B.B.M. ENTERPRISESversusTHE STATE OF WEST BENGAL AND ANR.

8                       [2020]
             SUPREME COURT     6 S.C.R. 8
                            REPORTS                     [2020] 6 S.C.R.


A                         B.B.M. ENTERPRISES

                                     v.

                 THE STATE OF WEST BENGAL AND ANR.

B                     (Civil Appeal No. 2834 of 2020)

                              JULY 30, 2020

                  [R. F. NARIMAN, NAVIN SINHA AND
                         INDIRA BANERJEE, JJ.]
C
          Arbitration and Conciliation Act, 1996:

        s. 34 – Petition under – Filed after expiry of limitation period
  of 120 days – Dismissed by District Judge – High Court setting
  aside the order of District Judge remanded the matter – In second
D
  round of litigation District Judge dismissed the petition – High Court
  by impugned order again remanded the matter to be adjudicated
  afresh – Appeal to Supreme Court – Held: District Judge had
  disposed of the petition u/s. 34 giving adequate reasons – High
  Court wrongly remanded the matter – Appeal disposed of.
E
        CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2834
  of 2020.

          From the Judgment and Order dated 26.03.2019 of the High Court
    at Calcutta in FMA No. 1298 of 2017.
F
          With

          Civil Appeal No. 2835 of 2020.

G        Saurav Agarwal, Priyankar Saha, Sarad Kumar Singhania,
    Anshuman Chowdhury, Ms. Rashmi Singhania, Advs. for the Appellant.

          Sidharth Luthra, Sr. Adv., Ms. Madhumita Bhattacharjee,
    Ms. Srija Choudhury, Saifuddin Shams, Mohd. Shakeib Naru, Advs. for
    the Respondents.
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                                     8
            B.B.M. ENTERPRISES v. STATE OF WEST                              9
                      BENGAL & ANR.

      The Judgment of the Court was delivered by                             A
      R.F. NARIMAN, J.
      1. Leave granted.
      2. We have heard learned counsel for the parties at great length.
                                                                             B
       3. Mr. Sidharth Luthra, learned Senior Advocate, appearing on
behalf of the respondent, painstakingly took us through the records,
including the Award, in order to point out various deficiencies which,
according to him, fell within the parameters of a Section 34 petition as a
result of which we should not therefore disturb the judgment of the High
Court, which has merely remanded the matter and directed that the            C
matter be disposed of in six months.
        4. This matter has a chequered history. The Award that was made
by the learned Arbitrator was on 16.09.2009. Five claims were made
before him amounting in all to Rs. 2,08,59,989. However, ultimately the
Award that was made in favour of the appellant herein was to the extent      D
of Rs. 1,38,44,430 plus 15% on a sum of Rs. 1,17,77,080 as pendente
lite interest plus Rs. 2,67,350 by way of costs without interest. If the
said amount, dehors costs, was not paid in four months, the interest
figure would become higher and would attract 18%.
       5. When the Award was put into execution, the Executing Court         E
pointed out that by the date of its order dated 11.02.2010, the 120 day
period – beyond which no Award can be challenged – was already over
and therefore proceeded with the execution. It was only when an order
of 17.02.2010 was made directing the RBI to disburse the awarded
amount after attaching the Government’s Bank Account, and the reply
                                                                             F
of the RBI dated 20.02.2010 stating that adequate funds were not in
such account, that the matter was then remitted by the High Court by an
order dated 24.02.2010 stating that the Government was willing to deposit,
at that point of time, 50% of the decretal dues in two weeks. At this
stage, therefore, the High Court set aside the Executing Court’s order
dated 17.02.2010. It is only after these proceedings that the respondent     G
woke up and filed a Section 34 petition challenging the Award on
02.04.2010.
      6. In the first round of litigation, the Section 34 petition was
dismissed by the learned District Judge on 22.03.2012, stating that the
period of 120 days was over, and hence no foray into the merits would        H
10            SUPREME COURT REPORTS                            [2020] 6 S.C.R.


