ORDER
Indira Banerjee, J.
1. The petitioner has filed the instant application under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 1996 Act) for setting aside an award dated March 22, 2005.
2. By the impugned award, the sole Arbitrator has awarded to the respondent a sum of Rs. 49,86,990/- along with pendente lite interest at the rate of 8 per cent per annum for a period of 5 years and 7 months, amounting to Rs. 22,27,500/-. The total value of the award is Rs. 72,14,490/-.
3. The Court-fees for this application has been assessed by the Stamp Reporter at a sum of Rs. 1,08,217,35/- under Entry 1(10) of Schedule II of the West Bengal Court-fees Act, 1970 (hereinafter referred to as the Court-fees Act) as amended with effect from October 28, 2002, by the West Bengal Court-fees (Amendment) Act, 2002 (hereinafter referred to as the 2002 Amendment Act.)
4. The petitioner has disputed the assessment. Since the adjudication of the dispute involves interpretation of provisions of the Court-fees Act, as amended from time to time, which would affect the changing of Court-fees, notice was issued to the learned Advocate General.
5. Entry 1(10) of Schedule II of the Court-fees Act, which has been inserted by the 2002 Amendment Act, is extracted hereinbelow for convenience.
Sl. No. Particulars Proper Fees
"(10) Application under Section 12 or Section 34 of the Arbitration and Conciliation Act, 1996
(26 of 1996), for a direction for filing an award or for an order for filing an agreement and
application for enforcing foreign awards--
(a) When presented to a Court of Civil Judge (Junior Division) One hundred rupees.
(b) When presented to the City Civil Court, Calcutta or a Court
of the Civil Judge (Senior Division) or a District Court of the
High Court--
(i) if the value of the subject-matter of the award does not Five hundred rupees or
exceed Rs. 10,000 one per centum of award
whichever is more.
(ii) if such value exceeds Rs. 10,000 but does not exceed One thousand rupees or
Rs. 50,000 one and half per centum
of award whichever is
more.
(iii)if such value exceeds Rs. 50,000 Five thousand rupees or
one and half per centum
of award, whichever is
more."
6. Mr. P.C. Sen appearing on behalf of the petitioner-rightly submitted that neither of the sections of the 1996 Act referred to in Entry 1(10) of Schedule II of the Court-fees Act as amended by the Amendment Act at all pertain to the filing of an agreement on the filing an award.
7. Sections 12, 13 and 34 of the 1996 Act are extracted hereinbelow for convenience:
Section 12: Grounds for challenge.–(1) When a person is approached in connection with his possible appointment as an arbitrator, he shall disclose in writing any circumstances likely to give rise to justifiable doubts as to his independence or impartiality.
(2) An arbitrator from the time of his appointment and throughout the arbitral proceedings, shall, without delay, disclose to the parties in writing any circumstances referred to in Sub-section (1) unless they have already been informed of them by him.
(3) An arbitrator may be challenged only if–
(a) circumstances exist that give rise to justifiable doubts as to his independence or impartiality, or
(b) he does not possess the qualifications agreed to by the parties.
(4) A party may challenge an arbitrator appointed by him, or in whose appointment he has participated, only for reasons of which he becomes aware after the appointment has been made.
Section 13: Challenge procedure.–(1) Subject to Sub-section (4), the parties are free to agree on a procedure for challenging an arbitrator.
(2) Failing any agreement referred to in Sub-section(1), a party who intends to challenge an arbitrator shall, within fifteen days after becoming aware of the constitution of the arbitral tribunal or after becoming aware of any circumstances referred to in Sub-section (3) of Section 12, send a written statement of the reasons for the challenge to the arbitral tribunal.
(3) Unless the arbitrator challenged under Sub-section (2) withdraws from his office of the other party agrees to the challenge, the arbitral tribunal shall decide on the challenge.
