Sarayu Plastics Pvt. Ltd. vs Gujarat Water Supply and Sewage Board

M.D. Shah, J.—This petition under Articles 14, 191(g), 226 and 227 of the Constitution of India is filed by the Petitioner praying for quashing and setting aside the order dated 27-7-2009 passed by the learned 5th Senior Civil Judge, Gandhinagar, in Special Darkhast No. 21 of 2008 dismissing the said Darkhast and seeking a direction to the Respondent to make payment as per the recommendations of the arbitrator.

Short facts are that a rate contract for supply of PVC pipes was awarded to the Petitioner by the Respondent on 15-4-1998. As the Respondent made certain recoveries from the bills of the Petitioner, the Petitioner objected to the same. In view of the dispute between the parties, Shri N.J. Thaker, a retired Chief Engineer, was appointed by the Ministry of Water Supply and Sewage Board, Gandhinagar, on 23-4-2003, to give opinion. Shri N.J. Thaker vide his report dated 25-5-2004 was of the opinion that an amount of Rs. 44,99,979/- was illegally recovered by the Respondent. Since the amount was not being received by the Petitioner, he preferred Special Darkhast No. 21 of 2008 before the learned Principal Senior Civil Judge, Gandhinagar, for recovery of the said amount with interest @ 18% p.a. along with costs.

In the reply filed by the Respondent before the trial court, it was contended that the document on the basis on which Darkhast has been filed is neither an award nor has there been any arbitral proceedings and is a nullity. According to him, there has been no reference to arbitration at all and Shri Thaker has been appointed to give his report on the aspect of recovery of excess payment and, therefore, the report submitted by Shri N.J. Thaker is not an award and there are only recommendations and suggestive course of action and, hence, the alleged award is null and void and without jurisdiction and inexecutable and, hence, prayed to dismiss the Darkhast.

Upon affording opportunity of hearing to the parties, the learned 5th Addl. Senior Civil Judge, Gandhinagar, passed order dated 27-7-2009 dismissing Special Darkhast No. 21 of 2008. Hence, the present petition.

Heard learned advocate, Mr. K.K. Shah, for the Petitioner.

It is vehemently argued by Mr. K.K. Shah that in pursuance of letter dated 23-4-2003 written by Hon''ble Minister, Water Supply and Sewage Board, Gandhinagar, a retired Chief Engineer, Shri N.J. Thaker was appointed as arbitrator and terms of reference were fixed and Shri N.J. Thaker submitted his award on 25-5-2004 before the Member Secretary, Water Supply and Sewage Board, Gandhinagar. It is further submitted that though Petitioner by several letters requested for implementation of the award, it was not implemented. According to him, award is passed as per the provisions of the Arbitration Act and hence, he sought to implement it u/s 36 of the Arbitration Act as executing Court has all powers to pass order for implementation of the award. However, his request was rejected. It is, therefore, submitted that the executing Court has materially erred in holding that Shri N.J. Thaker has not given any specific verdict and no award has been given but only a report or opinion has been given and hence, the order passed by the court below is required to be quashed and set aside.

This Court has gone through copy of the letter dated 23-4-2003 written by Hon''ble Minister, Water Supply and Sewage Board, Gandhinagar. It appears from the said letter that, Hon''ble Minister has only suggested to resolve the dispute by appointing one of the two retired Chief Engineers namely, Shri K.J. Dave and Mr. N.J. Thaker. It is nowhere stated in the said letter that Shri N.J. Shah is appointed as arbitrator. If letter dated 5-11-2003 written by Chief Engineer, Water Supply and Sewage Board, is seen, it transpires that terms of reference fixed by the Board was a direction to Shri N.J. Thaker to give an independent opinion within 45 days about the dispute and Rs. 10,000/- were fixed as his remuneration for the said work which was to be born equally by both the parties. Said letter speaks volume of asking Shri N.J. Thaker to submit his report and nothing transpired about Shri N.J. Thaker having appointed as arbitrator. If front page of the report dated 25-5-2004 submitted by Shri N.J. Thaker is gone through, it specifically mentioned that he is submitting his report only in reference to condition of the contract given to the present Petitioner and suggestion made by auditor of the Water Supply and Sewage Board. Forwarding letter dated 25-5-2004 of the said report also categorically mentioned that he is submitting his opinion in duplicate.

Taking into consideration the facts of the case, it transpired that Shri N.J. Thaker was never appointed as arbitrator nor were any terms of reference fixed. It also transpired that Shri N.J. Thaker has only submitted his opinion by way of a report and hence, it cannot, by any stretch of imagination, be said to be an award under the provisions of Arbitration Act and, therefore, question of filing any execution petition for implementation of the award does not arise as, as discussed above, no award was submitted by Shri N.J. Thaker but only a report was submitted and, hence, execution petition is not tenable either under the Arbitration Act or the Code of Civil Procedure. In view of the above, this petition is summarily dismissed.