M/S Brahmani Infratech Pvt. Ltd. vs M/S Mantri Technology Parks ...
2022 Latest Caselaw 1176 Tel

 THE HON'BLE THE CHIEF JUSTICE SATISH CHANDRA SHARMA
                                      AND
      THE HON'BLE SRI JUSTICE ABHINAND KUMAR SHAVILI

               COMCA.Nos.31, 32, 46 and 47 of 2019

COMMON JUDGMENT: (Per the Hon'ble the Chief Justice Satish Chandra Sharma)

       Regard being had to the controversy involved in the

aforesaid cases, they were heard together and are being decided

by a common order.

       The facts of COMCA.No.31 of 2019 are reproduced as

under:-

       The present appeal is arising out of the order dated

24.04.2019 passed by the learned Judge, Commercial Court-

cum-XXVI Additional Chief Judge, City Civil Court, Hyderabad,

in COP.No.196 of 2017.

       The facts of the case reveal that an award was passed by

the Arbitral Tribunal on 31.01.2015 and the present appellant

being aggrieved by the award has preferred an application under

Section 34 of the Arbitration and Conciliation Act, 1996 (for

short "the Act") before the Court below. The respondents have

also preferred applications being aggrieved by the award of the

Arbitral Tribunal and the Court below, by a common order

dated 24.04.2019, has modified the arbitral award.

Learned counsel appearing for both sides are fair enough

in stating before this Court that the award itself has been

modified by the Court below and straight away reliance has

been placed upon the judgment delivered by the Hon'ble

Supreme Court in the case of Project Director, National

Highways No.45 E AND 220, National Highways Authority of

India vs. M. Hakeem1. Learned counsel for the parties have

also drawn the attention of this Court towards the judgment

delivered by the Hon'ble Supreme Court in the case of

McDermott International Inc. vs. Burn Standard Co. Ltd.2.

Paragraph 48 of the judgment rendered by the Hon'ble

Supreme Court in the case of National Highways Authority of

India (1 supra) is reproduced as under:-

"48. Quite obviously if one were to include the power to modify an award in Section 34, one would be crossing the Lakshman Rekha and doing what, according to the justice of a case, ought to be done. In interpreting a statutory provision, a Judge must put himself in the shoes of Parliament and then ask whether Parliament intended this result. Parliament very clearly intended that no power of modification of an award exists in Section 34 of the Arbitration Act, 1996. It is only for Parliament to amend the aforesaid provision in the light of the experience of the Courts in the working of the Arbitration Act, 1996, and bring it in line with other legislations the world over."

(2021) 9 SCC 1

(2006) 11 SCC 181

Similarly, paragraph 52 of the judgment rendered by the

Hon'ble Supreme Court in the case of McDermott

International Inc. (2 supra) is reproduced as under:-

"52. The 1996 Act makes provision for the supervisory role of courts, for the review of the arbitral award only to ensure fairness. Intervention of the Court is envisaged in few circumstances only, like, in case of fraud or bias by the arbitrators, violation of natural justice, etc. The Court cannot correct errors of the arbitrators. It can only quash the award leaving the parties free to begin the arbitration again if it is desired. So, the scheme of the provision aims at keeping the supervisory role of the Court at minimum level and this can be justified as parties to the agreement make a conscious decision to exclude the Court's jurisdiction by opting for arbitration as they prefer the expediency and finality offered by it."

In the light of the aforesaid judgments delivered by the

Hon'ble Supreme Court, the modification of arbitral award as

has been done in the present case is certainly impermissible

and the common order passed by the Court below is hereby set

aside. The parties shall appear before the Court below on

28.03.2022 and the Court below is requested to decide the

matters as expeditiously as possible, preferably within a period

of six months, as the parties are agitating the matters right from

2017. It is needless to mention that the observations made by

the learned Judge will not come in the way of the parties and

the learned Judge shall decide the matters afresh on merits.

Another important aspect of the case is that during the

pendency of the present appeals, a sum of Rs.10.00 crores was

paid by the appellant in COMCA.No.31 of 2019 to the

respondent No.1 and the respondent No.1 was directed to

furnish a bank guarantee in respect of the aforesaid amount.

This Court has remanded the matters back for deciding

them afresh to the Court below and therefore, the respondent

No.1 in COMCA.No.31 of 2019 shall continue to renew the bank

guarantee till the disposal of the applications preferred by the

parties under Section 34 of the Act.

With the aforesaid, the present appeals stand allowed.

Pending miscellaneous applications, if any, shall stand

closed. There shall be no order as to costs.

________________________ SATISH CHANDRA SHARMA, CJ

_______________________ ABHINAND KUMAR SHAVILI, J

15.03.2022 JSU