Calcutta High Court Decides on Whether an Appeal Under Section 34 of the Arbitration Act Allows Amending of Petitions

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Prakash Industries Ltd. filed a petition before the High Court of Calcutta. They filed it under Section 34 of the Arbitration and Conciliation Act, 1996. The main issue that arose is whether or not the amendment of an arbitration petition can be considered after the award is issued.

Facts of the Case

Prakash Industries Ltd and Bengal Energy Ltd decided to go into arbitration. The reason for opting arbitration is not mentioned. Both the parties completed the arbitration procedure. However, Prakash Industries Ltd did not find the arbitration award to their satisfaction. Hence they filed an appeal under section 34 of the Arbitration and Conciliation Act, 1996. The reason for the appeal is a request to amend the arbitration petition.

Contentions by the Petitioner 

A senior counsel appearing on their behalf put forth the following arguments. The principle point of argument revolved around one area, which is that the petition did not have reasons amplified. The petitioner submitted that if it is amplified, the outcome ought to change. The learned counsel reasoned the same with several cases. They showed how the Court allowed the amendment of petitions on reasonable grounds. 

Contentions by the Respondent 

In this case, Bengal Energy Ltd is the respondent. The principle point of the argument is explaining the legislative intent of the act. Section 34 of the Arbitration Act is to provide a chance for complete justice. However, letting the petitioners file for an amendment would increase the timeline of litigation. In addition to this, it will drag the case through an unprecedented timeline. In this case, allowing the amendment would defeat the purpose of the act. The counsel supported the argument with several cases.

Interpretation by the Court 

The Court referred to the Code of Civil Procedure. Under Order 6, Rule 17, the amendment of petitions cannot change its nature in any way. Hence, the nature of the case cannot be changed. In addition to this, the Court also considered the Arbitration Act in making its decision. The Act provides for appeal of awards on selected grounds. These grounds include “perversity”, “shocking the conscience of the Court” and “if contrary to public policy”.

The petitioner alleged that the petition did not include the provisions of the Sale of Goods Act. Not including the Sale of Goods Act violates the principles of natural justice. Section 34 of the Arbitration Act allows the appeal in specific cases. Therefore, if there is a lack of proper notice or an unequal opportunity to present the case, then it can be appealed. 

As a result of consideration of sections and case laws, the Court did not allow the amendment to the petition. It relied on the case of Hindustan Construction. Here, the Supreme Court spoke on amendments in the interest of justice. But the Supreme Court did not allow it as it changes the nature of the original case. 

Considering the facts of this case, the nature of the petition would change. Hence, it will also change the nature of the case, which the Court cannot allow.

Conclusion 

The law provides an adequate remedy to cater to situations that cannot be foreseen. Amendment of a petition is definitely for the benefit of the party. No misuse of these benefits should take place even in case of arbitration, as it drags the litigation. Besides, the nature of the case mustn’t change. 


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