Bombay High Court
Mutha Construction Through Prop. ... vs Strategic Brand Solutions ... on 12 January, 2022
Bench: S.J. Kathawalla, Milind N. Jadhav
KANCHAN
PRASHANT
DHURI
Digitally signed by Kanchan P Dhuri 1 / 9 36-IA-2146-2019.odt
KANCHAN
PRASHANT DHURI
Date: 2022.01.14
10:50:07 +0530
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
INTERIM APPLICATION NO. 2146 OF 2019
IN
COMMERCIAL APPEAL NO. 466 OF 2019
IN
COMMERCIAL ARBITRATION PETITION NO. 511 OF 2018
Mutha Construction through Prop. Manish P. Mutha ... Applicant/Appellant
Versus
Strategic Brand Solutions (India) Pvt. Ltd. ... Respondent
WITH
IN PERSON APPLICATION (L) NO. 980 OF 2022
IN
INTERIM APPLICATION NO. 2146 OF 2019
.........
Mr. Nimay Dave alongwith Mr. Mohit Advani, Mr. Ativ Patel, Mr. Darshit Dave and
Mr. Harshad Vyas instructed by AVP Partners for the Applicant/Appellant.
Mr.Rohan Cama, Amicus Curiae, present.
Mr. Parag Dutt, Director of Respondent-Company, present.
.........
CORAM : S.J. KATHAWALLA AND
MILIND N. JADHAV, JJ.
DATED : JANUARY 12, 2022.
(through video-conferencing)
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P.C. :-
1. By the present Interim Application, the Applicant, being the original
Appellant, seeks restoration of the captioned Appeal. In the circumstances set out
hereafter, we are disposing of the Interim Application on merits while also noting that
there is no warrant for restoring the Appeal, for the reasons set out below.
2. The brief facts leading to the filing of the captioned Interim Application
are set out below.
3. The parties were in arbitration before a learned Sole Arbitrator, being a
retired Judge of this Court. The learned Arbitrator passed an Award dated 17 th January
2018. Being aggrieved by the Award, the Applicant preferred Commercial Arbitration
Petition No. 511 of 2018 under Section 34 of the Arbitration and Conciliation Act,
1996 ("the Act").
4. When the Petition appeared before the learned Single Judge (G. S.
Kulkarni J.), the learned Single Judge, by an Order dated 30 th April 2019, recorded that
the parties were agreeable that the impugned Award be set aside by consent "... and as
the parties intend to approach the learned sole arbitrator for a fresh reasoned award. "
The order further records in paragraph 4 that the parties "... intend to request the
learned sole arbitrator to publish a fresh award as expeditiously as possible. "
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Accordingly, the Award having been set aside by consent, the Petition was disposed of
in the above terms.
5. As per the case of the Applicant, the Applicant received a copy of the
order on 4th May 2019, and as it was during the Court's summer vacation, upon re-
opening the Applicant moved a praecipe seeking modification of the order dated 30 th
April 2019 inter alia on the footing that consent had not been accorded for the matter
being sent to the same learned Sole Arbitrator. We are informed by the Advocate for
the Appellant that the request made in the praecipe was rejected by the Learned Single
Judge. However, no order to this effect is found in the Court record.
6. Being aggrieved by the aforesaid Order dated 30 th April 2019, on the
limited aspect of consent to have the matter heard by the same learned Sole Arbitrator,
the Applicant filed Commercial Arbitration Appeal No. 466 of 2019 which came
before the Division Bench of this Court. At the hearing on 17 th July 2019, the Appeal
was dismissed as not pressed, reserving liberty to the Applicant to seek review of the
Order dated 30th April 2019.
7. The Applicant accordingly filed Commercial Review Petition (L) No. 39
of 2019 before the learned Single Judge and the learned Single Judge by his Order
dated 22nd November 2019 rejected the Review Petition while recording inter alia that
he was not persuaded to accept the contentions and submissions urged on behalf of
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the Applicant herein that the Order dated 30th April 2019 was not passed by consent.
8. Being aggrieved by the rejection of the Review Petition, the present
Interim Application was filed on 17th December 2019 seeking restoration of the
captioned Appeal, to file.
9. The matter appeared before this Court on 6th January 2022 and 7th
January 2022 at which time this Court granted accommodation to the Respondent to
enable the director of the Respondent, who was appearing in person, to take steps to
appoint an Advocate. On 6th January 2022, this Court also directed that the learned
Arbitrator was not to proceed with the hearing that was scheduled to be held, in the
meantime.
10. When the matter appeared on 10th January 2022, for the reasons stated
therein, this Court felt it appropriate to appoint Shri Rohaan Cama as Amicus Curiae
to assist the Court in the matter.
11. At the hearing of the Interim Application today, i.e. 12 th January 2022,
we have heard Mr. Cama, the Amicus, and Mr. Dave learned Counsel for the
Applicant.
