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2012 Supreme(Cal) 810

High Court of Judicature at Calcutta
ASHIM KUMAR BANERJEE, SHUKLA KABIR SINHA, JJ.
Steel Authority of India Ltd.
Versus
The Indian Cements Ltd.
A.P.O. Nos. 373, 377 of 2011 & A.P. Nos. 130 & 129 of 2004
Decided On : 04-09-2012

Advocates Appeared:
For the Appellant:Pradip Ghosh, Senior Advocate, Dhruba Ghosh, C.L. Singh, Advocates.
For the Respondent:Tilak Bose, Senior Advocate, Rishad Madora, Advocate.

Headnote:

ARBITRATION - Setting aside of award - Territorial jurisdiction - Calculation of limitation period - Applicability of Section 14 of the Limitation Act - Whether leave under Clause 12 of the Letters Patent is necessary to invoke the jurisdiction of the Calcutta High Court.

Fact of the Case:

SAIL entered into a Charter Party agreement with ICL for importing coal from Australia. The vessel was to discharge cargo at four places in India including Paradip and Haldia. A dispute arose when the vessel arrived at Paradip Port on July 28, 1995 and completed discharge of unloading coal to the extent of 24,088 MT and leaving a balance quantity of 23,501 MT to be discharged at Haldia Port being the next port of discharge. The dispute was referred to arbitration and the Arbitral Tribunal published its award on September 6, 1999. SAIL challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996 before the Delhi High Court on December 16, 1999. The Delhi High Court declined to entertain the application vide judgment and order dated March 15, 2004, finding that it had no territorial jurisdiction. SAIL filed the application in the Calcutta High Court on April 15, 2004. The learned Single Judge dismissed the applications being found barred by laws of limitation.

Finding of the Court:

The Calcutta High Court held that the application under Section 34 was filed within the prescribed period of limitation, excluding the period taken by the Delhi High Court to decide the issue under Section 14 of the Limitation Act. However, the Court held that it did not have territorial jurisdiction to entertain the application as the cause of action arose at Paradip and Haldia, and not within the territorial jurisdiction of the Calcutta High Court. The Court directed the return of the petition to SAIL for being filed at the appropriate Court, either at Paradip Port or Haldia Port.

Issues: 1. Whether the application under Section 34 was filed within the prescribed period of limitation? 2. Whether the Calcutta High Court had territorial jurisdiction to entertain the application under Section 34?

Ratio Decidendi: 1. The Court held that the period taken by the Delhi High Court to decide the issue would stand excluded from being counted in the instant case under Section 14 of the Limitation Act, as SAIL had approached the Delhi High Court on a bonafide mistake. 2. The Court held that the Calcutta High Court did not have territorial jurisdiction to entertain the application under Section 34 as the cause of action arose at Paradip and Haldia, and not within the territorial jurisdiction of the Calcutta High Court.

Final Decision: The appeals were allowed in part. The judgment and order of the learned Single Judge impugned were modified to the extent that the petition was directed to be returned to SAIL for being filed at the appropriate Court, either at Paradip Port or Haldia Port. The period taken by the Calcutta High Court in deciding the issue, as well as the period the Registrar might take in actual return, would stand excluded under Section 14 of the Limitation Act.

Judgment :-

Ashim Kumar Banerjee, J.

FACTS

On June 3, 1995 Steel Authority of India Limited (hereinafter referred to as SAIL) entered into a Charter Party agreement with Indian Cements Limited (hereinafter referred to as ICL) for importing coal from Australia . The vessel was to discharge cargo at four places in India including Paradip and Haldia. The dispute arose when the vessel arrived at Paradip Port on July 28, 1995 and completed discharge of unloading coal to the extent of 24,088 MT and leaving a balance quantity of 23,501 MT to be discharged at Haldia Port being the next port of discharge. At the time of unloading at Paradip Port, one of the cranes out of four cranes of the vessel had been found out of order for which SAIL calculated the lay time on pro-rata basis which ICL did not agree, that gave rise to dispute to be resolved through arbitration in terms of the arbitration clause stipulated in the Charter Party Agreement. Accordingly, the parties nominated their respective nominees in the Arbitral Tribunal. The Arbitral Tribunal held sittings at Delhi. The Arbitral Tribunal ultimately, published its award on September 6, 1999. SAIL was not happy with the award. SAIL challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996 before the Delhi High Court on December 16, 1999. The Delhi High Court finally heard the application and declined to entertain the same vide judgment and order dated March 15, 2004. The Court found that it had no territorial jurisdiction to entertain the same. The Court directed the application to be returned to SAIL for filing it in the proper Court. SAIL applied for Certified Copy of the order however, did not wait as by that time the petition was ready to be returned. The Court returned it on April 13, 2004. April 14 being holiday at Calcutta SAIL filed it in this Court on April 15, 2004. From the records, we find that the original application filed before the Delhi High Court being O.M.P. 30 of 2000 was re-numbered as A.P. No. 129 of 2004 by this Court. Similarly, in the other appeal this Court re-numbered it as A.P. No. 130 of 2004. Both these appeals would relate to two Chartered Parties, however, involving identical facts.

Learned Single Judge heard both the applications A.P. No. 129 and 130 of 2004. ICL raised preliminary issue to the effect that applications were barred by laws of limitation and this Court also lacked territorial jurisdiction to entertain the applications. The Learned Judge decided the first issue as against SAIL whereas the other issue raised by ICL was rejected. His Lordships dismissed the applications being found barred by laws of limitation hence, these appeals.

CONTENTIONS RAISED BY SAIL:

Mr. Dhruba Ghosh, learned counsel argued on behalf of the SAIL. According to him, the Tribunal published the award on September 6, 1999. However, SAIL received the same on September 22, 1999 hence, the limitation period would start from the said date and not from the date of the award. SAIL filed the application on December 17, 1999 that would involve eighty four days required for the said purpose. The time stopped running as soon as SAIL filed the application for setting aside that was to be brought within ninety days hence, the application before the Delhi High Court was within time.

Delhi High Court by its judgement and order dated March 15, 2004 directed return of the petition to SAIL for being filed in the proper Court. The SAIL received the petition from the Court’s department on April 13, 2004. April 14 being a holiday, the petition was filed on April 15, 2004. Hence, there would not be any delay in filing the same. Even if April 14 would be excluded out of the purview of limitation, there could be at best one or two days delay in filing the same that would also keep the application within the prescribed period of limitation. Mr. Ghosh further contended that the period taken by the Delhi High Court to decide the issue was covered by Section 14 of the L






























































































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