Britto T. P. v Industrial Credit & Development Syndicate Ltd & Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR.JUSTICE P.N.RAVINDRAN** ## **TUESDAY, THE 27TH DAY OF AUGUST 2013/5TH BHADRA, 1935** ## **OP(C).No. 1297 of 2013 (O)** ## **---------------------------** **AGAINST THE ORDER/JUDGMENT IN EP 44/2007 of DISTRICT COURT,THRISSUR DATED 12-06-2007** ## **PETITIONER/PETITIONER/3RD JUDGMENT DEBTOR** **--------------------------** **BRITTO.T.P., AGED ABOUT 34 YEARS, S/O.T.O.POULOSE, RESIDING AT TEETHAI HOUSE PAREKKATTUKARA, P.O MURIYAD, TRICHUR DISTRICT PINCODE 680 683.** ## **BY ADV. SRI.PEEYUS A.KOTTAM** ## **RESPONDENTS/RESPONDENTS/DECREE HOLDER/JUDGMENT DEBTORS 1 & 2** **----------------------------** **1. M/S INDUSTRIAL CREDIT & DEVELOPMENT SYNDICATE LTD REGISTERED OFFICE, SYNDICATE HOUSE, MANIPAL UDUPPI, MANGALORE, KARNATAKA.** **2. K.ABOOBACKER, AGED ABOUT 46 YEARS, S/O.KHADER V.M, X/723, KADUNGOTHAYIL HOUSE PUNNAYOORKULAM, VIA KUNNAMKULAM, TRICHUR DISTRICT PINCODE 680683** ## **3. SUHARA M, AGED ABOUT 34 YEARS,** **W/O.K.ABOOBACKER, X/723, KADUNGOTHAYIL HOUSE PUNNAYOORKULAM, VIA KUNNAMKULAM, TRICHUR DISTRICT PINCODE 680 683** ## **R1 BY ADV. SRI.S.R.DAYANANDA PRABHU** **THIS OP (CIVIL) HAVING BEEN FINALLY HEARD ON 27-08-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** ## **OP(C).No. 1297 of 2013 (O)** ## **---------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS** **-------------------------------------** **EXHIBIT P1. TRUE COPY OF EP NO.44/2007 DATED 12.06.2007 FILED BY THE IST RESPONDENT BEFORE THE DISTRICT COURT, TRICHUR.** - **EXHIBIT P2. TRUE COPY OF PETITION DATED 05.11.2012 FILED BY THE PETITIONER BEFORE THE DISTRICT COURT TRICHUR IN EA NO. 164/2012 IN EP NO. 44/2007 IN SP NO. 17/1999.** - **EXHIBIT P3. TRUE COPY OF ORDER DATED 20.12.2012 OF DISTICT JUDGE THRISSUR IN EA NO.164/2012 IN EP NO.44/2007 IN AP NO.17/1999.** **RESPONDENT(S)' EXHIBITS :** - **---------------------------------------** **R1(a): COPY OF ARBITRATION AWARD DT. 20.5.1999 OF THE 3RD RESPONDENT.** **R1(b): COPY OF NOTICE DT. 26.9.1998 SENT TOT HE PETITIONER.** - **R1(c): COPY F POSTAL ACKNOWLEDGEMENT DT. 29.9.1998 SIGNED BY THE PETITIONER.** - **R1(d): COPY OF RETURNED REGISTERED POSTAL COVER DT. NIL ADDRESSED TO THE PETITIONER.** - **R1(e): COPYT COVERING LETTER DT. 1.7.1999 SENT BY THE ARBITRATOR TO THE PETITIONER.** - **R1(f): COPY OF REGISTERED COVER SENT BY THE ARBITRATOR AND ADDRESSED TO T HE PETITIONER RETURNED WITH ENDORSEMENT DT. 20.7.1999** - **R1(g): COPY OF OBJECTION DT. 3.4.2010 FILED BY THE PETITIONER IN E.P.NO. 44/2007 IF DDISTRICT COURT, THRISSUR** - **R1(h): TRUE COPY OF HIRE PURCHASE AGREEMENT DT. 2.8.1997 EXECUTED BY THE PETITIONER.** - **R1(i): COPY OF VAKKALATH DT. 3.4.2010 FILED BY THE PETITIONER E.P. NO. 44/2007 OF DISTRICT COURT, THRISSUR.** ## **\\ TRUE COPY \\** ## **PA TO JUDGE** **jm** ## **P.N.RAVINDRAN, J.** =-=-=-=-=-=-=-=-=-=-=-=-= ## **O.P.(C)No.1297 of 2013** =-=-=-=-=-=-=-=-=-=-=-=-=-= **Dated this the 27[th] day of August, 2013** ## **JUDGMENT** The third judgment debtor in E.P.No.44 of 2007 on the file of the Court of the District Judge of Thrissur has filed this original petition under Article 227 of the Constitution of India, challenging Ext.P3 order passed by the Court of the District Judge of Thrissur on 20.12.2012 dismissing E.A.No.164 of 2012 in E.P.No.44 of 2007 in A.P.No.17 of 1999, an application filed by him (Ext.P2) to dismiss E.P.No.44 of 2007 as not maintainable. The brief facts of the case as discernible from the pleadings are as follows:- 2. The first respondent herein had lent and advanced the sum of Rs.8,69,580/- to the second respondent for the purchase of a brand new truck. The second respondent's wife, the third respondent herein and the petitioner were guarantors to the said transaction. The first respondent has along with its counter affidavit produced as Ext.R1(h), a copy of the hire purchase agreement entered into on 2.8.1997 between it on the one hand and the petitioner and respondents 2 and 3 on the other. The first respondent has averred that when the hirer (the second **O.P.(C)No.1297 of 2013** **2** respondent) defaulted payment of the hire charges, it instituted Arbitration Case No.17 of 1996, that in that arbitration case, the Arbitrator passed Ext.R1(a) award on 20.5.1999, that before the arbitration proceedings were initiated it had issued Ext.R1(b) notice dated 26.9.1998 to the petitioner and respondents 2 and 3 by registered post acknowledgement due, that a copy of the said notice was served on the petitioner as can be seen from Ext.R1(c) postal acknowledgement card, that thereafter the first respondent referred its claim to Sri.B.Yogishwara Holla, Advocate, the named Arbitrator, that the Arbitrator entered upon the reference and passed Ext.R1(a) award on 20.5.1999, directing the petitioner and respondents 2 and 3 to pay to the first respondent the sum of Rs.9,27,903/- with future interest at the rate of 15% per annum on the sum of Rs.2,25,600/- from 26.9.1998 till payment as also the sum of Rs.3,675/- as costs of arbitration, that a signed copy of the award was sent by the Arbitrator to the petitioner along with Ext.R1(e) covering letter dated 1.7.1999, that the cover containing the signed copy of the award was returned with the endorsement “returned as the addressee has not reached the house”. The first respondent has also averred that in the execution petition, the petitioner filed Ext.R1(g) objections contending that the award is not passed in accordance with law and therefore it is not executable, that he later **O.P.