JUDGMENT Prakash Krishna , J.
1. This is an appeal under Section 37(1)(b) of the Arbitration and Conciliation Act 1996 (hereinafter referred to as the Act) at the instance of the objector, against whom an award by the Arbitral Tribunal has been passed.
2. The factual matrix of the case is that the parties entered into a registered lease agreement in respect of property No. 7/110-A Sarup Nagar, Kanpur, The said lease agreement is dated 15th February, 1999. It also contains an arbitration clause. The respondent is admittedly the lessor and the present appellant is the lessee of the aforesaid property. The dispute having arisen between the parties It was referred to Arbitral Tribunal of Shri Manish Agrawal. The Arbitral Tribunal by its award dated 4th August, 2000 ordered that-the present appellant shall deliver the vacant possession of the premises in question i.e. 7/110-A to the present respondent and shall also pay the over due rent from January, 2000 up to 3rd August, 2000 amounting to Rs. 56.000/- along with the damages at the rate of Rs. 5000/- per day w.e.f. 1st September, 2000 till the actual date of delivery of the vacant possession of the accommodation in question. It also directs payment of electricity dues amounting to Rs. 2.85 lacs approximately and interest at the rate of 15% per annum etc.
3. The appellant filed objections Under Section 34 of the Act against the aforesaid award on 1st December, 2000 along with an application for condonation of delay in its filing. The delay was condoned by order dated 19th January, 2001, however, the objections preferred by the appellant has been dismissed by the Court below by the impugned order. Aggrieved against the aforesaid order, the present appeal has been filed.
4. Heard learned counsel for the parties and perused the record. Shri Shashi Nandan, Senior Advocate assisted by Shri Manu Khare, learned Advocate raised three points in support of the appeal. Firstly the finding of the Court below in paragraphs 6 and 7 of the judgment that there was no sufficient cause to condone the delay under proviso to Sub-section (3) of Section 34 of the act is incorrect, secondly, (.he award is, a waste paper inasmuch as it has not been, written on stamp paper and no stamp duty has been paid by the respondent on the aforesaid award, thirdly after the award dated 4th August, 2000, the party entered into a fresh agreement on 2nd September, 2000. The fresh agreement declared that the aforesaid award is null and void and shall not be put into execution and relations of the parties shall be governed by the terms and conditions as contained therein, therefore, the award is not executable and liable to be set aside.
5. Sri S.N. Verma, learned Senior counsel assisted by Sri Pankaj Bhatia, learned counsel appearing on behalf of the respondents submitted that notwithstanding the fact that the Court below found that the delay in filing objections could not be condoned, the Court proceeded to decide the objections preferred by the appellants on merits and as such the question that the objections were barred by limitation is only of academic interest. He submitted that the objections to an Arbitral award can be raised only on the ground enumerated in Section 34(2) of the Act. None of the objections raised by the appellant falls in the aforesaid category and, therefore, the objections are liable to be rejected. The genuineness and correctness of the subsequent alleged agreement dated 2nd September, 2000 was also disputed on behalf of the respondents. It was submitted that no such agreement was entered into by the parties and the alleged agreement dated 2nd September, 2000 is forged and fabricated document and cannot be relied upon at all.
6. Taking the first point first, it is true that the Court below has come to the conclusion in paragraphs 6 and 7 of the judgment that there are no sufficient reasons to condone the delay under proviso to Sub-section (3) of Section 34 of the Act. It is also true that the Court below by the order dated 19th January, 2001 had condoned the delay and It was escaped from the notice of the Court below. This position was admitted by the learned Senior Counsel Shri S. N. Verma for the respondents. It was argued by the learned counsel for the appellant that in view of the above fact, the Judgment in question shows the non application of the mind by the Court below. This argument has no merit and is liable to be rejected. The fact remains that the Court below also considered the objections on its own merit and has not based its judgment solely on the question of limitation. In view of the fact that the objections have been considered and decided on merits, in the opinion of the Court the question of limitation is only of academic interest. It does not require any further discussion.
7. The second point raised by the learned counsel for the appellant is that the award is liable to be set aside on the ground that it has not been stamped and registered. This point is fully covered by a recent judgment of the Apex Court in the case of M. Anasuya Devi v. M. Manik Reddy, (2003) 8 JT (SC) 276. The Supreme Court has held that the question of registration of an award and payment of stamp duty is not required to be gone into at the stage of proceedings under Section 34 of the Act. In fact this issue is premature at this stage. Section 34 of the Act provides for setting aside of the award on the grounds enumerated therein. It cannot be disputed that an application for setting aside the award would not lie on any other ground not enumerated in Section 34 of the Act. The questions as to whether the award is required to be stamped and registered would be relevant only when the parties would file the award for its enforcement under Section 36 of the Act. At that stage the parties can raise objections regarding its admissibility on account of non registration and non stamping under Section 17 of the Registration Act. In view of the above the second point raised by the learned counsel for the appellant is liable to be rejected.
