Section 34 Application Does Not Cease To Be An Application Only Because Procedural Requirements Were Not Complied: Delhi High Court

The Delhi High Court has ruled that an application to set aside an arbitral award under Section 34 of the Arbitration and Conciliation Act, 1996 (A&C Act) does not cease to be an application merely because the applicant has not complied with certain procedural requirements. The bench of Justices Vibhu Bakhru and Purushaindra Kumar Kaurav held that filing an affidavit in support of an application and the statement of truth by way of an affidavit, are procedural requirements. In absence of these requirements, the application cannot be treated as non est, the Court said. The Court added that though filing of a court fee is necessary, however, the defect in not filing the court fee along with the application can be cured and it would not render the application invalid. Certain disputes between the appellant - Oil and Natural Gas Corporation (ONGC), and the respondent, who is a Joint Venture of M/s Sai Rama Engineering Enterprises and M/s Megha Engineering & Infrastructure Ltd, arose under a Contract, which were referred to arbitration. Against the arbitral award passed in favour of the respondent, the appellant filed an application under Section 34 of A&C Act before the Delhi High Court. The Single Judge dismissed the appellant’s application on the ground that it was filed beyond the limitation period prescribed under Section 34(3). The appellant challenged the order before the Division Bench of the High Court by filing an appeal under Section 37 of the A&C Act. The appellant ONGC submitted before the Court that it received a copy of the award on 23.10.2018. The appellant filed the application under Section 34 on 20.02.2019, which was returned by the Registry for refiling as it was defective. Finally, the appellant cured the defects and re-filed the application on 25.02.2019. The Single Judge had ruled that since the application filed by the appellant prior to 25.02.2019, was not proper, it could not be considered as valid and it did not qualify as an application under Section 34 of the A&C Act. The Single Judge held that it had no jurisdiction to condone the delay since the application was filed beyond the extended period of 30 days that could be condoned in terms of the proviso to Section 34(3). The Division Bench noted that the application filed by the applicant on 20.02.2019 was notified by the Registry as defective because the affidavits and the statement of truth by way of an affidavit were not attested and the vakalatnama was not stamped. The appellant re-filed the application several times before refilling it on 25.02.2019, after finally curing all the defects. The bench held that the nature of some defects is such that it would not be appropriate to consider the defective application as an application under Section 34 of the A&C. However, certain defects are curable and do not render the application as non est. Thus, every improper filling is not non est, the Court said. The Court added that for an application to be considered as non est, the Court must come to the conclusion that it cannot be considered as an application for setting aside the arbitral award. “The first and foremost requirement for an application under Section 34 of the A&C Act is that it should set out the grounds on which the applicant seeks setting aside of the arbitral award”, the Court said. The bench added: “It is also necessary that the application be accompanied by a copy of the award as without a copy of the award, which is challenged, it would be impossible to appreciate the grounds to set aside the award”. Further, in addition to the above, the Section 34 application must also state the name of the parties and the bare facts of the case in context to which the award is sought to be set aside, the Court said. Also, the bench reckoned that it is necessary that the application is signed by the party or its authorised representative, since in the absence of such signatures, it would be difficult to accept that the application is moved by the applicant. However, the Court ruled that the application to set aside an arbitral award does not cease to be an application merely because the applicant has not complied with certain procedural requirements. The bench added that filing an affidavit in support of an application and the statement of truth by way of an affidavit, are procedural requirements. Thus, in absence of these requirements, the application cannot be treated as non est, the bench concluded. “It is well settled that filing an affidavit in support of an application is a procedural requirement. The statement of truth by way of an affidavit is also a procedural matter. As stated above, it would be necessary to comply with these procedural requirements. Failure to do so would render an application under Section 34 of the A&C Act to be defective but it would not render it non est”, the Court said. Noting that the ...

Section 34 Application Does Not Cease To Be An Application Only Because Procedural Requirements Were Not Complied: Delhi High Court

Parina Katyal

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