Point of Law:Arbitral Award – Hearing the parties once again - Permitting Arbitrator to hear the parties de novo will enlarge the mandate of Section 34(4) - 13 years have passed since the Arbitrator last heard the matter - impractical even to expect that the Arbitrator, without hearing the parties, will be in a position to supply the reasons in the Award

JUDGMENT :

Moushumi Bhattacharya, J.

1. This is an application made by the respondent for seeking adjournment of the proceedings for setting aside of an arbitral Award dated 27th December, 2008 for granting an opportunity to the Arbitrator for eliminating the grounds for setting aside of the arbitral Award. The application has been made under Section 34(4) of the Arbitration and Conciliation Act, 1996 (the Act), which gives the option to a court, in fit cases, to adjourn the proceedings in order to give the Arbitral Tribunal an opportunity to resume the proceedings or to eliminate the grounds for setting aside of the arbitral Award. The applicant herein is the respondent/Award-holder in the proceedings for setting aside of the impugned Award.

2. Mr. Sidhartha Mitra, learned Senior Counsel for the applicant/Award-holder, submits that Section 34(4) of the Act empowers the court to adjourn the proceedings in order to give the Tribunal an opportunity to take such action, as in the opinion of the Tribunal, would eliminate the grounds for setting aside of the arbitral Award. Counsel submits that the petitioner in A.P. No. 99 of 2009 (the application for setting aside of the Award) had rejected the applicant’s recommendation of the names of two retired judges and one Senior Advocate and had instead recommended names of three Technical Nominees in their place. Among the three Technical Nominees a former Director (Technical) of Mahanadi Coalfields Ltd. a subsidiary of Coal India Limited (the petitioner in the Section 34 application) was selected as the sole arbitrator. Counsel submits that the petitioner did not take any steps for more than eleven years to get the matter heard, since there was an automatic stay of the Award upon filing the section 34 application by the petitioner. According to Counsel, the circumstances in which a court can pass an order under Section 34(4) of the Act had been laid down in Kinnari Mullick vs. Ghanshyam Das Damani; (2018) 11 SCC 328 and since the impugned Award has not been set aside, this court can adjourn the proceedings for the purpose mentioned under Section 34(4) on an written application made by the applicant Award-holder.

3. The primary contention of Mr. Jishnu Chowdhury, learned Counsel appearing for the respondent/Award-debtor, is that the applicant was put on notice of the grounds for setting aside of the Award, namely, that the Award does not contain reasons, in February 2009 when the Section 34 application was filed. The present application was, however filed in March, 2020 after eleven years. Counsel cites several cases on the proposition that six months is the outer limit for retention of arguments made by the parties and that courts are duty-bound to deliver judgments within the aforesaid time period. Counsel further submits that Section 34(4) only gives the Arbitral Tribunal an opportunity to resume the Arbitral proceedings, but does not permit fresh arguments. Reliance is placed on Sundaram Fastener Limited vs Assistant Commissioner of Urban Land Tax; (1989)1 Mad LJ 72 to explain the meaning of the word “Resume”. Counsel places a similar provision in the Arbitration Act, 1940 and submits that the power to reconsider an Award does not find place in the present 1996 Act. Two decisions of the Singapore High Court and the Singapore Court of Appeal are cited in this regard.

4. Before embarking on the strength of the contentions made on behalf of the parties, the scope of Section 34(4) of the 1996 Act should first be stated. Under this sub-section, on receipt of an application for setting aside of an arbitral Award under Sub-section 1 of Section 34, the receiving court may, in appropriate circumstances, adjourn the proceedings for a given period of time in order to give the arbitral tribunal an opportunity to resume the arbitral proceedings or to take such action as considered fit by the arbitral Tribunal for the purpose of eliminating the grounds on which the Award-debtor has sought to set aside