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High Court of Judicature at Bombay
R.D. DHANUKA, J.
Pradyuman Kumar Sharma & Another
Versus
Jaysagar M. Sancheti & Others
Arbitration Petition No.300 of 2012, 301 of 2012, 302 of 2012 & 303 of 2012
Decided on : 14-03-2013
Where arbitrator had shown all indulgence to both parties therefore if arbitrator allowed claim of respondents on merits, no bias can be imputed to arbitrator. - As far as allegations of bias made by the petitioner against the arbitrator are concerned, except a bald statement in the ground raised by the petitioner, petitioner has not substantiated the said allegation though the matter was adjourned by the Court at the request of the petitioner to seek amendment to the petition and liberty was granted to amend the petition, petitioner did not amend the petition. The arbitrator had shown all indulgence to both the parties and more indulgence to the petitioner by granting various adjournments and granted full opportunity. During the course of hearing before the arbitrator, the petitioner, through his Advocate, had withdrawn the allegations of bias. Allegations of bias made by the petitioner in their petition under Section 14 of the Act came to be rejected by the Court. The Supreme Court did not interfere with the said order and merely directed the arbitrator to decide application under Section 16 made by the petitioner. Petitioner did not make any application within time prescribed under Section 13(2) of the Act. The petitioner made belated application under Section 12 by which the petitioner repeated his allegations made in petition filed under Section 14 which were already rejected by the Court. The arbitrator, therefore was right in rejecting the application made by the petitioner under Section 12 read with 13 of the Act. There is no substance in the allegation of the petitioner that the arbitrator was biased against the petitioner for the reasons alleged therein or otherwise. No bias can be imputed against the arbitrator if he has allowed the claim of the respondents on merits.
Arbitration and Conciliation Act, 1996 - Section 18 - Meaning of expression "full opportunity to present his case".
Expression "full opportunity to present his case" used in Section 18 of Act means that full opportunity to be given to both parties before arbitrator. - The expression ’full opportunity to present his case’ used in Section 18 of the Act, would, mean full opportunity to be given to both the parties before the arbitrator, Both the parties were already allowed to lead its evidence by the arbitrator. Both had led oral as well as documentary evidence. After the petitioner closed his evidence, respondents had commenced and almost completed their arguments before the arbitrator. The respondents had no opportunity to lead any further evidence as the evidence of both the parties was closed.
The arbitrator, therefore, was right, in rejecting the application belatedly made by the petitioner for permitting the petitioner to apply for issuance of writ of summons to refer the document for examination of a handwriting expert. Under guise of full opportunity, a party cannot be permitted to delay and/or frustrate the arbitration proceedings by one or the other means.
Arbitration and Conciliation Act, 1996 - Sections 18, 19 and 24 Proviso - Production of oral evidence at belated stage.
Opportunity to produce oral evidence at belated stage of conclusion of final arguments by respondents, cannot be afforded to petitioner.
Arbitration and Conciliation Act, 1996 - Section 19 - Civil Procedure Code, 1908, Order XXVI, Rule 10 - Unproved disputed document.
Since provisions of Order XXVI, Rule 10 of Code, cannot be extended to unproved disputed document, hence arbitrator cannot consider such document as a piece of evidence on record. - Perusal of Order XXVI, Rule 10 of the Code of Civil Procedure indicates that Court is empowered to appoint Commissioner for carrying out local investigation. The scheme of Order XXVI, Rule 10 of Code of Civil Procedure indicates that such Commissioner appointed by the Court or carrying out investigation, collects the evidence on behalf of the Court and the report of such Commissioner has to be read as evidence in such proceedings as per the provisions of Code of Civil Procedure. Provisions of Order XXVI, Rule 10 of Code of Civil Procedure or principles thereof; cannot be extended to the alleged report relied upon by the petitioner, the same being a disputed document not having been proved by the petitioner by examining proper witness in that behalf in spite of an opportunity being available to the petitioner to examine witness at the relevant and appropriate time. Petitioner himself did not enter the witness-box. He was the best witness to depose that his signature was alleged to have been forged by the respondents. In my view; though arbitrator is not bound by the provisions of Code of Civil Procedure or Evidence Act, principles of Evidence Act and Code of Civil Procedure are applicable even to arbitration proceedings. A document which is disputed by a party and if not proved, cannot be considered even by the arbitrator to be on record or as a piece of evidence. Taking into consideration an unproved document by an arbitrator, on the contrary would be in violation of principles of natural justice. Arbitrator was not bound to refer the alleged document to an expert witness suo motto .
