judge of the said High Court allowing the applications filed by the respondent herein by setting aside the awards made by the Arbitrators.

3. Two disputes pertaining to the claim of the appellants against the respondent herein were referred to arbitration and the same were numbered as Arbitration Reference No. 313/95 in the case of Deepa Jain and Arbitration Reference No. 316/95 in the case of Hari Om Maheshwari the appellants herein. Though both the arbitration proceedings were taken up for consideration together. In Reference Case No. 313/95 i.e. case of Deepa Jain the evidence of both the parties concluded on 29th of January, 1999 while the evidence of the appellant in Reference Case No. 316/95 pertaining to Hari Om Maheshwari was concluded on 8th of April, 1999 and the matter was listed for evidence of the respondent in that case to 10/11th of May, 1999. On that day i.e. on 10th of May, 1999 the respondent herein remained absent. The Arbitrators on that day closed the evidence and posted the matter for making awards. Before the said awards were made on 20th May, 1999 the respondent herein sent an application to the Arbitrators seeking further opportunity to lead evidence in the Reference Case No. 313/95 of Deepa Jain in which the evidence of both the parties had closed. No application was made in Reference Case No. 316/95 which is the arbitration case of Hari Om Maheshwari. From the record it is seen that the said application was not entertained by the Arbitrators and they delivered the award sometime in November, 1999. It is against the two awards the respondent herein preferred two applications to set aside the said awards under Section 30 of the Arbitration Act, 1940 (hereinafter referred to as ‘the Act’) before the learned Single Judge of the Bombay High Court. It was his contention that he could not attend the arbitration proceedings on 10th May, 1999 because on the previous date of the proceedings he had wrongly noted down the next date of hearing. Hence, the Arbitrators ought to have given him an opportunity of presenting his evidence before making an award.

4. The learned Single Judge who heard the two applications together accepted the case of the respondent herein and set aside the awards in question and remitted the same to the Arbitrators for fresh disposal after giving an opportunity to the respondent to lead his evidence. They also directed that one more arbitration proceedings between one Jayesh Sanghani and the respondent herein which was earlier remanded to the Arbitrators should be decided along with these arbitration proceedings.

5. An appeal filed against the said common order of the learned Single Judge before an Appellate Bench of the Bombay High Court came to be dismissed and it is against this common order of High Court of Bombay that the appellant is before us.

6. Shri Jaideep Gupta, learned Sr. counsel appearing for appellant herein contended that the grounds on which the High Court has set aside the award are not the grounds contemplated under Section 30 of the Act. He submitted that arbitration proceedings having started in the year 1995 could not be completed even in the year 1999, therefore, the High Court ought not to have interfered with the award. He pointed out that in Reference Case No. 316/95 pertaining to Deepa Jain the evidence had already concluded and the explanation given by the respondent for not leading evidence on 10th of May, 1999 was frivolous and the Arbitrators rightly did not entertain a prayer for granting a further opportunity for leading evidence. Such a denial of a further opportunity by the Arbitrators would not be a ground conte

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2004 Supreme(SC) 1561

Cases Referred (3)