(4) If a challenge under any procedure agreed upon by the parties or under the procedure under Sub-section (2) is not successful, the arbitral tribunal shall continue the arbitral proceedings and make an arbitral award.
(5) Where an arbitral award is made under Sub-section (4), the party challenging the arbitrator may make an application for setting aside such an arbitral award in accordance with Section 34.
(6) Where an arbitral award is set aside on an application made under Sub-section (5), the Court may decide as to whether the arbitration who is challenged is entitled to any fees.
Section 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 of 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 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.
8. The learned Advocate General submitted that Entry 1(10) of Schedule II would apply to applications under the sections of the 1996 Act specified therein as well as to applications for filing of awards, filing of agreements or enforcement of foreign awards.
9. The question is, whether the interpretation sought to be given by the learned Advocate General of Entry 1(10) of Schedule I can be accepted in the absence of any conjunction or of the word ‘application’ before the words ‘for a direction…’ in the entry.
10. The intention of the legislature is primarily to be gathered from the language used, which means, attention has to be paid to what has been said and also to what has not been said. A construction which requires for its support addition or substitution of words, is in my view, ordinarily to be avoided. It is not for the Court to cure the defective phrasing of an Act.
11. The Advocate General, very fairly conceded that there is no scope for any application to the Court under Section 12 of the 1996 Act. It is apparent that the 2002 Amendment Act in so far us the same has inserted Entry 1(10) of Schedule II of the Court-fees Act, has hastily and haphazardly been enacted without proper application of mind as otherwise Section 12 of the 1996 Act would not have been included in the said Entry.
12. The erroneous inclusion of Section 12 of the 1996 Act in Entry 1(10) of Schedule II of the Court-fees Act gives rise to serious doubts as to whether inclusion of Section 34 of the 1996 Act in the said Entry was consciously intended by legislature.
13. Mr. Sen drawn my attention to Entry 17(iv) of Schedule II of the Court-fees Act, which is as follows:
“17 Plaint or Memorandum of Appeal in each of the following sheets
(i)…
(ii)…
(iii)…
(iv) to set aside and award ….Eighty Rupees”.
14. The learned Advocate General argued that Entry 17(iv) provides for plaints and Memorandum of Appeal in suits for setting aside of an award. There can be no suit under Section 34 of the 1996 Act and therefore no plaint either.
15. Entry 17(iv) of Schedule II of the Court-fees Act after its amendment by the 2002 Amendment Act is identical to Entry 15 of Schedule II of the Court-fees Act prior to its amendment by the 2002 Amendment Act, except for the amount of the Court-fees, which has been enhanced by the 2002 Amendment Act.
16. Prior to amendment of the Court-fees Act by the 2002 Amendment Act, the Court fees for applications for setting aside of an Award under Sections 30 and 33 of the Arbitration Act, 1940 as well as under Section 34 of the 1996 Act was being levied in accordance with Entry 15 of Schedule II of the Court-fees Act. Even after the Amendment, the Court-fees for applications under the Arbitration Act, 1940 for setting aside an Award is being levied in accordance with Entry 17(iv) of Schedule II.
17. Mr. Sen has cited the decision of the Supreme Court in the case of Chandra Mohan v. State of U.P., reported in AIR 1966 SC 1987, where a Five-Judge Bench held that the fundamental rule of Interpretation was the same, whether one construed the provisions of the Constitution or an Act of Parliament. The Court would have to find out the expressed intention from the words of the Constitution, or the Act, as the case might be. If two constructions were possible the Court would have to adopt that construction which would ensure smooth and harmonious working of the Act and eschew the other which would lead to absurdity or give rise to practical inconveniences or make well-established provisions of existing law nugatory.
18. Mr. Sen also cited the judgment of the Supreme Court in the case of K. M. Nanavati v. State of Bombay, , where Supreme Court held that if two sections were repugnant, the known rule was that the last must prevail. Mr. Sen pointed out that Entry 17(iv) came after entry 1(10) and in case of any inconsistency the said entry should prevail.