8. Elaborating the third point the learned counsel for the appellant submitted that the Court below committed illegality in not recording any finding about the genuineness and correctness of the subsequent agreement dated 2nd September, 2000, therefore, the objections under Section 34 of the Act are liable to be allowed and the award passed by the Arbitral Tribunal should be set aside. Reliance has been placed by him on a judgment of Supreme Court, Munshi Ram v. Banwari Lal, AIR 1962 SC 903.
9. To decide this point it is necessary to consider the statutory provisions of the Act, Section 34(1) of the Act provides that recourse to a Court against an Arbitral Award may be made only by an application for setting aside such award in accordance with Sub-sections (2} and (3), Sub-section (2) of Section 34 enumerates the grounds on which an Arbitral Award can be set aside. The relevant portion of Section 34 is quoted below :-
"Section 34(1) ........................
(2) An arbitral award may be set aside by the Court only if -
(a) the party making the application furnishes proof that -
(i) a party was under some incapacity, or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law for the time being in force; or
(iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration;
Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part: or
(b) the Court finds that -
(i) the subject matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or
(ii) the arbitral award is in conflict with the public policy of India.
Explanation- Without prejudice to the generality of Sub-clause (ii), it is hereby declared, for the avoidance of any doubt, that an award is in conflict with the public policy of India if the making of the award was induced or affected by fraud or corruption or was in violation of Section 75 or Section 81.
(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 applicant was prevented by sufficient cause from making the application within the said period of three months it may entertain the application within a further period of thirty days, but not thereafter."
10. The law recognises limited and specific grounds, on which an arbitral award can be set aside. The intention of the Legislature is clear to restrict power of Court in such matters. To put it differently, the object of the Act is to attribute finality to an arbitral award, except under certain and recognised matters. This provision is in consonance of objectives of the Act, namely, to ensure that- the arbitral tribunal remains within the limits of its jurisdiction and to minimize the supervisory role of Courts in the arbitral process (see the statement and reasons as given in the Arbitration and Conciliation Bill, 1995). Thus when an award is given, the parties cannot, under the Act 1996, challenge it except as laid down there.
11. Thus, the parties cannot under the Act challenge an arbitral award except on the ground as laid down in Section 34(2) of the Act. The objections that the award has become null and void in view of subsequent agreement between the parties is not one of the grounds available in Sub-section (2) of Section 34, of the Act, to challenge the award. Even then it was contended by the appellant that it is always open to parties of a dispute to settle the dispute among themselves by way of compromise and, therefore, the award in question should have been set aside. In reply the counsel for respondent submitted that for the reasons more than one the said argument has no merit. He submitted that the genuineness and correctness of the aforesaid alleged agreement dated 2nd September, 2000 is very much in dispute. The parties have disputed the execution of any such agreement, therefore, unless and until the said agreement is established it cannot be a ground for setting aside the award. Secondly, the original lease agreement dated 15-2-1999 between the parties containing the arbitration clause is by way of registered document, the terms and conditions of a registered document cannot be varied by a subsequent unregistered document. The alleged subsequent agreement dated 2-9-2000 is unregistered agreement.
12. The appellant has placed reliance upon the judgment of Supreme Court in the ease of Munshi Lal v. Banwari Lal, AIR 1962 SC 903. The said judgment of the Supreme Court is an authority for the proposition that the Arbitration Act, 1940, does not disable the parties from terminating their dispute in a different way and if they do so, it could not be intended by law that a dispute which has been successfully terminated should again become the subject of litigation. The Supreme Court after great discussion has come to the conclusion that in view of Section 17 of the Arbitration Act, 1940, a judgment has to be pronounced, according to the award and upon the judgment so pronounced a decree follows, therefore, the Court can take notice of the subsequent terms entered into between the parties, varying the terms of the award. This observation of the Supreme Court should be understood in the context of Section 17 of the Arbitration Act, 1940. A close reading of the aforesaid judgment of the Supreme Court shows that it has distinguished the ruling of the Privy Council given in the case of Jnanendra Mohan Bhaduri v. Rabindra Nath Chakravarthi, approving the judgment of the Calcutta High Court given in the case of Rabindra Nath Chakravarthi v. Jnanendra Mohan Bhaduri.
