Tuesday, 1 November 2016

Whether district Judge while entertaining application U/S 34 of arbitration Act functions as civil court or mere tribunal?

Now, turning to the next question as to
whether the present appeal is maintainable and whether the
original petition was under Article 227 or 226 of the
Constitution of India, it may be pointed out that since the
filing of the proceeding under Section 34 of the 1996 Act
before the learned District Judge is against the statute, the 
subsequent order, dated 18.07.2016, cannot cure the initial
illegality. As it has already been held hereinabove that the
Court of the learned District Judge does not exercise
jurisdiction of a regular civil court but is a Court of limited
jurisdiction,
IN THE HIGH COURT OF JUDICATURE AT PATNA
Letters Patent Appeal No.1841 of 2016
IN
Civil Writ Jurisdiction Case No. 746 of 2016

Bihar Rajya Bhumi Vikas Bank Samiti, Bihar-Jharkhand, Now
known as Multi-State Co-operative Land Development Bank
Ltd., Bihar & Jharkhand, 
V
 State of Bihar.
CORAM: CHIEF JUSTICE
AND
HONOURABLE DR. JUSTICE RAVI RANJAN

Date: 28-10-2016

The core issue, which this appeal has raised, is:
whether issuance of a notice, under sub-Section (5) of
Section 34 of the Arbitration and Conciliation Act, 1996 
(hereinafter referred to as ‘the 1996 Act’), is
mandatory or directory? Connected with this core issue
is the issue : whether an order, entertaining an
application, which is made contrary to the provisions of
Section 34 (5) of the 1996 Act, by omitting to serve
advance notice on the opposite party by the
application, would be amenable to Article 227 or 226 of
the Constitution of India? Yet another issue, raised in
this appeal, is: whether a District Judge, while
exercising power under Section 34 of the 1996 Act
functions as a Civil Court or a Court other than a Civil
Court?
BACKGROUND FACTS
2. The brief facts, giving rise to present appeal,
may be summed up as follows:
(i) The appellant bank alleges that the State
owes to it a sum of Rs. 570.79 crore under different heads.
The bank approached this Court for appointment of an
Arbitrator by filing Request Case No 4 of 2013, which was
allowed, on 07.03.2014, and Mr. Justice S. C. Jha (Retired)
was appointed as the Arbitrator.
(ii) The order, appointing the Arbitrator, was
challenged by way of Special Leave Petition before the
Supreme Court in S.L.P. (C) No. 15552 of 2014. By its order, 
dated 14.07.2014, the Supreme Court dismissed the Special
Leave Petition aforementioned.
(iii) After dismissal of the Special Leave
Petition, the arbitration proceeding commenced. Though the
State raised the issue of maintainability of the arbitration
proceeding, the same was rejected by the Arbitrator by order,
dated 24.05.2015, and this order, dated 24.05.2015, was not
challenged. The proceeding, thus, continued and the award
was passed on 06.01.2016.
(iv) The State challenged the award, invoking
the jurisdiction of the District Judge, by way of an application
made under section 34 of the 1996 Act. However, no prior
notice was issued to the appellant bank under Section 34 (5)
of the 1996 Act. The Shirestedar of the learned Court below
pointed out the defect with regard to non-compliance with the
provisions of Section 34 (5) of the 1996 Act, which found
reference in the margin of the order sheet; yet the learned
Court below ignored the same and proceeded to take up the
application, made under Section 34 (5) of the 1996 Act, for
disposal.
(v) The grievance of the appellant bank is that
the provisions of Section 34 (5) of the 1996 Act, requiring a
notice to be given is mandatory and since no notice had been
given, as required by Section 34 (5) of the 1996 Act, to the
appellant bank before making of the application under Section
34 (5) of the 1996 Act, seeking to get the award set aside,
the decision of the learned District Judge to proceed with the
application, made under Section 34 of the 1996 Act, is
untenable in law. It is contended that by the order under
appeal, the very purpose of the amendment, brought in to the
1996 Act by the Arbitration and Conciliation (Amendment)
Act, 2015, by way of Section 18, with effect from 23.10.2015,
has been made redundant.
3. Aggrieved by the order, dated 18.07.2016,
aforementioned, the appellant bank impugned the said order
in a petition filed under Article 227 of the Constitution of
India. A learned single Judge of this Court has, disagreeing
with the contention of the appellant bank that the decision of
the learned District Judge, Patna, of issuing notice through his
order, dated 18.07.2016, was bad since there was nonadherence
to the requirement of issuance of a prior notice as
per the provisions embodied in Section 34 (5) of the 1996
Act, which, according to learned counsel for the appellant, is
mandatory in nature, and held that Section 34 (5) of the 1996
Act is merely directory and not being mandatory, the order,
dated 18.07.2016, passed by the District Judge does not call
for any interference and accordingly dismissed the petition.
4. The observations made, conclusions reached 
and the decision given by the learned single Judge read as
follows :
“19. In view of the above
settled principles of law and in view of my
discussion above I find that Section 34
(5) of the Conciliation Act, 1996 is not
mandatory rather it is directory. It was
inserted for the purpose of expeditious
disposal of the arbitration matter, i.e.,
the period which was being consumed in
issuing the notice is sought to be
shortened by providing this provision by
amendment but that does not mean that
for noncompliance thereof the application
is to be dismissed at the very threshold.
The courts have the jurisdiction to
entertain the application and by inserting
sub-section (5) of Section 34, the power
of the Court has not been taken away.
This does not mean that always this
provision should not be complied with.
Further by the impugned order no
prejudice is caused to the petitioner. Now
the petitioner has got the knowledge,
therefore, the petitioner may appear and
file objection. Huge amount is involved
and, therefore, the proceeding cannot be
rejected at the very threshold on
technical ground, particularly when I
have held that the provision is not
mandatory rather it is directory”. 
5.Aggrieved by the dismissal of the writ
petition made under Article 226 of the Constitution of India,
this Letters Patent Appeal has been preferred under Clause X
of the Letters patent of High Court of Judicature at Patna.
6. We have heard Mr. Y. V. Giri, learned Senior
Counsel, appearing for the appellant, and Mr. Ravi Ranjan,
learned Assistant Counsel to Standing Counsel No. 22,
appearing for the respondents.
7. While considering the present appeal, it
needs to be pointed out that there is, admittedly, no Letters
Patent Appeal provided under Clause X of the Letters Patent
of High Court of Judicature at Patna against an order made
under Article 227. What has, however, been contended, on
behalf the appellant-bank, is that the order passed by the
learned single Judge, in Civil Misc. No.746 of 2012, was, in
fact and in substance, in exercise of power under Article 226
of the Constitution and, therefore, this Letters Patent Appeal
is available. Yet another question, which has been raised in
the present appeal, as already indicated above, is whether a
notice, under Section 34(5) of the 1996 Act, is mandatory or
directory in nature.
8. The two questions, so posed, bring us to yet
another question and the question is: Whether a District
Judge, while exercising power under Section 34(5) of the Act, 
functions as a Civil Court or merely as a Court or a tribunal?
SCOPE OF ARTICLE 226 VIS-À-VIS ARTICLE 227
9. There is no dispute before us that as against
an order, made under Article 226 of the Constitution of India,
and intra-Court appeal, under Clause 10 of the Letters Patent
of Patna High Court, lies. There is also no dispute that
whereas an order, made under Article 226 of the Constitution
of India, is an appealable order under Clause 10 of the Letters
Patent of Patna High Court, no intra-Court appeal lies as
against an order, which has been passed in exercise of power
under Article 227 of the Constitution of India.
10. Articles 226 and 227 of the Constitution of
India stand on distinctly different footing. Every High Court
has been conferred with the power to issue writs under Article
226 of the Constitution of India and these are original
proceedings, (State of U.P. v. Dr. Vijay Anand Maharaj
(AIR 1963 SC 946) (See also Shalini Shyam Shetty v.
Rajendra Shankar Patil, reported in (2010) 8 SCC 329);
whereas the power exercisable, under Article 227 of the
Constitution of India, is neither original nor is it appellate.
Clearly held the Supreme Court, in Umaji Keshao Meshram
v, Radhikabai, reported in, 1986 (Supp) SCC 401, that a
proceeding, under Article 226 of the Constitution of India, is
an original proceeding, while a proceeding, under Article 227 
of the Constitution of India, is not an original proceeding.”
