State Of Tripura vs Shri Ashes Deb
2022 Latest Caselaw 1134 Tri

             HIGH COURT OF TRIPURA
                   AGARTALA


                    CRP 85 of 2022


1.   State of Tripura
     Represented by the Secretary, Department of PWD,
     Government of Tripura,

2.   Executive Engineer
     PWD (R&B), L.T. Valley Division, Manu, District- Dhalai
     Tripura.
                                           -----Petitioner(s)
                        Versus

Shri Ashes Deb, Contractor,
Son of late Amalendu Deb, Dhaleshwar, Natun Palli, Road No.2,
P.O. Dhaleshwar, Agartala.
                                           -----Respondent(s)

CRP 86 of 2022

1. State of Tripura Represented by the Secretary, Department of PWD, Government of Tripura,

2. Executive Engineer PWD (R&B), L.T. Valley Division, Manu, District- Dhalai Tripura.

-----Petitioner(s) Versus

Shri Ashes Deb, Contractor, Son of late Amalendu Deb, Dhaleshwar, Natun Palli, Road No.2, P.O. Dhaleshwar, Agartala.

-----Respondent(s)

BEFORE

HON‟BLE MR. JUSTICE S.G.CHATTOPADHYAY

For the Petitioner(s) in both the matters. : Mr. D. Bhattacharya, G.A.

Mr. K. De, Addl. G.A.

For the Respondent(s) in both the matters. : Mr. Somik Deb, Sr. Advocate.

Mr. S. Majumder, Advocate.

                    Date of hearing           : 24.11.2022

                    Date of delivery of
                    Judgment & order          : 21.12.2022

                    Whether fit for reporting :     Yes No
                                                    


                                      JUDGMENT&ORDER

These civil revision petitions are directed against the common order

dated 20.08.2022 passed by the District Commercial Court, West Tripura,

Agartala in case No. Ex (M) 29 of 2021 and Ex (M) 30 of 2021.

[2] The factual context of the case is as under:

In the arbitral proceeding No. 09(SCD) of 2019 in respect of a

dispute between Shri Ashes Deb, contractor (petitioner) and the Executive

Engineer, Longthorai Division, Public Works Department (R & B) (O.P.)

CRP No.85 of 2022 CRP No.86 of 2022

arising out of work order No. F.8(8)/EE/LTV/D/MANU/3028-39 dated

11.12.2019, Shri Justice S.C. Das, former Judge of the High Court of

Tripura was appointed as the sole arbitrator in which the following

arbitral award was passed on 29.01.2021:

"In view of the discussion made above, the petitioner is entitled to get Rs.29,33,141/- + Rs.60,93,104/- + Rs.4,70,000+ Rs. 2,00,000, total Rs. 96,96, 245/- out of which, an amount of Rs.5,81,500/-, as decided under Issue No. 7, shall be set off and the amount therefore stands at Rs.96,96,245/- (-) Rs.5,81,500/- = Rs.91,14,745/-, and on this amount, the petitioner is entitled to get interest @ 9% per annum from 04.12.2018.

The payment of awarded amount of Rs.91,14,745/- with 9% interest should be made within 90 days from the date of award along with cost part as awarded under Issue No.6, i.e. Rs. 1,91,743/-. In case of failure to make payment within 90 days, entire amount shall carry interest @12% per annum from 04.12.2018."

[3] Shri Ashes Deb, being the award holder under the said arbitral

award approached the Commercial Court seeking enforcement of the

award in terms of Section 36 of the Arbitration and Conciliation Act,

1996 („the Arbitration Act‟ for short). His application was registered as

Ex (M) 30 of 2021. The State-respondent against whom the arbitral award

was passed raised objection by filing application under Section 47 CPC

which was rejected by the Commercial Court by the impugned order and

the State-respondent was directed to pay the whole amount of award to

the award holder petitioner.

[4] Similarly, in the other arbitral proceeding No. 10 (SCD) of 2019 in

respect of a dispute between the same parties arising out of work order

No. F.8(8) (Pt-II)/EE/LTV/D/MANU/3056-66 dated 05.08.2013, Shri CRP No.85 of 2022 CRP No.86 of 2022

Justice S.C. Das, former Judge of the High Court of Tripura was

appointed as the sole arbitrator who passed the following arbitral award

on 29.01.2021:

"In view of the issue wise discussion and decision made above, the petitioner is entitled to get Rs.46,19,899/- + Rs.2,20,000/- + Rs.2,37,995/-, total Rs.50,77,894/- out of which, an amount of Rs.12,48,502/-, as decided under Issue No.6, shall be set off and the amount, therefore, stands at Rs. 38,29,392.00/- and on this amount, the petitioner is entitled to get interest @ 9% per annum from 04.12.2018.

The payment of awarded amount of Rs.38,29,392/- should be made within 90 days from the date of award along with cost part as awarded under Issue No.5, i.e. Rs.1,81,722/-. In case of failure to make payment within 90 days, entire amount shall carry interest @12% per annum from 04.12.2018."

