The Delhi High Court ruled that even if the Tribunal misinterpreted the Stamp Act, 1899 the Court wouldn’t have the jurisdiction to interfere under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “A&C Act”) .
It was opined that even though document not properly stamped shouldn’t have been admitted into evidence, however, once admitted, the same cannot be relied upon to contest the validity of the arbitral award.
The Bench also ruled that the Court may not even have the powers as provided under Section 61 of the Indian Stamp Act. Further, at best the Court would send the document for proper stamping and hence, the enforcement or validity of the award cannot be challenged on this ground.
Brief Facts:
The present petition has been filed under Section 34 of the A&C Act to set aside the award vide which the Petitioner was directed to pay Rs. 5 crores along with interest to the Respondent.
Contentions of the Petitioner:
It was argued that the agreement containing arbitration clause should have been impounded as it was incorrectly stamped. Further, that the Respondent did not produce any evidence of loss and hence, was not entitled to any amount.
Contentions of the Respondent:
It was alleged that the plea of insufficiently stamped was taken at a belated stage. Further, it was argued that damages were not to be proved as amount was payable as per the Barter Agreement between the parties.
Observations of the Court:
As per the allegation of insufficient stamping, it was noted that the Agreement was executed in New Delhi. It was sent for signatures of the Petitioner at Mumbai.
It was ruled that the Tribunal concluded that the Agreement was properly stamped as per New Delhi and it is trite law that Court does not site as an Appellate Court under Section 34.
It was expounded that even otherwise had the Tribunal misinterpreted the Stamp Act, the Court wouldn’t have the jurisdiction to interfere under Section 34.
It was opined that even though document not properly stamped shouldn’t have been admitted into evidence, however, once admitted, the same cannot be relied upon to contest the validity of the arbitral award.
The Bench also ruled that the Court may not even have the powers as provided under Section 61 of the Indian Stamp Act. Further, at best the Court would send the document for proper stamping and hence, the enforcement or validity of the award cannot be challenged on this ground.
Regarding the proof of damage, it was opined that the Respondent’s claim was based on the consideration payable and not on any breach, therefore proving damages was not required at all.
The decision of the Court:
Based on the aforementioned analysis, the Delhi High Court rejected the present petition and accordingly upheld the award.
Case Title: ARG Outlier Media Pvt. Ltd. V. HT Media Ltd.
Coram: Hon’ble Justice Navin Chawla
Case No.: OMP (COMM) 161/2023
Advocates for Petitioner: Advs. Mr. Sandeep Sethi, Ms. Malvika Trivedi, Mr. Bani Dikshit, Mr. Uddhav Khanna, Ms. Diya Dutta, Ms. Sujal Gupta, Mr. Shailendra Slaria, Ms. Shreya Sethi, Mr. Vikram Singh Dalal, Ms. Tanvi Tewari
Advocates for Respondent: Advs. Mr. Ashok Kumar Singh, Mr. Sonal Kr. Singh, Mr. Shivang Singh, Mr. Obhirup Ghosh, Ms. Meghna Butolia, Mr, Gagan Kr. Sharma, Mr. Kunal Nema, Ms. Saloni Singh
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