Delhi High Court
Harish Chander vs M/S. Gambit Leasing & Finance ... on 19 February, 2014
Author: Valmiki J. Mehta
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ FAO No.322/2010
% 19th February, 2014
HARISH CHANDER ..... Appellant
Through: Mr. N.L. Bareja, Advocate.
Versus
M/S. GAMBIT LEASING & FINANCE (PVT.) LTD. & ANR.
..... Respondents
Through: Ms. Neha, Advocate for respondent
No.1.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA
To be referred to the Reporter or not?
VALMIKI J. MEHTA, J (ORAL)
1. This first appeal is filed under Section 37 of the Arbitration &
Conciliation Act, 1996 (hereinafter referred to as 'the Act') impugning the
judgment of the court below dated 4.5.2010 which dismissed the objections
under Section 34 of the Act on the ground that the same are barred by
limitation.
FAO No.322/2010 Page 1 of 4
2. Taking that the objections were within time the next issue
which arises is that whether the appellant/objector are entitled to succeed on
merits for setting aside of the Award dated 13.8.2007 which has decreed the
claim of the respondent no.1/finance company against the principal borrower
one Sh. Pappu and against the appellant as the co-guarantor. By the Award,
an amount of Rs.63,184/- has been decreed jointly and severely against the
principal borrower and the guarantors.
3. Counsel for the appellant argues that the appellant was never
served in the arbitration proceedings and therefore the exparte Award is
bound to be set aside. In order to verify this aspect, I examined the
arbitration record and I find that the appellant was served not once but twice
by registered post AD. Firstly he was served for 19.3.2007 and for the
second time he was served for 16.4.2007. There is no dispute that the
registered AD cards were sent to the correct official address of the appellant
who was working in the DTC depot at Rohini. Counsel for the appellant, on
a query from the Court, does not dispute that the appellant was serving at the
Rohini depot of DTC in March and April, 2007 when the registered covers
were sent, however, he disputes the signatures on the two AD cards as not
being that of the appellant.
4. In my opinion, once there are requisite AD cards showing due
FAO No.322/2010 Page 2 of 4
service upon the appellant, not once but twice in the arbitration proceedings,
and that too at the official address where the appellant was posted, I am of
the opinion that the appellant would have been served through any person in
the department and who would have given the notices to the appellant.
Order 5 Rule 27 of Code of Civil Procedure, 1908 (CPC) states that where a
person is a public officer or an officer of a local authority the summons can
be sent for service to the head of the office in which the employee is posted.
Accordingly, applying the letter and spirit of Order 5 Rule 27 CPC to the
present case it is held that the appellant was served in the arbitration
proceedings. Once appellant was served in the arbitration proceedings, and
he failed to appear, then no issues of merits can be urged before this Court as
was sought to be done on behalf of the appellant inasmuch as issues of
merits had to be decided by the arbitrator provided the appellant appeared
before the arbitrator, filed his pleadings and thereafter established his
defence. This has not been done and therefore there is no reason for setting
aside of the Award passed against the appellant as the co-guarantor.
5. At the request of the counsel for the appellant it is noted that the
appellant, in accordance with law, to the extent he has paid the amount for
the principal borrower to the finance-company, he can recover the amount
paid to the finance-company with interest from the principal borrower.
FAO No.322/2010 Page 3 of 4
6. In view of the above, the appeal is dismissed, leaving the
parties to bear their own costs.
FEBRUARY 19, 2014 VALMIKI J. MEHTA, J.
Ne
