Application under wrong provision is not ground to refuse amendment

Venture Global Engineering vs. Satyam Computer Services Ltd. and another 

Head note

Civil Procedure Code, 1908 - Order VIII Rule 9 - Arbitration & Conciliation Act, 1996 - Section 34 - Andhra Pradesh Arbitration Rules, 2000 - Rule 12(1) - The appellant entered into a Shareholders Agreement and a Joint Venture Agreement with the first respondent, for establishing a company with the second respondent - disputes cropped-up – Regarding TRW, a manufacturer and supplier of automotive equipments, which provides engineering and IT services agreed to sub-contract the automotive engineering works to the second respondent - referred to arbitration - The sole arbitrator held the appellant is to transfer its entire shareholding in the second respondent to the first respondent. The first respondent filed a petition for the recognition and enforcement of the award before the U.S. District Court, Eastern District Court of Michigan – mean while Chairman and founder of the first respondent confessed that the balance sheets of the first respondent had been fraudulently inflated to the tune of Rs.7,080/- crores. As a result, Price Waterhouse Cooper (PWC), auditors of the first respondent, declared that the financial statements could no longer be considered accurate or reliable – Thus, the appellant filed an interim application before the Trial Court to bring certain facts on record and also filed additional pleadings - The Trial Court, allowed the application of the appellant - The first respondent challenged the said order - The High Court, allowed the revision and inter alia, held that a reading of Section 34(1) and (3) of the ABC, 1996 indicates that a party could only set aside the arbitral award if an application for the same is made within a period of 3 months (extendable by another 30 days) from the date of making the award; whereas in the present case the new grounds of challenge are sought to be brought after the limitation period - The High Court further held, relying on Rule 12(1) of the Andhra Pradesh Arbitration Rules, 2000, that Rule VIII of Civil Procedure Code is not applicable, so a petition for additional pleading is not maintainable under Order VIII of Civil Procedure Code – this SLP – This court held Whether the award will be set aside or not is a different question and that has to be decided by the appropriate Court. In this appeal, this Court is concerned only with the question whether by allowing the amendment, as prayed for by the appellant, the Court will allow material facts to be brought on record in the pending setting aside proceeding - In the interest of justice and considering the fairness of procedure, the Court should allow the appellant to bring those materials on record as those materials are not wholly irrelevant or they may have a bearing on the appellant's plea for setting aside the award - this appeal succeeds. That question will be decided by the Court where setting aside proceeding is pending - The order of the High Court is set aside and that of the court below is restored.

Cases Referred:
1. Venture Global Engineering vs. Satyam Computer Services Ltd. and another (2008) 4 SCC 190
2. State of Maharashtra Vs. M/s Hindustan Construction Company Ltd. - AIR 2010 SC 1299
3. L.J. Leach and Company Ltd. and another Vs. Jardine Skinner and Co. - AIR 1957 SC 357
4. Pirgonda Hongonda Patil Vs. Kalgonda Shidgonda Patil and ors. - AIR 1957 SC 363
5. Burrough in Richardson vs. Mellish (1824-34) All E.R. 258
6. Central Inland Water Transport Corporation Ltd. and another vs. Brojo Nath Ganguly and another AIR 1986 SC 1571 at 1612
7. Elektrim S.A. vs. Vivendi Universal S.A. and Ors. (2007) EWHC 11 (Comm)
8. Profilati Italia S.R.L. vs. Painewebber Inc. and Anr. [(2001) 1 Lloyd's Law Reports 715].

Comparative Citations:
2010 (4) KLT 23 (SN) (C.No.26), 2010 (7) MLJ 712, 2010 (8) SCJ 4, 2010 (6) ALT 50, 2010 AIR(SCW) 5027, 2010 AIR(SC) 3371, 2010 (8) SCC 660, 2010 (4) CLT 557, 2010 (9) SLT 228,