[1] IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL NO.77 OF 2007 IN ARBITRATION PETITION NO.409 OF 2006 AND APPEAL NO.78 OF 2007 IN ARBITRATION PETITION NO.410 OF 2006 [ENTITY], a Public Sector Undertaking incorporated under the [ACT], having its registered office at Jeevan Bharti Tower-II, Connaught Circus, New Delhi - 100 001 and Mumbai Regional Business Centre Office at NSE Plaza, 1st Floor, "A" Wing, Bandra Kurla Complex, Bandra (E), Mumbai-400 051. - Versus - Appellants [ENTITY], a company incorporated under the [ACT], having their registered office at 1207, Vikram Towers, 16m Rajendra Place, New Delhi 110 008. Respondents [ENTITY], Senior Counsel a/w [ENTITY] i/b M/s. Dhruva & Co. for the Appellants. And [ENTITY] a/w [ENTITY] i/b M/s. Law Point for the Appellants. Sri [ENTITY] for the Respondents. Sri [ENTITY], Advocate General a/w Ms [ENTITY], AGP, on notice, for the State. Downloaded on - 09/06/2013 13:41:20 [2] CORAM: SRI [ENTITY] & SRI [ENTITY], JJ. DATED: AUGUST 13, 2008 ORDER (Per Sri [ENTITY], J.):
1. Heard. In both these appeals since common question of law is raised, they were heard together and are being disposed of by this common order.
2. The facts relevant for the decision on the point which is sought to be raised are that pursuant to the award passed by the learned arbitrator, the appellants filed arbitration petitions under [SECTION] of the [ACT], hereinafter called as "the New Act" and the said petitions came to be dismissed by the orders dated 9-10-2006. The appellants thereupon preferred the appeals against the said orders. The [CASE NUMBER] was admitted on 11-10-2007, leaving open the issue as to whether the appellants would be liable to pay the Court fee under [SECTION] and not under [SECTION] as is sought to be paid by the appellants. As far as the [CASE NUMBER] is concerned, the same is yet to be admitted. However, in both the appeals the issue regarding the liability to pay the Court fee has been raised and that is being considered under this order.
3. The respondents in both the appeals have raised preliminary objections about the non-maintainability of the appeals without payment of proper Court fee in terms of the provisions of law comprised under the [SECTION] read with [SECTION] of the [ACT], hereinafter called as "the [ACT]" in view of the decision of the Division Bench of this Court in the matter of Maharashtra Industries Development Corporation v. [ENTITY] Constructions Company, reported in 2007 (2) Bom.C.R. 835.
4. The appellants, on the other hand, referring to [SECTION] of the [ACT] contended that [SECTION] of the [ACT] clearly exempts the award under the New Act from the liability to pay the Court fee thereunder and, therefore, the provisions of law in that regard which would be attracted are comprised under the [SECTION] of the [ACT]. Hence, according to the appellants, there is no substance in the preliminary objection and the same is to be rejected.
5. The Division Bench of this Court to which one of us was a party (Sri [ENTITY], J.), in [ENTITY]'s case (supra) had clearly held that the appeals preferred under [SECTION] of the New Act should bear the Court fee in terms of [SECTION] of the [ACT] and not in terms of [SECTION] thereof. While arriving at the said finding, it was held that [SECTION] of the [ACT] excludes from its applicability the award passed under the [ACT], hereinafter called as "the Old Act", and further that after enactment of the New Act, which came into force from 22-8-1996, no amendment was made to [SECTION] of the [ACT] and the same continues to exclude from its applicability those awards which are passed under the Old Act, and not under the New Act.
Considering the same, it was held in [ENTITY]'s case that:
"the Award passed under the [ACT] is not excluded under [SECTION] and for the same reason, the said Article which specifically deals with the subject-matter of setting aside or modifying any award either at the original stage by filing an application or a petition in that regard, and also at the appellate stage by presenting memorandum of appeal, would naturally be applicable to all such proceedings.
Needless to say that the appeal is a continuation of the proceedings at the original stage. The provision under [SECTION] clearly speaks of plaint, application or petition including memorandum of appeal to set aside or modify any award. A memorandum of appeal to set aside or modify any award spoken of under [SECTION] is obviously in relation to an order passed on an application or a petition igto set aside or modify an award. The [ACT] nowhere provides any appeal against the award itself. On the
contrary, it specifically provides for a petition under [SECTION] for setting aside the arbitral award and [SECTION] entitles the aggrieved party to file an appeal against the order passed under [SECTION] either to set aside or to refuse to set aside the arbitral award. Once it is apparent that [SECTION] nowhere excludes from its applicability any award passed under any other statutes including the [ACT] and further it relates to a petition as well as an appeal to set aside or modify "any award", it would obviously include and award passed under the [ACT] or any order in relation thereto."
6. The contention on behalf of the appellants, however, is that [SECTION] of the [ACT] clearly provides that on repeal of the Old Act and on enactment of the New Act in its place, any reference to the Old Act in any other statute will have to be considered as reference to the provisions in the newly enacted Act.