11. Article 227 of the Constitution of India
vests in every High Court the power of superintendence over
all courts and tribunals throughout the territory in relation to
which it exercises jurisdiction. This jurisdiction of
superintendence, under Article 227 of the Constitution of
India, is for both, administrative and judicial superintendence.
12. Therefore, the powers, conferred under
Articles 226 and 227 of the Constitution of India, are separate
and distinct and operate naturally in different fields.
13. Another distinction between Article 226 of
the Constitution of India and Article 227 of the Constitution of
India jurisdictions is that under Article 226 of the Constitution
of India, the High Court normally annuls or quashes an order
or proceeding; but in exercise of its jurisdiction under Article
227 of the Constitution of India, the High Court, apart from
annulling a proceeding, in question, can also substitute the
impugned order by the order, which the inferior Tribunal
should have made.
14. With regard to the above, one may
gainfully refer to the decision, in Hari Vishnu Kamath v.
Ahmad Ishaque (AIR 1955 SC 233), wherein the
Constitution Bench of the Supreme Court, observed, “ … while
a “certiorari‟ under Article 226 the High Court can only annul 
the decision of the Tribunal, it can, under Article 227, do that,
and also issue further directions in the matter.”
15. The jurisdiction, under Article 226 of the
Constitution of India, is, normally, exercised, where a party is
affected; but power under Article 227 of the Constitution of
India can be exercised by the High Court suo motu as a
custodian of justice.
16. In fact, the power under Article 226 of the
Constitution of India is exercised in favour of persons or
citizens for vindication of their fundamental rights or other
statutory rights. The jurisdiction, under Article 227 of the
Constitution of India, is exercised by the High Court for
vindication of its position as the highest judicial authority in
the State.
17. In certain cases, where there is
infringement of fundamental right, the relief, under Article 226
of the Constitution, can be claimed ex debito justitiae or as a
matter of right. But, in the cases, where the High Court
exercises its jurisdiction under Article 227 of the Constitution
of India, such exercise is entirely discretionary and no person
can claim it as a matter of right. From an order of a single
Judge passed under Article 226 of the Constitution of India, a
letters patent appeal or an intra Court appeal is maintainable;
but no such appeal is maintainable from an order passed by a 
Single Judge of a High Court in exercise of power under Article
227 of the Constitution of India. (See Shalini Shyam Shetty
v. Rajendra Shankar Patil, reported in (2010) 8 SCC 329).
18. Having analyzed a number of its decisions,
the Supreme Court in Shalini Shyam Shetty v. Rajendra
Shankar Patil, reported in (2010) 8 SCC 329), has culled
out following principles with regard to exercise of power under
Article 227 of the Constitution of India :
(a) A petition, under Article 227 of the
Constitution of India, cannot be called a writ petition. The
history of the conferment of writ jurisdiction on High Courts is
substantially different from the history of conferment of the
power of superintendence on the High Courts under Article
227 of the Constitution of India;
(b) High Courts cannot, at the drop of a hat,
interfere with the orders of tribunals or courts inferior to it.
Nor can it, in exercise of this power, act as a court of appeal
over the orders of the court or tribunal subordinate to it in
exercise of its power of superintendence under Article 227 of
the Constitution of India. In the cases, where an alternative
statutory mode of redressal has been provided, such
alternative remedy would also operate as a restrain on the
exercise of this power by the High Court.
(c) While laying down the principle, on the basis 
of which power of superintendence, embodied, under Article
227 of the Constitution of India, is exercised by the High
Court, a Constitution Bench of the Supreme Court has pointed
out, in Waryam Singh v. Amarnath (AIR 1954 SC 215),
that a High Court, in exercise of its jurisdiction of
superintendence, can interfere with an order only to keep the
tribunals and courts subordinate to it ―within the bounds of
their authority. This power of superintendence cannot be
equated with appellate jurisdiction.
(d) Merely, therefore, the fact that an order is
incorrect, the High Court may not exercise its power of
superintendence under Article 227 of the Constitution of India.
However, the power of superintendence vested in a High
Court, under Article 227 of the Constitution of India, can be
invoked to remove a patent perversity in an order of the
tribunal or court subordinate to the High Court or where there
has been a gross and manifest failure of justice or the basic
principles of natural justice have been flouted.
(e) In exercise of its power of superintendence,
High Court cannot interfere to correct mere errors of law or
fact or just because another view than the one taken by the
tribunals or courts subordinate to it is a possible view. In other
words, the supervisory jurisdiction, under Article 227 of the
Constitution of India, has to be very sparingly exercised. 
(f) The main object of Article 227 of the
Constitution of India is to keep strict administrative and
judicial control by the High Court on the administration of
justice within its territory.
(g) The power of interference, under Article 227
of the Constitution of India, is to be kept to the minimum to
ensure that the wheels of justice do not come to a halt and
the fountain of justice remains pure and unpolluted in order to
maintain public confidence in the functioning of the tribunals
and courts subordinate to the High Court.
19. This power of superintendence, therefore,
under Article 227 of the Constitution of India, is not to be
exercised just for grant of relief in individual cases, but should
be directed for promotion of public confidence in the
administration of justice in the larger public interest; whereas
Article 226 of the Constitution of India is meant for protection
of individual grievance.
20. Thus, though the power, under Article 227
of the Constitution of India, may be unfettered, its exercise is
subject to high degree of judicial discipline pointed out above.
An improper and a frequent exercise of this power will be
counter-productive and will divest this extraordinary power of
its strength and vitality. (See, Shalini Shyam Shetty v.
Rajendra Shankar Patil, reported in (2010) 8 SCC 329).
21. In Lokmat Newspapers (P) Ltd. v.
Shankar Prasad, reported in (1999) 6 SCC 275, the
Supreme Court clearly laid down that if a single Judge
exercises jurisdiction, under Article 226 of Constitution of
India,, letters patent appeal would be maintainable;, but if the
jurisdiction is exercised under Article 227 of the Constitution
of India, intra-Court appeal will not be maintainable. It was,
however, made clear in Lokmat Newpapers (P) Ltd.
(supra), that if a single Judge of a High Court, while
considering the petition under Article 226 or Article 227 of the
Constitution of India, does not state under which provision he
has decided the matter and where the facts justify filing of
petition, both under Article 226 and Article 227 of the
Constitution of India, and a petition so filed is dismissed by
the Single Judge on merits, the matter may be considered in
its proper perspective in an appeal. (See, Umaji Keshao
Meshram v. Radhikabai, reported in 1986 Supp SCC 401,
Ratnagiri Distt. Central Coop. Bank Ltd. v. Dinkar
Kashinath Watve, reported in 1993 Supp (1) SCC 9, and
Sushilabai Laxminarayan Mudliyar v. Nihalchand
Waghajibhai Shaha, reported in 1993 Supp (1) SCC 11.
See also, Kanhaiyalal Agrawal v. Factory Manager,
Gwalior Sugar Co. Ltd., (2001) 9 SCC 609).
22. What nomenclature has been used by a 
party, while seeking intervention by Court is not so material as
the contents of the order, which is challenged, as well as the
contents of the order, which has been passed by the High
Court. (See State of M.P. v. Visan Kumar Shiv Charan Lal,
reported in (2008) 15 SCC 233).
23. If the judgment under appeal falls squarely
within four corners of Article 227 of the Constitution of India,
it goes without saying that intra-Court appeal from such
judgment would not be maintainable. On the other hand, if the
petitioner has invoked the jurisdiction of the High Court for
issuance of certain writ under Article 226 of the Constitution of
India, although Article 227 of the Constitution of India is also
mentioned, and, principally, the judgment appealed against
falls under Article 226 of the Constitution of India, appeal
would be maintainable.
24. What is important to be ascertained is,
therefore, the true nature of the order passed by the Single
Judge and not what provision he mentions, while exercising
such powers. (See Ashok K. Jha v. Garden Silk Mills Ltd.,
reported in (2009) 10 SCC 584).
25. In Ramesh Chandra Sankla v. Vikram
Cement, reported in (2008) 14 SCC 58, the Supreme Court
has held that a statement, made by a learned Single Judge,
that he has exercised power under Article 227 of the 
Constitution of India, cannot take away right of appeal against
such a judgment if power is, otherwise, found to have been
exercised under Article 226 of the Constitution of India.