13. At this stage it is necessary to notice few provisions of the Act. Section 39 of the Act provides that the Arbitral Award shall be made in writing and shall be signed by the members of the Arbitral Tribunal. The Arbitral proceedings shall be terminated by the final arbitral award or by an order of the Arbitral Tribunal under Sub-section (2) of Section 32. Section 35 of the Act has attached finality to Arbitral awards. Section 36 of the Act provides that, where the time for making an application to set aside the arbitral award under Section 34 has expired or such application having been made, it has been refused, the award shall be enforced under the Code of Civil Procedure in the manner as if it were a decree of a Court. This Section is a departure from corresponding Section 17 of the old Arbitration Act, 1940. Under Section 17 of the Act the Court shall pronounce judgment according to the award and upon the judgment so pronounced a decree shall follow, Keeping this distinction in mind, the ruling relied upon by the appellant in the ease of Munshi Ram (AIR 1962 SC 903) (supra) has to be examined. The relevant observations of the Supreme Court are contained in paragraph 15 of the aforesaid judgment which reads as follows :--
"(15) In Rabindranath Chakravarthi's also went before the Privy Council, the arbitration was before the present Arbitration Act was passed, and was governed by the Arbitration Act of 1.899. Under Section 15 of that Act, the Court was not required to pronounce a judgment or pass a decree, since the Act did not contain any provision for passing a decree. The award when filed in Court, unless set aside, had the force of a decree and was per se executable, it was. therefore, held that the Court had no general jurisdiction over the mailer, and that a decree passed modifying an award was without jurisdiction and a nullity, which the executing Court could refuse to execute. It will easily be seen that the reason of the rule was the absence of jurisdiction to pass a decree on the award, and a decree passed without such jurisdiction must evidently be a nullity."
14. At this stage it is relevant to notice the facts of the case of the Privy Council in the case of Jnanendra Mohan Bhaduri. (supra). A dispute having arisen between the parties, the matter was referred for arbitration. The Arbitrator made his award on 29th July, 19.18. On the award being filed there were two objections filed by the parties before the Court, containing certain terms of settlement among themselves, in accordance with which the parties wanted the award to be varied. The Court modified the award In terms of the settlement entered Into between the parties. The said settlement was made part of the decree passed by the Court. This decree was put in execution. An objection was raised before the Executing Court that the decree is nullity as the Court could not vary the terms of the award, In this background it was held by the Privy Council that the Arbitration Act 1899 does not contain any provision for making a decree on an award. Such a decree, if made is without jurisdiction is, therefore, nullity. It was of the opinion that unless the award is remitted or set aside, the award remained filed in Court and it was enforceable as if it were a decree of the Court. In this connection Section 15 of the Arbitration Act, 1899 as quoted in the aforesaid judgment of the Privy Council is reproduced below :-
"An award on a submission on being filed in Court in accordance with the foregoing provisions shall (unless the Court remits it to the reconsideration of the Arbitrators or Umpire or sets it aside) be enforceable as if it were a decree of a Court."
15. At this juncture it is relevant to notice the language of Section 36 of the Arbitration Act, 1996.
"36. Enforcement - Where the time for making an application to set aside the arbitral award under Section 34 has expired, or such application having been made it has been refused, the award shall be enforced under the Code of Civil Procedure, 1908 (V of 1908) in the same manner as if it were a decree of the Court."
16. The judgment of the Privy Council was held to be not applicable by the Supreme Court in the light of the provisions as contained in the Arbitration Act 1940. It also noticed that in the Arbitration Act of the year. 1899. there was no provision under the said Act requiring the Court to pass judgment or decree in terms of the award under Section 15 of that Act (Arbitration Act, 1899), the award filed in Court unless set aside had the force of a decree and was per se executable. The same position has been restored back by the Legislature under the present Arbitration Act of 1996. Therefore, this Court is of the view that the verdict of the Privy Council given in the case of Rabindranath Chakrabarti (supra) though was not applicable in the Arbitration Act, 1940, is fully applicable in the present Arbitration Act, 1996.
17. The Supreme Court in paragraph 18 of the aforesaid Judgment has held that the cases under the Arbitration Act of 1899 cannot afford a good guidance in respect of the cases under the Arbitration Act 1940.
18. The power of the Court to modify an award as existed under Section 15 of the Arbitration Act, 1940 is absent under the present Arbitration Act, 1996. Section 15 of the Arbitration Act, 1940 reads as follows :-
"15. The Court may by order modify or correct an award (a) where it appears that a part of the award is upon a matter not referred to arbitration and such part can be separated from the other part and does not affect the decision on the matter referred; or
(b) where the award is imperfect in form, or contains any obvious error which can be amended without affecting such decision; or
(c) where the award contains a clerical mistake or an error arising from an accidental slip or omission."
19. In view of the judgment of the Privy Council in the case of Jnanendra Mohan Bhaduri (AIR 1933 PC 61) (supra). If the award Is not set aside, the award remained filed in Court, and it is enforceable as if it were a decree of the Court.
20. Moreover, the appellant has to establish the genuineness and correctness of the aforesaid subsequent agreement in appropriate proceedings before deriving any benefit under it. Even otherwise the parties cannot vary the terms of an arbitral award by settlement under the Arbitration Act, 1996.
21. In the result there is no merit in the appeal and the appeal Is dismissed with costs.