Considering the same, while reading [SECTION], which refers to the Old Act, it should be read as if referring to the New Act and, therefore, the [SECTION] which reads that "Plaint, application or petition (including memorandum of appeal), to set aside or modify any award otherwise than under the [ACT]" should be read as "Plaint, application or petition (including memorandum of appeal), to set aside or modify any award otherwise than under the [ACT]"
and having so read, the applicability of the provisions of law comprised under [SECTION] would not arise. Referring to [SECTION] of the New Act, it was sought to be contended that inspite of repeal of the Old Act, the proceedings commenced under the Old Act have been saved. No intention is disclosed to save reference to the Old Act in various statutes and, therefore, it cannot be said that [SECTION] would not be attracted in the matter in hand. The expression "re-enactment" in [SECTION] cannot be narrowly construed to exclude reference to the New Act in [SECTION] of the [ACT].
7. The learned Advocate General, however, referring to [SECTION] of the [ACT] submitted that the said provision ig of law speaks of "repeal and re-enactment". The term "re-enactment" would imply a legislation not only with certain modifications on the same subject but it would be an enactment brought into force, though on the same subject, but based on different sources and with a totally different scheme.
According to the learned Advocate General, the fact that the New Act is totally different from the Old Act is well-settled pursuant to the decisions of the Apex Court in the matters of [PRECEDENT], [PRECEDENT], Konkan Railway Corpn.
Ltd. and others v. [PRECEDENT] Co., reported in (2000) 7 SCC 201 and [PRECEDENT].
Considering the scheme of the New Act being totally different from the Old Act, according to the learned Advocate General, the New Act cannot be said to be a re-enactment within the meaning of the said expression under [SECTION] of the [ACT] or [SECTION] of the [ACT] and, therefore, taking recourse to [SECTION] of the [ACT] or [SECTION] of the [ACT], [SECTION] of the [ACT] cannot be read to refer to the New Act in place of the Old Act.
8. The [SECTION] of the [ACT] provides that where the said Act, or any Central Act or Regulation made after the commencement of the said Act, repeals and re-enacts, with or without modification, any provision of a former enactment, then references in any other enactment or in any instrument to the provision so repealed shall, unless a different intention appears, be construed as references to the provisions so re-enacted.
Plain reading of the said provision, therefore, would undoubtedly disclose that as a result of repeal and re-enactment of a statute, any reference to any of the provisions in the repealed Act in any other enactment or any other instrument will have to be construed as referring to the corresponding provision in the re-enacted statute.
9. There is no dispute that the Old Act has been repealed. There is no dispute that what is saved under [SECTION] of the New Act are the proceedings which had commenced under the Old Act as well as all the notifications issued under the Old Act to the extent they are not repugnant to the provisions of law comprised under the New Act. The question, however, which arises is whether the New Act can be said to be a statute of the nature of re-enactment on repeal of the Old Act.
10. The Apex Court in Sundaram Finance' case (supra) clearly observed that prior to the promulgation of the New Act, the law on arbitration in India was substantially contained in three enactments, namely, the [ACT], the [ACT] and the [ACT]. It is further observed that in the Statement of Objects and Reasons appended to the Bill in respect of the New Act, it was stated that the Old Act which contained the general law or arbitration had become outdated. The said Objects and Reasons noticed that the United Nations Commission on International Trade Law ([ACT]) adopted in 1985 the Model Law on International Commercial Arbitration.
The General Assembly had recommended that all countries should give due consideration to the said Model Law which, along with the Rules, was stated to have harmonised concepts on arbitration and conciliation of different legal systems of the world and thus contained provisions which were designed for universal application. Having so observed, the Apex Court held that:
"The 1996 Act is very different from the [ACT]. The provisions of this Act have, therefore, to be interpreted and construed independently and in fact reference to the [ACT] may actually lead to misconstruction.
In other words, the provisions of the 1996 Act have to be interpreted being uninfluenced by the principles underlying the [ACT]. In order to
get help in construing these provisions, it is more relevant to refer to the [ACT] Model Law rather than the [ACT]."
The Apex Court thereafter has elaborately discussed the differentiation between two statutes.
11. In [PRECEDENT]'s case (supra), while dealing with the question about the intention of the Legislature in repealing the Old Act and enacting the New Act and bearing in mind the object of the New Act, the Apex Court while enumerating the difference between the provisions of law comprised under the New Act vis-a-vis the Old Act clearly held that:
"A bare comparison of different provisions of the [ACT] with the provisions of the [ACT] would unequivocally indicate that the 1996 Act limits intervention of court with an arbitral process to the minimum and it is certainly not the legislative intent that each and every order passed
by an authority under the Act would be a subject-matter of judicial scrutiny of a court of law."
The said view was reiterated by the Apex Court in [PRECEDENT]'s case (supra). In [PRECEDENT], and while highlighting the difference between the two enactments, it was pointed out that [SECTION] of the New Act is based on [SECTION] of the [ACT] Model Law.
