2019 Supreme(Gau) 856
IN THE HIGH COURT OF GAUHATI
MIR ALFAZ ALI, J.
M/s. Shivalaya - KCC (JV) - Appellant
Versus
State of Assam and Others - Respondents
Civil Revision Petition No. 43 of 2019
Decided On : 19-09-2019
Advocate Appeared:
G.N. Sahewalla, Adv.
The central legal point established in the judgment is that the court may extend the time for arbitral proceedings under Section 29-A of the Arbitration Act only for sufficient cause, and the failure to file the written statement within the specified time schedule constituted sufficient cause for extending the time.
Headnote:
Arbitration - Extension of Time - Arbitration and Conciliation Act, 1996 (Section 29-A)
Fact of the Case:
The petitioner sought extension of time for passing the award by the Arbitral Tribunal under Section 29-A of the Arbitration and Conciliation Act, 1996. The learned District Judge rejected the application, leading to the petitioner filing a revision petition.
Finding of the Court:
The court found that the learned District Judge exceeded jurisdiction and failed to consider whether there was sufficient cause for extending the time. It held that the delay in completing the proceeding was caused by the tribunal itself and refused to extend the time, attributing fault to the tribunal. However, the court concluded that the delay was due to the respondent's failure to file the written statement within the specified time schedule, which constituted sufficient cause for extending the time.
Issues: The issues involved the rejection of the application for extension of time under Section 29-A of the Arbitration Act, the legality and validity of the constitution of the Arbitral Tribunal, and the principles of res judicata.
Ratio Decidendi: The court's decision was based on the interpretation of Section 29-A of the Arbitration Act, which allows for the extension of time for arbitral proceedings only for sufficient cause. It also considered the provisions of Sections 13 and 16 of the Arbitration Act, which empower the Arbitral Tribunal to decide on its own jurisdiction and provide remedies for challenging the tribunal's decisions.
Final Decision: The petition was allowed, and the time for passing the award was extended by six months.
JUDGMENT :
Mir Alfaz Ali, J.
Challenge in this revision petition is to the order dated 13-02-2019 passed by learned District Judge, Kamrup in Misc. (Arb.) Case No. 21/2018, whereby the learned District Judge rejected the application filed by the petitioner under Section 29-A of the Arbitration and Conciliation Act, 1996 (in short the Arbitration Act) seeking extension of time for passing the award by the Arbitral Tribunal.
2. The facts, which may be relevant for disposal of this revision petition are as follows : Pursuant to a notice inviting tender (NIT) floated by the respondent, the petitioner was awarded with a contract for the work of "improvement and up-gradation of SH-3 (Morigaon to Nagaon)". Dispute having arisen between the parties with regard to the aforementioned contract, the matter was referred to arbitral tribunal. During continuation of the said arbitral proceeding, the petitioner raised another set of dispute pertaining to the same contract and referred its claim to the adjudicator under the clause 24.1 of the agreement, which was dismissed by the adjudicator. Thereafter, the petitioner by invoking the clause 25.3 of the agreement, referred the claim for adjudication by the arbitral tribunal and nominated Honourable Mr. Justice I.J. Mamtani as its nominee arbitrator. The respondent having not appointed its nominee arbitrator, the petitioner approached the Indian Council of Arbitration seeking appointment of an arbitrator and accordingly, the Indian Council of Arbitration nominated Honourable Mr. Justice Dinendra Biswas as the respondent's nominated arbitrator. The aforementioned co-arbitrators nominated Honourable Mr. Justice D.K. Seth as presiding arbitrator.
3. The respondents raised objection as to constitution of the Arbitral Tribunal by filing an application u/s 13 of the Arbitration Act, which was rejected by the tribunal. Respondents also challenged the maintainability of the arbitral proceeding on the principle of res-judicata under Order II Rule 2 CPC. As the tribunal could not complete the proceeding within the period of one year, the petitioner gave its consent, extending time for six months. However, the respondent initially took time to communicate its stand after a decision was taken by the competent authority and ultimately by letter dated 03-07-2018 refused to give its consent for extending time period. Hence, the petitioner filed the application before the learned District Judge under Section 29-A of the Arbitration and Conciliation Act seeking extension of time. The petition was resisted by the respondents. Upon hearing both the sides, learned District Judge by the impugned order dated 13-02-2019 rejected the application.
4. Aggrieved, the petitioner preferred the instant revision petition.
5. The respondents filed an affidavit-in-opposition denying the allegations made in the application and also raising certain preliminary objection.
6. I have heard Mr. D. Senapati, learned counsel for the petitioner and learned Govt. Advocate G. Rahul for the State respondent.
7. Learned counsel for the petitioner has assailed the impugned order stating that the learned District Judge while rejecting the application u/s 29-A of the Act, exceeded its jurisdiction and also failed to exercise the jurisdiction vested on him, inasmuch as, the application was rejected on the ground that the proceeding was barred under Order II Rule 2 CPC and also that the constitution of the Arbitral Tribunal, more particularly, nomination of Honourable Mr. Justice D.K. Seth as presiding arbitrator was illegal, which was completely outside the jurisdiction of the learned Addl. District Judge, while considering an application u/s 29-A of the Arbitration Act. It was also contended that the learned District Judge failed to consider and record a finding as to whether there was sufficient cause for extending the time, rather, rejected the application by exercising its jurisdiction in a manner as if he was dealing with an application u/s 34 of