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2021 Supreme(Del) 374
IN THE HIGH COURT OF DELHI AT NEW DELHI
V. KAMESWAR RAO, J.
M/s Pragya Electronics Pvt. Ltd. – Petitioner
Versus
M/s Cosmo Ferrites Ltd. and Another – Respondents
O.M.P. (COMM) No. 71 of 2019, I.A. No. 2767 of 2019
Decided On : 23-06-2021
Advocate Appeared:
For the Petitioner: Mr. Rohit Goel.
For the Respondents: Mr. Bharat Chugh, Mr. Sujoy Sur.
Point of Law: Arbitration Award- it is only in exceptional circumstances as provided in the Arbitration and Conciliation Act 1996, that the Court is entitled to intervene in the dispute, which was the subject matter of the arbitration, when injustice is caused to either of the parties.
Headnote:
Code of Civil Procedure, 1908 - Section 33, Order 7 Rules 10, Order XXIX Rule 1, Chapter XI - Arbitration and Conciliation Act, 1996 - Section 34 - Arbitration Award - Grounds for challenge - Cheque as Security - Unpaid Bills - Arbitrator found that respondent/claimant was entitled to recover amount, it rejected respondent/claimants claim for interest at rate of 12.25% p.a. on the said awarded sum - This however was challenged by respondent in Section 34 petition being OMP and coordinate bench set-aside impugned award to the extent of allowing 12.25% p.a. from date of invoices till the date of impugned award - It is case of the petitioner in present petition and contended by Mr. Rohit Goel that impugned Award is liable to be set aside as Award does not bear signature of Arbitrator on each and every page and even Award has been typed in three different fonts on three different types of sheets - In this regard he stated that impugned Award was in total violation of Chapter XI of the CPC which refer to Judgments and Decrees.
Finding of the Court:
Court may state that reference as made to Chapter XI is an error - It appears reference was intended to Part I of the CPC wherein Section 33 refers to a Judgment and a Decree - Mr. Goel has not qualified his submission as to how the Award is in violation of that provision - In so far as his contention that the learned Arbitrator has not signed each and every page of Award, he has not pointed out any provision which contemplates so - Even plea of Mr. Goel that award is typed in three different fonts shall not make award invalid - Again he has not submitted any rule/law in support of his submission - This plea of Mr. Goel is rejected - Arbitrator did not decide cases with correct application of formula and further that claim for price adjustment in respect of bitumen laid by contractors was not correct and award being contrary to contractual terms, Arbitrator having taken a particular view, which is a plausible view, keeping in mind parameters of judicial review by Court in exercise of powers under Section 34 of Act, award cannot be interfered - Suffice to state, no such submission was made by Mr. Goel - It is not the case of Mr. Goel that the award given by Arbitrator is contrary to terms of the agreement - Award cannot be interfered with - Court find Arbitrator has also held that insurance was against breakage during transit and no such claim was made - Any breakage beyond transit could not have been recovered through insurance or from respondent - This position is not contested by Mr. Goel - Hence, rejection of this claim of petitioner by Arbitrator cannot be faulted - Court do not see any merit in petition.
Result: Petition Dismissed.
JUDGMENT :
V. KAMESWAR RAO, J.
I.A. No. 2767/2019
This application has been filed by the petitioner for urging additional grounds. For the reasons stated in the application, the same is allowed.
The application is disposed of.
O.M.P. (COMM) No. 71/2019
1. The present petition has been filed under Section 34 of the Arbitration and Conciliation Act, 1996 (‘Act’ for short) impugning the Award dated April 13, 2016 with the following prayers:
“In view of the above said facts and submissions, it is, therefore, most respectfully prayed that this Hon'ble Court may graciously be pleased to:
(a) call for the arbitral record of the arbitration proceedings from the Respondent no. 2 SOLE ARBITRATOR JUSTICE V.P. BHATNAGAR (RETD.) OF THE ARBITRATION PROCEEDINGS TITLED AS “M/S COSMO FERRITES LTD. VS. M/S PRAGYA ELECTRONICS PVT. LTD. SHRIRAM TRANSPORT FINANCE CO. LTD. VS. GULWANT SINGH AND ANOTHER.
(b) set aside, reverse and quash the arbitration Award dated 13.4.2014 passed by the Ld. SOLE ARBITRATOR JUSTICE V.P. BHATNAGAR (RETD.) OF THE ARBITRATION PROCEEDINGS TITLED AS “M/S COSMO FERRITES LTD. VS. M/S PRAGYA ELECTRONICS PVT. LTD. SHRIRAM TRANSPORT FINANCE CO. LTD. VS. GULWANT SINGH AND ANOTHER.
(c) pass any other or further or relief which this Hon'ble Court may deem fit and proper in favour of the petitioner and against the Respondent.”
2. The chronology of events leading to the matter being heard/listed before this Court is as follows. The present petition was initially filed before the District Court, Saket in the year 2016 and vide order dated January 03, 2017 the Additional District Judge-5, Saket Courts noting the nature of the dispute involved in the petition is commercial with a value of Rs. 5,15,54,292/- and in view of The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015, the same falls within the jurisdiction of Commercial Courts of this Court, directed the parties to appear before the learned District and Sessions Judge. When the parties appeared before the learned District and Sessions Judge, the petitioner sought adjournment on the ground that a Transfer Petition, being TP (C) 169/2019, was pending adjudication before this Court as a Section 34 petition filed by the respondent was being proceeded against in this Court. However, since the Section 34 petition filed by the respondent being OMP (COMM) 350/2016 was disposed of on May 25, 2017, the Transfer Petition [TP (C) 169/2016] was disposed of as infructuous vide order December 5, 2017.
3. The petitioner herein, thereafter pressed his application under Order 7 Rules 10 and 10A before the learned District Judge. Vide order dated January 23, 2019 the learned District Judge noting the submission of the counsel for the respondent that the petitioner has not conducted the matter with due diligence and good faith and also noting that the question of due diligence not being within the jurisdiction of the said Court placed this matter before the Registrar General of this Court.
4. This matter was thereafter listed before the Registrar (Original) as per the direction of the Registrar General vide order dated January 31, 2019. The Registrar (Original) noting the chronology of the proceedings and the submission of the Counsel for the respondent that the petition is barred by limitation and the registry should at the first instance calculate the delay to which the counsel for the petitioner submitted that the petition being originally filed in District Court and it was not for the Registry to look into the aspect, the Registrar (Original) directed the matter to be placed before the appropriate Bench.
5. The respondent is the manufacturer and the petitioner is the distributor of Ferrites and it is the admitted case of the parties that petitioner and respondent entered into a non-exclusive Distributorship Agreement dated April 01, 2005 (‘Distributorship Agreement’ for short). Subsequently, the parties entered into annual agreements for the years 2007, 2008
