1997 Supreme(Bom) 688

IN THE HIGH COURT OF BOMBAY
V.R. Datar, J.
Khemka Co. (Agencies) Pvt. Ltd. ..... Petitioner.
Versus
Polish Ocean Lines ..... Respondent.
Arbitration Petition No. 98 of 1997 in Award No. 196 of 1996, decided on 15-12-1997.
Advocates appeared :
D.C. Gomes, for the petitioner.
G.A. Rebello with S.C. Naidu, Manish Desai and Ms. F. Markar i/b C.R. Naidu Co., for the respondent.

Headnote:Sections 13(d) and 15(1)Award carries mistake-Evidence of witnesses-Examined consists of clerical mistake-Omission in award a formal mistake can be corrected-Correction of mistake not illegal.

       Sections 30 and 33-Arbitrator maintaining only three witness were examined-Actually four were examined-Non-application of mind-Held-list-sent by arbitrator can be corrected-A simple mistake is not a non application of mind.-The last point urged for the petitioners is that the arbitrators have mentioned in their award as well as some portion of the minutes that only three witnesses are examined on behalf of the respondent i.e. petitioner herein while in fact four such witnesses have been examined and the minutes which mention the examination of three witnesses recorded by the arbitrators would go to show that it was fixed in their mind that only three witnesses have been examined on behalf of the respondent i.e. petitioner herein. That is how the arbitrators proceeded to consider the matter and this show total non application of mind by the arbitrators. This also goes to indicate that the evidence of the fourth witness examined on behalf of the respondent i.e. petitioner herein has not at all been considered by the arbitrators, and, therefore, this is a fit case for remission of the award. It is not that some simple or arithmetical or accidental error has been committed by the arbitrators but this would go to show total non-application of mind by the arbitrators.

       Sections 30 and 33-Award challenged-Made in foreign currency-Required in Indian Rupees-Limitation-Requirement of reasons-Award challenged for not giving reasons-Held-A non speaking award can not be interfered with by Court-As per evidences, claim was within limitation.-Since the arbitrators framed issues and when issue regarding the bar of limitation was there the arbitrators were enjoined to give reasons in particular about the issue of limitation and at least they ought to have recorded the findings. It was contended that the issue regarding limitation was issue of law and since the arbitrators were eminent judges, they were expected to record their reasons for holding that the claim was not barred by limitation. Counsel tried to show now the claim on the face of it is barred by limitation but it is not possible for me to examine this aspect of the matter. However, as indicated above, the arbitrators were given summary powers and were not bound to assign reasons in support of their award. Since they were to deal the case summarily, nothing is there to indicate that they were bound to record at least their findings. It 15 not possible for this Court to speculate what weighed with the minds of the arbitrators in holding that the claim was not barred by limitation. However Mr. R has tried to show with certain justification that the cause of action for the respondent to claim the amount from the petitioners arose when the Asrimpex Hungarian Trading Company obtained an award against the respondent company and respondent company was required to pay the same in Dollars. That is .alleged to have occurred some time in June 1993 and that is how Mr. R submits that the claim was obviously not at all barred by limitation. However, as stated above, it is not for this Court to examine the correctness of the award as an Appellate Court since the award is non speaking and the arbitrators were not bound to give reason No grievance, therefore, can be made by the petitioners on that ground.

       Sections 30 and 33-Claim by respondent for award-Amount of award to he terms of Indian currency and:-Award also as non speaking-Held-when the prayer clause demanded award in foreign currency, arbitrator was not wrong in doing so-Non speaking award, not require reason to give on their awards.- The agency agreement which contains an arbitration clause to this petition. This agreement does not provide for payment in a particular currency though certain charges payable to the petitioners as an agent are agreed to be paid in terms of Indian currency. There is, however, one clause in Item 6 (page 39) of this agency agreement which reads:

       "Any payments between the Company and the Agent to be effected in accordance with the terms of the payment agreement existing between Poland and the country of the Agent, if any, otherwise in free foreign currency." Mr. Gomes fairly conceded that he is not able to get the terms of payment agreement existing between poland and India. In the absence of the same the amount would be paid in free foreign currency. US dollars is such a free foreign currency but not rupees.

       Mr. Rabello for the respondent pointed out that in a suit filed by the petitioners against Ship Repairers Ltd. and the State Bank of Indore a decree for a sum m foreign currency has been claimed and this would go to indicate that even the petitioners were aware that the amount was to be paid in foreign currency. " At the preliminary meeting, by consent of the parties and their respective" Advocates, it was agreed by them that we shall have summary powers and shall not be required to give reasons for our Award."

       Having regard to the above recital, it is clear that the arbitrators were not bound to give reasons in support of their award and, therefore, it is a non speaking award. Further the arbitrators were given summary powers under the consent of both the parties and their advocates.

       Sections 30 and 33-If an award can be corrected-Validity of correction-Challenged-Ground After passing of award the corrigenda becomes functus officio-It can not be given by arbitrator-Held-A clerical mistake can always he corrected.-Mr. R submits that although the arbitrators in the above award and some portion of the minutes have stated that three witnesses were examined on behalf of the respondent i.e. petitioner herein yet the notes of arguments prepared by the arbitrators would go to show that they have considered the evidence of all the four witnesses examined on behalf of the respondent i.e. petitioner herein Mr. R further pointed out that in the minutes regarding the evidence of the witnesses recorded, it would be clearly seen that the evidence of the fourth witness is also stated to be recorded. It has been pointed out how the error crept in the minds of the arbitrators in stating that only three witnesses were examined. It was pointed out that first witness was examined at Bombay and his cross- examination was inconclusive, and further for the purpose of completion of the cross examination, certain documents at Calcutta were required and furthermore some more witnesses were to be examined at Calcutta and that is how the matter came to be adjourned and while recording that the witness was still under cross-examination, the arbitrators recorded that three more witnesses are required to be examined on behalf of the respondent and this would go to indicate that the arbitrators were quite alive to the fact that four witnesses were to the examined. Furthermore, Mr. R pointed out that after the award was made and published and forwarded, the arbitrator Mr. Justice L has forwarded a corrigendum stating that mistake has been committed in the award and the same should be corrected by inserting figure 4 in the place of three in regard to witnesses and wherever such mistake is there it should be, accordingly, corrected.

       Sections 30, 33 and 28-An award passed in extended time-Challenged-Ground-Award passed in extension-Should he considered void-Held-Once proceedings are as it is only Court which can extend the time-As Calcutta High Court has extended the time-It is not void-Petitioner filed an application in this Honble Court under the provisions of Section 28 of the Arbitration Act, 1940 for due extension of time to make and publish the award by the Joint Arbitrators. Inasmuch as there was some irregularity in the matter of extension of time for the Joint Arbitrators to make and publish the Award and likelihood of the same vitiating the arbitration proceedings,

       Section 38-Petitioner a protecting Agent-Award made by arbitrators in foreign currency made beyond the scope-Demand in foreign currency-Letter of demand in Indian Currency-Award cannot be vitiated. That the learned arbitrators where quite aware of this legal position and, therefore, made award in terms of foreign currency and further directed to obtain permission from the concerned authorities in accordance with FERA 1973. It is clear that the arbitrators were not bound to give reasons in support of their award and therefore it is a non speaking award. Further, the arbitrators were given summary powers under the consent of both the parties and their advocates.