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TMI Blog2022 (1) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... rlier; b) The respondent (ICICI Bank) is ordered and directed to pay to the claimant (I-pay) Rs. 50,000/- (Rupees Fifty Thousand) as cost on the application under Section 16 made before this Arbitral Tribunal." 4. In the petition, filed by the respondent-ICICI Bank under Section 34(1) of the Act, it has taken out Notice of Motion No.550 of 2018 seeking interim order to stay the effect, operation, implementation and execution of the award dated 13.11.2017, passed by the learned Arbitrator. In the same petition, the appellant/I-Pay has taken out Notion of Motion No.1549 of 2019, under Section 34(4) of the Act, seeking directions to adjourn the proceedings for a period of three months or such other time as may be determined by the Court, and direct the learned Arbitrator to issue appropriate directions/ instructions / additional reasons and / or to take such necessary and appropriate action. The High Court by a common order, has passed the conditional order in the Notice of Motion taken out by the respondent and dismissed the Notice of Motion No.1549 of 2019, taken out by the appellant herein, under Section 34(4) of the Act. Aggrieved by the order of dismissal, dismissing the Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade a total claim of Rs. 95 crores against the respondent. At first instance, a suit was filed in O.S. No.1094 of 2012 on its Original Civil Jurisdiction in the High Court of Judicature at Bombay. As there was a clause in the Agreement for arbitration, the High Court has referred the dispute to arbitration under Section 8 of the Act by appointing Mr. Justice R.G. Sindhakar (Retd.) as a Sole Arbitrator for resolving the dispute between the parties. 8. Mr.Justice R.G.Sindhakar (Retd.), who was appointed as Sole Arbitrator, has passed award dated 13.11.2017, directing the respondent herein, to pay to the appellant - claimant an amount of Rs. 50,00,00,000/- (Rupees Fifty Crores) together with interest @18% per annum from the date of award till payment and further directed to pay an amount of Rs. 50,000/- (Rupees Fifty Thousand) towards the costs. 9. Aggrieved by the award of learned Sole Arbitrator, the respondent-ICICI Bank has filed application under Section 34(1) of the Act for setting aside the award. In the said application, it is the case of the respondent that there was accord and satisfaction between the parties and the contractual obligations between the parties was closed m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Notice of Motion moved by the appellant for remitting the matter to the Sole Arbitrator under Section 34(4) of the Act, has been rejected. It is the case of the appellant that though the Arbitrator has awarded compensation/damages in view of the case of the appellant that the contract between the parties was illegally and abruptly terminated by the respondent, but he has not recorded detailed reasons on the said point. On the other hand, it is the case of the respondent, that there was full accord and satisfaction between the parties, as such, appellant is not entitled for any compensation/damages, as claimed for. To prove the case that there was 'accord and satisfaction' between the parties, the respondent has filed certain communications between the parties including letter dated 01.06.2010. It is the contention of Dr.Abhishek Manu Singhvi, learned senior counsel appearing for the appellant, that though the issue was resolved by the Arbitrator by holding that there was no accord and satisfaction between the parties, however, he has omitted to give adequate reasons in support of point no.1. Thus, it is pleaded that in view of settled legal position that lack of reasons or ga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome gaps in the reasoning. Learned senior counsels, with the above submissions, requested to set aside the impugned order and to issue directions for remitting the award to Arbitral Tribunal for consideration of the issue, on abrupt and illegal termination of the agreement entered between the parties and to give detailed reasons. 14. On the other hand, Shri K.V. Vishwanathan, learned senior counsel for the respondent has made following submissions: The Notice of Motion moved by the appellant is dismissed by the High Court by assigning valid reasons in the impugned order and in view of the same, no interference is called for. No grounds are made out in the application filed by the appellant for remitting the matter to the Arbitrator, and in fact, the Arbitrator has not considered the relevant documentary evidence produced on behalf of the respondent, and passed the award. As the Arbitrator has passed the award by ignoring important and relevant evidence on record, it suffers from perversity and patent illegality, which cannot be cured on remittal under Section 34(4) of the Act by the Arbitrator. Under guise of adding reasons, the Arbitrator cannot take contrary view against the aw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... course against arbitral award. The recourse to a Court against an arbitral award is to be in terms of Section 34(1) of the Act. As per Section 34(2A) of the Act, if the arbitral award arising out of arbitrations other than international commercial arbitrations, is vitiated by patent illegality, same is a ground for setting aside the award. Sections 34(2A), (3) & (4) of the Act, read as under: "34.(2A) An arbitral award arising out of arbitrations other than international commercial arbitrations, may also be set aside by the Court, if the Court finds that the award is vitiated by patent illegality appearing on the face of the award: Provided that an award shall not be set aside merely on the ground of an erroneous application of the law or by re-appreciation of evidence. (3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under section 33, from the date on which that request had been disposed of by the arbitral tribunal; Provided that if the Court is satisfied that the application was prevented by sufficient cause from ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eking remission to the Arbitrator to provide detail and express reasons in addition to reasons already stated in the arbitral award dated 13.11.2017. It is also their case that it is essential that additional reasons are made available by learned Arbitrator in support of his findings recorded in the award. On the other hand, it is the case of the respondent, that there is no finding at all, on the issue viz. "whether the contract was illegally and abruptly terminated by the respondent?", and in spite of the same, the Arbitrator without considering the important documents/communications between the parties, which throw light on accord and satisfaction between the parties, has proceeded to pass the award stating that there was no 'accord and satisfaction'. 19. As contended by learned senior counsel for the appellant, it is true that Section 34(4) of the Act is couched in a language, similar to Article 34(4) of the UNCITRAL Model Law on International Commercial Arbitration. In the case of AKN & Anr. v. ALC & Ors. (2015) SGCA 63, by considering legislative history of the Model Law, it was held by Singapore Court of Appeals that remission is a 'curative alternative'. In the case of Kin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gment in the case of Income Tax Officer, A Ward, Sitapur v. Murlidhar Bhagwan Das AIR 1965 SC 342. It is clear from the aforesaid judgment that 'finding is a decision on an issue'. Further, in the judgment in the case of J. Ashoka v. University of Agricultural Sciences and Ors. (2017) 2 SCC 609, this Court has held that 'reasons are the links between the materials on which certain conclusions are based and the actual conclusions'. In absence of any finding on point no.1, as pleaded by the respondent and further, it is their case that relevant material produced before the Arbitrator to prove 'accord and satisfaction' between the parties, is not considered, and the same amounts to patent illegality, such aspects are to be considered by the Court itself. It cannot be said that it is a case where additional reasons are to be given or gaps in the reasoning, in absence of a finding on point no.1 viz. "whether the contract was illegally and abruptly terminated by the respondent?" 21. Further, Section 34(4) of the Act itself makes it clear that it is the discretion vested with the Court for remitting the matter to Arbitral Tribunal to give an opportunity to resume the proceedings or not. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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