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2016 (8) TMI 1255 - BOMBAY HIGH COURTEffect of the amendment to Section 36 of the Arbitration Act - Arbitration and Conciliation (Amendment) Act, 2015 - Held that:- Application of amended Section 36 to the existing matters i.e. the applications under Section 34 of the Arbitration Act, that are pending as on 23rd October, 2015 is giving prospective effect to the amendment and not retrospective effect. The most relevant consideration for applying it to the existing matters is the nature, ambit and scope of the Amending Act. Under the original Section 36, filing of an application under Section 34 had the effect of casting shadow upon the executability of the award. This act of the award-debtor disabled the award-holder from executing the award in his favour irrespective of the merit in the challenge. In this circumstance, there could be no question of any right accruing to the award-debtor by filing the application under Section 34. The Amended Section 36 lifts the shadow over the right of the award-holder. His disability gets removed. At the same time, the application under Section 34 of the award-debtor remains intact. The removal of disability is not complete. It is partial. The provision enables the award-debtor to apply to the Court for make the award inexecutable pending his application. His right to apply for interim relief during the pendency of the application under Section 34 is not affected in any way. In this way in fact the Amending Act brings in balance between the rights and liabilities of both the sides. The ambit and scope of the Amended Section 36, is to cure the defect by removing the imbalance. Thus the application of the provision on the petitions under Section 34 pending on 23rd October, 2015, is prospective. It makes no difference if the application under Section 34 filed by the award-debtor was prior to 23rd October, 2015. Removal of shadow over the rights of the award-holder cannot be said to be prejudicial to the award-debtor. He has to now only file an application for interim reliefs, which may or may not, be subject to imposition of condition. Now that effect of the operation of the amended Section 36, is held to be prospective, there is in fact no need to consider the alternate argument of justifying retrospective operation, on the ground of the amendment being curative and procedural. In any case, that the amending provision is curative cannot be disputed at all. This is evident from the observations of the Apex Court in Nalco's case indicating the defects in the Original Section 36, the imbalance caused by it and the mischief done by it. There can also be no doubt that, it is procedural in nature as it concerns only the procedural aspect of the challenge to the arbitral award. It was sought to be argued that, application of the amendment to the existing matters would bring in anomaly or absurdity or produce impracticable results. The submission would have been of some substance if the Amended Section 36 were not to provide for an application to be made by the award-debtor for interim reliefs.
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