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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Lisa Gill, J.
M/s. Jain Rice Mills, Rayya – Appellant
Versus
Punjab State Warehousing Corporation, Chandigarh & Anr. – Respondents
CR No. 3199 of 2021 (O&M)
Decided On : 23-03-2022
Arbitration Act - Claim Petition - Section 23, Section 25
Fact of the Case:
Dispute arose between the petitioner, a rice miller, and the respondent-PSWC over a custom milling agreement. The respondent filed a provisional claim and later sought to file a revised claim. The petitioner challenged the orders allowing the revised claim.
Finding of the Court:
The court found that the respondent had valid reasons for filing a provisional claim initially and later seeking to file a revised claim. The court dismissed the petitioner's challenge, stating that there was no infirmity in the orders passed by the Arbitrator.
Issues: Validity of allowing a revised claim in arbitration proceedings, interpretation of Section 23 and Section 25 of the Arbitration Act
Ratio Decidendi: The court held that the respondent had shown sufficient cause for not filing the final/revised claim earlier, and the Arbitration Act did not bar the route undertaken by the Arbitrator.
Final Decision: The revision petition was dismissed, upholding the orders allowing the revised claim.
JUDGMENT
Lisa Gill, J. (Oral) - This matter is being taken up for hearing through video conferencing due to outbreak of the pandemic, COVID-19.
2. Petitioner has filed this revision petition challenging order dated 16.07.2021, Annexure P-15 and order dated 03.12.2021, Annexure P-19, passed by the learned Arbitrator.
3. Learned Arbitrator, vide order dated 16.07.2021, Annexure P- 15, while observing that the claimant-Punjab State Warehousing Corporation (for short 'PSWC'), had filed an application for placing on record a revised claim, reply and rejoinder of which was on record, felt that instead of a provisional claim petition which was earlier filed, the claim petition itself should be filed and the respondent would get an liberty to file the written statement and thereafter arbitration proceedings would continue in a smooth manner. Petitioner admittedly filed CR No. 1709 of 2021, challenging order dated 16.07.2021, which was dismissed as withdrawn on 26.08.2021 with liberty to approach the sole Arbitrator for termination of the proceedings in view of Section 25 of the Arbitration and Conciliation Act (for short 'the Arbitration Act'). Application for termination of the proceedings in terms of Section 25(a) of the Arbitration Act was filed. Reply thereto was filed by the respondent-claimant and vide impugned order dated 03.12.2021, Annexure P-19, the said application was dismissed holding that the claim petition cannot be dismissed under Section 23 read with Section 25 of the Arbitration Act.
4. Aggrieved therefrom, present revision petition has been filed.
5. Brief facts necessary for adjudication of the matter are that agreement dated 07.10.2011 was executed between the petitioner, who is a rice miller with the respondent-PSWC for custom milling of rice for the crop year kharif 2011-12. Dispute arose between the parties and the same was referred for arbitration vide order dated 03.06.2013. Notice was issued by the Sole Arbitrator on 11.07.2013 for 16.07.2013, directing the respondentCorporation to file the Statement of Claim. A provisional claim dated 30.07.2013, Annexure P-3, was filed by the respondent-Corporation along with an application dated 30.09.2013 under Section 17 of the Arbitration Act for grant of interim measures. Petitioner appeared and filed reply to the application under Section 17 of the Arbitration Act, but no reply to the provisional claim was filed as it is stated that it was only a provisional claim. It is submitted that the petitioner being aggrieved of the multiple civil and criminal litigation initiated against, filed CWP No.11058 of 2014 for issuance of a writ of mandamus for directing the respondents to allow the petitioner to make the outstanding payment of rice as per the custom milling rate in terms of Clause 12 (a) of the Agreement dated 07.10.2011 and further for directing the respondents to release the machinery/ building and the stock of the petitioner.
6. It is noted in order dated 29.05.2014 in CWP No. 11058 of 2014, that petitioner was ready and willing to make the payment of rice as per physical verification report dated 15.11.2012 and an amount of Rs.4,13,62,805/- is due against the petitioner. It was directed that petitioner would deposit Rs. One Crore within 15 days and thereafter notice be issued to the respondents for 07.10.2014. It was further directed that subject to deposit of Rs. One Crore, no coercive steps would be taken against the petitioner. Consequent thereto, further proceedings before the Arbitrator were adjourned sine die on 05.12.2017 to await the decision of CWP No. 11058 of 2014.
7. The said writ petition was finally disposed of vide order dated 29.11.2018, Annexure P-8, wherein it is recorded that the petitioner is still willing to deposit the amount of Rs.3,17,03,931/- and is also ready and willing to pay the balance amount which is found due after adjustment of the sale price of the rice lying in the godown. It is observed in order dated 29.11.2018 in CWP No. 11058 of 2
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