Case: GEETABEN ANILKUMAR PATEL AND ORS Vs. PRAVINCHANDRA JINABHAI PATEL AND ORS

2. Appellants have filed these appeals challenging the judgment dated 27.03.2012 of the High Court of Judicature at Bombay Bench at Aurangabad in W.P. No. 4669 of 2011 in and by which the High Court held that challenge to the arbitral award dated 07.07.1996 was time barred under the provisions of Section 34 of the Arbitration and Conciliation Act, 1996 (for short the Act)3. The facts of the case are that the appellant No.1/Anilkumar Patel and respondent No.1/Pravinchandra Patel are real brothers and sons of Jinabhai. They had three other brothers who were already separated. So far as the parties before us, they are related as under:Jinabhai Pravinchandra Jinabhai Patel (R1) Anilkumar Jinabhai Patel (A1) =Savitaben P . Patel/wife (R2) =Geetaben A. Patel/wife (A1(a))* Kalpita Dilipkumar Patel Alpita Jayesh Soni Trupti P . Patel (R3) (R4) (R5) Darshan A. Patel (A1(b))* Chetan A. Patel Vikram A.Patel =Monika Darshan Patel/wife (R10) (A1(c))* (A1(d))* [*Respondent Nos. 6 to 9 have been deleted as respondents and added as LRs of the appellant vide order dated 30.04.2015 in the SLP] Pravinchandra Patel and Anilkumar Patel together started the business of fertilizer manufacturing, chemical and real estate at Jalgaon. In the course of business, they set up number of companies and partnership concerns and acquired numerous immovable and movable properties. Pravinchandra Patel has three daughters, who are married and settled outside Jalgaon. Anilkumar Patel has three sons, who are residing with him at Jalgaon. As children of Pravinchandra Patel and Anilkumar Patel grew up and in order to avoid any possible litigation, both the brothers and their family members decided to make division of the assets of the family. For this purpose, they approached Latikaben (respondent No.12) and Bhikhalal Nathalal Patel (respondent No.11) who is the sister andw of Pravinchandra Patel and Anilkumar Patel and parties have agreed to appoint them as arbitrators. It culminated into an MOU dated 21.05.1996 appointing Latikaben and Bhikhalal Nathalal Patel as arbitrators which was signed by all the members of the family that is the appellants and respondents5. The arbitrators arrived at Jalgaon on 04.07.1996 and continued with the arbitration proceeding and passed the award on 07.07.1996 (with a mention of IMOU dated 29.06.1996) under which certain properties were given to Pravinchandra Patel and Anilkumar Patel whereas some other assets were kept undivided with equal rights and interest thereon of both groups. The award was written in Gujarati language by hand by the arbitrators and signed by the arbitrators. The copy of the award was given to Pravinchandra Patel and Anilkumar Patel by arbitrators in person which was duly acknowledged by them. Copy of the award bears signature of both Pravinchandra Patel and Anilkumar Patel with recital that they and their family members will act as per the award and will give effect to the same. Then by an award dated 03.11.1996, the issues between appellants and respondents were finally decided taking note of earlier awards. According to Pravinchandra Patel, Anilkumar Patel accepted and acted upon the awards on more than one occasion6. However, Anilkumar Patel and his family members (appellant Nos. 1(a) to 1(d) and respondent No.10) filed an arbitration petition No.202 of 2005 under Section 34 of the Act before the District Judge, Jalgaon on29.11.2005 challenging the award dated 07.07.1996 contending that they learnt about the arbitral award only on 11.08.2005 when they were served with the notice of execution petition filed by Pravinchandra Patel alongwith the xerox of the award dated 07.07.1996. Therefore, as per ther Patel, period of limitation starts only from 11.08.2005, from the date of their receipt of copy of the award. It was further alleged that, appellant Nos. 1(a) to 1(d) and respondent No.10 were not included as party in the award dated 07.07.1996 and the award is not binding on them. They have, inter alia, alleged that the award is a false and fraudulent document. They also emphasized that the signature of Anilkumar Patel in the arbitral award showing his acknowledgement was forged and therefore, could not be acted upon7. Later on, an application came to be filed by Anilkumar Patel for himself and on behalf of his family members for an amendment under Order VI Rule 17 C.P.C. stating that the arbitration petition No.202 of 2005 filed initially, did not contain the challenge to award dated03.11.1996 and hence, by an amendment sought to challenge award dated 03.11.1996 as well. The said application was dismissed on30.06.2006 by the District Court on the ground of limitation which was further challenged through W.P. No.5502 of 2006 before the High Court. The same was remanded to the District Judge on 21.08.2006 for consideration of the matter afresh. After remand, the District Judge by order dated 28.09.2006 again dismissed the amendment application on the ground of limitation. The said order dated 28.09.2006 was again challenged by Anilkumar Patel under W.P. No.7614 of 2006. The High Court vide order dated 13.11.2006 dismissed the