HIGH COURT OF HIMACHAL PRADESH AT SHIMLA Arb.A. No. : 4 of 2008. Decided on: 24.9.2008. Union of India through Chief Engineer ……… appellant. Versus M/s Kundan Const. Company ………Respondent. Coram: The Hon’ble Mr.Justice Deepak Gupta, Judge. The Hon’ble Mr.Justice V.K. Ahuja, Judge. Whether approved for reporting? No. For the appellant: Mr.Sandeep Sharma, Assistant Solicitor General of India. Deepak Gupta, J. (Oral): This appeal is directed against the judgment of the learned Single Judge passed in Arbitration Case No.33 of 2004, whereby he has rejected the objections filed by the present appellant under Section 34 of the Arbitration and Conciliation Act, 1996. The only point raised for consideration before the learned Single Judge was that the Contractor himself had rescinded the contract and the rescission of contract had been accepted by the appellant-Union of India. Therefore, according to Union of India, there was no subsisting contract between the parties and no arbitration agreement was in existence. The learned Single Judge rejected this contention on two grounds – i) that the appellant had not pleaded in its petition that the award is against the __________________ Whether reporters of local newspapers may be allowed to see the judgment? Yes. - 2 - Public Policy of India and; ii) that the Union of India had acquiesced in the arbitration proceedings and, therefore, was debarred from challenging the same on the ground that since the contract was rescinded, the arbitration proceedings were void abnitio. We are of the opinion that it is not necessary to repeat the words of the Section while filing objections to the award under Section 34 of the 1996 Act. However, on merits, we find that the present appellant had never raised any objection before the Arbitrator that he had no jurisdiction to entertain the matter. Under Section 16 of the Arbitration and Conciliation Act, 1996, the Arbitral Tribunal has been given the right to arbitrate and adjudicate upon its own jurisdiction. It is, therefore, obvious that a party challenging the jurisdiction of the Arbitrator must raise this objection under Section 16 at the initial stage. If the objection is not raised, then the party is deemed to have waived this objection. A reference can be made to two decisions of the Apex Court in this behalf. Both these decisions are under the Arbitration Act, 1940 but they are fully applicable to the facts of the present case. The Apex Court in Prasun Roy vs. The Calcutta Metropolitan Development Authority and another, AIR 1988 Supreme Court 205, has observed as under: “Where though a party is aware from the beginning that by reason of some disability the matter is legally incapable of being submitted to arbitration, participates in arbitration proceedings without protest and fully avails of the entire arbitration proceedings and then when he sees that the award has gone against him comes forward to challenge the whole of the arbitration proceedings as without jurisdiction on the ground of a known disability, the same cannot be allowed. This principle applies both before and after making of the award. The principle is that a party shall not be allowed to blow hot and cold simultaneously. Long participation and acquiescence in the proceeding preclude such a party from contending that the proceedings were without jurisdiction.” - 3 - The aforesaid judgment is based on the observations made by the Apex Court in N.Chellappan vs. Secretary, Kerala State Electricity Board and another, (1975) 1 Supreme Court Cases 289. Mr.Sandeep Sharma, learned Assistant Solicitor General of India, has relied upon a judgment rendered by the Apex Court in U.P. Rajkiya Nirman Nigam Ltd. vs. Indure Pvt. Ltd. and others, (1996) 2 Supreme Court Cases 667, wherein it has been held that acquiescence cannot confer jurisdiction on the Arbitrator. Here the question was whether the Arbitrator had jurisdiction or not, which is a pure question of law. In the present case, the question is whether an arbitration agreement was in existence. This was a mixed question of fact and law. The question as to whether the arbitration agreement continued to subsist or not, which has not been raised before the learned Arbitral Tribunal, cannot be permitted to be raised under Section 34 of the Arbitration and Conciliation Act, 1996. Therefore, we find no merit in the appeal filed by the appellant, which is dismissed in limini. In view of the final disposal of the main appeal, the stay application is also rejected. (Deepak Gupta), Judge. September 24, 2008. (V.K. Ahuja), (TILAK) Judge.