Court rules that delay in challenging the arbitral award makes the petition untenable; orders execution of award as per arbitration agreement.
In a significant decision, the Delhi High Court has dismissed an objection petition filed by Vinay Mawandia challenging an arbitral award on the grounds of delay, thereby allowing the execution of the award. The judgment, delivered by Justice Harish Vaidyanathan Shankar, underscores the stringent limitations on challenging arbitral awards, emphasizing the principle of finality in arbitration proceedings.
The case arose from a dispute between brothers Vinay Mawandia and Bimal Mawandia, among others, concerning the division of family properties. An interim arbitral award issued by a tribunal on November 13, 2021, directed the division of two properties in Gurugram, Haryana, and Howrah, West Bengal, as per a previously agreed Memorandum of Understanding (MoU) from February 27, 2019. The award was challenged by Vinay Mawandia under Section 34 of the Arbitration and Conciliation Act, 1996, seeking its setting aside.
The petitioner contended that the award was passed without proper claims and counterclaims being presented and that it lacked the signature of one of the arbitrators. However, the court found that the petitioner had acknowledged the award and participated in its implementation, which barred him from challenging it later. The court highlighted that the limitation period under Section 34(3) is mandatory, allowing no extension beyond 30 days after the initial three-month period.
Justice Shankar noted that Vinay Mawandia was aware of the award from a WhatsApp communication and actively engaged in subsequent steps to execute the award. The court emphasized that the petitioner's conduct, indicating acquiescence, and the absence of a timely challenge, rendered the objection petition untenable.
In dismissing the petition, the court also directed the execution of the award, instructing the transfer of the Gurugram property to the decree holders within six weeks, reaffirming the binding nature of the arbitrated settlement.
Bottom line:-
Arbitration and Conciliation Act, 1996 - Petition under Section 34 challenging arbitral award - Held, objections must be filed within the prescribed limitation period under Section 34(3), and delay beyond the statutory timeline cannot be condoned. Conduct indicating acquiescence in the arbitral award, including active participation in its implementation, bars the challenge.
Statutory provision(s):
Arbitration and Conciliation Act, 1996 - Sections 34, 36; Code of Civil Procedure, 1908 - Order XXI, Section 151
Vinay Mawandia v. Bimal Mawandia, (Delhi) : Law Finder Doc id # 2937105
