IMPORTANT POINT
The main legal point established is that under Section 34 of the Arbitration and Conciliation Act, 1996, the Court can partially or wholly set aside an Arbitral Award if the claims are separable and independent. The Court emphasized the need for the District Judge to consider the severability of the rejected claims and make a decision on the challenge under Section 34.

JUDGMENT :

MICHAEL ZOTHANKHUMA, J.

1. Heard Ms. S. Bhattacharjee, learned counsel for the appellant. Also heard Mrs. Mary L. Khiangte, learned Government Advocate, appearing for all the respondents.

2. The appellant is aggrieved by the Order dated 27.09.2023 passed by the District Judge, Aizawl dismissing Arbitration Case No. 1/2023 as infructuous. The Arbitrator in Arbitration Proceeding No. 4/2020 had allowed several of the claims of the appellant while rejecting others vide Arbitral Award dated 30.05.2022. The appellant had prayed for execution of the claims that had been allowed by the Arbitrator vide Execution Case No. 15/2023. The same was allowed vide Order dated 11.08.2023. With regard to the claims that had been rejected by the Arbitrator, the appellant challenged the rejection under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the 1996 Act”) vide Arbitration Case No. 1/2023. However, the same was dismissed vide order dated 27.09.2023 passed in Arbitration Case No. 1/2023 on the ground that the arbitral award had been executed vide Execution Case No. 15/2023.

3. The genesis of this appeal under Section 37(1)(c) of the 1996 Act is that the appellant had been awarded the contract work for construction of Tawngkolong to Longmasu Road 0.00 kmp-27.50 kmp. The appellant’s contract was terminated by the State respondents. As a dispute arose between the parties in respect of the said contract, an application under Section 11 of the 1996 Act was filed in this Court, vide Case No. Arbitration Petition 4/2019. This Court disposed of Case No. Arbitration Petition 4/2019, vide judgment dated 12.03.2020, appointing a sole Arbitrator to decide the dispute between the parties.

4. The appellant made 10 claims against the respondents, vide the Statement of Claims and the respondents submitted their statement of defence.

5. The case was registered before the Arbitrator as Arbitration Proceeding No. 4/2020. The Arbitration Proceeding No. 4/2020 was disposed of, vide Award dated 30.05.2022, by allowing Claim Nos. 2, 3, 4, 9 and 10 in favour of the petitioner. Claim No. 6 was withdrawn by the petitioner, while the petitioner’s Claim Nos. 1, 5, 7 and 8 were rejected by the Arbitrator.

6. The appellant thereafter filed Execution Case No. 15/2023 in respect of the Award dated 30.05.2022 pertaining to the claims which had been allowed by the Arbitrator. Execution Case No. 15/2023 was disposed of by the District Judge, Aizawl, vide order dated 11.08.2023 in terms of the Arbitrator’s Award dated 30.05.2022.

7. The appellant had also filed an application under Section 34 of the 1996 Act, in respect of Claim Nos. 1, 5, 7 and 8 which had been rejected by the Arbitrator, vide Arbitration Case No. 4/2022 before the District Judge, Aizawl. The District Judge, Aizawl dismissed Arbitration Case No. 4/2022, vide the impugned order dated 27.09.2023, on the ground that the Arbitral Award dated 30.05.2022 arising out of Arbitration Proceeding No. 4/2020 had been executed, vide order dated 11.08.2023 passed in Execution Case No. 15/2023 and as such, the application under Section 34 was found to be infructuous.

8. The appellant’s counsel submits that there was no challenge made to the Arbitral Award dated 30.05.2022 by the State respondents and as such, the appellant was claiming execution of a part of the Arbitral Award passed in arbitration proceeding, pertaining to release of performance guarantee, release of security deposit and cost of arbitration, as had been allowed by the Arbitrator. However, as Claim Nos. 1, 5, 7 and 8 had been rejected by the Arbitrator, the same had been put to challenge by the appellant, vide Arbitration Proceeding No. 4/2020. However, the dismissal of the same by the learned District Judge, Aizawl only on the ground that the execution case had been executed in terms of Award dated 30.05.2022 could not be a ground for dismissing the petitioner’s application made under Section 34. She submits that th