Raising Fresh Grounds At Appellate Stage Virtually Amounts To Filing Fresh Appeal; Barred By Limitation U/s. 34(3) A&C Act: Allahabad HC
|The Allahabad High Court reiterated that an appellant cannot be allowed to raise fresh grounds at an appellate stage as it virtually amounts to filing a fresh appeal barred under Section 34(3) of the Arbitration and Conciliation Act, 1996 (Act).
The Court dismissed the appeal filed by the State under Section 37 of the Act while reiterating the Supreme Court’s decision in State of Maharashtra v. Hindustan Construction co. Ltd. (2010) wherein it was held that the amendment in a pleadings under Section 37 of the Act cannot be allowed after expiry or limitation period as stated under Section 34 (3) of the Act.
A Division Bench of Justice Mahesh Chandra Tripathi and Justice Prashant Kumar observed, “The appellant cannot be allowed to amend the appeal or to raise fresh grounds at the appellate stage in view of the ratio laid down by the Hon’ble Supreme Court in the matter of State of Maharashtra Vs. Hindustan Construction co. Ltd.(supra). The amendment obtained or raising fresh grounds virtually amounts to file a fresh appeal and would be barred by limitation as laid down under Section 34(3) of the 1996 Act. Hence, it is not open for the appellant to raise any new ground or adduce any fresh evidence in an appeal under Section 37 of 1996 Act.”
Advocate Ankur Agarwal represented the appellants, while Advocate Jagat Narayan Mishra appeared for the respondent.
The Sole Arbitrator appointed by the appellants had passed an award which was challenged by the appellants under Section 34 of the Act and the same was dismissed by means of the speaking order. The appellants filed an appeal under Section 37 of the Act against the same.
The High Court noted that the Sole Arbitrator had proceeded to observe that the agreement between the parties was subject to the provisions forming part of the contract as well as to the general conditions of the contract. “All the 17 issues were considered in detail and categorical finding had been returned,” it remarked.
“We also find that while preferring an appeal under Section 34 of the 1996 Act, no such ground had been taken by the appellant. Even the instant appeal had been preferred with considerable delay of around two years and no such ground had been taken. At this belated stage, an attempt had been made to bring on record the additional evidence,” the Court observed.
As per Section 34 read with Section 37 of the Act, the award can only be set aside if the same is found to be contrary to (a) fundamental policy of Indian Law; or (b) the interest of India; or (c) justice or morality and (d) if it is patently illegal. “In the present case, none of these aforesaid exceptions are said to be attracted in the present case,” the Bench remarked.
“The learned Commercial Court dealing with Section 34 application was not acting as a Court of Appeal. Yet, looking to the long-drawn arguments, the Commercial Court enumerated the issue raised and then returned findings after examining the record and while rejecting the submissions made on behalf of the State-appellant. There had been no such flaw in the judgment and order passed by the Commercial Court which call for interference by this Court under the limited scope of Section 37 of the 1996 Act,” the Court remarked.
Consequently, the Court held, “In view of the aforesaid facts and circumstances, we have no hesitation to hold that the appellants have failed to make out any case for interference under Section 37 of the 1996 Act. The Arbitrator after considering all the evidences and record had passed a detailed speaking award, dealing with every aspect of the claim separately, which is also approved by the Commercial Court. The appellants herein have failed to make out any case, which may call for interference by this Court.”
Accordingly, the High Court dismissed the petition.
Cause Title: State Of Uttar Pradesh & Ors. v. M/S Virat Construction (Neutral Citation: 2024:AHC:171241-DB)