TaxTMI 
TaxTMI 
2024 (11) TMI 48
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....signated area; e. Removal of offshore identified debris/wrecks; and f. Environmental monitoring. 4. These tasks were to be completed on or before 11 April 2017. Thereafter, disputes arose between the parties. The appellant invoked the arbitration agreement. The arbitral proceedings commenced and the three-member arbitral tribunal made an award on 7 March 2024 directing the respondent to: a. Pay the appellant a sum of Rs 21,07,66,621 towards the claims that were allowed in its favour; b. Pay the appellant interest on the amount awarded at the rate of nine per cent per annum from 15 November 2017 until the date of the award if the payment was made within three months, and, if not, at the rate of twelve per cent per annum from the date of the award till the date of payment; and c. Pay the appellant Rs 3,20,86,405 by way of costs. 5. Both parties filed applications under Section 33 of the Arbitration and Conciliation Act 1996 "Arbitration Act" for correction of the award and for additional arbitral awards. The arbitral tribunal dismissed the application filed by the respondent. It allowed the application filed by the appellant only to the extent of increasing the costs awar....
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....he fact that the respondent is a statutory body and correctly held that security should be furnished in the form of a bank guarantee; (iv) As such the impugned judgment should not be interfered with under Article 136 of the Constitution; and (v) The body of precedents which Mr Divan relied on pertains to appeals under Section 37 of the Arbitration Act. 10. Section 36(2) of the Arbitration Act indicates that where an application to set aside an arbitral award has been filed under Section 34, the filing of such an application shall not, by itself, render that award unenforceable, unless the Court grants a stay on the enforcement of the arbitral award in terms of sub-section (3). The provision indicates that a separate application must be made for this purpose. Sub-section (3) of Section 36 stipulates that where such an application has been filed, the Court may, subject to such conditions as it may deem fit, grant stay of the operation of the award for reasons to be recorded in writing. Following the amendments brought about by the Arbitration and Conciliation (Amendment) Act 2015, the first proviso to sub-section (3) stipulates that the Court shall, while considering an application ....
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....ppellant this amount, which had already been paid by the respondent to the appellant. It held that while the substance of the claims of the parties could only be determined in the proceedings under Section 34 of the Arbitration Act, it was prima facie satisfied that the arbitral tribunal had erred in not considering the claim of the respondent. Apart from discussing this claim, which was in the amount of approximately Rs 3 crores, the High Court did not address the other claims of the appellant which were allowed by the arbitral tribunal. The amount awarded in relation to the remaining claims is approximately Rs 18 crore. 12. The High Court granted a stay on the operation of the award subject to the respondent furnishing a bank guarantee for the principal amount awarded to the appellant, i.e. Rs 21,07,66,621. It held that it was not inclined to issue orders in relation to the interest and the costs awarded to the appellant because "the petitioner is not a fly-by operator and is a statutory undertaking." The law qua arbitration proceedings, in our view, cannot be any different merely because of the status of the respondent as a statutory undertaking. 13. In this regard, it is nece....
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....bitration Act. ... 28. Section 36 of the Arbitration Act also does not provide for any special treatment to the Government while dealing with grant of stay in an application under proceedings of Section 34 of the Arbitration Act. Keeping the aforesaid in consideration and also the provisions of Section 18 providing for equal treatment of parties, it would, in our view, make it clear that there is no exceptional treatment to be given to the Government while considering the application for stay under Section 36 filed by the Government in proceedings under Section 34 of the Arbitration Act." ( emphasis supplied ) 15. Bearing in mind the above principles, we are of the view that the High Court was in error in not even prima facie considering the fact that apart from the issue of cess, there was an arbitral award in favour of the appellant in regard to other claims as well. Further, the High Court ought not to have based its decision on the condition for the grant of stay on the status of the respondent as a statutory authority. The Arbitration Act is a self-contained code - it does not distinguish between governmental and private entities. Hence, the decision of the Court ca....