By these petitions filed under Section 34 of the Arbitration & conciliation Act, 1996 (for short herein after 'the Act'), the petitioner seeks to challenge the impugned awards all dated 30th March 2009 declared by the learned arbitrator.
2. By consent of parties, in view of the identical facts in all the four matters and common argument advanced by both the parties, all aforesaid petitions were clubbed and heard together finally at the stage of admission and are being disposed off by common order. I shall summarise the facts in arbitration petition No.300 of 2012 which were referred by both the parties.
3. The petitioner has advanced submissions only on three issues though various grounds are raised in the petitions and thus, facts and submissions relating to those three issues canvassed by the petitioner are set out hereinafter.
4. The petitioner was carrying on business in the name and style of M/s Kuber Builders and also in the name and style including Kuber Planters Ltd. Under a letter of allotment dated 23rd December 1997 issued by CIDCO, the petitioner acquired the lease hold interest in respect of land being piece and parcel of land admeasuring approximately 2382.12 sq. mtrs bearing No.18/4, Sector 10, Vashi, District Thane, Maharashtra on the terms and conditions contained therein. On 10th July 2000, the petitioner and the respondent entered into an agreement by which, the services of the petitioner for development and completing the incomplete building for commercial and residential use on profit sharing basis on the terms and conditions set out in the said agreement was engaged. On 16th August 2000, the Competent Authority under the Maharashtra Protection of Interest of Depositors (in Financial Establishment) Act, 1999 (for short MPID Act) attached the said property in possession of the petitioners and also other three properties being Kuber Heritage, Kuber Citadel and Kuber Embassy which were subject matter of companion arbitral references and subject matter of these petitions. Various proceedings were filed by both the parties in this Court challenging the orders passed by the learned Special Judge under MPID Act.
5. Both the parties thereafter entered into a Deed of Dissolution dated 4th December 2001 thereby agreeing to dissolve all the four joint venture agreements entered into between them on the terms and conditions set out therein. It is the case of the petitioner that the petitioner handed over six post dated cheques for an aggregate value of Rs.16.50 lacs to the petitioners, however three cheques were returned as dishonoured.
6. The dispute arose between the parties. By letter dated 30th October 2002, the respondents invoked the arbitration agreement and thereafter filed application under Section 11 of the Act. By an order dated 28th February 2003, passed by the learned designate of the Honourable Chief Justice of this Court appointed Mr. Justice V.R. Datar, former Judge of this Court as the sole arbitrator. During the period between 21st August, 2003 and 12th May 2004, both the parties filed their respective pleadings. The petitioners also filed counter claim before the learned arbitrator. Both the parties also filed affidavits in lieu of examination-Asmitain-chief. On 9th September 2004, cross examination of witness of respondents was completed. On 5th March 2005, cross examination of petitioners' witness was completed. On 21st April 2005, Mr. Justice V.R. Datar, the learned arbitrator resigned. The respondents thereafter filed application under Section 11 for appointment of arbitrator. By an order dated 26th September 2005, the Honourable Chief Justice appointed Dr Justice B.P. Saraf, former Chief Justice of Jammu & Kashmir High Court and former Judge of this Court as sole arbitrator. By an award dated 30th March 2009, the learned arbitrator declared that the agreement dated 10th July 2000 was valid, subsisting and binding on the parties to the arbitration and ordered and directed the petitio
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