The appellate court allowed the arbitration appeal, setting aside a Section 34 order because accepting the award unequivocally prevented the party from challenging jurisdiction under Section 34, relying on Pooran Chand Nangia.
Impugned judgment dated 14.08.2006 passed in Arbitration Petition No.5 of 2003 was set aside.
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ARBA No.24 of 2006
This appeal involves a challenge to the order passed in a proceeding U/s.34 of the Arbitration and Conciliation Act, 1996 (hereinafter in short called as “the Act, 1996”).
Shri S. Mohanty, learned counsel for the appellant submitted that once the award of the Arbitrator is satisfied without any complaint/objection, the party aggrieved by the other part of the order is estopped from asking undertaking a proceeding U/s.37 of the Act, 1996.
Referring to the observation made in paragraph no.2 of the judgment of the Hon’ble Apex Court in the case of Pooran Chand Nangia Vs. National Fertilizers Ltd. as reported in (2003)8SCC245, Shri S. Mohanty, learned counsel for the appellant submitted that for the direct application of the judgment vide (2003)8SCC245 to the case at hand, the judgment U/s.34 of the Act, 1996 becomes bad.
In spite of notice, there is no appearance on behalf of the respondent.
On perusal of the judgment cited at Bar in the case of Pooran Chand Nangia Vs. National Fertilizers Ltd. as reported in (2003)8SCC245, this Court finds, in paragraph no.2 the Hon’ble Apex Court held as follows:
“ 2. We have heard learned counsel for the parties, only two questions which arise for our consideration are: (1) whether once the appellant having accepted the award, is it open to him to challenge the same on the ground that the Arbitrator had no jurisdiction and, (2) whether the Deputy General Manager (Materials) was competent or has jurisdiction to enter into an Arbitration.
2
So far as the first question is concerned, it is not disputed that the appellant had received the money which was doe to him under the award and once the appellant had submitted to the award unequivocally and without reservation, it is not open to him to challenge the award. We have looked into the record and find that the appellant had submitted unequivocally to the jurisdiction of the Arbitrator. He also accepted the awarded amount without any reservation. Had the appellant desired to challenge the award, he could have reserved his right to do so, but no such reservation was made in the letters sent by him. In this view of the matter, there remains no manner of doubt about the fact that the appellant had submitted to the award and it does not lie in the mouth of the appellant to challenge the award. For these reasons, we reject the first argument of the learned counsel for the appellant.”
Reading of the aforesaid judgment and considering the submission of Shri S. Mohanty, learned counsel for the appellant, this Court finds, the decision indicated hereinabove, has a direct application to the case of the appellant rendering the impugned order as bad in law and accordingly, while allowing this Arbitration Appeal, this Court sets aside the impugned judgment dated 14.08.2006 passed in Arbitration Petition No.5 of 2003.
The Arbitration Appeal stands allowed.
…….………………… (Biswanath Rath, J.)
Ayas
2 issues framed by the court
Whether an appellant is estopped from challenging an arbitrator's order under Section 34 after the award was accepted and satisfied without complaint.
Whether the reliance on the Apex Court decision in Pooran Chand Nangia renders the impugned Section 34 order bad in law.
Colour shows how this judgement treated each authority
Pooran Chand Nangia Vs. National Fertilizers Ltd.Relied on¶7
(2003)8SCC245
2 provisions across 1 enactments
Appellant
Respondent
Ayas
Biswanath Rath
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