19. Entry 17(iv), it may perhaps be argued, applies to awards other than awards covered by the Arbitration Act, 1940 or the 1996 Act, which might be challenged by way of a suit and Court-fees for setting aside of arbitral awards covered by the Arbitration Act, 1940 or 1996 Act had erroneously been levied under the said entry and/or under Entry 15 prior to enforcement of the Amendment Act of 2002.
20. If Entry 1(10) of Schedule II to the Court-fees Act as amended were to be interpreted to include applications for setting aside of an award in addition to applications for filing of awards and agreement and applications for enforcement of foreign awards, the Court would have to read into Entry 1(10) the word ‘application’ just after ‘(26 of 1996)’ before the words “for a direction to …”. Alternatively, this Court would have to read into the said Entry, the conjunction ‘or’ before “for a direction to…”.
21. Such an interpretation would give rise to absurdities which could not have been intended by legislature, for a person enforcing a domestic award would have to pay a nominal Court-fee whereas a person seeking to set aside an award even on the ground of inherent want of jurisdiction of the arbitral Tribunal would have to pay ad valorem Court-fees at par with an application for enforcement of a foreign award. Applicants for setting aside awards are often the State, the Union of India, Government Undertakings and Statutory Authorities complaining of huge amounts having been awarded towards escalation, damages, compensation and the like, in total disregard of the contract.
22. There could be no logical rationale behind compelling a person who has suffered an award to pay Court-fees higher than the maximum Court-fees for filing a suit, irrespective of valuation. It seems absurd that the Court-fees for an award of approximately Rs. 72 lakhs should be about Rs. 1,08,000/- when the Court-fees for a suit of similar or even much higher value would be restricted to Rs. 50,000/- being the maximum Court-fees.
23. Having regard to the limited scope of interference by Court under Section 34 of the 1996 Act and consequential uncertainties of the result of a challenge to an award, irrational, prohibitive Court-fees would result in denial of recourse to Courts for redressal of genuine grievances. This could not have been intended by legislature. Entry 1(10) was, in my view intended to apply to applications for enforcement of foreign awards and to filing of awards and agreements in connection with the enforcement of foreign awards. Significantly, there is no independent provision in the 1996 Act for filing of an award or agreement in Court.
24. Mr. Bhaskar Mitter, the learned Advocate appearing on behalf of the award holder has drawn my attention to Entry 14 of Schedule II, which is extracted hereinbelow :
Memorandum of appeal (1) Where the appeal is from an Eighty
under Sections 37 and 50 order of a Court of the Civil rupees
of the Arbitration and Judge (Junior Division)
Conciliation Act, 1996
(26 of 1996)
(2) in any other case Five
hundred
rupees.
25. The Court-fees for memorandum of appeal in this Court in respect of an appeal under Section 37 of the Arbitration and Conciliation Act, 1996 which includes an appeal against an order setting aside or refusing to set aside an arbitral award under Section 34 is Rs. 500/.
26. As submitted by Mr. Mitter, it was probably the intention that the Court-fees for applications for setting aside of an award under Section 34 of the Arbitration and Conciliation Act, 1996 should also be Rs. 500/-. Unfortunately, this Court has no power to reframe legislation. If the legislature has not properly expressed what was intended, it is for legislature to amend the Statute.
27. I, therefore, have no option to hold that the Court-fees for an application for setting aside of an award would be payable under Entry 2(c) of Schedule II to the Court-fees Act which stipulates the Court-fees for any original petition to the High Court, not otherwise provided for in the West Bengal Court-fees Act, 1970.
28. Affidavit-in-opposition to the setting aside application be filed within three weeks from date, reply, if any thereto, be filed within two weeks thereafter. Matter to appears as ‘Adjourned Arbitration Motion” after six weeks.
29. All parties concerned are to Act on a signed xerox copy of this dictated order on the usual undertakings.