[5] The award holder filed similar application under Section 36 of the

Arbitration and Conciliation Act, 1996 before the Commercial Court

seeking enforcement of the said arbitral award and the said application

was registered as case No. Ex (M) 29 of 2021. The State-respondent filed

petition under Section 47 CPC raising objection against the enforcement

of the arbitral award which was rejected by the Commercial Court by the

common impugned order dated 20.08.2022.

[6] Aggrieved by and dissatisfied with the said order dated 20.8.2022

passed by the District Commercial Court, West Tripura, Agartala, the

State has preferred the said civil revision petitions for quashing the

impugned order.

CRP No.85 of 2022 CRP No.86 of 2022

[7] Heard Mr. D. Bhattacharya, learned G.A. appearing for the

petitioner-State along with Mr. K. De, learned Addl. GA as well as Mr.

Somik Deb, learned senior advocate appearing along with Mr. S.

Majumder, learned advocate for the respondent.

[8] The executing Court discarded the objection raised by the State

counsel under Section 47 CPC mainly on the ground that an arbitral

award passed by the arbitrator is final and binding on the parties which

can be challenged only on the grounds prescribed under Section 34 of the

Arbitration and Conciliation Act, 1996 (the Arbitration Act hereunder)

and the application of Section 47 CPC in a proceeding under Section 36

of the Act for enforcement of arbitral award would make Section 34 of

the Arbitration Act redundant. The executing court also viewed that

Arbitration Act is a self-contained Act and the provisions of CPC will

apply only insofar as the same are not inconsistent with the spirit and the

provisions of the Arbitration Act. In such view of the matter, the

commercial court allowed the petitions filed under Section 36 of the

Arbitration Act and passed an order for enforcement of the award. At this

juncture, it would be appropriate to reproduce the relevant extract of the

impugned order dated 20.08.2022 passed by the District Commercial

Court, West Tripura Agartala which reads as under:

"Section 36 of the Arbitration Act though says the award shall be enforced in accordance with the provision of CPC, but CRP No.85 of 2022 CRP No.86 of 2022

does not, however, envisage granting leave to a party to arbitration proceeding to raise pleas on maintainability of the arbitral award. In my considered opinion once the award has been passed it becomes final where no restraint order is passed in an application for setting aside the award under Section 34 of the Arbitration Act. An arbitral award can only be challenged on the grounds prescribed under Section 34 of the Arbitration Act and subject to the parameters set out in Section 34, an arbitral award passed by the Arbitrator is final and binding on the parties. The term „in accordance with the CPC‟ employed in Section 36 cannot be read out of context or inconsistent with the rest of the Sections of Arbitration Act. The application of Section 47 of the CPC in a proceeding for enforcement of arbitral award would leave Section 34 of the Arbitration Act redundant and it will be inconsistent with the scheme of Arbitration Act. In the case of Pam Developments Private Limited vs State of West Bengal, Hon‟ble the Supreme Court has held that the reference to CPC in Section 36 of the Arbitration Act is only to guide the Court as to what conditions can be imposed by the Court, and the same have to be consistent with the provisions of the Arbitration Act. The Supreme Court further had ruled that the Arbitration Act is a self contained Act, and the provisions of CPC will apply only insofar as the same are not inconsistent with the spirit and the provision of Arbitration Act. The Arbitration Act, therefore, being a self contained code comprehensively deals with all aspects of arbitration and it does not envisage the application of whole gamut of CPC. The CPC can only guide the Court in dealing with the applications under the Arbitration Act. Having regard to Section 34 of the Arbitration Act we cannot go into the merit of the claim and should only deal with the enforcement of the award treating the award as final......"

[9] The State-counsel appearing for the petitioner has argued that in

terms of Section 36 of the Arbitration Act, an award passed by the arbitral

tribunal shall have to be enforced in accordance with the provisions of the

Code of Civil Procedure, 1908, in the manner as if it was a decree of the

Civil Court. Therefore, any objection filed under Section 47 CPC

deserves consideration by the executing court.

CRP No.85 of 2022 CRP No.86 of 2022

[10] Mr. D. Bhattacharya, learned G.A. has strenuously argued that the

finding of the executing court that application of Section 47 CPC will

make Section 34 of the Arbitration Act redundant is completely

erroneous. Counsel contends that in view of the clear mandate of Section

36 of the Arbitration Act, an objection raised under Section 47 CPC is

obviously applicable against the enforcement of an arbitral award since

such award shall be treated as a decree of the court and it would be

executed in the same manner as if it were a decree of the court. State-

counsel, therefore, argued that the executing court has erred in declining

to accept the objections raised by the State under Section 47 CPC in the

execution of the arbitral award and therefore, the impugned order is liable

to be set aside.