(C)No.1297 of 2013** **3** filed E.A.No.164 of 2012 (Ext.P2) supported by an affidavit sworn to by his counsel contending that a signed copy of the award has not been delivered to him as stipulated in section 31(5) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act” for short) and therefore, the execution petition is not maintainable. The first respondent has in the counter affidavit contended that the petitioner was fully aware of the arbitration proceedings, that he intentionally did not receive the notice sent by the Arbitrator and that his intention is only to drag the proceedings. The first respondent has also stated that as on 26.6.2013, the sum of Rs.14,37,668/- is due under the award and that the petitioner is jointly and severally liable to discharge the said liability. 3. The main contention raised in the instant original petition is that the court below erred in holding that the court can consider the question whether the application is within time or the award of the Arbitrator is liable to be set aside only in a petition under section 34 of the Act, that proceedings under sections 33 and 34 of the Act can be initiated only after a signed copy of the award is delivered to the party in terms of section 31(5) of the Act and therefore, the impugned order is liable to be set aside. It is contended that the petitioner can file an application under section 34 of the Act to set aside the award of the Arbitrator only after **O.P.(C)No.1297 of 2013** **4** getting a signed copy of the award, that a signed copy of the award has not till date been delivered to the petitioner and therefore, he is not in a position to file an appropriate petition challenging the award passed by the Arbitrator. 4. I heard Sri.Peeyus A. Kottam, learned counsel appearing for the petitioner and Sri.S.R.Dayananda Prabhu, learned counsel appearing for the first respondent. Though respondents 2 and 3 have been served they have not entered appearance or filed objections. Sri.Peeyus A. Kottam, learned counsel appearing for the petitioner contended though such a plea has not been specifically raised in the pleadings, that an award of the Arbitrator can be enforced under section 34 of the Act only after the time for making an application to set aside the arbitral award under section 34 has expired or such an application having been filed it has been refused, that in the instant case a signed copy of the award has not been delivered to the petitioner so far, that the time for making an application to set aside an arbitral award under section 34 has not so far expired, that the petitioner has not been able to file such an application for the reason that a signed copy of the award has not been served on him, that the period of limitation prescribed for filing an application under section 34 has to be computed from the date on which the person making the application had received the **O.P.(C)No.1297 of 2013** **5** arbitral award and therefore, as a signed copy of the arbitral award has admittedly not been delivered to the petitioner till date, the execution petition to enforce Ext.R1(a) award is not maintainable. The learned counsel for the petitioner contended that the Arbitrator has not delivered a signed copy of the award to the petitioner, that even assuming that what was sent along with Ext.R1(e) letter dated 1.7.1999 was a signed copy of the award, the signed copy of the award was not delivered to the petitioner, that the postal article containing the copy of the award was returned to the sender namely the Arbitrator and therefore, it cannot be said that the signed copy of the award has been delivered to the petitioner and the time limit for filing an application under section 34 of the Act has expired. 5. Per contra, Sri.S.R.Dayananda Prabhu, learned counsel appearing for the first respondent contended that the petitioner had no case in Ext.R1(g) objections filed by him in E.P.No.44 of 2007 that a signed copy of the award has not been delivered to him, that the only objection raised by him was that the award was not in accordance with law, that he had also raised a plea of no means and therefore, the petitioner cannot be heard to contend that a signed copy of the award has not been delivered to him. Referring to Ext.P2 application filed by the petitioner questioning the maintainability of the execution petition, the learned counsel **O.P.