AI Structured Summary
Not yet generated for this judgment
Judgment
Dr. Vineet Kothari, J.
The present Misc. Appeal has been filed by the legal representatives of the PWD Contractor namely, Mr. Prahalad Rai Kedia, who executed a contract for strengthening of road from Udaipur to Ratanpur Stone No. 329 to 342 under the Agreement No. 8 for the year 1989-90, Job No. 008/R.J./87/073. In the year 1990-91, after completion of contract and payment of final bill, the contractor raised certain dispute with Public Works Department for payment of some additional amount for the works executed by the contractor in terms of the agreement between the parties and as per the terms of the agreement, the sole arbitrator namely, Shri Gulab Singh Bhandari, Executive Engineer, PWD Department was appointed to resolve the dispute, who by his award dated 25.02.1994 awarded a sum of Rs. 5,84,362/- in favour of the contractor on the ground of additional lead (distance) required to be covered for bringing the ballast (Sratl) from Pipli Quarry whereas, the same was brought from some other quarries, as the Pipli Quarry was not worked for last many years and was not allowed to be operated by the Forest Department. The Contractor claimed Rs. 2,69,227/- under this extra item. The contractor also claimed Rs. 1,02,427/- on account of "spreading" of soil on the ground whereas the "compacting of soil" was the main item but the "spreading of soil" was not included in the main item and, therefore, for this extra item, the aforesaid amount was claimed. The contractor further claimed a sum of Rs. 99,600/- towards escalation charges. The contractor also claimed 12% interest per annum on the aforesaid extra items. Thus the total Rs. 5,84,362/- was awarded as per the claim of the Contractor. The said award was forwarded by the learned Arbitrator to the concerned Court of Additional District Judge, Udaipur for making it the "Rule of Court", as required under Sections 17 and 41 of the Arbitration Act, 1940, the old law later on replaced by the Arbitration and Conciliation Act, 1996.
The learned Court below of Additional District Judge No. 3, Udaipur (Shri Shyam Lal Gupta, RHJS) refused to make the Award dated 25.02.1994 a "Rule of the Court" by the impugned judgment dated 16.08.1996 and being aggrieved by the same, the present misc. appeal has been filed by the legal representatives of the deceased contractor, in whose favour the award in question had been passed by the Arbitrator.
The learned Senior Advocate Mr. J.L. Purohit with Mr. Shashank Joshi appearing for the appellants urged that the learned Court below could not have set aside the whole of the award in question without being satisfied with the conditions stipulated in Section 30 of the Arbitration Act, 1940 for setting aside of the award, which according to the learned counsel lie in a very narrow compass and, therefore, in the absence of such circumstances, the learned Trial Court has seriously erred in setting aside the award in question. The learned counsel also submitted that the learned Trial Court has further erred in refusing to make the award in question a "Rule of Court" and hence, the present misc. appeal filed on behalf of the legal representatives of the deceased contractor deserves to be allowed. He also submitted that the exercise of the power by the Court below beyond a period of four months was contrary to Section 28 of the Act of 1940 and, therefore, the impugned order of the learned Additional District Judge deserves to be quashed and set aside on this count alone.
Per contra, the learned Government Counsel Mr. Mukesh Dave supported the impugned order passed by the Court below and urged that the well reasoned order of the learned Additional District Judge does not require any interference by this Court and, therefore, the present misc. appeal of the contractor-claimants deserves to be dismissed.
Having heard the learned counsel for the parties and upon perusal of the record of the case, this Court is satisfied that there is no force in the present appeal filed on behalf of the legal representatives of the deceased contractor, in whose favour the Award in question was passed and, therefore, the same is liable to be dismissed.
It is noticed that under the old law, i.e., Arbitration Act, 1940, any award passed by the Arbitrator was required to be sent to the Court of competent jurisdiction for making the same, a "Rule of the Court" but under the scheme of the new Arbitration and Conciliation Act, 1996, every Award passed by the Arbitrator itself is treated to be a decree passed by the Civil Court. This Court is of the opinion that the Award of the Arbitrator under the new law, of course, can be set aside only on the grounds available under Section 34 of the new Act. As per Section 17 of the old Arbitration Act of 1940, the learned Court below, while making the award a rule of the Court, could enter upon the merits of the award itself.
Having perused the reasons given by the learned Court below, this Court is satisfied that the Court below was perfectly justified in setting aside the award in question passed by the Arbitrator in favour of the deceased contractor which appears to be passed beyond the terms of the contract itself. The relevant extract of the arbitrator''s award is also quoted herein below for ready reference:-
The brief reasons given by the learned Trial Court for setting aside the award in question are quoted herein below for ready reference:-
The relevant provisions contained in Sections 15 to 19 of the old Arbitration Act, 1940 are quoted herein below for ready reference:-
"15. Power of Court to modify award.- The Court may by order modify or correct an award-
(a) where it appears that a part of the award is upon a matter not referred to arbitration and such part can be separated from the other part and does not affect the decision on the matter referred; or
(b) where the award is imperfect in form, or contains any obvious error which can be amended without affecting such decision; or
(c) where the award contains a clerical mistake or an error arising from an accidental slip or omission.
