IMPORTANT POINT
The court upheld the validity of the arbitral award, emphasizing limited grounds for judicial interference and the necessity of demonstrating clear error or illegality.

JUDGMENT :

M.G.Priyadarsini, J.

This Civil Miscellaneous Appeal is filed under Section 37(1)(B) of the Arbitration and Conciliation Act (for short ‘the Act’) by appellant aggrieved by the Order dated 04.03.2011 in Arbitration Original Petition No.2171 of 2005 (impugned Order) passed by the learned Chief Judge, City Civil Courts, Hyderabad (for short ‘learned Chief Judge’) wherein application filed by M/s.Goel Carriers (hereinafter referred as ‘respondent’) against claimant, to set aside Award dated 17.02.2005 passed by learned Sole Arbitrator-respondent No.2 herein, was dismissed.

2. For the sake of convenience, hereinafter, the parties will be referred as per their array before the learned Sole Arbitrator.

3. Claimant entered an Agreement dated 16.01.2001 with respondent for transportation of consignments such as hermetically sealed compressors and other ancillary parts from Hyderabad to Delhi, Noida and other places. Some consignments transported during January, May, June and August, 2001 were damaged due to accidents. Claimant incurred Rs.29,01,021/- for repairing the damaged compressors. Respondent withheld consignments worth of Rs.10,76,685/- towards freight charges. Therefore, disputes arose between claimant and respondent.

4. As per Clause No.14 of the Agreement, the Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) appointed respondent No.2 as Sole Arbitrator vide Letter dated 12.04.2002 for settlement of disputes, in terms of Agreement.

5. Notices were issued to the parties. After giving reasonable opportunities to both sides and after duly considering the facts and consequences of the case, the learned Arbitrator passed an Award dated 17.02.2005 and awarded a sum of Rs.24,71,621/- along with interest at the rate of 18 percent per annum from the date of Award till realization in favour of Claimant.

6. Aggrieved by the same, respondent filed Arbitration Original Petition No.2171 of 2005 before the learned Chief Judge, City Civil Courts, Hyderabad and the same was dismissed vide impugned Order dated 04.03.2011. Aggrieved by the same, respondent has filed this Civil Miscellaneous Appeal to set aside the impugned Order.

7. Heard Sri D. Srinivas Prasad, learned counsel for appellant and Sri Bakaraju Venkat Rama Rao, learned counsel for respondent No.1 and perused the record available before this Court.

8. Now the point for consideration is:

Whether the impugned Order dated 04.03.2011 passed in Arbitration Original Petition No.2171 of 2005 by the learned Chief Judge, is liable to be set aside?

POINT :

9. The contentions of learned counsel for appellant is that claimant invoked the jurisdiction of Civil Court under Order VII Rule 1 and 2 read with Section 26 of the Code of Civil Procedure (for short ‘C.P.C.’) and committed breach of the alleged agreement between the parties to refer the matter to arbitration; that there is settlement of all claims between parties; that there is no arbitration agreement between the parties; that no notice was issued to appellant for settlement of alleged disputes and prayed this Court to allow this Civil Miscellaneous Appeal by setting aside the impugned Order as well as Award passed by the learned Sole Arbitrator.

10. Learned counsel for respondent No.1 submitted that the learned Sole Arbitrator has passed the impugned Award after considering all the aspects and gave detailed reasons for arriving at a right conclusion and the same does not require any interference by this Court and prayed to dismiss this Civil Miscellaneous Appeal.

11. It is to be noted here that claimant filed a suit in O.S.No.1119 of 2001 on the file of the learned Principal Senior Civil Judge, Rangareddy District and vide Orders dated 19.12.2001 passed in I.A.No.2189 of 2001 obtained an injunction restraining respondent from alienating the consignments, wherein it is specifically stated that interim order will be in force till claimant’s remedy of Arbitration of disputed claims is resolved and the said Order deeme