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Municipal Corporation of Delhi Vs. S.A. Builders Ltd., (Now Known as Sab Industries Ltd New Delhi) and Another - Court Judgment

SooperKanoon Citation

Subject

Arbitration

Court

Delhi High Court

Decided On

Case Number

I.A. 9315/99 in OMP 2/98

Judge

Reported in

2001IIAD(Delhi)441; 90(2001)DLT57; 2001(57)DRJ694; 2001(2)RLR321

Acts

Code of Civil Procedure (CPC), 1908 - Sections 151, Order 6, Rule 17; Arbitration and Conciliation Act, 1996 - Sections 34; Delhi Municipal Corporation Act, 1957 - Sections 4, 16(2), 201, 202, 203; Arbitration Act, 1940 - Sections 14(2), 30

Appellant

Municipal Corporation of Delhi

Respondent

S.A. Builders Ltd., (Now Known as Sab Industries Ltd New Delhi) and Another

Appellant Advocate

Sh. Raman Duggal, Adv

Respondent Advocate

Sh. Manmohan, Adv.

Excerpt:


.....take other pleas which it now proposes to introduce, before the arbitrator it will be deemed to have waived its right to take them within the meaning of section 4 of the act. strong reliance was placed on the decision in ashwini kumar vs. - i am, thereforee, of the view that although an application for amendment under order 6 rule 17 cpc can be made seeking to amend the objections filed for setting aside the award but the allowing or refusing the amendment would rest on the well known principles enumerated in the abovementioned decisions of the privy council and of the supreme court. such a power would not as a rule, except in exceptional circumstances, be exercised because its effect is to take away from a party a legal right which accrued to him by lapse of time. under the proviso appended to that sub section objections can be entertained within the period of 30 days thereafter if the court is satisfied that the objector was prevented by sufficient cause from making objections within said period of three months.orderk.s.gupta, j.1. petitioner-objector has filed this application under order 6 rule 17 read with section 151 cpc seeking amendments in the objection petition filed under section 34 of the arbitration and conciliation act, 1996 (for short 'the act') for setting aside the award dated 16th/18th december 1997 made by respondent no.2. the purport of the amendments sought is that the agreement executed between the objector-petitioner and respondent no.1 was not in accordance with the provisions of sections 201, 202 and 203 of dmc act and byelaws made there under and, thereforee, the same was void and accordingly the arbitration clause contained in the agreement was also invalid and arbitrator did not have the jurisdiction to enter into arbitration and give the said award. 2. needless to say that respondent no.1 has contested the application by filing reply. 3. submission advanced by sh.raman duggal appearing for petitioner-objector was that the pleas sought to be raised in terms of proposed amendments are legal in nature and can be taken at any stage in the proceedings. on the other hand, contention made by sh.manmohan for respondent no.1 was that the objection of lack of.....

Judgment:


ORDER

K.S.GUPTA, J.

1. Petitioner-Objector has filed this application under Order 6 Rule 17 read with section 151 CPC seeking amendments in the objection petition filed under section 34 of the Arbitration and Conciliation Act, 1996 (for short 'the Act') for setting aside the award dated 16th/18th December 1997 made by respondent No.2. The purport of the amendments sought is that the agreement executed between the Objector-petitioner and respondent No.1 was not in accordance with the provisions of sections 201, 202 and 203 of DMC Act and Byelaws made there under and, thereforee, the same was void and accordingly the arbitration clause contained in the agreement was also invalid and arbitrator did not have the jurisdiction to enter into arbitration and give the said award.