26. Clarified the Supreme Court, in MMTC v.
CCT, reported in, (2009) 1 SCC 8, that a High Court shall
consider the nature of the controversy, the nature of relief,
which is sought for, and the nature of the order, which might
have been passed by a single Judge of the High Court in order
to decide if the order has been made under Article 226 or 227
of the Constitution of India.
27. Let us, first, consider the question as to
whether the petition, in the present case, filed under Article
227 of the Constitution of India, was essentially an application
under Article 227 of the Constitution of India or was an
application essentially made under Article 226 of the
Constitution of India. This can be culled out from the nature
of jurisdiction sought to be invoked and the nature of
jurisdiction by the principal Civil Court, under the provisions
Section 2(e) of the 1996 Act, with particular reference to
Section 34 thereof.
28. Section 2(e) of the 1996 Act defines the
„Court‟ to mean the „principal Civil Court‟ of original
jurisdiction, in a district, in an arbitration case other than
international commercial arbitration, and includes the High 
Court in exercise of its ordinary original civil jurisdiction
having jurisdiction to decide the questions forming the subject
matter of the arbitration, but does not include any Civil Court
of a grade inferior to such principal Civil Court, or any Court
of Small Causes.
29. The definition of Court, as given in
Section 2(e) of the 1996 Act, take us to decide as to whether
a principal Civil Court, as mentioned in Section 34 of the 1996
Act, is a Civil Court of ordinary jurisdiction as is understood
under the Bengal, Agra and Assam Civil Courts Act, 1887
(hereinafter referred to as „the 1887 Act‟), with plenary power
and authority to decide suits of any nature under Section 9 of
the Code of Civil Procedure.
30. We have considered the rival
submissions.
31. Thus, the principal questions, which
arise, in the present case, may be set out as follows;
Whether, while exercising jurisdiction
under Section 34 of the Arbitration and
Conciliation Act, 1996, the principal civil
Court is a Court or a tribunal?
If the principal civil Court is a tribunal,
whether a writ of certiorari can be issued
and if so, under what circumstances?
Whether the provisions of Section
34(5) are mandatory or directory?
Whether, while exercising jurisdiction
under Section 34 of the Arbitration and
Conciliation Act, 1996, the principal civil
Court acts as a Civil Court of ordinary
jurisdiction or as a mere Court or as a
tribunal?
32. While considering the question posed
above, one needs to bear in mind the distinction between
Courts and Tribunals.
33. In the case of Harinagar Sugar Mills
Ltd. v. Shyam Sundar Jhunjhunwala (AIR 1961 SC 669),
the issue before the Supreme Court was whether Company
Law Board is a tribunal within the meaning of Section 9A of
Special Court (Trial of Offences Relating to Transactions in
Securities) Amendment Ordinance, 1994
34. Justice Hidayatullah, (as his Lordship
then was) delivered a separate, but concurring judgment. He
observed that all tribunals were not courts, though all courts
were tribunals. The expression „courts‟ was used to designate
those tribunals, which were set up in an organized State for
the administration of justice. By administration of justice was
meant the exercise of the judicial power of the State to 
maintain and uphold rights and to punish wrongs. Whenever
there was an infringement of a right or an injury, the courts
were there to restore the “vinculum juris”. When rights were
infringed or invaded, the aggrieved party could go and
commence a „querela‟ before the ordinary civil courts. These
courts were invested with the judicial power of the State and
their authority was derived from the Constitution or some Act
of legislature constituting them. Their number was ordinarily
fixed and they were ordinarily permanent and could try any
suit or cause within their jurisdiction. Their numbers might be
increased or decreased, but they were almost always
permanent and went under the compendious name of “Courts
of Civil Judicature”. There could be no doubt that the Central
Government did not come within this class. With the growth
of civilization and the problems of modern life, a large number
of administrative tribunals had come into existence. These
tribunals had the authority of law to pronounce upon valuable
rights. They acted in a judicial manner and even on evidence
on oath, but they were not part of the ordinary courts of civil
judicature. They shared the exercise of the judicial power of
the State, but were brought into existence to implement some
administrative policy or to determine controversies arising out
of some administrative law. They were very similar to courts,
but were not courts. When the Constitution spoke of „courts‟ 
in Articles 136, 227 and 228 and in Articles 233 to 237 and
the Lists, it contemplated courts of civil judicature but not
tribunals other than such courts. This was the reason for
using both the expressions in Articles 136 and 227. By
„courts‟ was meant courts of civil judicature and by „tribunals‟
those bodies of men who were appointed to decide
controversies arising under certain special laws. Among the
powers of the State was included the power to decide such
controversies. This was undoubtedly one of the attributes of
the State and was aptly called the judicial power of the State.
In the exercise of this power, a clear division was noticeable.
Broadly speaking, certain special matters went before
tribunals and the residue went before the ordinary courts of
civil judicature. What distinguished them had never been
successfully established. A court in the strict sense was a
tribunal which was a part of the ordinary hierarchy of courts
of civil judicature maintained by the State under its
Constitution to exercise the judicial power of the State. These
courts performed all the judicial functions of the State except
those that were excluded by law from their jurisdiction. The
word „judicial‟ was itself capable of two meanings. It might
refer to the discharge of duties exercisable by a judge or by
justices in court or to administrative duties which need not be
performed in court but in respect of which it was necessary to 
bring to bear a judicial mind to determine what was fair and
just in respect of the matters under consideration. That an
officer was required to decide matters before him judicially in
the second sense did not make him a court or even a tribunal
because that only established that he was following a
standard of conduct and was free from bias or interest. Courts
and tribunals acted judicially in both senses and in the term
„courts‟ were included the ordinary and permanent tribunals
and in the term „tribunals‟ were included all others which were
not so included. The matter would have been simple if the
Companies Act had designated a person or persons, whether
by name or by office, for the purpose of hearing an appeal
under Section 111. It would then have been clear that though
such person or persons were not „courts‟ in the sense
explained, they were clearly „tribunals‟. The Companies Act
said that an appeal would lie to the Central Government. The
court was, therefore, faced with the question whether the
Central Government could be said to be a tribunal. The
function that the Central Government performed under the
Companies Act and Rules was to hear an appeal against the
action of the directors. For that purpose a memorandum of
appeal setting out the grounds had to be filed and the
company, on notice, was required to make representations, if
any, and so also the other side, and both sides were allowed 
to tender evidence to support their representations. The
Central Government by its order then directed that the shares
be registered or need not be registered. The Central
Government was also empowered to include in its orders
directions as to payment of costs or otherwise. The function
of the Central Government was curial and not executive.
There was provision for a hearing and a decision on evidence,
and that was indubitably a curial function. In its functions the
Central Government often reached decisions but all its
decisions could not be regarded as those of a tribunal.
Resolutions of Government might affect rights of parties and
yet they might not be in the exercise of judicial power.
Resolutions of Government might be amenable to writs under
Articles 32 and 226 in appropriate cases but might not be
subject to a direct appeal under Article 136 as the decisions of
a tribunal. The position, however, changed when Government
embarked upon curial functions and proceeded to exercise
judicial power and decide disputes. In these circumstances, it
was legitimate to regard the officer who dealt with the matter
and even Government itself as a tribunal. The word „tribunal‟
was a word of wide import and the words „court‟ and „tribunal‟
embraced within them the exercise of judicial power in all its
forms. The decision of the Central Government thus fell within
the powers of the Supreme Court under Article 136. 
35. In Kihoto Hollohan v. Zachillhu,
reported in 1992 Supp (2) SCC 651, the observations,
made in the case of Harinagar Sugar Mills Ltd. (supra),
were quoted with approval and it was held that where there
was a lis, an affirmation by one party and denial by another,
the dispute involved the rights and obligations of the parties
to it and when an authority was called upon to decide it, there
was an exercise of judicial power. That authority was called a
tribunal if it did not have all the trappings of a court.
36. What is clearly noticeable, from the
decisions of Harinagar Sugar Mills Ltd. (supra) and Kihoto
Hollohan (supra), is that a court, in the strict sense, was a
tribunal, which was a part of the ordinary hierarchy of courts
of civil judicature maintained by the State under its
Constitution to exercise the judicial power of the State.
