Allowed

Kalaivani Air Travels Pvt. Ltd. v. Travel Agents Association of India and 4 Ors.

Bombay HC15 Apr 2019NMS/973/2019

Case brief

AI extract

What is this about?

The single judge allowed a notice of motion seeking condonation of a 24-day delay in filing an Arbitration Petition under Section 34 of the Arbitration and Conciliation Act, 1996. The court found sufficient cause for the delay due to the petitioner's illness and procedural issues.

What did the court decide?

Notice of Motion allowed; 24 days delay condoned; Petition numbered for admission on 3rd May 2019; execution proceedings stayed until 3rd May 2019.

Kalaivani Air Travels Pvt. Ltd. Vs Travel Agents Association of… — Arbitration | Bombay HC (2019)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.973 OF 2019

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IN

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ARBITRATION PETITION (L) NO.14 OF 2019

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Kalaivani Air Travels Pvt. Ltd.

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…Petitioner

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versus

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Travel Agents Association of India and Ors. …Respondents

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Mr. H.S.Mohammed Rafui, for Petitioner.
Mr. Rajeev Ravi, for Respondent Nos.1 to 3 and 5.
Ms. Kavita M. Pawar, for Respondent No.4.

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CORAM: S.J. KATHAWALLA, J.

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DATE: 15th APRIL, 2019

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P.C.:

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1.The above Notice of Motion is taken out by the Petitioner seeking
condonation of delay of 24 days in filing the Arbitrtion Petition under Section 34 of the
Arbitration and Conciliation Act, 1996 (the Act). The learned Arbitrator passed his
Award dated 8th March, 2017, but failed to send the original copy of the same to the
Petitioner herein as more particularly explained by the Hon'ble Apex Court in its
decision in the case of State of Maharashtra V/s. ARK Builders Pvt. Ltd.1 the relevant
paragraphs of which are reproduced hereunder :

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"12.The appellants are now before this Court by grant of special leave. The two provisions of the Arbitration and Conciliation Act, 1996, relevant to answer the question raised in the case are Sections 31 and 34.

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1 2011 (4) SCC 616

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Section 31 deals with form and contents of arbitral award; and insofar as
relevant for the present provides as follows :

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"31. Form and contents of arbitral award. - (1) An arbitral award
shall be made in writing and shall be signed by the members of the
Arbitral Tribunal.

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(2)-(4)***
(5) After the arbitral award is made, a signed copy shall be
delivered to each party.
(6)-(8)***
(emphasis added)

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Section 31(1) obliges the members of the Arbitral Tribunal / arbitrator
to make the award in writing and to sign it and sub-section (5) then
mandates that a signed copy of the award would be delivered to each
party. A signed copy of the award would normally be delivered to the
party by the arbitrator himself. The High Court clearly overlooked
that what was required by law was the delivery of a copy of the award
signed by the members of the Arbitral Tribunal / arbitrator and not
any copy of the award.

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13. Section 34 of the Act then provides for filing an application for
setting aside an arbitral award, and sub-section (3) of that section lays
down the period of limitation for making the application in the
following terms :

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"34 Application for setting aside arbitral award. - (1) Recourse
to a court against an arbitral award may be made only by an
application for setting aside such award in accordance with sub-
section (2) and sub-section (3).

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(2)***

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(3) An application for setting aside may not be made after three
months have elapsed from the date on which the party making
that application had received the arbitral award or, if a request
had been made under Section 33, from the date on which that
request had been disposed of by the Arbitral Tribunal.
Provided that if the Court is satisfied that the applicant was
prevented by sufficient cause from making the application
within the said period of three months it may entertain the
application within a further period of thirty days, but not
thereafter.

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The expression "party making that application had received the
arbitral award" (emphasis supplied) cannot be read in isolation and it
must be understood in light of what is said earlier in Section 31(5) that
requires a signed copy of the award to be delivered to each party.
Reading the two provisions together it is quite clear that the limitation
prescribed under Section 34(3) would commence only from the date a
signed copy of the award is delivered to the party making the
application for setting it aside.

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14. We are supported in our view by the decision of this Court in
Union of India v. Tecco Trichy Engineers and Contractors in SCC
para 8 of the decision, it was held and observed as follows :(SCC p.
243)

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"8. The delivery of an arbitral award under sub-section (5) of
Section 31 is not a matter of mere formality. It is a matter of
substance. It is only after the stage under Section 31 has passed
that the stage of termination of arbitral proceedings within the

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meaning of Section 32 of the Act arises. The delivery of arbitral
award to the party, to be effective, has to be 'received' by the
party. This delivery by the Arbitral Tribunal and receipt by the
party of the award sets in motion several periods of limitation
such as an application for correction and interpretation of an
award within 30 days under Section 33(1), an application for
making an additional award under Section 33(4) and an
application for setting aside an award under Section 33 (3) and
so on. As this delivery of the copy of award has the effect of
conferring certain rights on the party as also brining to an end
the right to exercise those rights on expiry of the prescribed
period of limitation which would be calculated from that date,
the delivery of the copy of award by the Tribunal and the receipt
thereof by each party constitutes an important stage in the
arbitral proceedings."

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(emphasis added)
15. The highlighted portion of the judgment extracted above, leaves no
room for doubt that the period of limitation prescribed under Section
34(3) of the Act would start running only from the date a signed copy
of the award is delivered to / received by the party making the
application for setting it aside under Section 34(1) of the Act. The
legal position on the issue may be stated thus. If the law prescribes that
a copy of the order/award is to be communicated, delivered, dispatched,
forwarded, rendered or sent to the parties concerned in a particular
way and in case the law also sets a period of limitation for challenging
the order / award in question by the agrieved party, then the period of
limitation can only commence from the date on which the order /

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award was received by the party concerned in the manner prescribed by
the law.

