SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

1995 Supreme(Del) 903

High Court Of Delhi
FLOWMORE PRIVATE LIMITED - Appellant
Versus
NATIONAL THERMAL POWER CORPORATION LIMITED - Respondent
ORIGINAL MISCELLANEOUS PETITION 67 of 1993
Decided On : 11/24/1995

Advocates Appeared:
S.K.TANEJA, SANJIV PURI

The court has the discretion to extend the time for filing a reply in an arbitration proceeding under Section 28 of the Arbitration Act, 1940, but such discretion must be exercised judicially and only if cogent reasons are forthcoming.

Headnote:

ARBITRATION ACT, 1940 - SECTION 28 - EXTENSION OF TIME - COURT'S DISCRETION - FACTORS TO BE CONSIDERED - DELAY DUE TO NEGLIGENCE OR DILATORY TACTICS - MISCONDUCT OF ARBITRATORS.

Fact of the Case:

Petitioner sought extension of time under Section 28 of the Arbitration Act, 1940, for filing a reply in an arbitration proceeding. The respondent opposed the extension on the grounds of dilatory tactics by the petitioner and misconduct by the arbitrators.

Finding of the Court:

The court found that the petitioner had sought adjournments for cogent reasons, while the respondents had asked for them when they could be easily avoided. The court also found that the arbitrators had not committed any misconduct by holding an urgent meeting on the petitioner's application seeking stay of invocation of the Bank guarantees, as they did not pass any order on the application.

Issues: 1. Whether the petitioner was guilty of dilatory tactics in seeking adjournments. 2. Whether the arbitrators were guilty of misconduct in holding an urgent meeting on the petitioner's application seeking stay of invocation of the Bank guarantees.

Ratio Decidendi: 1. The court held that not every delay would invite the wrath of the court and that the delay must be undue and on account of either negligence or dilatory tactics. The court found that the petitioner had not been guilty of contumacious conduct. 2. The court held that the arbitrators had not committed any misconduct by holding an urgent meeting on the petitioner's application seeking stay of invocation of the Bank guarantees, as they did not pass any order on the application.

Final Decision: The court allowed the application and further extended the period by another four months.

JASPAL SINGH. J

( 1 ) SOME time in May, 1991, while dealing will) sub-section (1) of Section 28 of the Arbitration Act I had said: "there is no doubt in my mind that no formal application need be moved and that the court may act suo motu The discretion lies with the Court. But then discretion being a much maligned, much mis-used term, the wise-men of law have with a view to tame this wild horse, and to control its swift hoofs, held that discretion must be exercised judicially and only if cogent reasons are forthcoming. If this be the prescription or specification for the grant of extension, and I have no doubt that this is, is it a fit case for exercising the discretion in favour of extension?" (Union of India v. M/s. Associated Producers Co. 1991 (3) Delhi Lawyer 191 ). The learned counsel for the respondent implores that I may as well poss the same very question in the present petition too which also happens to be under section 28 and proceed to answer it within the parameters of my above observations. As per him. I must turn down the prayer for extention of time on two grounds. First, that the petitioner had been guilty of dilatory tactics and, secondly, the arbitrators had themselves been guilty of misconduct,

( 2 ) 1. do stand by my word surely there be cogent reasons for extension of time. But then, is not every case an island unto itself ?

( 3 ) TRUE, as a general rule where a party seeking extension of time has itself been guilty of negligence or dilatory tactice, it cannot get extension (See : J. W. Oliver v. Mian Dost Mohammad AIR 1935 Lah 191; (1) Hindustan Steel v. Amar Nath AIR 1971 Ori 288) (2 ). But then, does it stand attracted to the case in hand? I believe. It is here that the respondent meets its Waterloo.

( 4 ) THE record shows that the first meeting of the arbitrators took place on January 24, 1991 in which the petitioners were directed to file their claim by February 16, 1991. However, this was not done "due to reasons beyond their control" and a? such the lime was extended. A date was also fixed for filing of reply and counter claim by the respondents. Though the petitioner did file its claim, the respondents failed to submit its reply inviting the following comments from the arbitrators: "mr. Seth, learned counsel for the N. T. P. C. made a request for time for filing reply. This is rather unfortunate because on our last hearing on 9th April. 1991, we had given time schedule for filing counter reply. We had given sufficient time to N. T. P. C. and we really feel that there is no real justification for not having filed the reply in time. . . . " On the next hearing adioument was necessitated on account of illness of counsel for the petitioner. The next date fixed was March 26, 1992. However, before the date fixed a letter was received from the petitioner seeking extension of time for filing reply. That letter is of March 20, 1992 and runs as under : "we were directed by the Hon ble Arbitrators to file our reply by 25th January, 1992 but, due to prolonged strike, which is still continuing, at our Works, we could not enter the factory-premises and take-out relevant records. As such, we could not hand-over complete documents to our Lawyer for preparing our reply in the matter. We, therefore, request the Hon ble Arbitrators to grant us four more weeks to file the. reply and also adjourn the hearing fixed for March 26. 1992 as useful purpose would not be served in the hearing fixed for March 2". 1992. We, sincerely regret the delay and the inconvenience caused to the Hon ble Arbitrators arid the opposite party. " 479 On this the time was extended till May 3, 1990. The order having been complied with, the respondent was directed to file rejoinder by July 20, 1992 and as rejoinder was not filed, more time was granted. The next three meetings were consumed by some applications, while the 11th meeting saw the respondent taking objection that arbitration could not proceed as the matter required to be referred first






Click Here to Read the rest of this document

1
2
3
4
5
6
7
8
9
10
11
SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top