NCS Sugars Limited v. P.E.C. Limited
In the High Court of Delhi
OMP (Comm) 18/2020 and IA 456-457/2020
Before Justice Vibhu Bakhru
Decided on October 22, 2021

Relevancy of the Case: “Executed” and “execution” in the Indian Stamp Act, 1899 includes attribution of electronic records as per Section 11 of the Information Technology Act, 2000

Statutes and Provisions Involved

• The Arbitration and Conciliation Act, 1996 (Section 31, 31(1), 34, 34(3), 36)
• The Code of Civil Procedure, 1908 (Section 47)
• The Indian Stamp Act, 1899 (Section 17, 2(12), 29, 33)
• The Registration Act, 1908 (Section 17)
• The Information Technology Act, 2000 (Section 11)
  

Relevant Facts of the Case

• An arbitration took place between the parties under the Delhi International Centre (DIAC) framework. Justice J.S. Khehar, former Chief Justice, presided over the tribunal as the Sole Arbitrator.
• The petitioner (respondents before the Arbitral Tribunal) filed this petition on October 31, 2019. However, they filed this case more than seventeen months after obtaining the impugned award. Earlier, the arbitral tribunal had passed an arbitral award on May 01, 2018. When the tribunal passed this award, the petitioner or its representatives were not present.
• In the present case, the petitioner seeks to quash the arbitral award. This is happening seventeen months after receiving the signed copy of the award.
• The petitioners contested that the impugned award delivered by the Arbitral Tribunal was insufficiently stamped. Therefore, it is not a valid arbitral award.

Prominent Arguments of the Parties

• The petitioner’s counsel claims that the impugned award has not adhered to the stamping procedure given under Section 33 and 2(12) of the Indian Stamp Act, 1899 and Section 11 of the Information Technology Act, 2000.
• A duly stamped and executed award was received on October 1, 2019. They filed the current petition within the three months following that date, and there is no delay. Also, they have filed this petition within the time limit set out in Section 34(3) of the Arbitration and Conciliation Act, 1996.

Opinion of the Bench

• As per Section 33 of the Indian Stamp Act, 1899, an insufficiently stamped instrument is required to be impounded. However, it does not cease to be an instrument.
• Words like executed and execution imply a signed and an instrument with signature in the context of the Indian Stamp Act, 1899. Further, this includes attribution of electronic records within the meaning of Section 11 of the Information Technology Act, 2000.

Final Decision

• An arbitral award insufficiently stamped is an arbitral award nonetheless.
• Hence, the court dismissed the petition and dismissed all pending applications.