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IN THE HIGH COURT OF ALLAHABAD
SUBHASH VIDYARTHI, J.
M/s. A2z Waste Management (Meerut) Pvt. Ltd Thru. Its Authorized Signatory Mr. Yuvraj Sharma – Petitioner
Versus
Construction And Design Services, U.P. Jal Nigam, Noida Thru. Director/Project Manager And Others - Respondents
Matters Under Article 227 No. 2098 of 2024
Decided On : 09-05-2024
ARBITRATION - EXPEDITIOUS DISPOSAL OF ARBITRATION CASE - Arbitration and Conciliation Act, 1996, Sections 34, 42; Commercial Courts Act, 2015, Sections 16 - The court emphasized the statutory mandate under Section 34(6) of the Arbitration and Conciliation Act for expeditious disposal of applications challenging arbitration awards, mandating resolution within one year. The Commercial Courts Act aims to enhance the efficiency of commercial dispute resolution, reflecting legislative intent to improve the justice delivery system. The court highlighted the importance of timely resolution to prevent undue financial burden on public exchequer due to accruing interest on arbitration awards.
Fact of the Case:
The petitioner sought a direction for the expeditious disposal of Arbitration Case No. 831 of 2019, which was pending in the Commercial Court, challenging an arbitration award from May 2019. The case involved multiple applications under Section 34 of the Arbitration and Conciliation Act filed by different respondents, leading to delays in proceedings.
Finding of the Court:
The court found that the delay in the disposal of the application under Section 34 was detrimental to the public interest, especially given the accruing interest on the awarded amount. It noted the legislative intent behind the Arbitration and Conciliation Act and the Commercial Courts Act to ensure timely resolution of commercial disputes.
Issues: Whether the court should direct the expeditious disposal of the pending arbitration cases and whether the conduct of the respondents in delaying proceedings warranted any punitive action under Section 340 Cr.P.C.
Ratio Decidendi: The court held that the statutory provisions under the Arbitration and Conciliation Act and the Commercial Courts Act necessitate prompt resolution of arbitration disputes. It emphasized that delays caused by the respondents were against the interests of justice and public exchequer.
Final Decision: The petition under Article 227 was allowed, directing the Commercial Court to proceed with Arbitration Case No. 831 of 2019 and Arbitration Case No. 133 of 2023 expeditiously, without unnecessary adjournments.
JUDGMENT :
Subhash Vidyarthi, J.
1. Heard Sri Jaideep Narain Mathur Senior Advocate assisted by Sri Suyash Gupta Advocate, the learned Counsel for the petitioner and Shri Indu Prakash Singh, learned counsel for the respondent No.1 - Construction and Design Services, U.P. Jal Nigam and respondent no. 2 - U.P. Jal Nigam and Sri Pankaj Srivastava, the learned counsel for the respondent No.3 – Municipal Corporation, Meerut.
2. By means of the instant petition filed under Article 227 of the Constitution of India, the petitioner has sought a direction for expeditious disposal of Arbitration Case No.831 of 2019 pending in Commercial Court No. 2, Lucknow. The aforesaid case is an application under Section 34 of the Arbitration and Conciliation Act which was filed by the respondent no. 1 and 2 on 11.09.2019 challenging an Arbitration Award dated 29.05.2019 passed in favour of the petitioner.
3. A copy of the entire order sheet of the proceedings under Section 34 of the Arbitration and Conciliation Act has been annexed with the petition. A copy of an order dated 10.07.2023 passed by this Court sitting at Allahabad in Transfer Application No.278 of 2021 has also been annexed with the petition. The said Transfer Application was filed by Meerut Municipal Corporation (respondent No.3 in this petition) seeking transfer of Case No. Nil of 2019 in the Court of the District Judge, Meerut, which was an application under Section 34 of Arbitration and Conciliation Act filed by the respondent no. 3 on 05.10.2019 challenging the same arbitration award dated 29.05.2019. The Transfer Application was allowed by means of an order dated 10.07.2023 and the application under Section 34 of the Arbitration and Conciliation Act, 1996 filed by the respondent no. 3 at Meerut was transferred to Lucknow and it was directed that that the same shall be heard along with Arbitration Case No.831 of 2019. After being transferred to Commercial Court – 2, Lucknow, the application under Section 34 filed by the respondent no. 3 has been registered as Arbitration Case No. 133 of 2023.
4. When the case was taken up as fresh on 27.04.2024, the learned counsel for the respondent Nos.1 and 2 had sought two days’ time to seek instructions in the matter. On 01.05.2009, the learned counsel for the respondent No.3 filed an application under Section 340 Cr.P.C. and the learned counsel for respondent No.1 and 2 filed counter affidavit/objections against the petition under Article 227 of the Constitution of India. Subsequently, the respondent Nos.1 and 2 have also filed a counter affidavit.
5. It is relevant to note that Section 34 (6) of Arbitration and Conciliation Act contains a statutory mandate that an application under this Section shall be disposed of expeditiously and in any event, within a period of one year from the date on which notice referred to in Sub Section (5) is served upon the other party. This statutory mandate cannot be altogether ignored by the Commercial Court and by this Court.
6. The application under Section 34 is pending before a Commercial Court, which has been constituted under the Commercial Courts Act, 2015. The statement of objects and reasons of the Commercial Courts Act, 2015 states that: -
7. The object of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Bill, 2015, was inter alia, to amend the Code of Civil Procedure, 1908, as applicable to the Commercial Courts and Commercial Divisions which shall prevail over the existing High Courts Rules and other pr
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