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CS Professional · Arbitration, Mediation and Conciliation · Preparation and Execution of Arbitral Award

A tribunal refuses to deliver its signed award to Desai Foods Ltd until Desai pays Rs 8,00,000 in fees demanded by the tribunal. No written agreement fixed these fees between Desai Foods and the tribunal, and the arbitration agreement is silent on lien. Which statement is correct under Section 39?

The tribunal has a lien for unpaid costs, but Desai Foods may apply to the Court. The Court can order delivery of the award on payment of the demanded sum into Court, pay the tribunal a reasonable amount and refund the balance.

  1. AThe tribunal has no lien on the award, so Desai can demand delivery immediately
  2. BDesai Foods may apply to the Court, which can order delivery on payment of the demanded costs into Court, and then pay the tribunal a reasonable sum from it and refund the balanceCorrect
  3. CThe Court must order Desai to pay the full Rs 8,00,000 directly to the tribunal
  4. DOnly the opposite party, not Desai Foods, may apply to the Court

Explanation

Section 39(1) gives the tribunal a lien for unpaid costs. Under 39(2), the Court may order delivery on payment of the demanded costs into Court, award the tribunal a reasonable sum and refund the balance. Under 39(3), any party may apply unless the fees were fixed by written agreement, which is not the case here.

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