(C)No.1297 of 2013** **6** appearing for the first respondent contended that though in the affidavit filed in support of the said application it had been averred that a signed copy of the award has not been served on the third judgment debtor (evidently meaning the petitioner), the affidavit is not one sworn to by the petitioner but by his counsel and therefore, no reliance can be placed on the averment in the said affidavit to hold that as a signed copy of the award has not so far been delivered to the petitioner, the award is not executable. 6. I have considered the submissions made at the Bar by learned counsel appearing on either side. I have also gone through the pleadings and the materials on record. It is not in dispute that though the Arbitrator to whom the dispute between the parties was referred had passed Ext.R1(a) award on 20.5.1999 and the Arbitrator had sent by registered post acknowledgement due, a copy of the award (whether it is signed or not is not relevant) to the petitioner in the address furnished by him, the postal article containing the copy of the award was returned with the endorsement “ÕßÜÞØAÞøX ÕàGßW ®JßçºîøÞJÄáæµÞIí οAß” (returned since the addressee has not reached the house). The respondent has no case that apart from sending Ext.R1(f) letter, the Arbitrator had thereafter sent another communication to the petitioner enclosing with it a signed copy of the award. It is evident **O.P.(C)No.1297 of 2013** **7** from the pleadings and the materials on record that till date, a signed copy of the award has not been delivered to the petitioner. 7. The Apex Court has in **State of Maharashtra v. ARK Builders (P) Ltd.** [(2011) 4 SCC 616] held that the period of limitation prescribed for filing an application under section 34(3) of the Act would start to run only from the date on which a signed copy of the award is delivered to the party making the application under section 34(1) of the Act. It was held that if the law prescribes that a copy of the order/award is to be communicated, delivered, dispatched, forwarded, rendered or sent to the parties concerned in a particular way and the law also sets a period of limitation for challenging the order/award in question by the aggrieved party, then the period of limitation can commence only from the date on which the order/award was received by the party concerned in the manner prescribed by the law. In **Benarsi Krishna Committee & Others v. Karmyogi Sherlters Private Limited** [(2012) 9 SCC 496] the Apex Court held that the expression “party” as defined in sections 2(1)(h), 31(5) and 34(3) of the Act is the party to the arbitration agreement and does not include the agent of the party to such agreement. It was held that any reference made in sections 31(5) and 34(2) of the Act to the party can only mean the party himself and not his agent or **O.P.(C)No.1297 of 2013** **8** Advocate empowered to act on the basis of a vakalath. The Apex Court also held that it is delivery of a signed copy of the arbitral award on the party himself which gives the party concerned a right to proceed under section 34(3) of the aforesaid Act. 8. Section 36 of the Act stipulates that where the time for making an application to set aside the arbitral award under section 34 has expired, or such application having been made, it has been refused, the award shall be enforced under the Code of Civil Procedure, 1908 (5 of 1908) in the same manner as if it were a decree of the court. Ext.R1(a) award in the instant case is sought to be enforced under section 36 of the Act. In view of the admitted fact that a signed copy of the award has not so far been delivered to the petitioner, who is a party to the arbitral award, it cannot be said that the time for making an application to set aside the arbitral award under section 34 of the Act has expired. The petitioner has also not filed such an application and it has not been refused. It necessarily follows that the first respondent cannot, before a signed copy of the award is delivered to the petitioner and the time fixed for filing an application under section 34 of the Act has expired, take steps to enforce the award. I accordingly hold that the instant execution petition, E.P.No.44 of 2007 is premature. The first respondent will have to wait till a signed copy of the award is **9** ## **O.P.(C)No.1297 of 2013** delivered to the petitioner and the time for making an application to set aside the arbitral award computed in terms of section 34 of the Act expires, before proceeding to enforce the award. For the reasons stated above, I allow the original petition, set aside Ext.P3 order dated 20.12.2012 passed by the Court of the District Judge of Thrissur and dismiss E.P.No.44 of 2007 in A.P.No.17 of 1999 on the file of the Court of the District Judge of Thrissur as a premature petition. No costs. Sd/- ## **P.N.RAVINDRAN JUDGE** /true copy/ P.A. To Judge ## **vpv**