KV Viswanathan for BCCI in dispute over amended S. 36 of Arbitration Act

The Board of Control for Cricket in India (BCCI) has moved the Supreme Court in appeal against a decision of the Bombay High Court regarding the applicability of the amended Section 36 of the Arbitration and Conciliation Act..Senior Advocate KV Viswanathan appeared for BCCI while Senior Advocate P Chidambaram represented Kochi Cricket Private Limited..The case pertains to two arbitral awards to the tune of Rs. 153 crore and Rs. 384 crore passed against BCCI in favour of M/s Rendezvous Sports World and Kochi Cricket Private Limited. BCCI had filed application under Section 34 of the Act challenging the awards..Subsequently, on October 23, Section 36 of the Act was amended..As per the old Section 36, if an application under Section 34 was filed, the arbitral award could be enforced only after the said application was refused. However, the amended Section 36 provides that filing of such application shall not by itself render the award unenforceable, unless the Court grants an order of stay of operation of said arbitral award..BCCI’s contention was that since it filed the Section 34 application before the coming into force of the amended Section 36, there should be no enforcement of the arbitral award till the Section 34 application is decided. In other words, they contended that it is the old Section 36 that would apply to their case..However, BCCI’s Chamber summons in Bombay High Court was dismissed by the Court. The Court conceded that the application of Section 36 to an application under Section 34 is prospective and not retrospective. It, however, held that it would not make any difference even if application under Section 34 was filed before October 23..“…in fact the Amending Act brings in balance between the rights and liabilities of both the sides. The ambit and scope of the Amended Section 36, is to cure the defect by removing the imbalance. Thus the application of the provision on the petitions under Section 34 pending on 23rd October, 2015, is prospective. It makes no difference if the application under Section 34 filed by the award-debtor was prior to 23rd October, 2015. Removal of shadow over the rights of the award-holder cannot be said to be prejudicial to the award-debtor. He has to now only file an application for interim reliefs, which may or may not, be subject to imposition of condition.Now that effect of the operation of the amended Section 36, is held to be prospective, there is in fact no need to consider the alternate argument of justifying retrospective operation, on the ground of the amendment being curative and procedural. In any case, that the amending provision is curative cannot be disputed at all. This is evident from the observations of the Apex Court in Nalco’s case indicating the defects in the Original Section 36, the imbalance caused by it and the mischief done by it.”.The BCCI has now challenged this decision before the Supreme Court..When the matter came up for hearing today before C Nagappan and AM Sapre JJ, Nagappan J said that the Bench is not a regular one and will break soon..“There must be continuity in the Bench hearing the matter.”.The Court then adjourned the matter for August 16..Image of P Chidambaram taken from here.