1 INTHECOURTOFSH.[ENTITY],ADJ04,SOUTH DISTRICT,SAKETCOURT,NEWDELHI Civil Suit No. 20599/16 Mukesh Sethi & Ors. Vs. M/s [ENTITY] & Anr. 18.03.2017 ORDER
1. By this order I shall dispose of the petition under [SECTION] of the [ACT] (hereinafter referred to as the Act), filed on behalf of the petitioner, challenging the Exparte Arbitral Award dated 09.08.2014.
2. The brief facts of the case are that the petitioners took a loan of Rs. 12,60,000/- from the respondent no. 1 and the loan had to be repaid in 120 equal monthly installments of Rs. 21,107/-. The relevant documents were executed between the concerned parties at the time of apply and sanctioning of the loan. The respondent no. 1 had created a charge against the immovable property bearing no. 44/4, 3rd Floor, West Patel Nagar, New Delhi against the petitioner. The original documents of the said property were handed over by the petitioner no. 1 to the respondent no. 1. The petitioners failed to repay the outstanding loan amount and the respondent no. 1 recall the entire loan amount by sending legal notice dated 25.03.2014 to the petitioners. The petitioners failed to make the payment, therefore respondent no. 1 invoked the arbitration clause of the loan agreement. The respondent no. 1 filed a claim petition before the Ld. Arbitrator, who issued notices to the petitioners for 20.05.2014 and again for 08.07.2014, but the petitioners failed to appear , therefore, they were proceeded ex-parte and an Ex-parte Arbitral Award was passed on 09.08.2014.
3. It is stated in the petition under consideration that the ex-parte arbitral award dated 09.08.2014 is bad in law and liable to be set aside. On 20.05.2014, the petitioner no. 1 reached at the place where arbitration proceedings were to be held but the petitioner no. 1 was informed that no such proceedings were to be held at that place, therefore, he returned back. Ld. Arbitrator did not send any other notice regarding change of address to the petitioners. It is further stated that no notice under [SECTION] of the [ACT] for appointment of arbitrator was ever issued to the petitioners. It is further stated no recall notice of loan was ever issued to the petitioners. It is further stated that equal opportunities have not been given to the petitioners by Ld. Arbitrator.
4. It is further stated that Ld. Arbitrator has passed impugned award on the basis of testimony of Mr. [ENTITY], who represented to be SPA of respondent no. 1 but he was not authorized till the date of arbitral award. It is further stated that the Ld. Arbitrator has not considered the claim and statement of accounts of respondent no. 1 properly and without the certificate under [SECTION] of the [ACT] , relied upon the statement of account as true and correct. It is prayed that ex- parte arbitral award may kindly be set aside.
5. In reply, it is stated on behalf of respondent no. 1 that the present petition is barred by limitation as the impugned award was passed on 09.08.2014 but the petition under consideration has been filed on 22.01.2015. It is further stated that on 20.05.2014, the clerk of Ld. Arbitrator informed to the parties that father-in-law of Ld. Arbitrator had expired and due to personal exigency the proceedings could not be taken place and the next date of hearing 08.07.2015 was given. It is further stated that the petitioners were informed by legal notice dated 25.03.2014 about the appointment of Ld. Arbitrator. All other averments made in the petition are denied.
6. Arguments heard. Record perused and considered.
7. The arbitral award was passed on 09.08.2014 and the petition under consideration was filed on 22.01.2015 that is after 165 days from the date of award. [SECTION] of the Act , provides that the application for setting aside an award may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or if a request had been made under [SECTION], from the date on which that request had been disposed of by the arbitral tribunal. The proviso of [SECTION] of the Act provides that if the court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months , it may entertain the application within a further period of 30 days, but not thereafter. Thus, the maximum period in which the application/petition under [SECTION] of the Act can be filed is 120 days from the date on which the party making the application under [SECTION] of the Act had received the award. In the case in hand, the petitioners have not stated when did they receive the arbitral award. The petitioners have admitted that they have received the notice from the arbitrator for 20.05.2014 but when petitioner no. 1 appeared at the place of the arbitrator he was informed that no proceeding had to be held at that place, therefore, he returned back. I do not find any substance in the contention of the petitioners that petitioner No.1 was informed that no proceedings would be held at the given place. For the sake of arguments, if it is assumed that the petitioner no. 1 was informed as stated in the petition still the petitioners could appear before Ld. Arbitrator as a second notice of arbitration proceeding for 08.07.2014 was issued to all the petitioners and was sent by speed post at the same addresses of the petitioners. But despite service of notice, the petitioners not appeared. Thereafter, the notice of intention to proceed ex-parte was issued to all the petitioners by Ld. Arbitrator for 25.07.2014 but despite the said notice no one appeared on behalf of petitioners. Thus, it is clear that the petitioners were well aware about the arbitration proceedings and they deliberately did not appear. Not only this after passing the ex-parte award, Ld. Arbitrator had sent the copy of arbitral award to the petitioners at the same given addresses of the petitioners on 11.08.2014. The petitioners were served with the copy of award but despite that they failed to file the petition under consideration within the period of limitation.
8. It was held in [PRECEDENT], that "Use of words, 'but not thereafter' in the proviso to Sub- section (3) makes it clear that even if a sufficient cause is made out for a longer extension, extension cannot be beyond thirty days".
9. The ruling [PRECEDENT] (Supra) is squarely applicable to the facts of the present case. Hence, it is established that the petitioners have failed to file the present petition within the period of 90 days and even could not file in the next period of 30 days from the date of receiving the arbitral award. The other contentions of the petitioners that the Ld. Arbitrator had not given notice to them and did not treat them equally have no substance as these all are moonshine and sham defence.
10. It was held in [PRECEDENT] "Court while considering challenge to arbitral award does not sit in appeal over the findings and decision of the arbitrator, which is what the High Court has practically done in this matter. The umpire is legitimately entitled to take the view which he holds to be the correct one after considering the material before him and after interpreting the provisions of the agreement. If he does so, the decision of the umpire has to be accepted as final and binding.
11. In view of the above discussions, it is established that the petition under [SECTION] of the Act was not filed within time and this Court has no power to condone the delay of more than 30 days, therefore, the instant petition is barred by limitation. Even otherwise, there is no ground on merit in the petition to set aside the arbitral award dated 09.08.2014. Hence, the present petition is dismissed being barred by limitation and also has no merits.
AnnouncedintheOpenCourt. ([ENTITY]) Dated:18.03.2017 ADJ04,SouthDistrict SaketCourt,NewDelhi