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17. In the light of the discussions made above, we find the impugned
order of the Bombay High Court unsustainable. The High Court was
clearly in error not correctly following the decision of this Court in
Tecco Trichy Engineers and Contractors and in taking a contrary
view. The High Court overlooked that what Section 31(5)
contemplates is not merely the delivery of any kind of a copy of the
award but a copy of the award that is duly signed by the members of
the Arbitral Tribunal.

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18. In the facts of the case, the appellants would appear to be deriving
undue advantage due to the omission of the arbitrator to give them a
signed copy of the award coupled with the supply of a copy of the award
to them by the respondent claimant but that would not change the legal
position and it would be wrong to tailor the law according to the facts
of a particular case.

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19. In the light of the discussion made above, this appeal must
succeed. We, accordingly, set aside the judgments and orders passed by
the Bombay High Court and the Principal District Judge, Latur. The
application made by the appellants under Section 34 of the Act is
restored before the Principal District Judge, Latur, who shall now
proceed to hear the parties on merits and pass an order on the
application in accordance with law. Since the matter is quite old, it is
hoped and expected that the Principal District Judge will dispose this
matter preferably within 6 months from the date of receipt of this
Order."

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2. The Petitioner obtained a photocopy of the Award from the other side and

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on realizing that there was some error in the Award, sought amendments/corrections
to the Award which were carried out on 9th September, 2018. The original corrected

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Award was sent to the Petitioner by the learned Arbitrator through registered post
A.D., which was received by the Petitioner on 15th September, 2018 at Trichy.

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According to the Petitioner, they were unable to file the Petition under Section 34 of
the Act within time and the same is delayed by 24 days. In Paragraph No.4 of their
Affidavit dated 19th February, 2019 and paragraph No.6 of the affidavit dated 13th April,

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2019, reasons for not filing the present Appeal within the time prescribed are
mentioned, and the same are reproduced hereunder :

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4.The present Arbitration Petition has been filed on ….... there is a
delay of 28 days in filing the Petition. The delay is neither wilful nor
wanton. The Petitioner was contacted by the well wishers at the local
chapter level after the amendment of the award and assure that they are
trying to sort out the issue with the national office bearers to drop further
proceedings in the matter to put an end to all the litigation. Later the
Petitioner came to know that the 4th Respondent has filed the Execution
Petition before the Trichy Court and received the Court Notice. The
Petitioner is a permanent resident of Trichy was suffering from illness of
continued fever unable to coordinate with his counsel since the petition has
to be filed in Mumbai High Court.., within 120 days the Appeal was
required to be preferred before Hon'ble High Court, Bombay. I say that the
Appellant required to approach the Advocate for giving instructions for

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filing Petition against amended Order dated 9th September, 2018. I say
that the Petitioner was advised medical rest was under treatment during all
this period, advised me to take rest and was unable to attain Advocate
Office and/or give instructions for drafting the Appeal, hence there is delay
of 28 days in filing the present Petition”.

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6.I submit that the limitation period of ninety days calculated from the
date of receipt of the hard copy of the award by post expires on 13th
December, 2018. The period of 120 days for filing Arbitration Petition
expires on 13th January, 2019. I have filed the Arbitration Petition on 7th
January, 2019. I submit that there is a delay of 24 days only in filing the
Petition which is beyond the period of Ninety days. I respectfully submit
that the above Arbitration Petition was filed within the period of 120 days
excepting the delay of 24 days which is after the expiry of the Ninety days.
Due to inadvertence it has been earlier stated that the date of receipt of the
hard copy of the award as 11th September, 2018 which is typographical
error. The total delay would be only 24 days in filing which is beyond the
period of ninety days and well within the period of 120 days. As a matter
of fact my counsel in Chennai prepared the Arbitration Petition and sent to
me for signing at Trichy. I also signed and sent it to the learned Counsel
and the same was forwarded to Bombay for filing.

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I further respectfully submit that the papers prepared for filing initially
was not in conformity with the prescribed format of the Original Side Rules
of this Hon'ble High Court and some corrections and changes were required
to be made. I could not meet my counsel at Chennai and Mumbai for
finalizing the filing papers till the end of December, 2018 as I was suffering
from severe illness of fever and I was advised medical rest at Home. The

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delay in contacting my counsel before the end of December is neither willful
nor wanton. My counsel arranged to file the same after the reopening of the
Court after December vacation. In the interest of justice, I humbly pray
that this Hon'ble Court may be pleased to condone the delay of 24 days in
filing the Arbitration by allowing the Notice of Motion and thus render
justice.”

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3.In view of the above, I am satisfied that sufficient cause is shown by the
Petitioner for condonation of delay of 24 days. The delay of 24 days is accordingly
condoned. Office to number the Petition and place the same for Admission on 3rd
May, 2019. The Notice of Motion is accordingly disposed of.

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4. The execution proceedings shall not commence until 3rd May, 2019.

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( S.J.KATHAWALLA, J. )

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Kalaivani Air Travels Pvt. Ltd. v. Travel Agents Association of India and 4 Ors.

Case brief

What is this about?

What did the court decide?

Kalaivani Air Travels Pvt. Ltd. v. Travel Agents Association of India and 4 Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

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