12. Mr. Cama placed before us the two competing stands that would be
urged by the respective parties. He invited our attention to the judgment of this Court
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in Geojit Financial Services Limited v. Kritika Nagpal - Appeal No. 35 of 2013 in
Arbitration Petition No. 47 of 2009, dated 25th June 2013, and the judgments of the
Supreme Court in Radha Chemicals v. Union of India - Civil Appeal No. 10386 of
2018 dated 10th October 2018 and Kinnari Mullick & Anr. v. Ghanshyam Das Damani
- (2018) 11 SCC 328. He submitted that a reading of the said judgments could yield a
line of argument by the Applicant that the High Court under Section 34 has the power
only to set aside an arbitral award or a limited power to remit the matter to the
Arbitrator in the circumstances set out under Section 34(4). Admittedly, we are not
concerned with a case under Section 34(4). Mr. Cama submitted that it may be argued
by the Applicant that after setting aside the Award, the learned Single Judge was
functus officio and had no jurisdiction to even record consent of parties to go before
the same learned Arbitrator. The sequitor to this possible argument being that even by
consent parties could not have conferred jurisdiction on the learned Single Judge to
record consent to go before the same learned Arbitrator.
13. The contra stand was then placed before us by Mr. Cama, being the
stand that the Respondent would rely upon,viz. that the learned Single Judge has
expressly recorded the consent of the parties, and there was no jurisdictional error, as
the learned Single Judge has not suo moto remitted the matter back to the learned Sole
Arbitrator. It is only such a remand that is precluded by the above judgments, which
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judgments do not consider a situation where a party has consented before the learned
Single Judge to take the matter back to the same learned Arbitrator.
14. Needless to say Mr. Dave for the Applicant endorsed the former
view,viz. that the learned Single Judge was functus officio and could not even have
recorded consent to go before the same learned Arbitrator. He placed reliance on the
above judgments to urge that the learned Single Judge has in effect remanded the
matter back to the learned Sole Arbitrator, which he contends could not be done as per
the above judgments.
15. Having considered the two competing stands placed before us by Mr.
Cama, and having heard Mr. Dave in support of the stand referred to above, we are not
inclined to allow the Interim Application.
16. As regards the submission that the learned Single Judge was functus
officio we are not impressed with this argument. There is no dispute about the legal
position as to the limited jurisdiction that may be exercised by a Judge hearing a
Section 34 Petition. It is also well settled that when setting aside an Award, the learned
Judge would not have jurisdiction to thereafter remand the matter back to the same
learned Sole Arbitrator; that position of law is also not in dispute.
17. However, in the present case, the learned Single Judge has not in any
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manner transgressed the limits of his jurisdiction. The parties before the learned
Single Judge have expressly consented to have the Award set aside, and as recorded by
the learned Single Judge, and confirmed in his order while rejecting the Review
Petition, had expressed their intention and desire to have the matter heard by the same
learned Sole Arbitrator and for him to publish an Award expeditiously. The learned
Single Judge has done no more than record this agreement of the parties, obviously at
their request.
18. The learned Single Judge has not, as was done in the case of Kinnari
Mullick (supra), suo moto remanded the matter back to the learned Sole Arbitrator.
The learned Single Judge has merely recorded the consent of the parties to have a
fresh award published by the same learned Arbitrator, presumably after affording the
parties a suitable hearing in the matter. The recording of such consent cannot in any
manner be said to be an exercise conferring jurisdiction on the learned Single Judge
after he had become functus officio. It was in the course of the very same hearing
where the award was being set aside that parties agreed to have the matter heard
before the same learned Sole Arbitrator. This sort of consent/agreement is recorded
by Courts day in and day out and there is no jurisdictional infirmity in doing so.
19. On the contrary, we feel it would be impermissible and wholly
undesirable if a party who has requested the Court to record its consent, is thereafter
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allowed to resile from the same and to contend that the Court had no jurisdiction to
record the consent in the first place. Having regard to the learned Single Judge
confirming that the order was indeed passed by consent, while rejecting the Review
Petition, we are not inclined to permit the Applicant to urge that the order wrongly
records the consent of parties to have the matter heard and decided by the same
learned Sole Arbitrator.
20. In the light of the above, we would not be inclined to allow the Appeal on
merits, even if the same were restored, and therefore no useful purpose would be
served by allowing the Interim Application. The Interim Application for restoration of
the captioned Appeal, is accordingly dismissed.
21. As the hearing concluded Mr. Dutt, the Director of the Respondent,
submitted that he was receiving threatening calls in respect of the present matter.
Without expressing any opinion on the veracity of the above claim, it would always be
open to Mr. Dutt to seek necessary police assistance / protection, should the same be
found to be necessitated by the concerned authorities.
22. After the hearing concluded, Mr. Dave learned Counsel for the
Applicant sought continuation of the interim order dated 6 th January 2022, directing
that the learned Arbitrator not proceed with the hearing fixed by him, for a reasonable
period of time, to enable the Applicant to consider its legal options. This is a
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reasonable request and accordingly the order dated 6 th January 2022 shall continue to
operate for a period of two weeks from the date of uploading of the present Order.
23. The Interim Application stands disposed of, with no order as to costs.
( MILIND N. JADHAV, J. ) ( S.J. KATHAWALLA, J. )