writ petition observing that Anilkumar Patel is adopting tactics of approbate and reprobate and Anilkumar Patel is acting as per his convenience by denying the knowledge of award dated 03.11.1996 in some court proceedings though in some other proceedings, he has relied on the said award and sought to take advantage on the basis of the said award8. Insofar as the challenge to the award dated 07.07.1996, the District Judge vide order dated 14.02.2011 allowed the application under Section 34 of the Act inter alia, holding that the period of limitation prescribed under Section 34(3) of the Act is to be computed from the point of time when the party concerned received the copy of the arbitral award. The District Judge set aside the award holding that number of serious issues have been raised in application under Section 34 and there is nothing to show that Anilkumar Patel was authorised by the other applicants to receive a copy of the award on their behalf and it cannot be said that the appellant Nos.1(a) to 1(d) and respondent No.10 had received the award in terms of Section 31(5) of the Act9. Being aggrieved, Pravinchandra Patel filed W.P. No.4669 of 2011. The High Court by the impugned judgment dated 27.03.2012 set aside the order of the District Judge holding that the petition filed in the year 2005 under Section 34 of the Act was time barred. The High Court held that sofaras the award dated 03.11.1996, the findings in W.P.No.7614 of 2006 have attained finality which has foreclosed the right of Anilkumar Patel to challenge the award dated 07.07.1996. The High Court enumerated various circumstances to hold that Anilkumar Patel and his family members were well aware of the award dated 07.07.1996. The High Court also relied upon various correspondence between the parties, legal proceedings etc. (O.A. No.298A/2001 etc.) to arrive at the conclusion that Anilkumar Patel received the award dated 07.07.1996. On those findings, the High Court held that the petition filed in the year 2005 under Section 34 of the Act is time barred and the petition filed under Section 34 of the Act challenging the award dated 07.07.1996 came to be dismissed.

Reasoning: 23. Award dated 07.07.1996 was received by Anilkumar Patel for himself and on behalf of his family members. In interim MOU dated 29.06.1996, Anilkumar Patel signed for self and as a power of attorney holder for his wife and his all sons and. Challenging the award dated 07.07.1996, Anilkumar Patel and his family members have filed a single petition under Section 34 of the Act. Likewise they have also filed a single petition for amending the arbitration petition No.202 of2005. Anilkumar Patel, being the head of his family, was a person directly connected with and involved in the proceeding and was also in control of the proceeding. Being head of the family, Anilkumar Patel would have been the best person to understand and appreciate the arbitral award and take a decision as to whether an application under Section 34 of the Act was required to be filed or not. In such facts and circumstances, in our considered view, service of arbitral award on Anilkumar Patel amounts to service on the other appellant Nos.1(a) to 1(d) and respondent No.10 and they cannot pleade of Section 31(5) of the Act26. As rightly observed by the High Court, Anilkumar Patel has gone to the extent of even disputing his signature in the award dated07.07.1996 by drafting choreographed petition. Having accepted the award through Anilkumar Patel, being the head of the family, appellant Nos. 1(a) to 1(d) and respondent No.10 cannot turn round and contend that they had not received the copy of the award. The High Court rightly held that ....Receiving the copy by Anilkumar on behalf of himself and respondent nos. 2 to 6, under an acknowledgment, is in terms ofe of Section 31(5) of the Actand Section 34(3) thereof..... and that the application filed under Section 34 of the Act by Anilkumar Patel and appellant Nos. 1(a) to 1(d) and respondent No.10 was barred by limitation. We do not find any good ground to interfere with the impugned judgment24. The High Court has enumerated various circumstances which indicate that Anilkumar Patel was well aware of the award dated07.07.1996 and also relied upon the award in internal communication between the parties and various legal proceedings. Inter Office Memo dated 22.07.1996, sent by Anilkumar Patel to Pravinchandra Patel, seeking for delivery of file of Gat No.266/2 of Bambhori, Taluka Brandol. Anilkumar Patel has stated that in Gat No.266/2 of Bambhori, agricultural land has come to his share and since some dispute has been raised by the party by whom thed is to be executed, Anilkumar Patel requested to handover the file maintained in connection with the agricultural land mentioned in Gat No.266/2. The said Inter Office Memo clearly shows that even on 22.07.1996, Anilkumar Patel had acted upon the award dated 07.07.1996Various circumstances brought on record clearly show that Anilkumar Patel was authorized by other appellant Nos. 1(a) to 1(d) and respondent No.10 to receive copy of the award and act on their behalf and we find no reason to take a different view from that of the High Court.