Thursday, 18 October 2018

Whether court deciding petition U/S 34 of Arbitration Act has jurisdiction to remand the matter to arbitrator for fresh decision?

 In a Section 34 petition filed before the learned Single
Judge, the learned Single Judge found that the point of limitation
had not been decided correctly and, therefore, remanded the matter
to the Arbitrator in order that this point be decided afresh. He
also went on to add that a new Arbitrator would have to be
appointed in order to decide this afresh as he did not know about
the whereabouts of the original Arbitrator. From this, an Appeal
was preferred to the Division Bench, which, by the impugned
judgment dated 06.11.2017, dismissed the Appeal against the learned
Single Judge’s judgment.
2
5) This Court in a series of judgments culminating in Kinnari
Mullick and Another vs. Ghanshyam Das Damani, (2018) 11 SCC 328
held that the court while deciding a Section 34 petition has no
jurisdiction to remand the matter to the Arbitrator for a fresh
decision. It is, therefore, clear that the learned Single Judge’s
judgment is contrary to this judgment as a result of which both the
judgments of the Single Judge as well as the Division Bench have to
be set aside.
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 10386 OF 2018
(Arising out of SLP (C) No. 2334/2018)

RADHA CHEMICALS Vs  UNION OF INDIA 
Dated:October 10, 2018.

1) Leave granted.
2) Heard the learned Counsel appearing for the parties.
3) By an Award dated 28.02.2007, the Sole Arbitrator held that
limitation would not stand in the way of a decision on merits, as a
result of which an Award was made for a sum of Rs. 21,60,440/-
together with 12% interest.
4) In a Section 34 petition filed before the learned Single
Judge, the learned Single Judge found that the point of limitation
had not been decided correctly and, therefore, remanded the matter
to the Arbitrator in order that this point be decided afresh. He
also went on to add that a new Arbitrator would have to be
appointed in order to decide this afresh as he did not know about
the whereabouts of the original Arbitrator. From this, an Appeal
was preferred to the Division Bench, which, by the impugned
judgment dated 06.11.2017, dismissed the Appeal against the learned
Single Judge’s judgment.
2
5) This Court in a series of judgments culminating in Kinnari
Mullick and Another vs. Ghanshyam Das Damani, (2018) 11 SCC 328
held that the court while deciding a Section 34 petition has no
jurisdiction to remand the matter to the Arbitrator for a fresh
decision. It is, therefore, clear that the learned Single Judge’s
judgment is contrary to this judgment as a result of which both the
judgments of the Single Judge as well as the Division Bench have to
be set aside.
6) We, therefore, set aside both the judgments and relegate the
matter to the stage of the original Section 34 petition, which now
has to be heard, on its merits in accordance with the parameters
laid down by this Court for decision under Section 34 of the
Arbitration and Conciliation Act, 1996.
7) Accordingly, we remand the matter to the Single Judge, who is
requested to take up the matter and decide the same at the earliest
considering that the Award in this case has been passed over ten
years ago.
8) The Appeal is allowed in the aforesaid terms.
.......................... J.
(ROHINTON FALI NARIMAN)
.......................... J.
(NAVIN SINHA)
New Delhi;
October 10, 2018.

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