2016 (6) TMI 1452 - HC - Indian Laws

Service of Arbitral Award - existence of dispute between the parties or not - applicability of period of limitation prescribed under Section 34(3) of the Arbitration Act. Whether unclaimed service of the signed copy of the arbitral award sent by the learned arbitrator to a party under Section 31(5) of the Arbitration Act inspite of intimation posted by the postman would amount to a good service and refusal to accept the arbitral award? - whether limitation for filing a petition would commence under Section 34(3) of the Arbitration Act from the date of such refusal of service of the arbitral award? HELD THAT - If the submission of the learned counsel for the petitioner that till service of signed copy of the arbitral award from the learned arbitrator is actually received by the petitioner though it was not claimed by the petitioner inspite of intimation posted by the postman, it will not amount to delivery of the award under Section 31(5) of the Arbitration Act is accepted, dishonest litigant who deliberately does not claim copy of the signed award sent by the learned arbitrator inspite of the postman having posted the intimation, the limitation would never commence for filing a petition under Section 34(3) of the Arbitration Act and the beneficiary of the award would never be able to apply for execution of such award. An unclaimed service amounts to a good service and amounts to refusal to accept the delivery of the arbitral award which was sent by the learned arbitrator at the correct address and the intimation was posted by the postman to the petitioner. The limitation for filing of the arbitration petition under Section 34(3) of the Arbitration Act would commence from the date on which the intimation was posted by the postman and the same was not collected by the petitioner from the post office. Admittedly, the intimation was posted in this case by the postman on 21st July 2014 and 22nd July 2014 whereas the the petitioner has lodged the arbitration petition only on 22nd June 2015. The petition thus having been filed after expiry of three months from the date of deemed delivery of such award, the petition in my view is barred by law of limitation prescribed under Section 34(3) of the Arbitration Act. Arbitration Petition is dismissed on the ground of limitation.

Summary

Issues Involved:
1. Limitation for filing the petition under Section 34(3) of the Arbitration and Conciliation Act, 1996.
2. Whether unclaimed service of the arbitral award amounts to good service and refusal to accept the award.
3. Commencement of the limitation period for filing a petition under Section 34(3) of the Arbitration Act.

Detailed Analysis:

Limitation for Filing the Petition:

The petitioner challenged the arbitral award dated 18th July 2014 under Section 34 of the Arbitration and Conciliation Act, 1996. The respondent raised an issue of limitation, arguing that the petition was filed beyond the prescribed period under Section 34(3) of the Arbitration Act. The petitioner contended that the signed copy of the award was received on 13th March 2015, and thus, the petition filed on 22nd June 2015 was within the limitation period.

Unclaimed Service of the Arbitral Award:

The petitioner argued that the limitation period should commence from the date of receiving the signed copy of the award. The respondent countered that the arbitrator had sent the signed award on 18th July 2014, and the postal department made attempts to deliver it on 21st and 22nd July 2014, but the petitioner did not claim it. The respondent asserted that this unclaimed service amounted to good service and refusal to accept the award.

Commencement of Limitation Period:

The court examined whether unclaimed service of the signed copy of the arbitral award, despite postal intimation, constituted good service and refusal to accept the award, thus triggering the limitation period under Section 34(3) of the Arbitration Act. The court noted that the petitioner had not disclosed the attempts made by the postman to deliver the award in July 2014. The petitioner’s additional affidavit claimed unavailability during the delivery attempts, but no proof was provided.

Key Findings:

The court found that the petitioner was aware of the award by August 2014 but applied for a certified copy only in February 2015. The court held that the Arbitration Act is a self-contained code, and time taken to obtain a certified copy under Section 12(2) of the Limitation Act is not excluded from the limitation period under Section 34(3) of the Arbitration Act.

Under Section 3(1) of the Arbitration Act, written communication is deemed received if delivered to the addressee’s place of business or habitual residence. The court concluded that the petitioner’s failure to claim the award despite postal intimation amounted to good service and refusal to accept the award. The limitation period commenced from the date of postal intimation, making the petition filed on 22nd June 2015 time-barred.

The court referenced the Supreme Court’s judgment in C.C. Alavi Haji, which held that service is deemed effected when sent to the correct address by registered post unless proven otherwise. The court extended this principle to the Arbitration Act, agreeing with the Calcutta High Court that unclaimed service amounts to refusal of service.

Conclusion:

The court dismissed the arbitration petition on the ground of limitation, stating that the petitioner’s arguments were contrary to established legal principles and the provisions of the Arbitration Act. The petition was filed beyond the three-month period from the date of deemed delivery of the award.

Order:

(a) Arbitration Petition No.1422 of 2015 is dismissed on the ground of limitation.

(b) There shall be no order as to costs.