Secondly, a body, which performs curial functions or which
decides a lis — an affirmation by one party and denial by
another, it is called a tribunal if it did not have all the
trappings of a court. In other words, certain special matters
go to tribunals and the residue goes to the ordinary courts of
civil judicature.
37. Mr. Y. V. Giri, learned Senior counsel, for
the appellant has argued that the „principal Civil Court‟, under
Section 2(e) of the 1996 Act, is not a Civil Court in real sense. 
He has relied upon the decision of the Supreme Court, in
Nahar Industrial Enterprises Limited v. Hong Kong and
Shanghai Banking Corporation and others, reported in
(2009) 8 SCC 646, to support his contention. In Nahar
Industrial Enterprises Limited (supra), the Supreme Court
has pointed out the essentials of a civil court by indicating
that the court must be able to pass a decree as also must be
capable of undertaking a full-fledged trial in terms of the
provisions of the Code of Civil Procedure and/or the Evidence
Act. Only because a court is competent to adjudicate an issue
of civil nature does not necessarily lead to the inference, nor
can it be held, that the court, so dealing with a case, is a civil
court.
38. Learned Counsel for the State, on the
other hand, argues that the District Judge, exercising
jurisdiction under the provisions of the 1996 Act, discharges
functions of a civil court inasmuch as the District Judge has
the power to make orders requiring emergent actions, such
as, appointment of a receiver, where the situation so
warrants, or to pass any other necessary order taking interim
measures, such as, granting of an injunction, etc. The District
Judge also enforces the award of the Arbitral Tribunal as a
decree exercising, by virtue of the provisions of Section 36 of
the 1996 Act, the powers conferred by Order 21 of the Code 
of Civil Procedure.
39. In Nahar Industrial Enterprises
Limited(supra), the Supreme Court has pointed out the
essentials of a civil court by indicating that the court must be
able to pass a decree as also must be capable of undertaking
a full-fledged trial in terms of the provisions of the Code of
Civil Procedure and/or the Evidence Act. Only because a court
is competent to adjudicate an issue of civil nature does not,
according to the decision, in Nahar Industrial Enterprises
Limited (supra), necessarily lead to the inference that the
court, so dealing with a case, is a civil court. It is apposite to
point out, in this regard, the relevant observations, made in
Nahar Industrial Enterprises Limited (supra), which read
as follows:
“69. Civil court is a body
established by law for administration of
justice. Different kinds of law, however
exist, constituting different kinds of
courts. Which courts would come within
the definition of the civil court has been
laid down under the Code of Civil
Procedure find mention in Section 4 and
5 thereof. Some suits may lie before the
Revenue Court, some suits may lie before
the presidency Small Cause Courts. The
Code of Civil Procedure itself lays down
that the Revenue Courts would not be
courts subordinate to the High Court.
xx xx xx
87. Should we adopt the
principle of purposive interpretation so as
to hold that the DRT would be a civil
court?
88. We have noticed
hereinbefore that civil courts are created
under different acts. They have their own
hierarchy. They necessarily are
subordinate to the high court. The
appeals from their judgment will lie
before a superior court. The high court is
entitled to exercise its power of revision
as also superintendence over the said
courts. For the aforementioned purpose,
we must bear in mind the distinction
between two types of courts trying
disputes of civil nature. Only because a
court or tribunal is entitled to determine
an issue involving civil nature, the same
by itself would not lead to the conclusion
that it is a civil court. For the said
purpose, as noticed hereinbefore a legal
fiction is required to be created before it
would have all attributes of a civil court.
89. The tribunal could have
been treated to be a civil court provided it
would pass a decree and it had all the
attributes of a civil court including
undertaking of a full-fledged trial in terms
of the provisions if the Code of Civil
Procedure/ or the Evidence Act. It is now
trite law that jurisdiction of a court must 
be determined having regard to the
purpose and object of the Act. If
parliament, keeping in view the purpose
and object there of thought it fit to create
separate Tribunal so as to enable the
banks and the financial contained in the
code of Civil Procedure as also the
Evidence Act need not necessarily be
restored to, in our opinion, by taking
recourse to the doctrine of purposive
construction, in another jurisdiction
account be conferred upon it so as to
enable this court to transfer the case
from the civil court to a Tribunal.”
40. Viewed from the above perspective, the
principal civil court, while exercising powers under Section 34
of Arbitration and Conciliation Act, 1996, cannot be described
to be or held a Court of civil judicature; but since it decides
the validity of an award made by an arbitrator, which has
consequences on the rights and liabilities of parties, it
assumes the character of a Court, which is effectively, in the
light of the decision, in Harinagar Sugar Mills Ltd. (supra),
a tribunal.
NATURE OF JURISDICTION UNDER ARTICLE 226 VIS-À-
VIS ARTICLE 227
41. The next question would be what is the
nature of jurisdiction vested in High Court under Article 226
and 227 vis-à-vis orders of Courts and Tribunals? This
question assumes importance, because of the fact that if the
application, preferred by the appellant before the learned
single Judge, is, in effect, an application under Article 226,
then, a letters patent appeal would lie. However, if the
application, preferred by the appellant before the learned
single Judge, is, in effect, an application under Article 227,
this letters patent appeal would not lie.
42. As has been held in the case of Anil
Kumar Shrivasatava v. Shaurya Sunil (CWJC 718 of
2016), all the powers, which are given to the High Court
under sub-Clauses (a), (b) and (c) of Clause 2 of Article 227,
are in respect of courts and tribunals, which are subordinate
to the territorial jurisdiction of a High Court. A single Judge or
a single Bench of a High Court is not a court subordinate to
the Division Bench of the High Court and, therefore, the power
of superintendence, which is vested in a High Court by Article
227, is not exercisable against order or decision of its own
single Bench.
43. Coming, now, to the scope and ambit of
jurisdiction vested in the High Court under Article 226, the
Supreme Court, in the case of G. Veerappa Pillai v. Raman
& Raman Ltd. (AIR 1952 SC 192), has observed that writs,
as are referred to in Article 226, are obviously intended to
enable the High Court to issue them in grave cases, where the 
subordinate tribunals or bodies or officers act wholly without
jurisdiction, or in excess of it, or in violation of the principles
of natural justice, or refuse to exercise a jurisdiction vested in
them, or there is an error apparent on the face of the record,
and such act, omission, error, or excess has resulted in
manifest injustice.
44. Cautioning that jurisdiction under Article
226 is not in the nature of appellate jurisdiction, the Supreme
Court, in G. Veerappa Pillai (supra), held that however
extensive the jurisdiction under Article 226 may be, it is not so
wide or large as to enable the High Court to convert itself into
a court of appeal and examine for itself the correctness of the
decision impugned and decide what is the proper view to be
taken or the order to be made.
45. In this context, it would be pertinent to
mention that in Radhey Shyam v. Chhabi Nath, reported in
(2015) 5 SCC 423, the Supreme Court, while dealing with
the validity of the ratio, laid down in the case of Surya Dev
Rai v. Ram Chander Rai, reported in (2003) 6 SCC 675
whether a writ of certiorari would lie against an order of the
civil court observed as follows;
“11. It is necessary to clarify
that the expression “judicial acts” is not
meant to refer to judicial orders of civil
courts as the matter before this Court
arose out of the order of the Election 
Tribunal and no direct decision of this
Court, except Surya Dev Rai, has been
brought to our notice where writ of
certiorari may have been issued against
an order of a judicial court. In fact, when
the question as to scope of jurisdiction
arose in subsequent decisions, it was
clarified that orders of the judicial courts
stood on different footing from the quasijudicial
orders of authorities or tribunals.”
46. It will be seen that the powers of the
High Court, as conferred by Articles 226 and 227 of the
Constitution of India, operate in two separate fields. Such
exercise, on occasions, intermeddles and crosses each other.
However, the two powers are different in nature.
47. The power of superintendence under
Article 227, though wide, is supervisory in nature. The power
under Article 227 cannot, therefore, be exercised to interfere
with an order if the order, made by a subordinate court or
tribunal, is within the bounds of, or in conformity with, law.
