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2012 Supreme(Bom) 796

High Court of Judicature at Bombay
MOHIT S. SHAH & N.M. JAMDAR
M/s Snehdeep Auto Centre through, Mr. Naresh P. Advani Proprietor
Versus
Hindustan Petroleum Corporation Ltd.
Appeal No. 143 of 2012 in Arbitration Petition No.430 of 2008
Decided On : 16-04-2012

Advocate Appeared:
For the Appellant:Atul Rajyadhaksha, Senior advocate with A.C. Sarkate, Advocate.
For the Respondent:M.S. Siodia, i/by Rustamji & Ginwala, Advocates.

Headnote:Arbitration and Conciliation Act, 1996 - Section 34 - Award - Where respondent in his written submission not contended that mandate of arbitrator had come to an end therefore setting aside of an award on ground that it was passed after period provided for in agreement was over, unjustified.

Judgment :-

N.M. Jamdar J.

This appeal challenges the order passed by the learned single Judge dated January 13, 2012 in Arbitration Petition No.430 of 2008. By the impugned order the learned single Judge allowed the Arbitration Petition filed by the respondent primarily on the ground that the award assailed therein was made after the period provided for in the agreement for making an award expired and thus after the mandate of the arbitrator had come to an end.

2. An agreement of dealership was entered into between the appellant and the respondent-Hindustan Petroleum Corporation for allotment of a petrol/diesel distributorship to the appellant. On December 11, 2002 the agreement was terminated by the respondent on the ground of alleged irregularities committed by the Appellant. The Appellant challenged the order of termination initially by way of a Writ Petition. The Writ Petition was disposed of on the ground that Arbitration proceedings are available to the appellant for redressal of his grievance. On July 21, 2005 arbitrator was appointed and on October 25, 2005 the Appellant filed his claim Statement on record. As per the agreement between the parties the award was to be made within six months after entering upon the reference. An extension of four months could be granted by the arbitrator by a written order. The relevant term reads as under:-

“The award shall be made in writing within six months after entering upon the reference or within such extended time not exceeding further four months as the sole arbitrator shall by a writing under his own hands appoint”.

3. It is an admitted position before us that the initial period of six months for rendering the award expired on November 3, 2006 and further period of four months expired on March 3, 2007, and the award was made by the arbitrator on April 10, 2008. By the award the arbitrator set aside the termination of the dealership agreement dated June 1, 1995 and held that the claimant is entitled to Rs.9,94,068/-. The arbitrator also issued certain other ancillary directions.

4. The respondents thereafter preferred an Arbitration Petition bearing No.430 of 2008 in this Court. The respondent-Corporation assailed the award on several grounds pertaining to the action of termination of the agreement of dealership on the basis of alleged irregularities committed by the respondent. The learned single Judge after hearing Counsel for the parties came to the conclusion that as admittedly the award was passed after the period provided under the contract i.e. ten months was over considering the law laid down in the case of N.B.C.C Ltd. v. J.G. Engineering Pvt. Ltd. reported in 2010 AIR Supreme Court 640, r.w. section 15 of the Arbitration and Conciliation Act, there was no other alternative but to set aside the award on the ground that it was made after the mandate of the arbitrator had come to an end by efflux of time provided under the agreement between the parties. The respondent is thus in appeal before us.

5. We have heard the learned Counsels appearing for both the sides. Learned counsel for the Appellant has urged that contention that the award was made after the period provided under the agreement, was not specifically raised by the respondent in the Arbitration Petition before the learned single Judge. He further argued that the respondent after the period stipulated was over on November 3, 2006 continued to make submissions in the Arbitration proceedings. On December 21, 2006 after the respondent made further submissions. On that date both the parties sought time from the arbitrator to file their written submissions which were accordingly filed on March 12, 2007. This conduct of the respondent, according to the Counsel for the appellant, amounts to clear waiver on the part of the respondent and this fact has not been considered by the learned single Judge. Learned Counsel for the appellant has submitted that the Judgment of Apex Court in the case of N.B.C.C Ltd. (supra) on wh













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