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Judgment
Rajiv Shakdher, J.
IA No. 21687/2012 (under Order VI Rule 17 of Code of Civil Procedure, 1908)
This is an application by which the petitioner seeks amendment of its petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (in short ''the Act'').
1.1. According to Ms. Dhir, the amendments sought are pivoted on three principal grounds. These being as follows:
"(i) First, the learned arbitrator could not have proceeded with arbitration proceedings in view of the fact that the petitioner herein (i.e. original claimant) had failed to file its statement of claim before him.
(i)(a) it is the submission of the learned counsel for the petitioner that provisions of Section 25(a) read with Section 2(9) of the Act contemplate that if a statement of claim is not filed then, the arbitrator is required to terminate the proceedings. In support of this submission, the learned counsel for the petitioner seeks to place reliance on the judgment of the Supreme Court in the case of State of Goa Vs. Praveen Enterprises, .
(ii) Second, that the purported admission in paragraph 28 of the petition whereby, it is stated that the petitioner is liable to pay a sum of Rs. 1,24,53,281, is a plea, which is based on a demurer, which is that, if only, the respondent''s documents are taken into account then, the petitioner could be called upon to pay said amount as against the sum awarded by the learned arbitrator.
(iii) Third, that the rate of interest awarded by the learned arbitrator is usurious and, therefore, the award to that extent needs to be set aside."
Insofar as the first ground is concerned, I am of the view that a conjoint reading of the provisions of Section 25(a) and Section 2(9) of the Act does not lead to the conclusion which Ms. Dhir has arrived at. Arbitration proceedings cannot be terminated by an arbitrator in case a claimant fails to file its statement of claim. This is precisely the reason that Section 2(9) excludes inter alia the provisions of Section 25 from the ambit of the term ''claim''.
1.2. The necessary conclusion which would follow, is that, in case the statement of claim is not filed then the learned arbitrator would terminate the proceedings vis-�-vis the statement of claim. It would not follow thus, that the proceedings qua the counter-claim, which the respondent may have filed before the learned arbitrator, shall also stand dissolved.
1.3. The judgment in the case of State of Goa, does not lead to a contrary conclusion, as is sought to be contended by Ms. Dhir.
1.4. Faced with this position, Ms. Dhir submitted that the issue in this case would have to be examined, keeping in mind the fact that at the time when this court passed the order dated 13.01.2009 in the petition filed by the petitioner under Section 11 of the Act, the respondent had, inter alia, taken the stand that there was no arbitral dispute obtaining between the parties and hence, there was no question of a counter-claim being lodged by the respondent for adjudication by the learned arbitrator.
1.5. A careful reading of the order dated 13.01.2009 passed by this court would show that though the court recorded this submission of the respondent, it ultimately did give an opportunity to parties to file their claims before the learned arbitrator.
1.6. In these circumstances, it is quite clear that the proceedings could not have been terminated as Section 25 itself contemplates that unless parties agree to the contrary, the proceedings will stand terminated if the statement of claim is not filed. Having regard to the order of this court dated 13.01.2009, it is quite clear that the parties had agreed to the contrary, which is that, each party could file its respective claims. This is exactly what the respondent did in the proceedings initiated before the learned arbitrator.
Insofar as the second ground is concerned, which is with regard to purported admissions made, in my view, no amendment is required because there are several averments made in the existing petition, which precede paragraph 28. At the appropriate time these averments would have to be read along with the averments made in paragraph 28. As to whether or not, there is an admission, as contended by the respondent, would have to be considered by the court at the stage of adjudication of the main petition after taking a holistic view of the averments made in the petition.
Similarly, insofar as third ground is concerned, which is, as to whether the rate of interest awarded by the learned arbitrator, is usurious, is an aspect which is not dependent only on the use of the term usurious in the pleadings -if otherwise the averments made in the petition and circumstances obtaining in the matter spell out a case that interest awarded is not beyond the established and usual rate. In the existing petition, a ground has been taken that the award is contrary to law which, according to me, would by itself include a challenge to usurious rate of interest, provided it is otherwise sustainable in the given facts and circumstances of the case.
3.1. The courts have repeatedly said that awards which impose usurious rate of interest can be interfered with on that account.
3.2. This is a matter though, on which I would not like to express my views, any further. Suffice it to say that this is an aspect that will be examined when the main petition is heard.
Needless to say, it will be open for the respondent to demonstrate otherwise in respect of both the second and third ground taken up by Ms. Dhir, to seek amendment to the main petition.
The application is accordingly disposed of.
OMP No. 773/2011 and IA No. 21688/2012 (for recalling of order dated 10.10.2012)
List on 02.03.2015.