S M KEJRIWAL Vs. P C GOENKA

JUDGEMENT

(1.) ADMIT . Respondent waives service. By consent heard forthwith.

(2.) THE petitioner by this petition impugns the award on the ground that he was not served with the notice of hearing of the petition. It is further his contention that no copy of the award as required to be served under Section 31(5) of the Arbitration & Conciliation Act, 1996 is served upon him.

(3.) IN the first instance the Court will have to decide as to whether a communication by the respondent of the Award to the petitioner and/or knowledge of the Award is sufficient for the period of limitation to run. Section 31(5) of the Arbitration Act, 1996 provides that after the arbitral award is made a signed copy shall be delivered to each party. Sub-section (3) of Section 34 provides that an application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under Section 33, from the date on which that request had been disposed of by the arbitral tribunal. Section 3 is the section pertaining to communications. It is therein provided that unless otherwise agreed by the parties, any written communication is deemed to have been received if it is delivered to the addressee personally or at his place of business or residence or mailing address. The communication is deemed to have been received on the day it is delivered. As there were disputes as to the real address of the petitioner as raised by the petitioner the records of the Bombay Stock Exchange were called for. The first communication was pertaining to the arbitral proceedings itself. The petitioner was sought to be served by Registered A.D as well as Under Certificate of Posting. The summons sent under Registered A.D . was returned back with an endorsement that the petitioner had left the address. In other words that is not the address of the petitioner. In these circumstances there was non-compliance of Section 3 in so far as notice is concerned. Copy of the award was again sought to be served on the petitioner at the same address both by registered A.D. as well as Under Certificate of Posting though at the time of service of notice to appear the endorsement was left the address. In so far as Registered A.D. is concerned, the copy of the award is returned back with the remark that the petitioner had been intimated. Address was the same as at the time when the summons for appearance was sought to be served on the petitioner. However, the letter of August 19, 1997 would show that the petitioner had knowledge of the Award. The question, however, is whether this knowledge of the petitioner is compliance with sub-section (5) of Section 31 of the Act of 1996. In so far as the Arbitration Act, 1940 is concerned to challenge an Award, a notice had to be given by the Court wherein the award was filed. It was only after such service of notice would the limitation commence to challenge the award. This Court even in cases where decree had been passed in terms of the Award has held that such decree would be a nullity if notice of the Award had not been served as required by this Court. (See judgment of Chapalgaonkar, J. in the case of Sevaram Laxmidas Sachdev v. National Insurance Co. and another 1993 Mah. L.J.1544.) Therefore, even in so far as the old Act is concerned, the period of commencement of Limitation was after due notice was received from the Court where the Award was filed. 4.In the light of that would mere notice of the communication of the passing of the Award or even knowledge of the contents result in time running for challenging the Award under sub-section (3) of Section 34 of the Act of 1996. In my opinion it has to be held in the negative. The language of Section 31(5) is clear. It is the duty cast on the Arbitral Tribunal to serve the signed copy of the Award on the parties who were parties to the Award. The expression used is "shall". Even if it is construed in its ordinary literal meaning the mandate is that it is mandatory and cannot be dispensed with. This is for the purpose that under the scheme of the new Act there is no provision to file the copy of the award in the Court having jurisdiction. That part has been done away with and instead the Arbitral Tribunal has been directed to serve a copy of the award directly on the parties. In other words what notice was required to be given by the Court is now required to be served by the Arbitral Tribunal itself. In these circumstances a strict construction must be placed on sub-section (5) of Section 31. The same construction as in the old Act for challenging the award from the date of notice by the Court must be followed under the new Act. This is more so as the time to challenge the award is of three months and the delay which can be condoned is only of one month. It must, therefore, be held that service of notice of the Award on the parties by the Tribunal is mandatory. Of course, this is subject to Section 3 of the Arbitration Act 1996. If the address with the Tribunal is one of the addresses as shown under Section 3, then if service is effected at the said address it will be in due compliance of the requirement of serving notice of the award on the party concerned. In the instant case, however, as seen earlier the notice for appearance itself was returned with the remark that addressee has left. In the light of that I have no hesitation in coming to the conclusion that the question of limitation in this matter did not run in view of the express provisions of sub-section (5) of Section 31 of the Act of 1996.