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2023 Supreme(Online)(KER) 13925
HIGH COURT OF KERALA
C.S. DIAS, J
M. RAJEEV KUMAR – Appellant
Versus
THE KERALA FOOTBALL ASSOCIATION – Respondent
OP(C) 460 2023
ANOOP BHASKAR, AMMU MANOHARAN, NARAYANAN, SATHYA SREEKUMARAN
The discretion of the Arbitral Tribunal under Section 24 regarding oral hearings cannot be judicially overturned unless in exceptional circumstances.
Headnote:
Arbitration - Oral Hearings - Arbitration and Conciliation Act - Section 24 - This section permits a tribunal to determine the necessity and timing of oral hearings for evidence presentation, emphasizing the tribunal's discretion within defined limits.
Fact of the Case:
The petitioners sought to set aside an order from the Arbitral Tribunal denying their request for an oral hearing to present evidence, claiming a violation of their rights under the Arbitration and Conciliation Act, 1996.
Issues: Whether the Arbitrator's decision to deny a request for an oral hearing violated the provisions of the Arbitration and Conciliation Act, 1996, and warranted judicial intervention.
Ratio Decidendi: The Arbitrator has discretion to determine the appropriateness of oral hearings under Section 24 of the Act. Judicial intervention is limited, and the case did not meet the criteria for exceptional interference.
Final Decision: The original petition is dismissed.
Key Points: - The Arbitral Tribunal has discretion to determine the necessity and timing of oral hearings under Section 24 (!) (!) . - Judicial intervention is limited and only permitted in exceptional circumstances (!) . - The petition to set aside the order was dismissed as the case did not meet the criteria for exceptional interference (!) .
What is the scope of the Arbitral Tribunal's discretion regarding oral hearings under Section 24 of the Arbitration and Conciliation Act, 1996?
Does a party have a right to seek judicial intervention if an Arbitral Tribunal denies a request for an oral hearing?
On what grounds can an Arbitral Tribunal's decision to deny an oral hearing be challenged in court?
JUDGMENT
The original petition is filed, to set aside Ext.P7 order passed by the Arbitral Tribunal in I.A No.4/2023 in A.C 2/2021. The petitioners are the respondents 1 and 2 and the respondents are the claimant and the respondents 3 to
5 before the Tribunal.
2. The petitioners’ case is that, even though they had filed I.A No.4/2023 before the Tribunal, to permit them to hold an oral hearing for presentation of their evidence, by issuing summons to the Secretary of the Kerala Football Association and to examine him, the Arbitrator, by the impugned order, has held that the application cannot be allowed at the present stage. Ext.P7 order is erroneous and unsustainable in law.
Hence the original petition.
3. Heard; Sri.Anoop Bhaskar, the learned counsel appearing for the petitioners, on admission.
4. Sri.Anoop Bhaskar vehementallly argued that the learned Arbitrator has passed Ext.P7 order in flagrant violation of Section 24 of the Arbitration and Conciliation Act, 1996 ( in short, ‘Act’), and the law laid down by the Delhi High Court inSukhbir Singh v. Hindustan Petroleum Corporation Ltd [2020 SCC OnLine Del 228]. InPunjab State Power Corporation Limited and another v. Emta Coal Limited and another [(2020) 17 SCC 93] , the Hon’ble Supreme Court has held that this Court can interfere in the arbitral proceeding under Article 227 of the Constitution of India, if there is patent lack of inherent jurisdiction. Thus, Ext.P7 order is liable to be set aside.
5. The petitioners have filed Ext.P2 application under Section 24 (1) of the Act, seeking the following relief:
“For the reasons set-forth in the accompanying affidavit, this Hon’ble Arbitral Tribunal may be pleased to grant an order permitting respondent Nos.1 &2 to hold oral hearings for the presentation of evidence by issuing summons/notice to the Secretary of Kerala Football Association to examine him.”
6. Section 24 of the Arbitration and Conciliation Act, 1996 , reads as follows:
“24. Hearings and written proceedings: (1) Unless otherwise agreed by the parties, the arbitral tribunal shall decide whether to hold oral hearings for the presentation of evidence or for oral argument, or whether the proceedings shall be conducted on the basis of documents and other materials:
Provided that the arbitral tribunal shall hold oral hearings, at an appropriate stage of the proceedings, on a request by a party, unless the parties have agreed that no oral hearing shall be held:
[Provided further that the arbitral tribunal shall, as far as possible, hold oral hearings for the presentation of evidence or for oral argument on day-today basis, and not grant any adjournment. Unless sufficient cause is made out, and may impose costs including exemplary costs on the party seeking adjournment without any sufficient cause”].
7. The learned Arbitrator, by Ext.P7 order, has held thus:
“16. Anyway granting permission to examine the Secretary or issuing notice to him for his presence at this stage is not allowed and these IAs have to be disposed, of course subject to the above observations. Points found accordingly.
17. In the result, these IAs stand dismissed. No cost.”
8. A reading of Ext.P7 order shows that the Arbitrator has held that he was not inclined at the present stage to permit the petitioners to let in oral evidence.
9. A reading of the first proviso to Section 24 (1) of the Act, reveals that the Arbitral Tribunal is conferred with the discretion to decide the stage at which the oral hearing has to be conducted. It is invoking the above discretion that the Arbitrator has deferred permission for oral evidence.
10. Even otherwise, Section 5 of the Act, mandates that no judicial authority shall intervene with the arbitral process except as provided under the provisions of the Act.
11. The Hon’ble Supreme Court, inBhaven Construction v. Executive Engineer, Sardar Sarovar, Narmada Nigam Ltd [(2022) 1 SCC 75] and Deep Industries Ltd v. Oil and Natural Gas Corporation [(2020) 15 SCC 706] , has categorically
