Sec 151 CPC Application Not Maintainable When Sect 29A(4) Of Arbitration Act Applies, Incorrect Quote Of Section Not Grounds For Dismissal: HP High Court

However, the bench also held that the application cannot be dismissed solely because it cited Section 151 CPC instead of Section 29A(4) of the Arbitration Act.

Brief Facts:

Kamlu (Applicant), also referred to as the Petitioner, filed an application under Section 151 of the Code of Civil Procedure (CPC) seeking an extension of time to comply with an order issued an arbitration case. The Petitioner argued that he previously filed a petition before the High Court requesting additional time for the arbitrator to conclude the arbitration proceedings. This petition was addressed by the High Court on August 2, 2023 with the court granting an extension allowing the arbitrator six more months to complete the proceedings. The parties involved were instructed to be present before the arbitrator. However, the Petitioner's counsel, who was responsible for communicating this order to the arbitrator, failed to download and present the order to the arbitrator. Consequently, the arbitrator was unable to take further action on the case due to the absence of the official order and the time originally granted by the Court expired. This failure to act led the Petitioner to file the current application where he sought another extension of time.

NHAI (Respondent No. 2) opposed the application and argued that it was not maintainable under Section 151 of the CPC. it contended that a specific provision exists under Section 29(A)(4) of the Arbitration Act which governs the extension of time in arbitration matters. Further, she argued that the Petitioner was negligent in not appearing before the arbitrator as required and there was no sufficient cause shown for extending the time period.

Observations by the High Court:

The High Court noted that Section 151 of the CPC, which provides for the inherent powers of the court, cannot be invoked when a specific statutory provision exists. This principle was further upheld by the Supreme Court in the case of My Palace Mutually Aided Coop. Society v. B. Mahesh 2022 SCC OnLine SC 1063 where it was held that Section 151 cannot be used to bypass procedural safeguards or statutory prohibitions. The High Court noted that Section 151 CPC is applicable only in the absence of an alternative remedy under existing legal provisions.

Given this precedent, the High Court agreed with the contention raised by NHAI that the application for extending the time for arbitration should have been filed under Section 29A(4) of the Arbitration Act rather than under Section 151 CPC. However, the High Court also noted that this procedural misstep was not fatal to the application. The High Court relied on the Supreme Court's decision in Pruthvirajsinh Nodhubha Jadeja v. Jayeshkumar Chhakaddas Shah (2019) 9 SCC 533 where it was held that merely citing an incorrect provision of law does not invalidate an application if the court has the power to grant the requested relief. The Delhi High Court also supported this view in Vijay Kumar Nagpal v. Parveen Kumar Nagpal (2022) 1 HCC (Del) 25 stating that a wrong statutory citation should not prevent the court from considering the merits of an application.

The High Court noted that there was negligence on the part of the counsel for not promptly downloading and delivering the order passed by the court extending the arbitrator's mandate. However, the High Court held that the Petitioner should not be penalized for the counsel's oversight. The High Court referred to its previous decision in Rajinder Kumar v. National Highways Authority of India, 2024 (1) HimLR 583 where it was emphasized that a landowner, whose land has been acquired, cannot be deprived of his remedies due to procedural lapses. The High Court reiterated the principle that the Petitioner has a constitutional right under Article 300A of the Constitution of India to protect his property and to receive adequate compensation which should not be denied due to the mistakes of legal counsel.

Consequently, the High Court allowed the application granted and the arbitrator an additional six months to complete the arbitration proceedings. The parties were directed to appear before the arbitrator on 18th September 2024 and a copy of the court's order was to be sent to the arbitrator for information.

Case Title: Kamlu vs Collector Land Acquisition

Citation: 2024 LiveLaw (HP) 52

Case Number: Arbitration Case No.599 of 2023

Advocate for the Petitioner: Mr. Ashwani Kaundal, Advocate, vice Mr. Maan Singh, Advocate, for the petitioner.

Advocate for the Respondent: Mr. Jitender Sharma, Additional Advocate General for respondents No.1 and 3/State. Ms. Sneh Bimta, Advocate, for respondent No.2.

Date of Judgment: 24.08.2024

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