Sunday 17 September 2017

Whether appeal is maintainable against order of rejection of amendment application to arbitration petition?


As reference is made to the above, which no where take into consideration a situation like this and so also the judgment. The Arbitration Petition under Section 34 to set aside an Arbitral Award is still pending. Merely because one or two grounds not permitted to be added, by rejecting the application that itself in no way can be stated to be the refusal to set aside the Arbitral Award.
9. The positive law, so far as contention under Section 37 is concerned, is very clear that it is maintainable against setting aside and/or refusing to set aside an Arbitral Award. In the present case, the rejection of the amendment application, in no way, can be stated to be concluding Section 34 petition finally.
10. The learned Judge, after considering the rival submissions, at the final stage of the arbitration petition, may set aside and/or refuse to set aside the Award. The Appeal against such orders under Section 37 is maintainable. However, rejection of such amendment application and/or refusing to permit to raise additional grounds, that itself can not be stated to be order, as contemplated under Section 37(c), against which Appeal, is maintainable. Against the rejection of amendment application, in view of plain reading of Section 37, the appeal itself is not maintainable. However, this in no way read and refer to mean that the Appellant has no remedy whatsoever to challenge and/or agitate the grounds, so raised in the Appeal.
In the High Court of Bombay
Ordinary Original Civil Jurisdiction
(Before Anoop V. Mohta and P.R. Bora, JJ.)
Messrs. Raghuvir Cotton Ginning & Pressing Pvt. Ltd.
v.
Messrs. Vijay Cotton & Fibre Co.
Appeal (L) No. 465 of 2006
In
Chamber Summons (L) No. 1977 of 2016
In
Arbitration Petition No. 507 of 2016
Decided on January 11, 2017
Citation; 2017 SCC OnLine Bom 76,2017(5) MHLJ 352

The Judgment of the Court was delivered by
Anoop V. Mohta, J.:— Heard finally, by consent of the parties.
2. The Appellant has filed the present Appeal under Section 37 of the Arbitration and Conciliation (Amendment) Act, 2015, (for short, “The Arbitration (Amendment) Act”.) whereby, the challenge is raised to order dated 6th October 2016, passed by the learned Single Judge, whereby the Chamber Summons for amendments to the Arbitration Petition filed under section 34 of the Arbitration Act, was rejected. The main Petition is pending for final adjudication.
3. A preliminary objection raised by the learned Counsel appearing for the Respondent referring to Section 37 of Arbitration (Amendment) Act and submitted that under the scheme, except the grounds/reasons so mentioned, no such Appeal is maintainable.
4. The learned Counsel appearing for the Appellant relied upon the Supreme Court Judgment in case of State of Maharashtra v. Hindustan Construction Company Limited1, whereby while dealing with the aspect of amendment to add the additional grounds within prescribed period, in application under section 34 and/or memo of Appeal under section 37, the Supreme Court has observed as under:
“Whether incorporation of additional grounds by way of amendment in the application under Section 34 tantamounts to filing a fresh application in all situations and circumstances. If that were to be treated so, it would follow that no amendment in the application for setting aside the award howsoever material or relevant it may be for consideration by the court can be added nor existing ground amended after the prescribed period of limitation has expired although the application for setting aside the arbitral award has been made in time. This is not and could not have been the intention of the legislature while enacting Section 34.”
5. And therefore, submission is made that though Section 37 is silent with this regard, in view of above observations of the Supreme Court about this Section itself, the appeal is maintainable and as the amendment ought to have been allowed to add the grounds.
6. The Arbitration Act and its effect on Arbitration proceedings, is settled. It is required to be considered in the background of the clear provisions of the Arbitration Act. Section 37 clause (c) of the Arbitration Act as relevant, is reproduced as under—
“Section 37 clause (c) - Setting aside or refusing to set aside an arbitral award under Section 34.”
7. The Appeal in High Court is available only if the order falls within the ambit of clauses of Section 37, and not otherwise.
8. As reference is made to the above, which no where take into consideration a situation like this and so also the judgment. The Arbitration Petition under Section 34 to set aside an Arbitral Award is still pending. Merely because one or two grounds not permitted to be added, by rejecting the application that itself in no way can be stated to be the refusal to set aside the Arbitral Award.
9. The positive law, so far as contention under Section 37 is concerned, is very clear that it is maintainable against setting aside and/or refusing to set aside an Arbitral Award. In the present case, the rejection of the amendment application, in no way, can be stated to be concluding Section 34 petition finally.
10. The learned Judge, after considering the rival submissions, at the final stage of the arbitration petition, may set aside and/or refuse to set aside the Award. The Appeal against such orders under Section 37 is maintainable. However, rejection of such amendment application and/or refusing to permit to raise additional grounds, that itself can not be stated to be order, as contemplated under Section 37(c), against which Appeal, is maintainable. Against the rejection of amendment application, in view of plain reading of Section 37, the appeal itself is not maintainable. However, this in no way read and refer to mean that the Appellant has no remedy whatsoever to challenge and/or agitate the grounds, so raised in the Appeal.
11. In view of the impugned order/supporting reasons so passed and considering the totality of the scheme of the Arbitration Act and as there is no remedy available specifically the Appeal, as contemplated under Section 37 against such order of rejection of amendment application, we are of the view that the Petitioner is entitled to agitate the issues and grounds as and when the situation comes and/or the law permits to agitate the same. We are inclined to observe that the grounds so agitated, as stated, go to the root of the matter and if it is not allowed to agitate at this stage, as the main Arbitration Petition itself is pending for final hearing, it would cause injustice and hardship to the Appellant. The Appellant is at liberty to raise the issue in accordance with law, as the parties cannot be rendered remediless.
12. In view of the specific provisions, if the final order is passed, revolving around those ground/rejected reasons, we are inclined to accept the preliminary objection raised that the Appeal under Section 37 against the order of rejection of amendment to Section 34 application, is not maintainable.
13. The Appeal is disposed of accordingly, with above observations. No costs.
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