BENARSI KRISHNA COMMITTEE Vs. KARMYOGI SHELTERS PVT LTD

JUDGEMENT

(1.) In this Special Leave Petition, a question has been raised as to whether the service of an Arbitral Award on the agent of a party amounts to service on the party itself, having regard to the provisions of Section 31(5) and Section 34(3) of the Arbitration and Conciliation Act, 1996, hereinafter referred to as "the 1996 Act".

(2.) The Petitioner is a Committee of Managing Landlords, who are co- owners of the Benarsi Krishna Estate at the Moti Cinema compound, Chandni Chowk, Delhi. The property apparently belongs to the Khanna family and the Seth family. The Respondent No.1 is a Private Limited Company incorporated under the Companies Act, 1956, and is an estate developer and builder of both residential and commercial properties. The Petitioner Committee entered into a Collaboration Agreement dated 16th November, 1990, by which the Respondent agreed to convert the Moti Cinema compound into a commercial complex. Subsequently, the agreement was amended on 2nd May, 1991, by which certain changes were introduced with regard to the scheme of payment. Inasmuch as disputes arose between the parties over the working of the agreement, the Respondent filed an application under Section 11 of the 1996 Act for appointment of an Arbitrator and by an order dated 14th May, 2001, the Delhi High Court appointed Justice K. Ramamoorthy, a retired Judge of the said Court, as the Sole Arbitrator. After considering the materials brought on record, the learned Arbitrator passed his Award upon holding that the Respondent had committed breach of the terms of the Collaboration Agreement and directed the Petitioner to refund the sum of Rs.41 lakhs which had been received from the Respondent, within three months from the date of the Award and in default of payment within the said period, the amount would carry interest @ 12% per annum from the date of the Award till the date of payment.

(3.) As will appear from the records, copies of the Award, duly signed by the learned Arbitrator, were received by the counsel for the respective parties. As far as the Respondent is concerned, the endorsement shows that the copy of the Award was received by its counsel on 13th May, 2004. However, no application for setting aside the Award was filed by the Respondent within the period of three months from the date of receipt of the Award, as provided under Section 34(3) of the 1996 Act.