The Supreme Court today issued notice in a plea filed by MP Rajya Tilhan Utpadak Sahakari Sangh Maryadit, Pachama , District Sehore seeking stay of execution of decretal amount of Rs 24,03,300 and on the principal amount Rs 14,39,292.68 interest at the rate of 12% will be paid from June 22, 1995 till realization. (M.P. Rajya Tilhan Utpadak Sahakari Maryadit, Pachama, District Sehore & Others Vs M/s Modi Transport Service)
Purishaindra Kaurav, the Counsel for M.P. Rajya Tilhan Utpadak Sahakari Sangh Maryadit, Pachama , District Sehore, submitted before the court that Modi Transport Service had filed an application for appointment of commissioner and not for appointment of arbitrator. For Modi Transport Service, counsel Ranjeeta Rohatgi appeared.
The Bench of Justice R. Subhash Reddy and Justice Sanjiv Khanna commented that by invoking arbitration proceedings, the civil suit is being kept in abeyance. The High Court upholding the order of Trial court noted that in 1994, prior to 2002, no provision existed with respect to referring the dispute to arbitrator during civil suit pendency.
After July 1, 2002, the provision was introduced for referring the dispute to Arbitrator in consonance with agreement of parties and such shall be appointed by Civil Court. M.P. Rajya Tilhan Utpadak Sahakari Sangh Maryadit, Pachama , District Sehore preferred First Appeal under section 96 CPC against judgment and decree passed by ADJ to District Judge in favour of Modi Transport Service.
Arbitrator Sushil Kumar Mantri, Chartered Accountant, got appointed as an Arbitrator with consent of both parties as decided by trial court. Arbitrator passed award under Arbitration Act, 1940 on 23.12.1994
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Now the question arose before the High Court was that whether the order passed on 23.12.1994 for appointment of arbitrator or for commissioner to examine account books and relevant papers of parties to assess the due amount. It was held by High Court of Madhya Pradesh that it is clear from order of trial court that Sushil Kumar Mantri, CA was appointed as arbitrator and not as commissioner.
The High Court rejecting the appeal observed,
“the objection filed challenging the award of arbitrator by Petitioner herein was filed beyond limitation period. Also the objections for setting aside an award or getting an award remitted for reconsideration was not filed within 30 days from the date of service of notice of filing of the award and, therefore, no separate notice was required as the appellants were aware of filing the award before the Court, hence the learned trial court has rightly arrived at a conclusion that the objection was time barred.”