High Court Of Delhi
G.A.MANI - Appellant
Versus
FOOD CORPORATION OF INDIA - Respondent
Suit 309A of 1979
Decided On : 03/17/1980
ARBITRATION - APPLICATION UNDER SECTION 14 OF THE ARBITRATION ACT, 1940 - LIMITATION - AWARD FILED BY ARBITRATOR IN COMPLIANCE WITH COURT DIRECTION - APPLICATION UNDER SECTION 14 FILED BEYOND LIMITATION - APPLICATION DISMISSED - AWARD RETURNED TO ARBITRATOR.
Fact of the Case:
Petitioner, a sole proprietor, filed an application under Sections 14 and 17 of the Arbitration Act, 1940, to enforce an arbitral award made in his favor. The respondent, Food Corporation of India, contested the application, arguing that it was barred by limitation and that the court lacked territorial and pecuniary jurisdiction.
Finding of the Court:
The court held that the application was barred by limitation as it was filed beyond the 30-day period prescribed under Article 119 of the Limitation Act, 1963. The court further held that the filing of the award by the arbitrator in compliance with the court's direction did not cure the limitation defect.
Issues: 1. Whether the court had territorial jurisdiction to entertain the application. 2. Whether the court had pecuniary jurisdiction to entertain the application. 3. Whether the application was barred by limitation. 4. Whether the award was liable to be set aside on account of objections raised by the respondent.
Ratio Decidendi: 1. The court has territorial jurisdiction to entertain the application as the head office of the respondent is located within its jurisdiction. 2. The court has pecuniary jurisdiction to entertain the application as the total claim before the arbitrator exceeded Rs. 50,000. 3. The application is barred by limitation as it was filed beyond the 30-day period prescribed under Article 119 of the Limitation Act, 1963. 4. The award cannot be set aside on account of the objections raised by the respondent as the application under Section 14 of the Arbitration Act, 1940, is barred by limitation.
Final Decision: The application under Sections 14 and 17 of the Arbitration Act, 1940, is dismissed as barred by limitation. The award and the record of proceedings are returned to the arbitrator.
( 1 ) SHRI G. A. Mani, sole proprietor of Messrs. G. A. Mani Sex-79, filed this application under Sections 14 and 17 of the Arbitration Act, 1940, hereinafter called the Act , stating that disputes having arisen out of the contract for the execution of the work of "construction of Asphalt Roads, Culverts and Storm Wafer Drains for Bulk Fertilizer Unloading and Handling Project at Kandla Port", reference was made to the managing director. Food. Coporation of India, vide letter dated September 8, 1977 and that Shri. B. N. Lokur, Arbitrator, had made and published the award on June 8, 1978, copy whereof was received by the petitioner on June II, 1978. Notice was issued to the Food Corporation of India. Simultaneously the arbitrator was also called upon to file the award which he did on July 9, 1979. Thereupon, notices in regard to the filing of the award were also issued to the patties. Food Corporation of India, hereinafter referred to as the respondent, resisted the application contending that it had been made beyond time, and that this Court lacked territorial jurisdiction as the contract was made at Bombay and was to be performed at Kandla and the fact that the respondent had its Head Office at New Delhi was if no consequence. It was further pleaded that the amount awarded being less than Rs. 50,000 there was lack of pecuniary jurisdiction as well.
( 2 ) OBJECTIONS under Sections 30 and 33 of the Act were separately filed (I. A. No. 2106 of 1979) contending that the award stood vitiated by misconduct on the part of the arbitrator as well as misconduct of proceedings. G. A. Mani, petitioner, conceded in his rejoinder that the application had been made beyond time but contended that inasmuch as award stood filed in Court and. objections thereto had been filed the matter had to be proceeded with and objection on the point of limitation was left with no merits. It was, however, maintained that this Court had territorial jurisdiction in view of Clause (a) of Section 20 of the Code of Civil Procedure and had also pecuniary jurisdiction inasmuch as claims preferred before the arbitrator were of the value of Rs. 1. 77 lacks. As regards the allegations of misconduct those were stoutly denied. Both the matters were taken up together and the following issues were framed :
1. Has this Court territorial jurisdiction to entertain and decide the matter? 2. Has this Court no pecuniary jurisdiction to entertain and decide the matter? 3. Is the application under Sections 14 and 17 of the Arbitration Act within limitation ? If not, to what effect 4. Is the award liable to be set aside on account of objections raised in the objections petition of respondent No. 1 ?the first three issues were treated as preliminary issues and were fixed for hearing inasmuch as it was agreed that no evidence was required to be produced.
( 3 ) ISSUE NO. 1. It is submitted by Shri S. K. Puri, learned counsel for the respondent, that the contract between the parties related to a project at Kandia and the disputes were referred to arbitration at Bombay where the award was made and, therefore, the Court at Bombay alone has jurisdiction to entertain this petition. I find no merit in this contention. It is an undisputed fact that the head office of the respondent is at New Delhi and, according to clause (a) of Section 20 of the Code of Civil Procedure, the suit can be instituted in a Court within the local limit of whose jurisdiction the defendant carries on business or works for gain. This point came up directly in Ram Ratan Bharti Vs. Food Corporation of India, 1978 Rajdhani Law Reporter 177 (1) and a Full Bench of this Court held that an application under Section 20 of the Act may be made in any Court where cause of action arises or the defendant resided works for gain. While coming to this conclusion, the Full Bench relied upon Makarn Singh v. M/s. Gammon (India) Ltd. , AIR 1971 S. C. 740 (2 ). Therein, it was held that the Code of Civil Procedure in
REFERRED TO : Ram Ratan Bharti v. Food Corporation of India
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