Delhi High Court
Gems Commercial Co. Ltd. vs Aditya Birla Finance Ltd. on 14 October, 2014
$~22
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ O.M.P. 775/2011
GEMS COMMERCIAL CO LTD ..... Petitioner
Through: Ms. Maneesha Dhir, Ms. Vinita
Sasidharan and Mr. Ujjneal Jain, Advocates
versus
ADITYA BIRLA FINANCE LTD ..... Respondent
Through: Mr. Suhail Dutt, Sr. Advocate with Mr.
Arvind Nayar and Ms. Nandadevi Deka,
Advocates
CORAM:
HON'BLE MR. JUSTICE RAJIV SHAKDHER
ORDER
% 14.10.2014
IA No.21755/2012 (u/O. VI R. 17 of CPC)
1. This is an application by which the petitioner seeks amendment
of its petition filed under Section 34 of the Arbitration and
Conciliation Act, 1996 (in short the Act).
1.1 According to Ms. Dhir, the amendments sought are pivoted on
three principal grounds. These being as follows :-
(i). First, the learned arbitrator could not have proceeded with
arbitration proceedings in view of the fact that the petitioner herein
(i.e., original claimant) had failed to file its statement of claim, before
him.
(i)(a). It is the submission of the learned counsel for the petitioner that
provisions of Section 25(a) read with Section 2(9) of the Act
contemplate that if, a statement of claim is not filed then, the
arbitrator is required to terminate the proceedings. In support of this
submission, the learned counsel for the petitioner seeks to place
reliance on the judgment of the Supreme Court in the case of State of
Goa Vs.Praveen Enterprises, 2011 (7) SCALE 131.
(ii). Second, that the purported admission in paragraph 28 of the
petition whereby, it is stated that the petitioner is liable to pay a sum
of Rs.44,77,031/-, is a plea, which is based on a demurer, which is
that, if only, the respondent's documents are taken into account then,
the petitioner could be called upon to pay said amount as against the
sum awarded by the learned arbitrator.
(iii). Third, that the rate of interest awarded by the learned arbitrator
is usurious and, therefore, the award to that extent needs to be set
aside.
2. In so far as the first ground is concerned, I am of the view that a
conjoint reading of the provisions of Section 25 (a) and Section 2(9)
of the Act does not lead to the conclusion which Ms. Dhir has arrived
at. Arbitration proceedings cannot be terminated by an arbitrator in
case a claimant fails to file its statement of claim. This is precisely
the reason that Section 2(9) excludes inter alia the provisions of
Section 25 from the ambit of the term 'claim'.
2.1 The necessary conclusion which would follow, is that, in case
the statement of claim is not filed then the learned arbitrator would
terminate the proceedings via-a-vis the statement of claim. It would
not follow thus, that the proceedings qua the counter claim, which the
respondent may have filed before the learned arbitrator, shall also
stand dissolved.
2.2 The judgment in the case of State of Goa (supra), does not lead
to a contrary conclusion, as is sought to be contended by Ms. Dhir.
2.3 Faced with this position, Ms. Dhir submitted that the issue in
this case would have to be examined, keeping in mind the fact that at
the time when this court passed the order dated 13.01.2009 in the
petition filed by the petitioner under Section 11 of the Act, the
respondent had, inter alia, taken the stand that there was no arbitral
dispute obtaining between the parties and hence, there was no
question of a counter claim being lodged by the respondent for
adjudication by the learned arbitrator.
2.4 A careful reading of the order dated 13.01.2009 passed by this
court would show that though the court recorded this submission of
the respondent, it ultimately did give an opportunity to parties to file
their claims before the learned arbitrator.
2.5 In these circumstances, it is quite clear that the proceedings
could not have been terminated as Section 25 itself contemplates that
unless parties agree to the contrary, the proceedings will stand
terminated if, the statement of claim is not filed. Having regard to the
order of this court dated 13.01.2009, it is quite clear that the parties
had agreed to the contrary, which is that, each party could file its
respective claims. This is exactly what the respondent did in the
proceedings initiated before the learned arbitrator.
3. In so far as the second ground is concerned, which is with
regard to purported admissions made, in my view, no amendment is
required because there are several averments made in the existing
petition, which precede paragraph 28. At the appropriate time these
averments would have to be read alongwith the averments made in
paragraph 28. As to whether or not, there is an admission, as
contended by the respondent, would have to be considered by the
court at the stage of adjudication of the main petition after taking a
holistic view of the averments made in the petition.
4. Similarly, in so far as third ground is concerned, which is, as to
whether the rate of interest awarded by the learned arbitrator, is
usurious, is an aspect which is not dependent only on the use of the
term usurious in the pleadings - if otherwise the averments made in
the petition and circumstances obtaining in the matter spell out a case
that interest awarded is beyond the established and usual rate. In the
existing petition, a ground has been taken that the award is contrary to
law which, according to me, would by itself include a challenge to
usurious rate of interest, provided it is otherwise sustainable in the
given facts and circumstances of the case.
4.1 The courts have repeatedly said that awards which impose
usurious rate of interest can be interfered with on that account.
4.2 This is a matter though, on which I would not like to express
my views, any further. Suffice it to say that this is an aspect that will
be examined when, the main petition is heard.
5. Needless to say, it will be open for the respondent to
demonstrate otherwise in respect of both the second and third ground
taken up by Ms. Dhir, to seek amendment to the main petition.
6. The application is accordingly disposed of.
OMP 775/2011 and IA No.21686/2012 (for recalling of order dated
10.10.2012)
7. List on 02.03.2015.
RAJIV SHAKDHER, J
OCTOBER 14, 2014
Yg
