18 December 2021, Saturday

1 year ago

Setting aside upheld where arbitrator acted in unnecessary haste and hurry. Both speedy disposal and reasonable opportunity are essential: Supreme Court of India

18 November 2021 | Narinder Singh and Sons v. Union of India | Civil Appeal No. 6734 of 2021 | Supreme Court of India | MR Shah and Sanjiv Khanna JJ | 2021 SCC OnLine SC 1082

The Supreme Court has applied Section 34(2) (a) (iii) ACA and Section 34(2)(b) (ii) ACA to uphold the appellate court’s reversal of the award. It agreed with the appellate court that the respondent Railways was unable to present its case and the arbitrator acted in “unnecessary haste and hurry.”

These were the observations of Sanjiv Khanna J authoring for the 2-judge bench:

  1. Under Section 19 ACA, the tribunal is bound by the Civil Procedure Code, 1908 or the Indian Evidence Act, 1872 and, in the absence of any agreement between the parties as to the procedure, may conduct the proceedings in the manner it considers appropriate.
  2. But Section 18 ACA mandates that both parties shall be treated with equality and each party shall be given a full opportunity to present his case.
  3. Sections 24 and 25 ACA and the newly enacted Section 29A ACA (though not applicable) emphasize on quick and prompt adjudications.
  4. Both speedy disposal and reasonable opportunity are essential for an even-handed and correct decision. Neither should be sacrificed nor inflated to prolong or trample a just and fair adjudication.
  5. A pragmatic and common-sense approach would invariably check any discord between the desire for expeditious disposal and adequacy of opportunity to establish one's case.

The facts were that the claim and defence were exchanged quickly. The appellant’s witness was examined the same day his evidence was filed. Railways request for deferral of his cross examination was refused. Railways was directed to file the affidavit and produce its witness for cross-examination on the next date of hearing. When Railways requested for further time to file affidavit, an order was made subject to the payment of costs. Sine costs were not paid, the affidavit of evidence was not taken on record. Then the matter was posted for arguments and an ex parte award was made.

Parties agreed that the arbitrator may be appointed by the court, which it did and directed the proceedings to begin from the stage of respondent cross examining the claimant’s witness.

Read the judgment here.


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