A    be permissible at this stage. However, by an order dated 11.01.2013, the
     Division Bench set aside this judgment and remanded the matter for a
     fresh hearing.
           7. The learned District Judge, in the second round, by an order
     dated 22.12.2016, heard learned counsel for both parties and found as
B    follows:-
           “A court must not substitute its interpretation as against the views
           and interpretation of the arbitrator, the finding of the arbitrator
           requires to be accepted without demur because court has no power
           or jurisdiction to sit over the finding of fact arrived at by the
C          arbitrators. In the instant case, so far I could realize from the
           argument as advanced by the Ld. Advocate of the petitioner and
           also from the petition under Sec. 34 of Arbitration & Conciliation
           Act and the photo copy of documents placed before the court
           that the petitioner challenges the finding of facts but nothing is
           oozing out from record that the impugned award is perverse either
D          on account of interpretation of law or any other collateral aspect
           and consequent decision taken by the Arbitrator. The ground upon
           which the award is challenged is an entirely factual issue; in no
           way covered by any ground as enumerated in Sec. 34 of the
           Arbitration and Conciliation Act. We cannot forget that since the
E          arbitrator is a judge appointed by the parties, the parties are bound
           by his decision. His decision is final unless the reasons given by
           him in arriving at his decision are totally perverse or award is
           based on wrong proposition of law. In this case the dispute arises
           out of work contract, its execution and payment, i.e. Amount of
           claim, that aspect totally comes within the jurisdiction of arbitrator
F          that very finding cannot be interfered in a proceeding under Sec.
           34 of the Arbitration and Conciliation Act. In a case titled Union
           of India vs. Kalinga Construction Company, reported in AIR 1971
           SC 646 it has been categorically held by the Hon’ble Supreme
           Court that it is not open to the court to re-examine and reappraise
G          the evidence considered by the arbitrator to hold that the conclusion
           reached by the arbitrator is wrong. It is also settled principle that
           award cannot be challenged on the ground arbitrator has arrived
           at a wrong conclusion or has failed to properly appreciate the
           facts and evidence. As per ratio of decision reported in 1994 (1)
           Arbi. L.R. 45, AIR 2003 NOC 156 (Raj) and in consonance with
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           B.B.M. ENTERPRISES v. STATE OF WEST                                 11
                     BENGAL & ANR.

      the object of Arbitration & Conciliation Act jurisdiction of the court   A
      has been fettered. In Narayan Prasad Lohia vs. N. Kunj Kumar
      Lohia reported in (2002) 3 SCC 572, it has been held that one of
      the objects of the said Act is to minimize the role of Courts in the
      arbitration process. This has been find place in Sec. 5 of the
      Arbitration & Conciliation Act and Sec. 5 of the Arbitration &           B
      Conciliation Act speaks that Judicial authorities should not interfere
      except where, so provided in the Act. It is the intention of the
      legislature that there should be a minimum interference with the
      award. It can only be challenged under Sec. 34 of the Arbitration
      & Conciliation Act. Taking the risk of repetition I again mentioned
      there is no valid ground in the petition under Sec. 34 of the            C
      Arbitration & Conciliation Act for challenging the award. On
      perusal of the award it has come to my notice that Ld. Arbitrator
      has dealt with all the pleas/issues at the time of arbitration hearing
      and there is nothing which may tantamount to any glaring
      procedural defect or there is any manifest error on the point of
                                                                               D
      law or any miscarriage of justice had been taken place. Ld.
      Arbitrator has given a detailed, speaking and well reasoned award.
      Therefore, there is no iota of evidence to cast doubt about the
      integrity of award or arbitrator was biased because Arbitrator
      has the jurisdiction and authority to decide the question of
      entitlement of contractor’s enhanced claim. I get support of this        E
      view from the decision reported in 2003 (2) Arbi L.R. 280 (DB).
      So, award requires no interference.”
       8. The impugned order dated 01.03.2019 set aside the learned
District Judge’s order stating:
                                                                               F
      “Even assuming that the award was assailable on the basis of
      unamended provisions of Section 34 of the Arbitration and
      Conciliation Act, the Court would expect that there would be some
      discussion on the merits of the objection on the award and not a
      mechanical affirmation of the award by simply stating that the
      award does not come within any of the grounds of challenge               G
      enumerated in Section 34 of the Act. The learned Trial Judge did
      not indicate the reason as to why the award is unassailable under
      Section 34 of the Arbitration and Conciliation Act.”
     Having so held, the matter was remanded to be disposed of in six
months. The stay that has been granted throughout the hearing would            H
12             SUPREME COURT REPORTS                             [2020] 6 S.C.R.


A    continue. A resume of these facts would show that the matter has gone
     up and down already twice. We may only state that even though it does
     not appear that, in the second round, the point of limitation was argued,
     since a de novo hearing by the Division Bench was ordered on
     11.01.2013, this point also stared at the Court like a sore thumb. We are
     not satisfied that there is any answer to the limitation point. Even otherwise,
B
     having perused the order of the learned District Judge, we are of the
     view that adequate reasons were given to dispose of the Section 34
     petition filed by the respondent. We do not agree with the High Court
     that no reasons were given as a result of which a remand ought to be
     ordered. Resultantly, therefore the impugned High Court judgment is set
C    aside and the judgment dated 22.12.2016 passed by the learned District
     Judge is affirmed.
            9. At the fag end, Mr. Sidharth Luthra, learned Senior Advocate,
     made a fervent appeal to reduce the rate of interest which would be
     18% after the four months from the date of the Award expired. We
D    think the interest of justice requires that 18% be set aside and that the
     respondent pay interest at the rate of 15%. Further, he prayed that six
     months’ time be granted in order to pay the balance amount under the
     Award. We think, in the circumstances of the case, a period of three
     months is reasonable.
E           10. The appeals are disposed of accordingly.


     Kalpana K. Tripathy                                         Appeals disposed of.



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