What is, however, extremely important to note is that while
exercising supervisory jurisdiction under Article 227, the High
Court not only acts as a court of law, but also as a court of
equity.
48. It is, therefore, not only the power, but
also the duty of the court to ensure that the power of Patna High Court LPA No.1841 of 2016 dt.28-10-2016
30/57
superintendence is exercised in order to advance the cause of
justice and uproot injustice. This power cannot, however, be
exercised to interfere with an order of a subordinate court or
tribunal if the order, made by the subordinate court or the
tribunal, is, otherwise, within the bounds of law. If, therefore,
a subordinate court or tribunal does not have a particular
power and refuses, therefore, to pass an order, such an order
cannot be interfered with by invoking Article 227, though such
an order, if otherwise unjust, may be interfered with, in an
appropriate case, by the High Court under Article 226. (See,
Ramesh Chandra Sankla and other v. Vikram Cement
and other, reported in (2008) 14 SCC 58).”
49. It is of immense importance to note that
the nomenclature, as mentioned in an application, as to
whether the application is under Article 227 or Article 226, is
not final. What is relevant is the power, which is sought to
invoked and the nature of power, which is, eventually,
exercised. No wonder, therefore, that in Rana Sinha @ Sujit
Sinha (supra), (in which one of us was a party), the Court
has, referring to the case of Pepsi Foods Ltd. Vs. Special
Judicial Magsitrate (AIR 1998 SC 128), pointed out that in
the case of Pepsi Foods Ltd. v. Special Judicial Magistrate
(AIR 1998 SC 128), too, the Supreme Court has made it
clear that "....nomenclature under which petition is filed is not Patna High Court LPA No.1841 of 2016 dt.28-10-2016
31/57
quite relevant and that does not debar the court from
exercising its jurisdiction, which, otherwise, it possesses
unless there is special procedure prescribed, which procedure
is mandatory”.
50. If a judgment under appeal falls squarely
within the four corners of Article 227, an 'intra court' appeal
from such a judgment would not, under the rules of the High
Court, be maintainable. If, on the other hand, the petitioner
has invoked the jurisdiction of the High Court for issuing a writ
under Article 226, although Article 227, too, is mentioned,
and, principally, the judgment, appealed against, falls under
Article 226, the appeal would be maintainable. What is
important to be ascertained is the true nature of the order and
not what provisions have been mentioned, while passing the
order by a learned Single Judge. (See Ashok K. Jha and
other v. Garden Silk Mills Limited and another, reported
in (2009) 10 SCC 584. This apart, what must also be borne
in mind is that exercise of power, under Article 226 or even
under Article 227, depends upon what facts have been
brought on record or what has surfaced on record. If the facts
emerging, therefore, on record, warrant or justify invoking of
jurisdiction under Article 226 or 227, the Court must exercise
its appropriate jurisdiction and would not deny to a person the
relief, which he is, otherwise, entitled to receive, merely on Patna High Court LPA No.1841 of 2016 dt.28-10-2016
32/57
the ground that the relief, which the person is entitled to
receive, has not been sought for or correct constitutional
provisions have not been mentioned in the application.
51. In fact, in Ramesh Chandra Sankla
and Ors. v. Vikram Cement Ltd., reported in (2008) 14
SCC 58, it has been held that a statement, made by a learned
single Judge, that he has exercised power under Article 227,
cannot take away the right of appeal against such an order if
the power is, otherwise, found to have been exercised under,
or traceable to, Article 226. The vital factor for determination
of maintainability of an 'intra court' appeal, arising out of a
writ proceeding, is the nature of jurisdiction invoked by the
party, the true nature of order passed by a Single Judge and
the nature of relief, which a party may be entitled to.
52. Let us, now, take into account as to the
basics of the two powers. One of us had an occasion to deal
with the powers of the High Court under Article 226 vis-à-vis
Article 227 of the Constitution of India, in Rana Sinha @
Sujit Sinha Vs State of Tripura, reported in (2011) 2 GLT
610, and pointed out that the question of issuance of writ of
certiorari, in an appropriate case, is not circumscribed and is
available provided the situation so demands. However, the
supervisory jurisdiction, under Article 227 of the Constitution
of India, has its own limitations. This power cannot be Patna High Court LPA No.1841 of 2016 dt.28-10-2016
33/57
exercised as a Court of appeal, but only with a view to keeping
the subordinate court within the bounds of law so that there is
adherence to the prescribed law. Supervisory jurisdiction has
its own limitations, which, otherwise, are not found in the case
of invoking of extra-ordinary jurisdiction available under
Article 226 of the Constitution of India.
53. What crystallizes from the above discussion
is that a statement, made by a learned single Judge or the
applicant that he has exercised or invoked the power under
Article 227, cannot take away the right of appeal against such
an order if the power is, otherwise, found to have been
exercised under, or traceable to, Article 226. The vital factor
for determination of maintainability of an 'intra court' appeal,
arising out of a writ proceeding, is the nature of jurisdiction
invoked by the party, the true nature of order passed by a
Single Judge and the nature of relief, which a party may be
entitled to.
54. The discussions undertaken so far lead us
to following conclusions;
a) That the principal civil court, while exercising
powers under Section 34 of the Arbitration and Conciliation
Act, 1996, is not a Court of civil judicature; rather, it only a
tribunal with the trappings of Court.
b)Orders of the judicial courts stand on a Patna High Court LPA No.1841 of 2016 dt.28-10-2016
34/57
different footing from the quasi-judicial orders of authorities
or tribunals.
c) A writ of certiorari can be issued, under
Article 226, in grave cases, where the subordinate tribunals or
bodies or officers act wholly without jurisdiction, or in excess
of it, or in violation of the principles of natural justice, or
refuse to exercise a jurisdiction vested in them, or there is an
error apparent on the face of the record, and such act,
omission, error, or excess has resulted in manifest injustice.
d)A statement, made by a learned single Judge
or the applicant that he has exercised or invoked power under
Article 227, cannot take away the right of appeal against such
an order if the power is, otherwise, found to have been
exercised under, or traceable to, Article 226. The vital factor
for determination of maintainability of an 'intra court' appeal,
arising out of a writ proceeding, is the nature of jurisdiction
invoked by the party, the true nature of order passed by a
Single Judge and the nature of relief, which a party may be
entitled to.
55. Thus, in the present case, as would be
seen from the averments made in the original application, the
appellant approached the Court stating that a mandatory
provision of law, as contained in the Arbitration and
Conciliation Act, 1996, has not been complied with by the Patna High Court LPA No.1841 of 2016 dt.28-10-2016
35/57
principal Civil Court, which is in the context of the facts of the
present case, is a tribunal or court, but not a civil court of
ordinary jurisdiction.
56. The application, in the present case, was,
thus, in essence, an application under Article 226 and not
under Article 227. We, have, therefore no hesitation in holding
that the present intra Court appeal is maintainable.
WHETHER THE PROVISIONS OF SECTION 34(5) ARE
MANDATORY OR DIRECTORY
57. Before proceeding to look into the rival
arguments with regard to the correctness of the order passed
by learned District Judge, it is apposite to refer to what has
been observed by the Law Commissions of India, while
amending Section 34 and 48 of the 1996 Act. Law
Commission, in its 246th Report, at paragraph 25, has
reported as follows:
“25. Similarly, the
Commission has found that challenges to
arbitration awards under sections 34 and
48 are similarly kept pending for many
years. In this context, the Commission
proposes the addition of sections 34 (5)
and 48 (4) which would require that an
application under those sections shall be
disposed off expeditiously and in any
event within a period of one year from the Patna High Court LPA No.1841 of 2016 dt.28-10-2016
36/57
date of service of notice. In the case of
applications under section 48 of the Act,
the Commission has further provided a
time limit under section 48 (3), which
mirrors the time limits set out in section
34 (3), and is aimed at ensuring that
parties take their remedies under this
section seriously and approach a judicial
forum expeditiously, and not by way of an
afterthought. In addition, a new
Explanation has been proposed to section
23 of the Act in order to ensure that
counter claims and set off can be
adjudicated upon by an arbitrator without
seeking a separate/new reference by the
respondent, provided that the same falls
within the scope of the arbitration
agreement. The Commission has also
recommended mandatory disclosures by
the prospective arbitrators in relation to
their ability to devote sufficient time to
complete the arbitration and render the
award expeditiously.”