[11] Mr. Somik Deb, learned senior advocate appearing for the

respondent on the other hand, argued that the only recourse available to

the party aggrieved by the arbitral award is to approach the Court by

filing an application under Section 34 of the arbitration Act for setting

aside such award. Counsel argued that the grounds on which an arbitral

award can be set aside are clearly laid down under Section 34 of the

Arbitration Act. Since, the petitioner-State did not challenge the arbitral

award under Section 34 of the Arbitration Act, the award holder moved

the Court under Section 36 of the Arbitration Act for enforcement of the

award. Mr. Deb, learned senior advocate contends that there is no scope CRP No.85 of 2022 CRP No.86 of 2022

to entertain an objection raised under Section 47 CPC while the Court

exercises power under Section 36 of the Arbitration Act. The executing

court can only stay the arbitral award pending disposal of a challenge

under Section 34 only if it is satisfied that the arbitration agreement or the

making of the award was induced or affected by fraud or corruption

otherwise, there is no scope under the law to entertain any challenge

against the enforcement of an award under Section 36 of the Arbitration

Act. Counsel contends that any application for setting aside an arbitral

award under Section 34 of the Arbitration Act has to be made within a

period of three months as provided under Sub-Section (3) of Section 34

which is extendable to a further period of 30 days under the proviso to

Sub-Section (3) if the applicant can satisfy the court that he was prevented

by sufficient cause from making the application within the said period. It

is submitted that the court can grant leave to the petitioner to amend such

application for raising additional objections only if a petition under

Section 34 of the Arbitration Act is filed within a period prescribed under

the law. Counsel argues that in the case in hand, since no petition under

Section 34 of the Act was filed by the State, it cannot be allowed to raise

such objections in a proceeding under Section 36 of the Arbitration Act to

resist the enforcement of the arbitral award. Counsel contends that

arbitration proceedings being ADR method for settlement of disputes

require early/quick resolution particularly, in cases where a money award CRP No.85 of 2022 CRP No.86 of 2022

is passed. Having referred to the judgment of the Delhi High Court

reported in 2008(2) Arb. LR 76 (Delhi) (DB) [S.N. Malhotra & sons vs.

Airports Authority of India and others] and another decision of Delhi

High Court reported in 2010(3) Arb. LR 70 (Delhi) [Bhushan Steel Ltd.

vs. Singapore International Arbitration Centre and another], counsel

submits that Section 5 of the Arbitration Act which is aimed at cabining

and confining the judicial intervention in the arbitration process, should

be strictly construed. Counsel contends that Section 5 begins with a non

obstante clause and clearly restricts judicial intervention insofar as,

matters governed by Part I of the Act are concerned. Such intervention is

not permissible except where it is so provided in Part I of the Act which

implies that no objection except under the grounds set out under Section

34 in Part I of the Act can be entertained by court. It is argued by the

learned counsel of the respondent that the mandate of Section 5 of the Act

should be kept in mind while dealing with an application under Section 36

of the Act which is also in Part I of the Arbitration Act. It has been argued

by Mr. Deb, learned counsel that no objection was raised by the State

against the arbitral award under Section 34 of the Arbitration Act within

the time prescribed under Sub-Section (3) of Section 34. Thereafter, the

respondent award holder filed the petition under Section 36 seeking

enforcement of the award. At this stage, objection raised under Section

47, CPC against execution of the award is untenable and the learned CRP No.85 of 2022 CRP No.86 of 2022

commercial court had rightly rejected such objections. Counsel, therefore,

urges the Court for rejecting the present revision petitions.

[12] Considered the submissions made by learned counsel representing

the parties. Perused the entire record.

[13] In the scheme of the Arbitration Act, a challenge against an arbitral

award can be made by taking recourse to Section 34 of the Arbitration

Act and that too on the grounds set out under Sub-Section (2-A) of

section 34 of the Act. It has surfaced from the record that the present

petitioner against whom the arbitral awards were made did not prefer any

application under Section 34 of the Act. After the time prescribed for

filing such application expired, the respondent award holder approached

the Court by filing a petition under Section 36 for enforcement of the

arbitral award. Only then, the petitioner-State against whom the arbitral

awards were passed raised objection under Section 47, CPC. Section 5 of

the Arbitration Act clearly provides that "Notwithstanding anything

contained in any other law for the time being in force, in matters

governed by this Part, no judicial authority shall intervene except where

so provided in this Part", which implies that the only remedy available to

the aggrieved party against whom an arbitral award is passed, is Section

34 of the Arbitration Act. Obviously, the petitioner-State did not avail

such remedy to resist the execution within the time prescribed under the

CRP No.85 of 2022 CRP No.86 of 2022

law. Petitioner raised objection to resist the execution only by filing an

application under Section 47, CPC despite the specific remedy available

under Section 34 of the Arbitration Act. In view of the prohibition

imposed under Section 5 of the Act, objection except under Section 34 of

the Act is not entertainable.

[14] In this legal and factual background, this Court is of the considered

view that the civil revision petitions are devoid of merit. Resultantly, the

petitions stand rejected and the case is disposed of.

Stay order, if any, stands vacated and pending application(s), if

any, shall also stand disposed of.

(S.G.CHATTOPADHYAY) J

Sabyasachi G.

CRP No.85 of 2022 CRP No.86 of 2022