IN THE HIGH COURT OF JUDICATURE AT MADRAS
M. DURAISWAMY, SUNDER MOHAN, JJ.
M/S. Saravana Global Holding Ltd., (Formerly known as Saravana Foundations Ltd.), Chennai - Appellant
Versus
N. Jayamurugan - Respondent
O.S.A. (CAD)No. 123 of 2021
Decided On : 29-08-2022
Appeal - Arbitration - Commercial Courts Act 2015, Arbitration and Conciliation Act 1996 - Section 34(4) of the Arbitration Act - Section 13(1A) of the Commercial Courts Act - Section 37 of the Arbitration and Conciliation Act
Fact of the Case:
The Appellant challenged an order under Section 34(4) of the Arbitration Act, seeking to set aside an award. The learned Single Judge dismissed the application, leading to the appeal. The issue was whether the appeal was maintainable under Section 13(1A) of the Commercial Courts Act.
Finding of the Court:
The Court found that the appeal was not maintainable under Section 13(1A) of the Commercial Courts Act, as the order passed under Section 34(4) of the Arbitration Act was not appealable under Section 37 of the Arbitration and Conciliation Act.
Issues: The main issue was the maintainability of the appeal under Section 13(1A) of the Commercial Courts Act.
Ratio Decidendi: The Court held that unless the Arbitration Act or the CPC provides for an appeal, no appeal shall lie under Section 13 of the Commercial Courts Act. The judgment emphasized that any other interpretation would lead to an absurd construction, where any order can be appealed against, notwithstanding the statutory limitation under CPC and the Arbitration Act.
Final Decision: The Original Side Appeal was dismissed as not maintainable.
JUDGMENT
(Prayer: Original Side Appeal filed under Section 13(1A) of the Commercial Courts Act 2015 r/w Section 37 of the Arbitration and Conciliation Act 1996, to allow the O.S.Appeal and set aside the order in application No.2419 of 2021 in O.P.No.595 of 2019 dated 25.10.2021 on the file of this Court.)
Sunder Mohan, J.
1. Challenging the order dated 25.10.2021 made in Application No. 2419 of 2019, under Section 34 (4) of the Arbitration Act, the Appellant has preferred the above Original Side Appeal.
2. The dispute between the Appellant and the Respondent was referred to Arbitration and the Appellant suffered an award directing them to pay a sum of Rs.6,48,35,500/-(Rupees Six Crore, Forty Eight lakhs, Thirty five thousand and five hundred only) together with interest to the Respondent. The Appellant filed O.P.No.595 of 2019 under Section 34 of Arbitration Act for setting aside the award. They filed an application in the said O.P under Section 34(4) of the Arbitration Act stating that the learned Arbitrator had not taken into consideration certain vital materials, the award suffers from gaps in the reasoning which could be cured and hence, prayed for adjournment in O.P.No.595 of 2019 so as to give the learned Arbitrator an opportunity to resume the Arbitral proceedings, to take such action, to eliminate the ground for setting aside the arbitral award.
3. The learned Single Judge dismissed the said application by observing that the learned Arbitrator had considered all the issues on merits, rejected all the contentions raised by the Appellant, and the award did not suffer for want of reasoning warranting the Court to pass an order as prayed for.
4. When the appeal was taken up for hearing, Mr.A.R.L.Sundaresan, learned senior counsel for the Respondent raised an objection stating that the intra-court appeal before this Court is not maintainable, as Section 37 of the Arbitration and Conciliation Act does not provide for an appeal remedy against an order passed under Section 34(4) of the Arbitration Act.
5. In view of the said submission, we thought it fit to decide the preliminary issue with regard to the maintainability of the appeal without adverting to the merits of the above appeal.
6. Mr.K.Subramanian, learned senior counsel for the Appellant, submitted that the intra-court appeal is maintainable against the order passed by the learned Single Judge, sitting in the Commercial Division of this Court under Section 13 of the Commercial Courts Act, 2015. The learned senior counsel further submitted that the proviso to Section 13 (1A) states that the appeal shall lie from orders enumerated under Order XLIII of CPC, 1908, and Section 37 of the Arbitration and Conciliation Act, 1996 does not preclude appeals being filed from any other order of the Commercial Division of this Court to the Commercial Appellate Division of that High Court. The learned senior counsel submitted that the proviso is complementary and is in addition to the main provision and does not restrict the nature of orders that can be appealed against, provided under the main provision. The learned senior counsel relied upon a judgement of the Apex Court in the case of Dyna Technologies Pvt. Ltd., vs Crompton Graves Ltd., reported in 2019 20 SCC 1, to impress upon us the legislative intention of adding Section 34(4) in the Arbitration and Conciliation Act. The learned senior counsel also relied upon the judgement of the Division Bench of this Court in Hindustan Unilever Ltd., Vs. S.Shanthi reported in 2021 SCC online Mad 5428 and an unreported judgement of the Division Bench of the Delhi High Court in D & H India Ltd., vs Superson Schweisstechnik India, dated 16.03.2020, wherein the Delhi High Court has held as follows:
''21.On a plain reading, the proviso to Section 13(1A) of the Commercial Courts Act is an enabling, rather than a disabling, provision. There is nothing, in the said proviso, which would seem to indicate that it dilutes the effect of sub-section (1A) of
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