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2022 Supreme(HP) 244

IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
SATYEN VAIDYA, J.
M/s V. Kare Biotech & Ors. - Petitioners
Versus
Hemant Aggarwal, S/o. Sh. Mahesh Rai Aggarwal & Ors. - Respondents
Civil Misc. Petition Main (Original) No. 130 of 2022
Decided On : 21-06-2022

Advocates Appeared:
For the Petitioner: Mr. Subhash Sharma.
For the Respondent:Mr. Sanjeev Kuthiala, Sr. Advocate with Ms. Anaida Kuthiala.

Point of Law: A party to arbitration proceedings has a remedy to challenge the award passed in such proceedings under Section 34 of the 1996 Act.

Headnote:

Constitution of India, 1950 - Article 227 - Code of Civil Procedure, 1908 - Order 11, Rules 1 & 2 read with Section 151 - Arbitration and Conciliation Act, 1996 - Section 34 – Arbitration - Arbitral Award - Whether an order passed on miscellaneous application during arbitral proceeding will be open to challenge before this court under Article 227 of Constitution of India - It is held that the petition under Article 227 of the Constitution of India in the instant case is not maintainable and hence this Court will refrain itself from adjudicating upon the merits of the order impugned by way of instant petition. (Para 17)

Finding of the Court : A party to arbitration proceedings has a remedy to challenge the award passed in such proceedings under Section 34 of the 1996 Act. One of the grounds for assailing arbitral award under the aforesaid provision is that such award is in conflict with public policy of India. The term “public policy of India” carries within it innumerable facets. It is altogether a different thing to say that there is no immediate remedy available to the petitioners than to say that they have no remedy at all.

Result: Petition disposed of

ORDER :

By way of instant petition, the petitioners have assailed order dated 18.12.2021 passed by the learned Arbitrator, whereby the application of the petitioners herein under Order 11, Rules 1 & 2 read with Section 151 of the Code of Civil Procedure (for short “CPC) was dismissed.

2. Respondents herein are the claimants before the learned Arbitrator, who have already submitted their claim. Before entering into defence, petitioners herein moved an application under Order 11, Rules 1 & 2 read with Section 151 of the CPC seeking reply of the respondents herein to the interrogatories formulated on behalf of the non-claimants/petitioners herein.

3. Impugned order reveals that the above noted application of the petitioners herein was rejected by the learned Arbitrator broadly on two grounds. Firstly, that the application was not maintainable before filing of written statement and secondly, that without the written statement of the petitioners herein on record, the application was premature as the relevance of the interrogatories could not be adjudged.

4. The first question that arises in the case is, whether an order passed on miscellaneous application during arbitral proceeding will be open to challenge before this court under Article 227 of the Constitution of India?

5. I have heard learned counsel for parties and have also perused the available records.

6. Petitioners herein at the very out set and in the first instance have submitted that the Arbitration and Conciliation Act, 1996 (for short “1996 Act”) does not provide for any remedy to challenge the impugned order and thus faced with the situation, petitioners had no other alternative efficacious remedy except to approach this Court by way of instant petition. Additionally, it has been submitted that Article 227 of the Constitution of India vests this Court with power of superintendence over all courts and tribunals. The forum of Arbitrator is also a tribunal and hence the jurisdiction of this Court under Article 227 of the Constitution of India cannot be said to be ousted.

7. On the other hand, Shri Sanjeev Kuthiala, Senior Advocate, assisted by Ms. Anaida Kuthiala, Advocate, representing the respondents has opposed the contention so raised on behalf of the petitioners with all vehemence.

8. It will be gainful to summarize the framework of 1996 Act for the purposes of finding answer as to maintainability of this petition.

9. The preamble of 1996 Act reads as under: -

    “PREAMBLE.

WHEREAS the United Nations Commission on International Trade Law (UNCITRAL)has adopted the UNCITRAL Model Law on International Commercial Arbitration in 1985;

AND WHEREAS the General Assembly of the United Nations has recommended that all countries give due consideration to the said Model Law, in view of the desirability of uniformity of the law of arbitral procedures and the specific needs of international commercial arbitration practice;

AND WHEREAS the UNCITRAL has adopted the UNCITRAL Conciliation Rules in 1980;

AND WHEREAS the General Assembly of the United Nations has recommended the use of the said Rules in cases where a dispute arises in the context of international commercial relations and the parties seek an amicable settlement of that dispute by recourse to conciliation;

AND WHEREAS the said Model Law and Rules make significant contribution to the establishment of a unified legal framework for the fair and efficient settlement of disputes arising in international commercial relations;

AND WHEREAS it is expedient to make law respecting arbitration and conciliation, taking into account the aforesaid Model Law and Rules;”

10. United Nations Commission on International Trade Law (UNCITRAL) adopted a Model Law in 1985 on International Commercial Arbitration. The General Assembly of the United Nations recommended member states to give due consideration to the model law to have uniformity in arbitration procedure which resulted in passing of the 1996 Act. The Act is a complete Code in itself and consolidates an

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