Arun Mishra, J.:-
Writ petitions have been filed as against order (P/1) dt. 3-7-2009 dismissing the application preferred under section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to Act of 1996). Under section 19 of the Micro, Small and Medium Enterprises Development Act, 2006 (hereinafter referred to as the 'Act of 2006') direction was issued to make the deposit of amount which order was not complied with. Due to non-compliance of the order, ultimately, the main applications under section 34 of the Act of 1996 were dismissed by the 6th Addl. District Judge, Bhopal in the aforesaid cases, which orders have been impugned in these writ petitions.
2. A preliminary objection has been raised by Shri Pushpendra Kaurav, learned counsel appearing on behalf of the respondent No. 1 that an appeal lies under the provision of section 37 of the Arbitration and Conciliation Act, 1996 as against an order passed under section 34(1)(b) of 1996 Act. He has placed reliance on decision of the Apex Court in Essar Constructions vs. N. P. Rama Krishna Reddy, (2000) 6 SCC 94.
3. Shri Priyank Jain, learned counsel appearing on behalf of the petitioners has submitted that it was an adjudication on an application under section 19 of the Act of 2006, due to non-compliance of which order the main application under section 34 of the Arbitration and Conciliation Act, 1996 has been dismissed. The dismissal is not on the ground contemplated under section 34 of the Arbitration and Conciliation Act, 1996. Thus, it would not amount to an order which is appealable under section 37 of the Arbitration and Conciliation Act, 1996.
4. Section 19 of the Act of 2006 is quoted below:
"19. Application for setting aside decree, award or order. - No application for setting aside any decree, award or other order made either by the Council itself or by any institution or centre providing alternate dispute resolution services to which a reference is made by the Council, shall be entertained by any Court unless the appellant (not being a supplier) has deposited with it seventy-five per cent of the amount in terms of the decree, award or, as the case may be, the other order in the manner directed by such Court:
Provided that pending disposal of the application to set aside the decree, award or order, the Court shall order that such percentage of the amount deposited shall be paid to the supplier, as it considers reasonable under the circumstances of the case subject to such conditions as it deems necessary to impose."
It is clearly provided in the aforesaid section 19 of the Act of 2006 that no application setting aside any decree, award or other order shall be entertained by any Court unless the appellant has deposited with it seventy-five per cent of the amount in terms of the decree, award or, as the case may be, the other order in the manner directed by such Court. In view of specific provision contained with respect to maintainability of appeal, the provision of section 19 of the Act of 2006 has to be read together and applied to the provision of section 34 of the Act of 1996 as a condition which is prerequisite to be complied with.
5. The provision of the sections 34 and 37 quoted below:
"34. Application for setting aside arbitral award. - (1) Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub-section (3).
(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.
(4) On receipt of an application under sub-section (1), the Court may, where it is appropriate and it is so requested by a party, adjourn the proceedings for a period of time determined by it in order to give the arbitral tribunal an opportunity to resume the arbitral proceedings or to take such other action as in the opinion of arbitral tribunal will eliminate the grounds for setting aside the arbitral award.
37. Appealable orders. - (1) An appeal shall lie from the following orders (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order, namely: -
(a) granting or refusing to grant any measure under section 9;
(b) setting aside or refusing to set aside an arbitral award under section 34.
(2) An appeal shall also lie to a Court from an order of the arbitral tribunal -
(a) accepting the plea referred to in sub-section (2) or sub-section (3) of section 16; or
(b) granting or refusing to grant an interim measure under section 17.
(3) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court."
It is apparent that under section 37(1)(b) of the Act of 1996 every order is appealable setting aside or refusing to set aside an arbitral award under section 34 of Act of 1996. The effect of non-compliance of order passed under section 19 of the Act of 2006 in the instant case is that main application under section 34 of Act of 1996 stands dismissed in which prayer was made to set aside the award. Such an order in our considered opinion would be appealable within provision of section 37(1)(b) of the Act of 1996 refusal may be on some other ground also. The matter is not res Integra, the Apex Court in Essar Constructions vs. N. P. Rama Krishna Reddy (supra) has held that the outcome of an order dismissing an application for condonation of delay in filing an application under section 30 Arbitration Act, 1940 for setting aside an award, held, in effect is that the prayer for setting aside the award has been refused on the ground of delay, such an order is ultimately therefore an order under section 30 and so appealable under section 39 of the Arbitration Act 1940. We do not find any ground under the scheme of the new Act 1996 to hold that such order would not be appealable under section 37.
6. Counsel for the petitioner has prayed for liberty to file appeal. That liberty need not be given, as it is available so as to allay fear, we give it formally as present petition is also not maintainable, petitioner is free to avail the appropriate remedy which is available in accordance with law. Certified copy of the impugned order, as prayed, be returned to the petitioners on filing photocopy of the same on record. The petitions are disposed of.
Order accordingly.