2. Needless to say that respondent No.1 has contested the application by filing reply.

3. Submission advanced by Sh.Raman Duggal appearing for petitioner-Objector was that the pleas sought to be raised in terms of proposed amendments are legal in nature and can be taken at any stage in the proceedings. On the other hand, contention made by Sh.Manmohan for respondent No.1 was that the objection of lack of jurisdiction of arbitrator at this stage is barred in view of section 16(2) of the Act. It was pointed out that objection to the said effect was never raised on behalf of petitioner-Objector either in the statement of defense or at any stage thereafter before the arbitrator. As a part of contention, it was further submitted that for failure of the petitioner-Objector to take other pleas which it now proposes to introduce, before the arbitrator it will be deemed to have waived its right to take them within the meaning of section 4 of the Act. It was also urged that this application dated 30th July 1999 was filed in the Registry on 17th September 1999 after a delay of about 1-1/2 year of the filing of objection-petition and in case the amendments sought are allowed, it would take away the legal right which has accrued to respondent No.1 by lapse of time. Strong reliance was placed on the decision in Ashwini Kumar vs.Banwari Lal & Ors .

4. It was not disputed before me by Sh. Duggal that the pleas which are now sought to be taken by seeking amendment were not raised on behalf of petitioner-Objector before the arbitrator at any stage in arbitration proceedings.

5. In Ashwini Kumar's case (supra) non-petitioners No.1 to 3 who were appointed as arbitrators, gave award on 25th August 1984 and thereafter they moved an application under section 14(2) of the Arbitration Act, 1940 before the District Judge, Sri Ganganagar praying that award be made the rule of court. After receipt of notice of filing of award, non-petitioners 4 & 5 filed objections under section 30 of the said Act for setting aside the award on 19th February 1985. Subsequently, non-petitioners 4 & 5 filed application on 19th September 1986 seeking amendments in objection- petition to raise additional pleas that in respect of agricultural land covered by the award, a suit was pending before Assistant Collector, Sri Ganganagar and without obtaining prior permission from him, no award could have been passed with regard to agricultural land and the award was liable to be set aside on that ground also. By the order dated 23rd May 1987 amendments sought to the said effect by non-petitioners 4 & 5 were allowed by the District Judge, Sri Ganganganagar. Civil Revision being No. 418/87 filed against that order by Ashwini Kumar, petitioner was allowed by a learned single Judge of Rajasthan High Court observing thus:-

'I am, thereforee, of the view that although an application for amendment under Order 6 Rule 17 CPC can be made seeking to amend the objections filed for setting aside the award but the allowing or refusing the amendment would rest on the well known principles enumerated in the abovementioned decisions of the Privy Council and of the Supreme Court. In the present case, the non-petitioners Nos.4 and 5 sought to add a new objection by way of amendment in their original objections filed on February 19, 1985. The amendment application was made more than one and a half years, after the limitation period of 30 days and of the filing of the original application. The new ground sought to be added was that in respect of agricultural land covered by award a suit was pending before the Assistant Collector, Sri Ganganagar and, thereforee, without obtaining prior permission of that court no award could have been passed in respect of the agricultural land and the award was liable to be set aside on this ground also. I am of the opinion that this amounts to adding a new ground and fresh allegation and to be raised by amending the original petition, it would take away from the petitioner a legal right which had accrued to him by lapse of time. Such a power would not as a rule, except in exceptional circumstances, be exercised because its effect is to take away from a party a legal right which accrued to him by lapse of time.Consequently, I hold that District Judge, Sri Ganganagar was wrong in allowing the amendments sought by non-petitioners Nos.4 and 5 for adding new ground for setting aside the award after a lapse of more than 1-1/2 years of the expiry of the limitation period.' (emphasis supplied).

6. I entirely agree with the ratio in Ashwani Kumar's case (supra). Under sub section (3) of section 34 of the Act objections for setting aside award can be filed within three months of the receipt of award. Under the proviso appended to that sub section objections can be entertained within the period of 30 days thereafter if the court is satisfied that the objector was prevented by sufficient cause from making objections within said period of three months. As noticed above, application under disposal was filed after about 1-1/2 year of the filing of objection-petition. In my view, the petitioner-Objector cannot be permitted at this juncture to add new grounds of challenge to the award dated 16th December 1997 as corrected on 18th December 1997 as it would take away from respondent No.1 a legal right which has accrued to it by lapse of time as also by reason of omission to take them before the arbitrator. The application thus deserves to be dismissed.

7. Consequently, the application is dismissed.


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