ORDER

This original petition has been filed to set aside the Arbitral award dated

29.12.2014 in A.C.P.No.101 of 2014 passed by the Sole Arbitrator Shri, Padmanaban.V, at Vellore.

2. The main contention of the learned counsel for the petitioners that the learned Arbitrator was appointed by the respondent in respect of the dispute arose in the loan agreement dated 19.01.2013 entered between the parties. Learned Arbitrator has passed an award for a sum of Rs.19,29,634/- together with interest at the rate of 18% per annum from the date of filing of the claim petition till the date of realization and petitioners to pay the cost of the arbitration proceedings at Rs.5,000/-. Learned Arbitrator has proceeded the matter exparte as the petitioners did not appear on 25.10.2014, the final date of hearing fixed by the learned Arbitrator. The main challenge in respect of the award is that no notice of invocation under Section 21 of the Arbitration and Conciliation Act was issued. Further, no opportunity has been given by the learned Arbitrator to proceed the matter before the Arbitral Tribunal. Similarly, the schedule pertaining to the agreement to conduct the arbitration at Vellore is not placed on record.

3. Learned counsel for the respondent would contend that the notice of invoking arbitration was served and the original award also produced before this Court. Hence, no ground has been made to interfere the award.

4. This Court has perused the materials available on Record.

5. The claim petition itself has been filed on 30.09.2014 before the Arbitrator and it appears that the notice was sent on the same day. On 25.10.2014, the petitioners were set exparte. Seven documents have been filed before the learned Arbitrator which has been marked as Exs.A1 to Ex.A7. Acknowledgement card of pre-arbitration dated 23.11.2013 has been filed as Ex.A7. Pre-arbitration Legal notice dated 23.11.2013 was issued informing the petitioners to repay the balance due by them on account of the contract. It appears that the Arbitrator has sent a notice dated 30.09.2014 which has been refused by the petitioners herein.

6. Be that as it may, the notice invoking arbitration has not been served and the Pre Arbitration notice dated 23.11.2013 was sent originally on 12.10.2013 which has been received by one of the parties on 23.11.2013. Whereas, now it is projected as if notice of invocation has been issued on 23.11.2013 and received by the petitioners on the same day. The acknowledgement card has also been marked to that effect. In that aspect, it is relevant to note that the acknowledgement dated 23.11.2013 only pertains to demand notice and not in respect of the invocation of arbitration. However, the respondent tried to use that acknowledgement card as if the same relates to the notice of invocation of Arbitration and the same has been done realising the fact that no notice invoking Arbitration was issued prior to the commencement of arbitration proceedings as contemplated under Section 21 of the Act.

7. Even assuming that the Arbitrator has intimated his appointment on

30.09.2014 fixing the date of hearing on 25.10.2014, no further hearings dates were notified and communicated to appellants as required under Section 24(2) of the Act. In such view of the matter, the very invocation of the notice has not been established. When the notice of appointment of Arbitrator has not been given and no proceedings have been communicated, the award could be interfered under Section 34(2)(iii) of the Act. In such view of the fact, the award by the learned Sole Arbitrator has to be interfered and the same is liable to be set aside. It is open to the respondent to invoke fresh arbitration as per law.

8. This Original Petition is Ordered accordingly. No costs.

Consequently connected application is closed.

08.09.2021 msv Index:Yes/No Internet:Yes/No Speaking order: Non-speaking order N. SATHISH KUMAR,J.

msv and A.No.358 of 2020

08.09.2021