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2008 Supreme(Del) 753

AIR 2009 DELHI 102
HIGH COURT OF DELHI
THE HONOURABLE DR. JUSTICE S. MURALIDHAR
Government of India Bharat Sanchar Nigam Limited
Versus
Acome
FAO(OS) Appeal No. 248 of 2007
Date of Judgment : 15-07-2008

Advocates appeared:
For the Appearing Parties:Abhishek Yadav, Alok Krishan Aggarwal, K.C.Kaushik, Naveen Chawla, Rahul Kaushik, Shruti Chandran, Advocates

JUDGMENT :

(1) WE have heard the learned counsel appearing for both parties.

(2) THE short question which falls for our consideration in this appeal is whether the petition filed by the appellant under Section 34 of the Arbitration and Conciliation Act, 1996 (for short the Act) was barred by limitation.

(3) IN order to appreciate the controversy involved in this appeal it is necessary to give facts. The appellant, then Department of Telecommunications and now Bharat Sanchar Nigam Limited, placed two purchase orders both dated 1st june, 1988 for supply of PIJF cables for Mahanagar Telephone Nigam Limited on the respondent M/s. ACOME. Dispute arose between the parties as according to the appellant some of the supplies were defective while the respondent maintained that the supplies were good and were in fact utilized by the appellant.

(4) THE matter was referred to the arbitral tribunal consisting of three technical experts, namely, Mr. B. R. Nair (Chairman of the Tribunal), mr. T. Narayanamoorthy, the arbitrator nominated by the respondent and Mr. Ranbir khanna, the arbitrator nominated by the appellant. Majority arbitrators, namely, Mr. B. R. Nair and Mr. T. Narayanamoorthy, made and published award dated 1st February, 2002. The award was not signed Mr. Ranbir Khanna, the third arbitrator. However reasons for not signing the award are contained in the award itself. In paragraph 6 of the award the majority arbitrators recorded that a draft award was prepared and circulated by the Secretariat and was discussed by the three arbitrators on 12th November, 2001. While the presiding arbitrator Mr. B. R. Nair and Mr. T. Narayanamoorthy were more or less in agreement, the third arbitrator, namely, Mr. Ranbir Khanna disagreed with them and expressed his disability to make and sign the award. In the minutes of the meeting held on 12th November, 2001, annexed to the majority award, the majority arbitrators recorded that Mr. Ranbir Khanna had opined on that day that no agreement could be reached on the award and, therefore, he was making his award in due course of time. As on the date of the publication of the majority award his award was still not available. Mr. Khanna gave his minority award on 18th September, 2002. Thereafter the appellant preferred the petition under Section 34 of the Act on 16th December, 2002 to challenge the majority award dated 1st February, 2002.

(5) A preliminary objection was raised by the respondent that the petition was barred by limitation since the majority award was made on 1st February, 2002 and communicated to the appellant on the same date. Limitation for filing objections to the majority award started running against the appellant from 2nd february, 2002. Section 34 (3) of the Act prescribes a limitation of three months starting from the date on which the party making an application for setting aside the award received the arbitral award. Upon sufficient cause being shown to the satisfaction of the Court, this period could extended by another thirty days but not thereafter. According to the respondent since the appellant was served with the copy of the award on 1st February, 2002, in any event the challenge thereto ought to have been raised by the appellant before 30th June, 2002 and not thereafter.

( 6 ) ON the other hand, the contention of the appellant was that unless all the arbitrators give their reasoned award it cannot be said that there is an arbitral award. According to the appellant the limitation did not begin to run for filing objections to the majority award till the decision of the dissenting arbitrator, dated 18th September, 2002, was received by the appellant, which was received by the appellant on 24th September, 2002. If limitation is computed from that date, the petition under Section 34 is well within time.

( 7 ) THE learned single Judge on exhaustive consideration of the Act held that the award of a multi-member arbitral tribunal comes into force on making and publishing of the major




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