2019 Supreme(Mad) 1162
IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
Managing Director, Tamil Nadu Fisheries Development Corporation Limited – Petitioner
Versus
K. Subramanian – Respondent
O.P. No. 480 of 2017
Decided On : 21-06-2019
Advocate Appeared:
For the Petitioner: Vijay Narayan for M/s. R. Master Ganesh.
For the Respondent: V.T. Gopalan for M/s. S. Radha Gopalan.
The main legal point established in the judgment is the limited scope of interference with arbitral awards, emphasizing the importance of the arbitrator's jurisdiction in interpreting contract terms and the grounds for interference based on public policy, fundamental policy of Indian law, and patent illegality.
Headnote:
Arbitration - Fishing License Dispute - Arbitration and Conciliation Act, 1996, Section 34 - 12, 13 - The court discussed the interpretation of the fishing license agreement and the geographical limits of engaging share fishermen. It highlighted the legal principles of public policy, fundamental policy of Indian law, and patent illegality as grounds for interference with an arbitral award. The court emphasized the limited scope of interference with arbitral awards and the importance of the arbitrator's jurisdiction in interpreting contract terms.
Fact of the Case:
The original petition was filed under Section 34 of the Arbitration and Conciliation Act, 1996, challenging an award related to a fishing license dispute. The respondent claimed that the petitioner did not allow them to carry out fishing activities as per the agreement, resulting in a loss. The learned Arbitrator passed an award in favor of the respondent, directing the petitioners to pay a sum of Rs. 2,09,00,607/- and interest, among other costs.
Finding of the Court:
The court found that the learned Arbitrator reasonably interpreted the fishing license agreement and passed a well-reasoned award. It dismissed the petition, emphasizing the limited grounds for interference with arbitral awards and the importance of the arbitrator's findings.
Issues: The issues framed were related to the entitlement of the claimant to the claimed amount, violation of license agreement terms, entitlement to interest and costs, and other relief.
Ratio Decidendi: The court emphasized the limited scope of interference with arbitral awards, the importance of the arbitrator's jurisdiction in interpreting contract terms, and the grounds for interference based on public policy, fundamental policy of Indian law, and patent illegality.
Final Decision: The petition was dismissed, and the order of the learned Arbitrator was upheld.
(Prayer: Original Petition has been filed under Section 34 of the Arbitration and Conciliation Act, 1996, to set aside the Award dated 15.05.2017 rendered by the learned Sole Arbitrator.)
1. Aggrieved over the award passed by the learned Arbitrator, the petition has been filed challenging the award dated 15.05.2017.
2. The brief facts leading to file this original petition is as follows:
(i) The first petitioner/first respondent floated a tender for fishing in Sathanur dam, for a period of 5 years from 15.07.2012 to 14.07.2017. In the auction, the respondent/claimant became a successful bidder. Hence, the 1st petitioner vide the deed of license, dated 13.07.2012 awarded the licence to the respondent/claimant for a sum of Rs. 1,23,45,678/-. Besides, the 1st petitioner collected a sum of Rs. 85,55,239/- towards incidental charges. Thus, the total amount collected by the 1st petitioner from the respondent/claimant works out to Rs. 2,09,00,917/-. In addition to the said amount, the respondent/claimant invested a sum of Rs. 45,00,000/- towards the purchase of seedlings and fingerlings. The respondent/ claimant has to handover 1/3 of the catches to the 1st respondent Corporation and the remaining 2/3 could be sold by the claimant. Further, the petitioners did not allow the respondent/claimant to do fishing, which caused loss to the respondent/claimant.
(ii) As per Clause 13 of the deed of license, the respondent/claimant is entitled to avail the service of the share fishermen of the 1st petitioner, after furnishing the list of the share fisherman to the 1st petitioner. Similarly, the respondent/claimant is entitled to do the fishing through authorized representatives not exceeding 7 members, after furnishing the list of their names. The respondent/claimant furnished the list of fisherman and their authorized representatives to the first petitioner. It is further contention of the respondent/claimant that the clause 13 of the Deed of Licence, no geographical limitation has been set out. In fact, the share fisherman from the Mettur Dam have been beaten up by the share fishermen of Sathanur Dam at the instances of the third petitioner. Despite the Peace Committee was convened by the District Collector, the respondent/claimant could not do the fishing. Hence, the respondent/claimant has approached the High Court of Madras in Writ Petition No. 2315 of 2013. The High Court has permitted the respondent/ claimant to do fishing at the Mettur Dam and appointed an Advocate Commissioner to oversee the fishing operation. However, the petitioners did not allow the respondent/ claimant to do fishing. In Subsequent, the tender was floated in the year 2013 and the condition imposed therein was that the service of share fishermen of Sathanur dam alone shall be availed, which condition was not there when the respondent/claimant took part in the auction in the year 2012.
3. The respondent/claimant has filed a counter stating that the licence itself makes it clear that only using the service of share fisherman irrespective of any Geographical limits. In pursuant to that, Clause 12 and 13 of the Licence Deed between the parties provides for the same. Because of the respondent/claimant’s poor management skills and not having experts, he could not access the Sathanur Dam. It is denied that the claimant has incurred a loss to the extent of Rs. 3,88,00,000/-.
4. On the side of the claimant, 12 documents were filed and on the side of the respondents 13 documents were filed and 6 witnesses were examined on the side of the respondent/claimant.
5. Based on the pleadings of the parties, the following issues were framed:
(i) Whether the claimant is entitled to the amount claimed in his claim statement?
(ii) Whether the terms and conditions enumerated in the license agreement dated 13.07.2012 has been violated by either of the parties?
(iii) Whether the claimant is entitled to any interest on the claim and if so what is the rate of interest?
(iv) Whether the claiman