SRI CHITTARANJAN MAITY versus UNION OF INDIA

Citation: [2017] 11 S.C.R. 722 · Decided: 03-10-2017 · Supreme Court of India · Bench: JASTI CHELAMESWAR · Disposal: Case Partly allowed

Cited by 3 judgment(s) · cites 3 · see the full citation network in Lexace

Judgment (excerpt)

A. 
B 
[2017] I l S.C.R. 722 
SRI CHITTARANJAN MAITY 
v. 
UNION OF INDIA 
(Civil Appeal Nos. 15545-15546 of20l 7) 
OCTOBER 03, 2017 
[J. CHELAMESWAR AND S. ABDUL NAZEER, JJ.] 
Arbitration and Conciliatio11 Act, 1996 - Arbitrability of 
dispute -Agreement e11tered i11to betwee11 the appe/la11t a11d 
C respondent for executio11 of work - Disputes arose between the 
parties - Appellant filed an application uls.11 (6) for appointme/1/ 
of Arbitrator - Arbitrator appointed - Award passed by Arbitral 
Tribunal challenged by responde/1/ which was dismissed by Single 
Judge of High Cu11rl - 01Yler of Single Judge challenged by 
o. 
E 
F 
rejpondent before Division Bench contending that the dispute could 
not be adjudicated by Arbitral Tribunal as the appellant had issued 
a 'No Claims Certificate' lo the respondent. thereby he foifeited his 
right for any claim from the respondent - Order of Single Judge 
and the award set aside with a directio11 for holding fresh reference 
by Arbitral Tribunal- On appeal, held: Issue relating to arbitrability 
of the dispute was 11either raised in the proceeding uls. 11 (6) before 
the Chief J11stice of High Court 11or before the Arbitral Tribunal or 
before the Single Judge in the proceedings uls.34 - Party 
questioning the jurisdiction of the Arbitrator has an obligation to 
raise the said questio11 before the Arbitrator - Thus, Division Bench 
was not justified in considering the arbitrability of the disputes for 
the .first time. 
Arbitration and Conciliation Act, 1996 - s.31 (7)(a) - Payment 
of illlerest -Arbitral Tribunal awarded interest on delayed payments 
i11 favour of appellant - Held: This section provides that if the 
agreement prohibits award of interest for the pre-award period (i.e. 
G · pre-reference and pendente lite period), the Arbitrator can11ot award 
interest for the said period - Admittedly, in the instant case, the 
General Conditions of Contract (GCC) goveming the contract 
between the parties, contained a clause which barred the p"yment 
of interest - Thus, appellant is not entitled for any interest on the 
H 
amount <1warded by Arbitra/ Tribunal. 
722 
· SRI CHITTARANJAN MAITY v. UNION OF INDIA 
723 
Pracrice and Procedure - Pleadings - Held: Party questioning 
A 
the jurisdiction ~/the Arbitrator has an obligation to raise the said 
question before the Arbitrator - Arbitration and Conciliation Act, 
1996. 
Arhitration - Arbitration award - Grounds for inte1ference -
Held: The intervention of court in arbitral awards is in few 
B 
circumstances like fraud or bias by the Arbitrators, violation of 
natural justice - Court cannot correct the errors of the Arbitrators. 
Partly allowing the appeals, the Court 
HELD: 1.l The issue relating to arbitrability of the dispute 
was not raised in the 11rocccding under Section 11(6) of the 
C 
Arbitration and Conciliation Act, 1996. One of the issues which 
can be considered by the Chief Justice under this provision is 
whether the claim is a live claim. This issue can 
also be kept 
open to be decided by the Arbitral Tribunal provided the said 
pica is urged before the Chief Justice. The respondent had not o 
raised the said plea either before the Chief Justice or Arbitral 
Tribunal or before the learned Single Judge in the proceedings 
under Section 34 of the 1996 Act. [Para ll] [728-F-H] 
1.2 Party qnestioning the jurisdiction of the Arbitrator has 
an obligation to raise the said question before the Arbitrator. [Para 
12) [729-A] 
1.3 Intervention of the court is envisaged only in few 
circumstances like fraud or bias by the Arbitrators, violation of 
natural justice. The court cannot correct the errors of the 
Arbitrators. [Para 13 J [729-D) 
1.4 Therefore, the Division Bench was not justified In 
considering the arbitrability of the disputes for the first time, 
particularly, when the respondent has not urged the issue relating 
to 'No Claims Certificate' before the Chief Justice, Arbitral 
Tribunal or before the learned Single Judge. [Para 14)(729-G-H) 
2.1 Section 31(7)(a) of the 1996 Act provides for payment 
of interest. In this Section, a specific provision has been created, 
whereby if the agreement prohibits award of interest for the prc-
award period (i.e. pre-reference and pe11de11te lite period), the 
Arbitrator cannot award Interest for the said period. Admittedly, 
E 
F 
G 
H 
724 
SUPREME COURT REPORTS 
[2017] 11 S.C.R. 
A 
the GCC, governing the contract between the parties, contains a 
clause which barre

Excerpt shown. Read the full judgment & AI analysis in Lexace.