LexSTATE OF MAHARASHTRA versus M/S. HINDUSTAN CONSTRUCTION COMPANY LTD.
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A B [2010] 4 S.C.R. 46 STATE OF MAHARASHTRA v. MIS. HINDUSTAN CONSTRUCTION COMPANY LTD. (Civil Appeal No. 2928 of 2010) APRIL 1, 2010 [R.V. RAVEENDRAN AND R.M. LODHA, JJ.] Arbitration and Conciliation Act, 1996 - ss.34 and 37 - Disputes between respondent-company and appellant-State C - Arbitral award - Application by appellant u/s.34 for setting aside the award rejected - Appeal by appellant uls.37 - Subsequent application by appellant for amendment in memorandum of appeal to raise additional/ new grounds - Rejected by High Court on the reasoning that new grounds D for setting aside the arbitral award could not be permitted· to be raised beyond the period of limitation prescribed in s.34(3) - Justification of - Held: On facts, justified - The grounds sought to be added in the memorandum of arbitration appeal by way of amendment were absolutely new grounds for which E there was no foundation in the application for setting aside the award - Such new grounds containing new material/facts could not have been introduced for the first time in an appeal when admittedly these grounds were not originally raised in the arbitration application for setting aside the award - F Moreover, no prayer was made by appellant for amendment in the application uls.34 before the concerned court or at the appellate stage - In the circumstances, it cannot be said that discretion exercised by the High Court in refusing to grant leave to appellant to amend the memorandum of arbitration G appeal suffers from any illegality. H Pleadings - Amendment of - Power of appellate court to grant leave to amend the memorandum of appeal - Discussed - Code of Civil Procedure, 1908 - Order XL/, rr.2 and 3 and Order VI, r. 17. 46 STATE OF MAHARASHTRA v. HINDUSTAN 47 CONSTRUCTION COMPANY LTD. Respondent construction company had entered into A a contract with the appellant-State. Disputes arose between the parties in respect of the work carried out by respondent, which were referred to the Arbitral Tribunal. The Tribunal awarded a specified amount to the respondent. Appellant filed an application under s.34 of B the Arbitration and Conciliation Act, 1996 for setting aside the arbitral award on various grounds viz., waiver, acquiescence, delay, laches and res judicata. The District Judge rejected the application for setting aside the award. The appellant filed arbitration appeal under s.37 of the C Act before the High Court. Subsequently, the appellant fil,~d an application seeking amendment to the memorandum of arbitration appeal by adding new grounds. The application for amendment was rejected by the High Court on the reasoning that the new grounds D for setting aside the arbitral award could not be permitted to be raised beyond the period of limitation prescribed in · s.34(3) of the Act. In appeal to this Court, the question which arose for E consideration was whether in an appeal under Section 37 of the Act from an order refusing to set aside the arbitral award, an amendment in the memorandum of appeal to raise additional/new grounds can be permitted. Dismissing the appeal, the Court F HELD: 1.1. Pleadings and particulars are required to enable the court to decide true rights of the parties in trial. Amendment in the pleadings is a matter of procedure. Grant or refusal thereof is in the discretion of the court. G But like any other discretion, such discretion has to be exercised consistent with settled legal principles. Insofar as Code of Civil Procedure, 1908 is concerned, Order VI Rule 17 thereof provides for amendment of pleadings. It H 48 SUPREME COURT REPORTS [2010] 4 S.C.R. A says that the Court may at any stage of the proceedings allow either party to alter or amend his pleadings in such manner and on such terms as may be just, and all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy B between the parties. [Paras 14 and 15) (56-E; 57-8-C] 1.2. Order XU Rule 2 CPC makes a provision that the appellant shall not, except by leave of the Court, urge or be heard in support of any ground of objection not set forth in the memorandum of appeal; but the Appellate C Court, in deciding the appeal, shall not be confined to the grounds of objections set forth in the memorandum of appeal or taken by leave of the Court. Order XU Rule 3 CPC provides that where the memorandum of appeal is not drawn up as prescribed, i
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