58. It is worth noting that the amendment to
Section 34(5) of 1996 Act finds reference, at paragraph 25, in
the 246th Report of the Law Commission, which has been
brought in as Section 35(6) of 1996 Act. The original proposed
amendment to Section 34(4) was, ultimately, brought in the
1996 Act by way of Section 34(5). Things would get clearer Patna High Court LPA No.1841 of 2016 dt.28-10-2016
37/57
once both the amended Sections 34(5) and (6) of 1996 Act,
are reproduced hereinbelow:
“Sec 34
(1) xx xx xx
(2) xx xx xx
(3) xx xx xx
(4) xx xx xx
(5) An application under this section shall
be filed by a party only after issuing a
prior notice to the other party and such
application shall be accompanied by an
affidavit by the applicant endorsing
compliance with the said requirement.
(6) An application under this section shall
be disposed of expeditiously, and in any
event, within a period of one year from
the date on which the notice referred to in
sub-section (5) is served upon the other
party.”
59. Both the above amendments came to be
inserted, in the 1996 Act, by the Arbitration and Conciliation
(Amendment) Act, 2015, with effect from 23.10.2015. The
purpose, as is discernible, for bringing the above
amendments, is to shorten the period of litigation post arbitral
proceeding. The challenge to an award should not protract to
an indefinite period of time. The life of such a challenge should
be controlled and a definite time-frame has been formulated
to bring closure to the challenge to an arbitral award. The Patna High Court LPA No.1841 of 2016 dt.28-10-2016
38/57
246th Report of the Law Commissions of India is explicit as to
the objective behind the amendment.
60. As would be noticed the intendment, under
Section 34 (5), is to provide a life span to the adjudication of
validity of an award made by the Arbitrator. In other words,
the date of 1 (one) year period shall be computed from the
date of service of notice. Hence, if there is a delay in service
of notice, the period of 1 (one) year span automatically gets
extended since such a period is to be computed from the date
of service of notice under Section 34(5).
61. In order to ascertain whether the provisions
of Section 34(5) are mandatory or directory, there are two
words in the expression “shall be filed by a party only after
issuing a prior notice” needs to be interpreted. The words
“shall” and expression “only” have been subject matter of
interpretation in various judgments of Supreme Court.
62. Crawford on Statutory Construction 1940
Edn Article 261 which was quoted with approval in Govindlal
Chagganlal Patel v. Agricultural Produce Market
Committee, Godhra, reported in (1975) 2 SCC 482 and
relied on in this decision. The quotation reads as under:
“The question as to whether a
statute is mandatory or directory depends
upon the intent of the legislature and not
upon the language in which the intent is
clothed. The meaning and intention of the Patna High Court LPA No.1841 of 2016 dt.28-10-2016
39/57
legislature must govern, and these are to
be ascertained, not only from the
phraseology of the provision, but also
while considering its nature, its design,
and the consequences which would follow
from construing it the one way or the
other.”
63. It is well settled proposition of law that no
universal rule can be formulated as to whether an enactment
shall be considered directory or mandatory except that
language alone most often is not decisive, and regard must
be had to the context, subject-matter and object of the
statutory provision, in question, in determining whether it is
mandatory or directory. In an oft-quoted passage, Lord
Campbell said "No universal rule can be laid down as to
whether mandatory enactments shall be considered directory
only or obligatory with an implied nullification for
disobedience. It is the duty of Courts of justice to try to get at
the real intention of the legislature by carefully attending to
the whole scope of the statute to be considered". Therefore
the question, as to whether the statute is mandatory or
directory, depends upon the intent of the legislature and not
upon the language in which the intent is clothed. The meaning
and intention of the legislature must govern and these are to
be ascertained not only from the phraseology of the provision,
but also by considering its nature, its design, and the Patna High Court LPA No.1841 of 2016 dt.28-10-2016
40/57
consequences, which would follow from construing it one way
or the other.
64. We are reminded of a decision of the
Supreme Court, in Raza Buland Sugar Co. Ltd. v.
Municipal Board, (AIR 1965 SC 895), wherein the
Supreme Court had considered the question, as to
whether Section 135(3) read with Section 94(3) of the U.P.
Municipalities Act, was mandatory or directory. The facts were
that Rampur Municipality, by a special resolution, proposed to
levy property tax on persons or a class of persons. Section
131(3) required that the Board shall pass a resolution and
have it published in the manner prescribed in Section 94 of
such proposed tax. Section 135(3) declared that a notification
of the imposition of the tax, under sub-Section (2) thereof,
shall be conclusive proof that the tax has been imposed in
accordance with the provisions of the Act. Under Section
94(3), every resolution, passed by the Board, shall be
published in a local Hindi newspaper or in its absence by
general or special order as may be directed by the State
Government. The Municipality had contended that it had
followed that procedure. The appellants contended that there
was infraction in that behalf. While considering that question,
per majority, the Supreme held, in Raza Buland Sugar Co.
Ltd. (supra), as follows:
"The question whether a Patna High Court LPA No.1841 of 2016 dt.28-10-2016
41/57
particular provision of a statute was
mandatory or directory cannot be
resolved by laying down any general Rule
and it should depend upon the facts
of each case and for that purpose the
object of the statute in working out
the provision is a determining factor.
The purpose for which the provision has
been made and its nature, the intention
of the legislature in making the provision,
the serious genera! inconvenience or
injustice to persons resulting from the
provision or other provisions dealing with
the same subject and other
considerations which may rise on the
facts of a particular case including the
language of the provision, have all to be
taken into account in arriving at the
conclusion whether a particular provision
is mandatory or directory."
(Emphasis is added)
65. After exhaustive consideration of the
subject, the Supreme Court held, in Raza Buland Sugar Co.
Ltd. (supra), that though there was a technical defect
inasmuch as the local paper, in which the publication had been
made, was in Urdu and not in Hindi, there was substantial
compliance and it was held to be directory and the tax
imposed was upheld.
66. Mr. Giri, learned senior counsel for the Patna High Court LPA No.1841 of 2016 dt.28-10-2016
42/57
appellant, has relied upon the decision of the Supreme Court,
in Bihari Choudhary and Anr. v. The State of Bihar and
Ors., reported in (1984) 2 SCC 627, to boost his argument
that if a provision directs for doing a particular thing in a
particular way, the same needs to be done in that way only
and no variation in doing of thing can be condoned and
accepted. The case relates to a suit with prayer for relief of
declaration of title and for delivery of possession of the
property with mesne profits sought against the State of Bihar.
The plaintiffs, in that suit, had issued a notice, under Section
80 of the Code of Civil Procedure, prior to the institution of the
suit, but filed the suit before the expiration of the statutory
period of two months. The State of Bihar took a plea in that
respect. The learned Munsif dismissed the suit, finding the
statutory notice defective. The want of proper notice was
upheld by both the first appellate court as well as by the
second appellate court, i.e., by the High Court of Patna. The
matter was carried, in appeal, before the Supreme Court and
the Supreme Court has, in Bihari Choudhary (supra), held,
at paragraph Nos. 4 and 6, as follows:
“4. When the language used in
the Statute is clear and unambiguous, it is
the plain duty of the Court to give effect
to it and considerations of hardship will
not be a legitimate ground for not
faithfully implementing the mandate of Patna High Court LPA No.1841 of 2016 dt.28-10-2016
43/57
the legislature.
5. xx xx xx
6. It must now be regarded as
settled law that a suit against the
Government or a public officer, to which
the requirement of a prior notice under
Section 80, C. P. C. is attracted cannot be
validly instituted until the expiration of
the period of two months next after the
notice in writing has been delivered to the
authorities concerned in the manner
prescribed for in the section and if filed
before the expiry of the said period, the
suit has to be dismissed as not
maintainable.”
67. Before the impact of the decision, in Bihari
Choudhary (supra), is considered, a reference to yet another
decision of the Supreme Court, in Kailash v. Nanhku and
Others, reported in (2005) 4 SCC 480, would not be out of
place to mention herein. The learned single Judge has relied
on the said judgment in support of his conclusion that the
provisions of Section 34(5) of the 1996 Act are not
mandatory, but a directory one. The Supreme Court had, in
Kailash (supra), the occasion to consider and interpret the
time period prescribed for submission of a written statement
by the defendants, in a civil suit, under the amended proviso
to Order 8, Rule 1 of the Code of Civil Procedure. The Patna High Court LPA No.1841 of 2016 dt.28-10-2016
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Supreme Court had held the time limit prescribed, under
Order 8, Rule 1, as directory.
