Bombay High Court

The Chief Officer, Municipal Council, DegloorversusM. D. Engineers, Through Proprietor Mahendra Laxmanrao Deshpande

Disposal: DISPOSED OFF
Bench: ARUN R PEDNEKER

Holding

Condonation of the delay was allowed, the arbitration appeal was dismissed, and a ten‑week stay on execution of the award was ordered.

Summary

The Municipal Council of Degloor filed a civil application seeking condonation of a 36‑day delay in filing an arbitration appeal and also requested a ten‑week stay on execution of the arbitral award. The council argued that the contract underlying the dispute was not proved, but the arbitral tribunal had categorically found that a contract existed, work was performed and payments made. The court found no prima facie illegality in the award and held that the claim for enhanced interest under Section 37 of the Arbitration and Conciliation Act, 1996 could not be entertained by the district court. Consequently, the court allowed the condonation of delay, dismissed the arbitration appeal, and ordered a ten‑week abeyance of any execution proceedings. The civil applications were disposed of accordingly.

Issues considered

Whether the 36‑day delay in filing the arbitration appeal can be condoned.
Whether there is a prima facie illegality in the arbitral award warranting interference.
Whether the claimant can obtain enhanced interest under Section 37 of the Arbitration and Conciliation Act, 1996.
Whether a stay of execution of the arbitral award can be granted for ten weeks.

Legislation cited

Arbitration and Conciliation Act, 1996 — s. 34, 37

Subjects

Arbitration
Condonation of delay
Arbitral award
Section 37
Interest enhancement
Stay of execution
Contract existence
Civil procedure

Judgment

2026:BHC-AUG:18234

                          IN THE JUDICATURE OF HIGH COURT AT BOMBAY
                                     BENCH AT AURANGABAD

                             955 CIVIL APPLICATION NO. 3906 OF 2026
                                       IN ARBAST/9500/2026

                              The Chief Officer, Municipal Council, Degloor
                                                 VERSUS
                  D. M. Engineers Through Proprietor Mahendra Laxmanrao Deshpande
                                                   ...
                         Advocate for Applicant : Mr. Sunil Vasantrao Kurundkar
                            Advocate for Respondents : Mr. R. S. Sarvadnya
                                                   ...
                            WITH CIVIL APPLICATION NO. 3908 OF 2026
                                        IN ARBAST/9500/2026

                                     WITH ARBAST/9500/2026
                                              ...
                                          CORAM    : ARUN R. PEDNEKER, J.
                                            Dated            : April 23, 2026
           PER COURT :


           1.    In Civil Application No. 3906 of 2026, filed for condonation of delay

           of 36 days in filing the Arbitration Appeal, for the reasons stated in the

           application, the same is allowed and disposed of.



           2.    The learned Counsel for the appellant / Municipal Council has taken me

           through the findings recorded in the award passed by the Arbitral Tribunal

           and submitted that there was a dispute regarding the very existence of the

           contract and the contract itself was not established.


           3.    However, the Arbitral Tribunal has recorded a categorical finding as to

           the existence of the contract. It is also noted that the work was carried out

           and part payments were made. In such circumstances, the contention that

           the contract is not proved cannot be accepted.


           4.    There is no prima facie patent illegality in the award passed by the

           Arbitrator. Considering the same, no case is made out for interference with

           the arbitral award.


                                               Page 1 of 2
                                                                      955 CA 3906-2026




5.       Insofar as Appeal under Section 37 of the Arbitration and Conciliation

Act, 1966 filed by the claimant is concerned, the same pertains to the

grant of interest at the rate of 6% per annum, and the claimant seeks

enhancement thereof.        Such enhancement cannot be granted by the

District Court in proceedings under Section 34 or Section 37 of the

Arbitration and Conciliation Act, 1996.            Hence, no case is made out for

interference on this count as well.         Accordingly, the Arbitration Appeal

(Stamp) No.9500 of 2026 stands dismissed.


6.       In Civil Application No. 3908 of 2026, the learned Counsel

appearing for the Municipal Council, on instructions, submits that the

arbitral award shall be implemented within a period of ten weeks.


7.       In view of the said statement, the arbitral award shall not be

executed for a period of ten weeks from today. The execution proceedings,

if any, shall remain in abeyance for the said period. The Civil Application

No.3908 of 2026 stands disposed of.




                                                       ( ARUN R. PEDNEKER, J. )



vj gawade/-.




                                     Page 2 of 2

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