SHEFALI PAUL Vs. ASHOK KUMAN JAIN

JUDGEMENT

(1.) THIS is an appeal under Section 37 (1) (b) of the Arbitration & Conciliation Act, 1996, challenging the validity of judgment and order dated 08.07.2005 passed by the learned District Judge, Dibrugarh, in Misc. Arbitration Case No. 1 of 2005. By this order the learned District Judge allowed an application filed under Section 34 of the said Act and set aside the award of the arbitrator with further direction to the parties to appear before the arbitrator again for resolution of their dispute.

(2.) THE respondent No.1 instituted the proceeding under Section 34 of the Arbitration & Conciliation Act, 1996, before the learned District Judge at Dibrugarh vide Misc. Arbitration Case No. 1 of 2005 stating that he as a tenant had entered into a commercial premises under the appellant No.1 herein. The tenancy was created by a lease deed registered on 12.04.1994 and one of the recitals of the said deed was that in case of any dispute or difference between the parties regarding anything connecting the demised premises, it shall be referred to the sole arbitration of Sri Sankar Lal Dhelia and the award passed by him shall be final, conclusive and binding between the parties. The lease deed expired on 31.03.20001 and the tenancy went on fresh terms and conditions, but no further deed was executed. While everything was going on smoothly, all on a sudden on 04.01.2005 the respondent No.1 was evicted from the premises in execution of award vide Title Execution No. 1 of 2004. After being evicted, the petitioner came to know that there was arbitration proceeding and that there was an award passed against him. The petitioner contacted his advocate to find out all necessary details to obtain certified copies of the case record which he received on 05.01.2005 thereafter. Having come to know about the award dated 28.01.2004, the petitioner filed proceeding under Section 34 of the Arbitration & Conciliation Act, 1996, on 11.02.2005. He further came to know that the award was shown to have been sent to him under registered cover on 08.03.2004 but he did not receive any award as claimed. With these averments the respondent No.1 made prayer for setting aside of the award on the ground that the same was vitiated by violation of the principles of natural justice; that the arbitration agreement was non -existent after 31.03.2001; that the arbitrator being a witness of the lease deed could not have acted as arbitrator; that the dispute in regard to eviction of tenant is not an arbitrable dispute etc. Misc. Case No. 37 of 2005 was registered in regard to said application and the learned Court issued notice upon the present appellant who appeared and submitted objection.

(3.) THE learned Court noted that unlike the earlier law in Arbitration Act, 1940, there is no requirement for making the award as rule of the Court and there is no need for filing award in Court which can be enforced straight way. The learned Court held that the writ for execution was issued on 04.10.2004 and the decree was executed on 04.01.2005 whereas application under Section 34 of Arbitration & Conciliation Act was filed on 11.02.2005. Under such circumstances, in view of the averments made by the petitioner that he did not receive any notice and the A/D card bears signature of some other person not known to him and that he came to know about the award only during execution of the award, it is observed that the proceeding was filed well within a period of limitation. The learned Court also held that the arbitrator being a witness to the lease deed was not competent to be an arbitrator and moreover, in view of the provision of Urban Areas Rent Control Act, an arbitrator is not competent to pass award for eviction of the tenant. Referring to the case of Natraj Studios (P) Ltd. vs. Navrang Studios & Another reported in 1981 SC 537, the learned Court observed that public policy requires that contract which nullify the rights conferred on tenant by the Act cannot be permitted even if there is an agreement for Arbitration. The same being contrary to Section 5 of the Assam Urban Areas Rent Control Act, arbitration is not permissible. Accordingly, the ex parte award was set aside and parties were directed to appear before the arbitrator to raise issues as to maintainability of arbitration before him. This judgment was passed on 08.07.2005. The present appeal is directed against this judgment and award.