68. The Supreme Court has, while dealing with
somewhat similar provision, contained in Section 13(2) of the
Consumer Protection Act, fixing the time period for submission
of the written statements, in Topline Shoes Ltd. v
Corporation Bank, reported in (2002) 6 SCC 33, had held
the same to be directory. The Supreme Court has, upon
considering the Statement of Objects and Reasons of the said
Act, at paragraph Nos. 8, 9 and 13, in Topline Shoes Ltd.
(supra), held as under:
“8. The Statement of Objects
and Reasons of the Consumer Protection
Act, 1986 indicates that it has been
enacted to promote and protect the rights
and interests of consumers and to provide
them speedy and simple redressal of their
grievances. Hence, quasi-judicial
machinery has been set up for the
purpose, at different levels. These quasijudicial
bodies have to observe the
principles of natural justice as per clause
(4) of the Statement of Objects and
Reasons. Which reads as under:
"To provide speedy and
simple redressal to consumer disputes,
quasi-judicial machinery is sought to
be set up at the district, State and
Central levels. These quasi-judicial Patna High Court LPA No.1841 of 2016 dt.28-10-2016
45/57
bodies will observe the principles of
natural justice and have been
empowered to given relief of a specific
nature and to award, wherever
appropriate, compensation to
consumers. Penalties for
noncompliance of the orders given by
the quasi-judicial bodies have also
been provided."
(emphasis supplied)
9. Thus the intention to
provide a time frame to file reply, is really
meant to expedite the hearing of such
matters and to avoid unnecessary
adjournments to linger on the proceedings
on the pretext of filing reply. The provision
however, as framed, does not indicate
that it is mandatory in nature. In case the
extended time exceeds 15 days, no penal
consequences are prescribed therefor. The
period of extension of time "not exceeding
15 days," does not prescribe any kind of
period of limitation. The provision appears
to be directory in nature, which the
consumer forums are ordinarily supposed
to apply, in the proceedings before them.
We do not find force in the submission
made by the appellant, in person, that in
no event, whatsoever, the reply of the
respondent could be taken on record
beyond the period of 45 days. The
provision is more by way of procedure to
achieve the object of speedy disposal of Patna High Court LPA No.1841 of 2016 dt.28-10-2016
46/57
such disputes. It is an expression of
"desirability" in strong terms. But it falls
short of creating of any kind of
substantive right in favour of the
complainant by reason of which the
respondent may be debarred from placing
his version in defence in any
circumstances whatsoever. It is for the
Forum or the Commission to consider all
facts and circumstances along with the
provisions of the Act providing time frame
to file reply, as a guideline, and then to
exercise its discretion as best it may serve
the ends of justice and achieve the object
of speedy disposal of such cases -keeping
in mind principles of natural justice as
well. The Forum may refuse to extend
time beyond 15 days, in view of Section
13(2) (a) of the Act but exceeding the
period of 15 days of extension, would not
cause any fatal illegality in the order.
10. xx xx xx
11. xx xx xx
12. xx xx xx
13. We have already noticed
that the provisions as contained under
Clause (a) of Sub-section (2) of Section
13 is procedural in nature. It is, also clear
that with a view to achieve the object of
the enactment, that there may be speedy
disposal of such cases, that it has been
provided that reply is to be filed within 30
days and the extension of time may not Patna High Court LPA No.1841 of 2016 dt.28-10-2016
47/57
exceed 15 days. This provision envisages
that proceedings may not be prolonged for
a very long time without the opposite
party having filed his reply. No penal
consequences have however been
provided in case extension of time
exceeds 15 days. Therefore, it could not
be said that any substantive right accrued
in favour of the appellant or there was any
kind of bar of limitation in filing of the
reply within extended time though beyond
45 days in all. The reply is not necessarily
to be rejected. All facts and circumstances
of the case must be taken into account.
The Statement of Objects and
Reasons of the Act also provides that
the principles of natural justice have
also to be kept in mind.”
(Emphasis is supplied)
69. Coming now to the expression “only” in
Saru Smelting (P) Ltd. v. CST, reported in 1993 Supp (3)
SCC 97, the question before the Supreme Court was
regarding interpretation of entry under the U.P. Sales Tax Act
for the purpose of taxation and whether the goods prepared
by the appellant falls within the particular entry or not. The
entry provided that if the goods are prepared by using
copper, tin, nickel or zinc or any other alloy containing any of
these metals only the tax would be assessed at 1% else the Patna High Court LPA No.1841 of 2016 dt.28-10-2016
48/57
tax would be 3.5 per cent. The Supreme Court, in Saru
Smelting (P) Ltd. (supra), held that the expression “only” is
very material for understanding the meaning of the entry.
Since the alloy, in dispute, contains Phosphorous, may be in a
very small quantity, it cannot fall within Entry 2(a) of the
aforesaid Notification.
70. It could be understood from the decision,
in Saru Smelting (P) Ltd. (supra), that Supreme Court
interpreted the expression “only” as conveying exclusivity. In
other words as opposed to the doctrine of ejusdem generis,
the expression “only” limits the implantation of the provision
in the manner indicated and admits no other exception.
71. One may point out that the dictionary
meaning of the word „only‟ is 'no other'. The word „only‟ is
used for the purpose of conveying exclusive nature of the
power exercisable by a person or authority. That the use of
the word „only‟, in legislation, reflects exclusiveness is a
judicially recognized fact.
72. One may, with regard to the above, readily
refer to Hari Ram v. Babu Gokul Prasad (AIR 1991 SC
427), wherein Section 166 of Madhya Pradesh Land Revenue
Code, 1954, came up for interpretation. Section 166 of the
Code of Madhya Pradesh Land Revenue Code read,
"166. Any person who holds
land for agricultural purposes from a Patna High Court LPA No.1841 of 2016 dt.28-10-2016
49/57
tenure holder and who is not an
occupancy tenant under Section 169 or
as protected lessee under the Berar
Regulation of Agricultural Leases Act,
1951, shall be ordinary tenant of such
land.
Explanation section - For the
purposes of this
(i) any person who pays lease
money in respect of any land in the form
of crop share shall be deemed to hold
such land;
(ii) any person who cultivates
land in partnership with the tenure holder
shall not be deemed to hold such land;
(iii) any person to whom only
the right to cut grass or to graze cattle or
to grow Singhara (Trapa bispinosa) or to
propagate or collect lac is granted in any
land shall not be deemed to hold such
land for agricultural purposes.”
73. In Hari Ram (supra), Section 166 showed
that any person, who holds land for agricultural purposes
from a tenure holder and who is not an occupancy tenant
under Section 169 or is not a protected lessee under the
Berar Regulation of Agricultural Leases Act, 1951, shall be
ordinary tenant of such a land. Answering the question as to
whether a person, who has a mere right to cut grass or to
graze cattle or to grow singhara (Trapa bispinosa) or to Patna High Court LPA No.1841 of 2016 dt.28-10-2016
50/57
propagate or collect tax, shall be deemed to hold such a land
for agricultural purposes, the Supreme Court observed, "The
word „only‟ in Explanation (ii) is significant. It postulates that
entire land should have been used for the purposes
enumerated. If part of the land was used for cultivation, then,
the land could not be deemed to have been granted for
cutting grass only. It has been found that out of 5 and odd
acres of land, 2 acres of land was under cultivation.
Therefore, the negative clause in Explanation (iii) did not
apply and the appellant became ordinary tenant under
Section 166."
74. The decision, in Hari Ram (supra), makes
it clear that the use of the word „only‟ reflects exclusiveness
and conveys negativity of the power meaning thereby that
had a case, under the new Code, not been made over for trial
to an Additional or Assistant Sessions Judge by the Sessions
Judge "of the division or had the State Government not
directed a case to be tried by an Additional or Assistant
Sessions Judge, such a Judge derived no jurisdiction to try
such a case, under the old Code, as a Court of Session, for
Sub-section (2) of Section 193 used the word „only‟.
