Arbitration In IndiaArbitral Tribunal obligated to serve copy of the Award to parties

The Allahabad High Court, in Smt. Jasvinder Kaur V. National Highways Authority of India [ Neutral Citation No. – 2024:AHC:96873], held that the Arbitral Tribunal is obligated to serve certified copies of the Arbitral Award to the parties under Section 31(5) of the A&C Act. It was also held that the Arbitral Tribunal cannot pass a backdated Arbitral Award.

FACTS

The National Highways Authority of India (hereinafter referred to as “Respondent”) had issued a notification under Section 3A of the National Highways Act, 1956(hereinafter referred to as “NHAI Act”), followed by another notification under Section 3D on 17.06.2013.

Smt. Jasvinder Kaur (hereinafter referred to as the “Appellant”) filed an objection before the Competent Authority under NHAI Act seeking a higher compensation rate, which was rejected.

The Appellant preferred the dispute to Arbitration under Section 3G(5) of the NHAI Act.

The Arbitral Tribunal passed an  award on 31.01.2023, with a retroactive date of 11.10.2022 (hereinafter referred to as the “Impugned Award”).

. The Appellant challenged the Impugned Award under Section 34 of the Arbitration and Conciliation Act, 1996  (hereinafter referred to as “A&C Act”) before the Ld. District Judge in Rampur. However,  the Ld. District Judge dismissed the application vide order dated 07.02.2023 as it was time barred (hereinafter referred to as the “Impugned Order”).

Being aggrieved and dissatisfied by the Impugned Order, ,the Appellant has preferred the present appeal under Section 37 of the A&C Act.

ISSUE BEFORE THE ALLAHBAD HIGH COURT

Whether the Ld. District Judge was justified in dismissing the application under Section 34 of the A&C Act?

CONTENTIONS OF THE PARTIES

The Appellant submitted that the Ld. District Judge had failed to appreciate the date of receipt of the Impugned Award by the Appellant. Hence, in absence of any finding on the date of receipt of the Impugned Award, application under Section 34 of the A&C Act cannot be rendered to be time barred.

It was argued that the Impugned Order has been passed without considering the submissions of the Appellant. It was further contended that the application was merely dismissed without providing any finding.

It was also argued that the Respondent had failed to provide any documents on record to prove that the Impugned Award was passed on 11.10.2022 and not on 31.01.2013.

The Respondent contended that the Appellant was aware that the matter was fixed for orders on 11.10.2022. It was also submitted that the Appellant had applied for the certified copy of Impugned Award after period of 3 months which is  after the expiry of  limitation period under section 34(3) of the A&C Act.

It was further submitted that the Appellant was disinterested in perusing the proceedings and hence, the Ld. District Judge has rightly passed the Impugned Order.

DECISION AND FINDINGS

The Allahabad High Court observed provision of Section 31(5) of the A&C Act and relied upon Union of India -v- Tecco Trichy Engineers [ (2005) 4 SCC 239] and Dakshin Haryana Bijli Vitran Nigam Limited v. Navigant Technologies Private Limited reported in [(2021) 7 SCC 657] and held that it is mandatory duty of the Arbitral Tribunal to send a signed copy of the Arbitral Award to the parties to the Arbitration.

It was further observed that the limitation period for application under Section 34 of A&C Act commences only after the delivery of signed copies of the Arbitral Award to the parties. It was observed that the Arbitral Tribunal had failed to deliver the Impugned Award to the Appellant on 11.10.2022. It was  also observed that the Impugned Award was passed on 31.01.2023. Therefore, the limitation would not apply.

The High Court allowed the present appeal and set aside the Impugned Order. It was further directed to the Ld. District Judge to adjudicate the application under Section 34 of the A&C Act within a period of 6 months.

AMLEGALS REMARKS

The Allahabad High Court has upheld the legislative intent and objective of the A&C Act. The concept of fairness and clarity is the basis of any legal statue. The High Court has imposed the due upon the Arbitral Tribunal to deliver the copies of the Arbitral Award to both the parties. under Section 31(5) of the A&C Act. Moreover, the limitation period for challenging the Arbitral Award under Section 34 of the A&C Act commences after the delivery of Arbitral Award to both the parties.

– Team AMLEGALS assisted by Ms. Niharika Rawat (Intern)