Judgment :-

R.V. Raveendran, J.

The respondent has entered appearance through caveat. Leave granted. Heard the learned counsel.

2. Certain disputes between respondent and appellant were referred to arbitration. The Arbitrator made an award dated 14.9.2005 directing the appellant to pay to the first respondent, a sum of Rs.57.6 crores with interest. The appellant filed an application under Section 34 of the Arbitration and Conciliation Act, 1996 (in short `Act) before the City Civil Court, Bangalore for setting aside the said award. The respondent filed its written statement, resisting the claim. The appellant made an application under Order XIV Rule 1 and 3 of Code of Civil Procedure (`Code for short) read with Rule 4(b) of the High Court of Karnataka Arbitration (Proceedings before the Courts) Rules, 2001 (`Rule

for short) requesting the Court to frame issues in the matter. The civil court rejected the application by an Order dated 12.9.2006.

3. The petitioners Writ Petition challenging the said order was dismissed on 12.9.2008. The learned Single Judge was of the view that applications under section 34 were not necessarily in the nature of a adversarial proceeding where a dispute between two parties requires adjudication by the court; that there is a legal presumption in favour of the award being valid; and that whether the opposite party joins issue or not, the person challenging the award has to make out one of the grounds enumerated under section 34(2) of the Act. Therefore, he held that there is no need for the court to frame issues, as is done in a civil suit. The writ appeal filed by the petitioner was dismissed by the impugned order, affirming the decision of the learned Single Judge. Feeling aggrieved, the appellant has filed this appeal by special leave.

4. Sri P.P. Rao, learned Senior Counsel for the appellant, submitted that section 34(2) of the Act requires the party making the application to prove the existence of one of the grounds enumerated therein, to set aside an award. He contended that if the respondent filed a written statement contesting the application under section 34 of the Act, the court will have to frame issues to focus the attention of the parties on the specific questions in controversy requiring adjudication, so that evidence can be led by the parties with reference to the issues. He submitted that unless issues were framed, the evidence led by parties would not be precise and to the point, but lengthy and meandering. He also contended that Rule 4(b) of the Rules requires an application under section 34 of the Act, to be dealt with and decided as a suit under the Code of Civil Procedure, and therefore it is obligatory for the court to frame issues in proceedings under section 34 of the Act.

5. On the other hand, Sri P. Vishwanatha Shetty, learned counsel for the respondents, contended that having regad to the scheme of the Act, and the need to dispose of the applications under Section 34 of the Act expeditiously, such proceedings are clearly intended to be summary in nature, and therefore issues were not required to be framed.

6. The question that therefore arises for consideration is whether `issues as contemplated under Order 14 Rule 1 CPC should be framed in applications under section 34 of the Act.

Need for framing issues

7. The object of issues is to focus upon the questions on which evidence has to be led and to indicate the party on whom the burden of proof lies. Rules 1 of Order 14 of the Code dealing with framing of issues is extracted below:

"1. Framing of issues - (1) Issues arise when a material proposition of fact or law is affirmed by the one party and denied by the other.

(2) Material propositions are those propositions of law or fact which a plaintiff must allege in order to show a right to sue or a defendant must allege in order to constitute his defence.

(3) Each material proposition affirmed by one party and denied by the other shall form the subject of a distinct issue.

(4) I