A.M. BABU, J.

1. We once dismissed this same appeal. It was as per our judgment dated 16.11.2016. That judgment was reported 2017(1) KLT SN 24 (C.No.26), (2016 (5) KHC 835, 2016 (4) KLJ 778, and ILR 2017(1) Ker.370). We reviewed and recalled the said judgment by order passed on 30.1.2017 (vide the order in R.P.No.36 of 2017).

2. We heard the learned counsel appearing for all the parties afresh.

3. The facts are these: The appellant purchased a motor vehicle. For that, a loan of Rs.4,68,000/- was availed of. The first respondent was the financier. The motor vehicle was hypothecated to the financier. A loan cum hypothecation agreement was executed in favour of the first respondent by the appellant and the second respondent. The loan was to be repaid in installments, but defaulted. The first respondent repossessed the motor vehicle and sold it for Rs.2,01,000/-. The arbitration clause in the hypothecation agreement was invoked. The arbitrator by his award fixed the liability of the appellant and the second respondent at Rs.3,22,730/-.

4. The appellant filed an application to set aside the arbitration award. The application was filed under S.34(1) of the Arbitration and Conciliation Act, 1996 (‘the Act’ for short). The application was numbered O.P.(Arb) No.25 of 2016. The District Judge, Manjeri dismissed it as not maintainable. Non-compliance of the provisions of S.34(5) of the Act was the reason why the application met dismissal.

5. Section 34(5) of the Act insists on the issuance of a prior notice by the applicant to the other party. Such a prior notice is a condition precedent to apply under S.34(1) of the Act. The application shall be accompanied by an affidavit by the applicant endorsing compliance with the aforesaid requirement in S.34(5). Admittedly the appellant did not issue any prior notice to the first respondent. No affidavit was filed. The learned District Judge therefore dismissed the application as not maintainable. We concurred with the District Judge and dismissed the appeal at the threshold.

6. We wrote our reasons for dismissing the appeal at paragraphs 5 and 6 of our judgment dated 16.11.2016. We said, procedural law would operate retrospectively. We also said that there would be no vested right in procedure. We concluded that the requirements in S.34(5) should be complied with even in cases where the arbitration proceedings commenced before the date of incorporation of the said sub-section. That conclusion of ours was wrong. The dismissal of the appeal was liable to be reviewed. We therefore on 30.1.2017 reviewed and recalled it. We happened to dismiss the appeal since we did not notice S.26 of the Arbitration and Conciliation (Amendment) Act, 2015 (for short Act 3 of 2016). S.26 was not brought to our notice.

7. The Act was originally amended by the Arbitration and Conciliation (Amendment) Ordinance, 2015. The Ordinance was promulgated on 23.10.2015. It was later replaced by Act 3 of 2016. Various provisions of the Act were amended and certain new provisions were introduced by Act 3 of 2016 with retrospective effect from 23.10.2015 (the date of promulgation of the Ordinance). Sub-s.(5) of S.34 of the Act was one of the provisions inserted by Act 3 of 2016 with retrospective effect from 23.10.2015. Should the requirements in S.34(5) of the Act be complied with in the case of an arbitration proceedings which commenced before 23.10.2015 ? That is the question. S.26 of Act 3 of 2016 is the direct answer to the question.

8. Section 26 of Act 3 of 2016 reads thus:

Nothing contained in this Act shall apply to the arbitral proceedings commenced, in accordance with the provisions of Section 21 of the principal Act, before the commencement of this Act unless the parties otherwise agree, but this Act shall apply in relation to arbitral proceedings commenced on or after the date of commencement of this Act.

Section 26 makes it abundantly clear that all the amendments to the Act brought in by Act 3 of 2016 shall have