Power to remit award.-(1) The Court may from time to time remit the award or any matter referred to arbitration to the arbitrators or umpire for reconsideration upon such terms as it thinks fit-
(a) where the award has left undetermined any of the matters referred to arbitration, or where it determines any matter not referred to arbitration and such matter cannot be separated without affecting the determination of the matters referred; or
(b) where the award is so indefinite as to be incapable of execution; or
(c) where an objection to the legality of the award is apparent upon the fact of it.
(2) Where an award is remitted under sub-section (1) the Court shall fix the time within which the arbitrator or umpire shall submit his decision to the Court:
Provided that any time so fixed may be extended by subsequent order of the Court.
(3) An award remitted under sub-sec. (1) shall become void on the failure of the arbitrator or umpire to reconsider it and submit his decision within the time fixed.
Judgment in terms of award.- Where the Court sees no cause to remit the award or any of the matters referred to arbitration for reconsideration or to set aside the award, the Court shall, after the time for making an application to set aside the award has expired, or such application having been made, after refusing it, proceed to pronounce judgment according to the award, and upon the judgment so pronounced a decree shall follow and no appeal shall lie from such decree except on the ground that it is in excess of, or not otherwise in accordance with, the award.
Power of Court to pass interim orders.-(1) Notwithstanding anything contained in sec. 17, at any time after the filing of the award, whether notice of the filing has been served or not, upon being satisfied by affidavit or otherwise that a party has taken or is about to take steps to defeat, delay or obstruct the execution of any decree that may be passed upon the award, or that speedy execution of the award is just and necessary, the Court may pass such interim orders as it deems necessary.
(2) Any person against whom such interim orders have been passed may show cause against such orders, and the Court after hearing the parties, may pass such further orders as it deem necessary and just.
Power to supersede arbitration where award becomes void or is set aside.- Where an award has become void under sub-sec. (3) of Section 16 or has been set aside, the Court may by order supersede the reference and shall thereupon order that the arbitration agreement shall cease to have effect with respect to the difference referred."
Upon bare perusal of the above quoted provisions of the old Arbitration Act of 1940, this Court is satisfied that the learned Court below has not committed any error in setting aside the award in question which was clearly beyond the terms of the agreement itself and the awarded claim was found to be baseless and, therefore, this Court is of the opinion that the learned Court below has very rightly refused to make the Award in question "Rule of the Court".
The learned Court below has clearly found that while the terms of the contract clearly stipulated that the Ballast has to be made available with the condition ''with all the lead and lift'' and that too, in a revised tender given by the Contractor, since in response to his initial bid, no work order was given to him and there was no such condition stipulated by the contractor that if the ballast is lifted from the quarry or quarries other than Pipli Quarry, which is closed for last 16-17 years due to protected forest area, then, the contractor would claim anything extra on this account. Therefore, the amount which had been awarded by the Arbitrator on this account has rightly been not allowed by the learned Court below; and upon perused the record of the case, this Court is also of the opinion that the impugned order does not call for any interference by this Court.
Similarly, the other amount awarded by the Arbitrator under the head of ''spreading of soil'' was not found justifiable by the learned Court below. The learned Court has rightly found that since in absence of the word ''spreading of soil'', in the BSR, this work is not different from ''Compaction of soil'' but later on to remove this anomaly, the word ''spreading'' has also been added in the G Schedule of the BSR under the item ''compaction''; and, therefore, the contractor was not found entitled to get any additional amount on this account. The learned Court found that the order/Award of the Arbitrator is against the Agreement and beyond the terms of the Agreement and, therefore, the learned Arbitrator had clearly fallen into error in awarding such amounts with interest in favour of the contractor. Since the learned Arbitrator acted beyond the terms of the contract, the learned Court below was perfectly justified in refusing to make the award in question a ''Rule of the Court'' within its power and discretion. No contra material was available before the learned Arbitrator or before the Court below which could persuade this Court to take a different view of the matter. The appeal filed by the legal representatives of the deceased contractor is thus found to be devoid of any merit and, therefore, the same is liable to be dismissed.
Accordingly and in view of the above, the instant civil misc. appeal filed on behalf of the legal representatives of the deceased contractor Prahalad Rai Kedia is dismissed. No costs. A copy of this Order be sent to the Court below and to all the parties concerned forthwith.