75. Let us, now, turn to the case Bhatia
International v. Bulk Trading S.A., reported in (2002) 2
SCR 411, wherein a three Judge Bench considered the effect Patna High Court LPA No.1841 of 2016 dt.28-10-2016
51/57
of the omission of the word „only‟ used in the UNCITRAL
Model Law. Article 1(2) of the UNCITRAL Model Law reads,
“The provisions of this law, except Articles 8, 9, 35 and 36,
apply only if the place of arbitration is in the territory of this
State. As against what Section 1(2) aforementioned reads,
Sub-section (2) of Section 2 of the Arbitration and Conciliation
Act, 1996 states, "This part shall apply where the place of
arbitration is in India."
76. From a bare reading of Section 1(2) of the
UNCITRAL vis-à-vis Section 2(2) of the Arbitration and
Conciliation Act, 1996, it becomes transparent that in Subsection
(2) of the Arbitration and Conciliation Act, 1996, the
word „only‟ stands omitted. It was contended, in Bhatia
International (supra), that India had purposely not adopted
Article 1 (2), as a whole, of Article 1(2) of UNCITRAL Model
Law and, hence, Section 9 would not apply to arbitral
proceedings, which took place outside India. Reacting to the
submissions so made, the Supreme Court observed and held,
"Thus Article 1(2) of the UNCITRAL Model Law uses the word
“only” to emphasize that the provisions of that law are to
apply if the place of Arbitration is in the territory of that
State. Significantly, in Section 2(2) the word „only‟ has been
omitted. The omission of this word changes the whole
complexion of the sentence. The omission of the word “only”Patna High Court LPA No.1841 of 2016 dt.28-10-2016
52/57
in Section 2(2) indicates that this sub-section is only an
inclusive and clarificatory provision. As stated above, it is not
providing that provisions of Part I do not apply to arbitrations
which take place outside India. Thus there was no necessity
of separately providing that Section 9 would apply.
77. The observations made above, in Bhatia
International (supra), clearly show that the omission of the
word „only‟, in sub-section (2) of Section 2, was treated by
the Supreme Court to have changed the whole complexion of
the sentence. The Supreme Court accordingly pointed out, in
Bhatia International (supra), that with the omission of the
word „only‟, the provisions of Sub-section (2) of Section 2 had
become inclusive and clarificatory and had not, therefore,
retained its exclusive characteristic.
78. It would be seen that whereas the
expression “shall” has been held to be an expression of
slippery semantics and does not convey with precision
whether the provisions of Section 34(5) are mandatory or
directory, the use of expression “only”, when applied with the
expression “shall”, shows that the legislature, with an
intention to provide a definite life span to the proceedings
under Section 34, intended to convey that henceforth, no
notice needs to be issued at the instance of principal civil
Court; rather, the notice is to be issued by the party himself Patna High Court LPA No.1841 of 2016 dt.28-10-2016
53/57
and only when the notice has been served, the application can
be filed in the principal civil Court so that the time spent in
serving notice, at the instance of the principal civil Court, is
saved and the litigation can be brought to an end at the
earliest possible time. If the provisions of Section 34(5) are
held to be directory, then, the service of notice may also be
done at the instance of principal civil Court, which would
mean that if in a given case, the notice is served after three
months, the length of litigation gets extended by three
months more than the period envisaged under Section 34(6).
79. It may be pointed out that Section 34(6)
also uses the expression “and in any event”. This means the
period of litigation, in no circumstances, should exceed 1
(one) year. If the contrary view is adopted, then, the entire
purpose of amendment would be rendered otiose.
80. Coupled with the above, it can be seen that
the legislature intended to make Section 34(5) as a condition
precedent before an application can be taken up for hearing.
An analogy can be drawn with reference to Section 80 of Code
of Civil Procedure, which provides that save as otherwise
provided in sub-section (2), no suit shall be instituted against
the Government (including the Government of the State of
Jammu and Kashmir) or against a public officer in respect of
any act purporting to be done by such public officer in his 
official capacity, until the expiration of two months next after
notice in writing has been delivered to, or left at the office.
81. The Privy Council has held, in Bhagchand
Dagadusa v. Secretary of State, reported in (1927) LR
54 IA 338, that that the terms of Section 80 should be
strictly complied with. The ratio of Bhagchand Dagadusa
(supra) has been approved by the Supreme Court in the case
of Dhian Singh Sobha Singh v. Union of India (AIR 1958
SC 274)
82. The right to file an application in SubSection
(5) of Section 34 of the 1996 Act (since after the 2015
amendment), arises only when a notice has preceded and an
affidavit is filed in support of issuance of such notice. The
notice ought to have been issued prior to filing of the
application and the issuance of notice by the learned District
Judge cannot obviate the initial error. The right to proceed
with an application, under Section 34 of the 1996 Act,
presupposes the sending of a notice under Section 34 of the
1996 Act and, unless the same is issued, there cannot be an
inherent right to file the application and, if so filed, to
entertain the same by the Court before whom the same has
been filed. The present notice, correctly submitted by the
learned Counsel for the appellant, is akin to notice under
Section 80 of the Code of Civil Procedure. The object, behind 
the enactment of Section 34(5) of the 1996 Act, is solely to
expedite the process of disposal of the application within the
time-frame of one year, but the issuance of notice is a
condition precedent before exercising right to challenging an
award. The right is unavailable if the notice has not been
issued. This is what emanates from a plain reading of Section
34(5) of the 1996 Act. The 246th Report of the Law
Commission of India, at least, indicates the desirability of
adjudication of the dispute expeditiously and sub-Section (6)
of Section 34 of the 1996 Act clearly supports the same. This
objective cannot be said to be achieved if the party,
challenging the award, for any reason, does not issue notice
prior to filing of the application. Once the objective behind the
amendment is taken into account, the decisions, relied upon
by the learned Counsel for the appellant, are not found
misplaced. Unless a notice under Section 80 of the Code of
Civil Procedure with sufficient time of two months are served
on the Government or its officials, as contemplated, there is
no inherent right to file a suit against the Government; so is
the case at hand. Unless there is compliance with the
statutory need of sending a prior notice, there is no inherent
right of filing the application, under Section 34 of the 1996
Act, challenging an award. If there is no right to initiate a
proceeding, its continuation, if filed, ignoring the statutory
provision, does not give right to its continuation. It cannot be
regularized by subsequent issuance of notice by the learned
Court below. The notice, as prescribed by Section 34 of the
1996 Act, is mandatory before proceeding with the filing of an
application under Section 34 of the 1996 Act.
83. Viewed from another aspect, a party may
be prevented for divergent reasons from filing its written
statement in time. The reasoning, once put forwarded, and
the court finds the same as exceptional, there is ground for
accepting the written statement even when the same is found
to have been filed beyond the time prescribed under the law.
Here, the same analogy does not fit in or can be applied. The
State has not cited any exceptional reasons. In fact, no reason
has been cited, at all, for not having issued the notice prior to
challenging the award under Section 34 of the 1996 Act.
Issuance of a previous notice and filing of an affidavit cannot
be claimed to be prevented under any situation. The
requirement is simple and can always be followed.
84. Now, turning to the next question as to
whether the present appeal is maintainable and whether the
original petition was under Article 227 or 226 of the
Constitution of India, it may be pointed out that since the
filing of the proceeding under Section 34 of the 1996 Act
before the learned District Judge is against the statute, the 
subsequent order, dated 18.07.2016, cannot cure the initial
illegality. As it has already been held hereinabove that the
Court of the learned District Judge does not exercise
jurisdiction of a regular civil court but is a Court of limited
jurisdiction, the challenge to the order, dated 18.07.2016, was
basically under Article 226 of the Constitution of India and the
order passed by learned single Judge, dated 06.09.2016, was,
indeed, in exercise of the Article 226 of the Constitution of
India, which is appealable under Letters Patent Appeal.
85. The present letters patent appeal is,
therefore, maintainable.
86. In the result, the appeal stands allowed.
However, there shall be not order as to cost.
 (I. A. Ansari, CJ.)
Dr. Ravi Ranjan, J. :
Pawan/-
I agree.
(Dr. Ravi Ranjan, J.)
AFR/NAFR AFR
CAV DATE 05.10.2016

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