Cil Securities Limited, ... vs Jugal Kishore Rawat And Another
2022 Latest Caselaw 5692 Tel

 THE HON'BLE SRI JUSTICE A. VENKATESHWARA REDDY

                     C.M.A.No.505 of 2008

JUDGMENT:

This Civil Miscellaneous Appeal is filed by the

appellant/first respondent assailing the order dated

29.09.2006 in OP No.2266 of 2002 on the file of the XIV

Additional Chief Judge, City Civil Court, Hyderabad.

2. The petitioner in OP No.2266 of 2002 has filed

the application under Section 34 of the Arbitration and

Conciliation Act, 1996 (for short 'the Act') to set aside the

award dated 10.06.2002 passed by the second respondent/

Mr. Bijay Mandhania, sole arbitrator. The learned XIV

Additional Chief Judge having considered the entire

material available on record allowed the petition and set

aside the award dated 10.06.2002 passed by the second

respondent/arbitrator.

3. Feeling aggrieved by the same, the first

respondent / M/s.CIL Securities Limited, Hyderabad, has

filed this C.M.A. on the following grounds:

AVR,J CMA No.505 of 2008

a) That the Court below has failed to consider the

material available on record and failed to

observe that the memorandum of agreement

dated 10.07.2000 is not only between the

appellant and the respondent, there is another

person by name Mr. M.P. Rawat, along with the

respondent and he was not made as a party to

O.P.No.2266 of 2002;

b) That the Court below ought to have seen that

the respondent/petitioner is not a registered

firm and debarred in law to maintain the

application under Section 69 (2) of the Indian

Partnership Act, 1932;

c) That the Court below ought to have seen that

Sections 11 (6) and 34 of the Act and also does

not allow the respondent/petitioner to maintain

the arbitration application on the alleged

ground of delay, as the same was not as per the

procedure and the petition was not

AVR,J CMA No.505 of 2008

maintainable and it amounts to abuse of

process of law;

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d) That the Court below ought to have seen that

the petition filed under Section 34 of the Act

does not point out any deficiencies in the award

passed by the Arbitrator and there are no mala

fides attributed to the Arbitrator and the award

passed is not liable to be set aside.

4. The petitioner / M/s.CIL Securities Limited has

filed O.P.No.2266 of 2002 under Section 34 of the Act to

set aside the award dated 10.06.2002 passed by the

second respondent/arbitrator. The learned XIV Additional

Chief Judge upon hearing both the parties, considering the

averments of the counter filed by the respondents therein,

allowed OP No.2266 of 2002, on the principles laid under

Section 34 (2)(9)(iii) of the Act holding that proper notice of

appointment of arbitrator of the arbitration proceedings

was not given to the petitioner therein, accordingly, award

was set aside.

AVR,J CMA No.505 of 2008

5. Be it stated that as per the counter filed by the

second respondent/arbitrator denying the petition

averments it was added with pen as mentioned in para-8 of

the order impugned that "it is submitted that no

proceedings are available with this respondent, it seems

the same are misplaced while shifting residence and hence

are not traceable."

6. The learned XIV Additional Chief Judge has

observed that the shifting of house is absolutely falsehood

as notices sent from the Court were served only at the said

address and no fresh address was also furnished. The sole

contention of the petitioner in OP No.2266 of 2006 is that

though the arbitrator has held a preliminary meeting, he

did not conduct any meetings after receiving the report of

the Chartered Accountant and in fact, the petitioner has

been sending letters to the Arbitrator to convene the

meeting of both the parties for deciding the dispute, but

the arbitrator did not call for any meeting to decide the

dispute.

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7. It appears that the petitioner has also filed a

writ petition before this Court for appointment of an

Arbitrator. In the meanwhile, that award dated 10.06.2002

was passed by the second respondent/arbitrator.

Therefore, while considering the principles laid under

Section 34 (2)(9)(iii) of the Act, since no opportunity was

given to the petitioner during arbitration proceedings the

award was set aside with a liberty to the parties to move

the High Court for appointment of another arbitrator for

deciding his claims on merits.

8. On an overall consideration of the material

available on record, I am of the opinion that there is no

evidence on record to show that the Arbitrator has issued

notice to the parties or the Arbitrator has responded to the

notices of the petitioner and fix a date on receipt of the

report of the Chartered Accountant. The only claim made

by the second respondent/arbitrator is that in view of

shifting of his house, the relevant material is not traced,

which is far from the truth for the simple reason that at the

address is given in the arbitration award itself notice was

AVR,J CMA No.505 of 2008

sent from the Court and it was served upon him, as

observed by the Court below in para-9 of the order

impugned and the Court below having considered the

principles laid under Section 34 (2) (9) (iii) of the Act has

rightly set aside the arbitration award dated 10.06.2002

passed by the second respondent/ arbitrator.

9. In the result, the Civil Miscellaneous Appeal is

dismissed as devoid of merits, confirming the order dated

29.09.2006 in OP No.2266 of 2006 on the file of the XIV

Additional Chief Judge, City Civil Court, Hyderabad.

However, in the circumstances of the case, there shall be

no order as to costs.

Miscellaneous Applications, if any pending in this

appeal, shall stand closed.

_________________________________ A. VENKATESHWARA REDDY, J.

Date: 08.11.2022 Isn