KINNARI MULLICK AND ANOTHER versus GHANSHYAM DAS DAMANI

Citation: [2017] 6 S.C.R. 657 · Decided: 20-04-2017 · Supreme Court of India · Bench: DIPAK MISRA · Disposal: Appeal(s) allowed

Cited by 1 judgment(s) · cites 2 · see the full citation network in Lexace

Judgment (excerpt)

[2017] 6 S.C.R. 657 
KINNARI MULLICK AND ANOTHER 
v. 
GHANSHYAM DAS DAMANI 
(Civil Appeal No. 5172of2017) 
APRIL 20, 2017 
[DIPAK MISRA, A. M. KHANWILKAR, 
MOHAN M. SHANTANAGOUDAR, JJ.) 
Arbitration and Conciliation Act, 1996 - s.34(4) -Appellants 
entered into an agreement with respondent - Disputes arose between 
A 
B 
c 
the parties - Respondent invoked arbitration proceedings ,... 
Arbitrator passed award allowing the claim of respondent -
Appellants filed application u/s.34 for setting aside the award -
Single Judge of High Court set aside the impugned award with the 
finding that it did not disclose any reason in support thereof -
Division Bench affirmed the finding and conclusion recorded by 
Single Judge 'however, suo motu relegated the parties before the D 
Arbitral Tribunal, in absence of any application filed by the parties 
to the arbitration proceedings and directed the Arbitrator to assign 
reason to support award passed by him - Propriety of - Held: No 
power /:las been invested by the Parliament in the Court to remand 
the matter to the Arbitral Tribunal except to adjourn the proceedings 
E 
for limited purpose mentioned u/s.34(4) - The limited discretion 
available to the Court under s.34(4) can be exercised only upon a 
written application made in that behalf by a party to the arbitration 
proceedings -
Respondent failed to make such a request before 
Single Judge in the first instance and also failed to do so before 
Division Bench - The Court cannot exercise this limited power of F 
deferring the proceedings before it suo motu - Further, the 
quintessence for exercising power uls.34(4) is that the arbitral award 
has not been set aside - In the instant case, Division Bench affirmed 
the conclusions recorded by the Single Judge and dismissed the 
appeal preferred by the respondent, thus the award was set aside 
on that count - Impugned direction of High Court suffers from 
jurisdictional error and thus cannot be sustained. 
Allowing the appeal, the Court 
HELD: I. On a bare reading of s.34(4) of Arbitration and 
Conciliation Act, 1996, it is amply clear that the Court can defer 
657 
G 
H 
658 
SUPREME COURT REPORTS 
[2017] 6 S.C.R. 
A the hearing of the application filed under Section 34 for setting 
aside the award on a written request made by a party to the 
arbitration proceedings to facilitate the Arbitral Tribunal by 
resuming the arbitral proceedings or to take such other action 
as in the opinion of Arbitral Tribunal will eliminate the grounds 
B for setting aside the arbitral award. The quintessence for 
exercising power under this provision is that the arbitral award 
has not been set aside. Further, the challenge to the said award 
has been set up under Section 34 about the deficiencies in the 
arbitral award which may be curable by allowing the Arbitral 
Tribunal to take such measures which can eliminate the grounds 
C for setting.aside the arbitral award. No power has been invested 
by the Parliament in the Court to remand the matter to the Arbitral 
Tribunal except to adjourn the proceedings for the limited purpose 
mentioned in sub-section 4 of Section 34. [Para 13) [666-B-D] 
2. In any case, the limited discretion available to the Court 
D under Section 34(4) can be exercised only upon a written 
application made in that behalf by a party to the arbitration 
proceedings. It is crystal clear that the Court cannot exercise 
this limited power of deferring the proceedings before it suo motu. 
Moreover, before formally setting aside the award, if the party to 
the arbitration proceedings fails to request the Court to defer 
E 
the proceedings pending before it, then it is not open to the party 
to move an application under Section 34(4) of the Act. For, 
consequent to disposal of the main proceedings under Section 
34 of the Act by the Court, it would become functus officio. In 
other words, the limited remedy available under Section 34(4) is 
F 
required to be invoked by the party to the arbitral proceedings 
before the award is set aside by the Court. (Para 14) (666-G-H; 
667-A] 
3. In the present case, the Single Judge had set aside the 
award. Indeed, the Respondent carried the matter in appeal before 
the Division Bench. Even if it is assumed that the appeal was in 
G continuum of the application under Section 34 for setting aside of 
the award and therefore, the Division Bench could be requested 
by the party to the arbitral proceedings to exercise its discretion 
under Section 34

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