12. In [PRECEDENT]'s case (supra), it was held that by virtue of [SECTION] of the New Act, recourse to the Court against an arbitral award can be had within the period prescribed. The importance of the period fixed under [SECTION] has been emphasised by the provisions of [SECTION] which provides that:
"Where the time for making an application to set aside the arbitral award under [SECTION] has expired the award shall be enforced under the [ACT] in the same manner as if it were a decree of the Court." Having so observed, it was further ruled by the Apex Court that: "This is a significant departure from the provisions of the [ACT]. Under the [ACT], after the
time to set aside the award expired, the court was required to "proceed to pronounce judgment according to the award, and upon the judgment so pronounced a decree shall follow"
([SECTION]). Now the consequence of the time expiring under [SECTION] of the 1996 Act is that the award becomes immediately enforceable without any further act of the court."
13. The above decisions of the Apex Court clearly lay down the law that the New Act is not a mere re-enactment of the Old Act. In fact, the very preamble of the New Act provides that whereas the United Nations Commission on International Trade Law has adopted the [ACT] Model Law on International Commercial Arbitration in 1985 and the General Assembly of the United Nations has recommended that all countries give due consideration to the said Model Law and in view of the desirability of uniformity of the law of arbitral procedures and the specific needs of international commercial arbitration practice, the [ACT] has adopted the [ACT] and the General Assembly of the United Nations has recommended the use of the said Rules in cases where a dispute arises in the context of international commercial relations and the parties seek an amicable settlement of that dispute by recourse to conciliation and the said Model Law and Rules make significant contribution to the establishment of a unified legal framework for the fair and efficient settlement of disputes arising in international commercial relations and it was, therefore, found expedient to make law respecting arbitration and conciliation, taking into account the aforesaid Model Law and Rules. The Statement of Objects and Reasons for the New Act clearly read thus:
"2. The United Nations Commission on International Trade Law ([ACT]) adopted in 1985 the Model Law on International Commercial Arbitration.
The General Assembly of the United Nations has recommended that all countries give due consideration to the said Model Law, in view of the
desirability of uniformity of the law of arbitral procedures and the specific needs of international commercial arbitration practice. The [ACT] also adopted in 1980 a set of Conciliation Rules. The General Assembly of the United Nations has recommended the use of these Rules in cases where the disputes arise in the context of international commercial relations and the parties seek amicable settlement of their disputes by recourse to conciliation. An important feature of the said [ACT] Model Law and Rules is that they have harmonised concepts on arbitration and conciliation of different legal systems of the world and thus contain provisions which are designed for universal application.
3. Though the said [ACT] Model Law and Rules are intended to deal with international commercial arbitration and conciliation, they could, with appropriate modifications, serve as a model for legislation on domestic arbitration ig and conciliation. The present Bill seeks to consolidate and amend the law relating to domestic arbitration, international commercial arbitration, enforcement of foreign arbitral awards and to define the law relating to conciliation, taking into account the said [ACT] Model Law and Rules."
14. The Apex Court having already considered and declared that the New Act is different from the Old Act, the contention that the New Act is a re-enactment within the meaning of the said expression under [SECTION] of the [ACT], cannot be accepted. The New Act has been enacted not merely by way of an amendment to the Old Act but the entire scheme of the New Act has been totally different and this has been elaborately discussed and clearly held by the Apex Court in the matters of Sundaram Finance, Finance [PRECEDENT] as well as in [PRECEDENT] and [PRECEDENT] (supra).
15. In the facts and circumstances as stated above, therefore, it is difficult to accept the contention on behalf of the appellants that [SECTION] of the [ACT] is required to be read as referring to the New Act in place of the Old Act consequent to enforcement of the New Act.
16. As rightly submitted on behalf of the respondents, all the aspects of the matter in relation to non-applicability of [SECTION] to the proceedings under the New Act has been elaborately discussed in [ENTITY]'s case by this Court and it was held that the Court fee payable on appeals arising out of the orders passed under [SECTION] of the New Act would be in accordance with [SECTION] read with [SECTION] thereof and not in terms of [SECTION]. The [SECTION] cannot be read as referring to the New Act and, therefore, any challenge either by way of petition or by way of an appeal to get the award set aside or modified passed under the New Act will have to carry the Court fee in terms of [SECTION] read with [SECTION] of the [ACT].
17. For the reasons stated above, therefore, the objection raised in this regard on behalf of the respondents is upheld. The appellants would be liable to pay the Court fee as has been held hereinabove.
Considering the provisions of [SECTION] of the [ACT], the time to pay the Court fee or the difference in Court fee is extended by four weeks, within which period the appellants will have to pay the Court fee, failing which the appeals shall stand dismissed for non-prosecution. On payment of the Court fee as above within the specified period, both the appeals shall be listed for further proceedings in accordance with law.
([ENTITY], J.) ([ENTITY], J.) sjs/raog77.7