Santokh Singh Arora & Anr. Vs. Union of India & Ors.
EmailAppeal: Civil Appeal No. 10548-10550 of 1983.
Petitioner: Santokh Singh Arora & Anr.
Respondent: Union of India & Ors.
Apeal: Civil Appeal No. 10548-10550 of 1983.
Judges: A.P.SEN & M.N.VENKATACHALIAH,JJ.
Date of Judgment: Oct 06, 1987
Head Note:
ARBITRATION ACT, 1960:
Sections 16 and 30 – Arbitrator rendered lump-sum award – Agreement required an award in respect of each item of claim – Error apparent on face of the award – Matter remanded to the Arbitrator for fresh awards.
Cases Reffered:
1. Champsey Bhara & Company v. The Jivraj Balloo Spinning & Weaving Company Ltd, LR (1922-23) 50 IA 324.
2. Jivarajbhai Ujmashi Sheth & Ors.v. Chintamanrao Balaji & Ors., (1964) 5 SCR 480.
3. Hindustan Steel Works Construction Ltd. v. C. Rajasekhar Rao, (1987) 4 SCC 93 = JT 1987 (3) S.C.239.
2. Jivarajbhai Ujmashi Sheth & Ors.v. Chintamanrao Balaji & Ors., (1964) 5 SCR 480.
3. Hindustan Steel Works Construction Ltd. v. C. Rajasekhar Rao, (1987) 4 SCC 93 = JT 1987 (3) S.C.239.
JUDGEMENT:
O R D E R
1. By a consolidated order dated November, 21, 1983 disposing of these appeals, this Court referred the disputes between the parties to arbitration by Sri A.C. Gupta, a retired Judge of the Supreme Court of India. The learned Arbitrator has rendered lump-sum awards in each of these three cases, all dated April 30, 1987. In Contract NO. GE/DDN/31 of 1967-68 the learned Arbitrator has awarded a total sum of Rs. 2,087, in Contract No. CWE/DDN/34 of 1966-67 he has awarded Rs. 36,770, and in Contract No. CEW/DDN/35 of 1967-68 a is entitled to Rs.65,505 in all towards his outstanding claims. There is no doubt or difficulty as to the law applicable, the impugned awards being for a lump-sum. See : CHAMSEY BHARA & COMPANY VS. THE JIVRAJ BALLOO SPINNING & WEAVING COMPANY LTD. LR (1922-23) 50 IA 324, JIVARAJBAHAI UJAMSHI SHETH & ORS. VS. CHINTAMANRAO BALAJI & ORS. (1964) 5 SCR 480 and HINDUSTAN STEEL WORKS CONSTRUCTION LTD. VS. C. RAJASEKHAR RAO (1987) 4 SCC 93. We accordingly indicated to the appellant who argued his case personally, that it was not open to the Court to question the correctness of the adjudication made by the learned Arbitrator and that the awards were binding on the parties.
2. The only contention advanced by the appellant before us is that there was an error apparent on the face of the awards within the meaning of s.30 of the Arbitration Act, 1940 inasmuch as the impugned awards were not in conformity with cl.70 of the agreement i.e. the arbitration clause. We are afraid, the contention must prevail. Learned counsel appearing for the Union of India indeed does not contest the legal position. The order of reference made by this Court in terms invokes and incorporates cl.70 of the agreement between the parties.
3. It appears that the attention of the learned Arbitrator was not drawn to the provision contained in cl.70 of the agreement and in particular, to the requirement of paragraph 6 thereof. Clause 70, insofar as material, is in the following terms:
“70 Arbitration – All disputes, between the parties to the contract )other than those on which the decision of the C.W.E. or any other person is by the contract expressed to be final and binding) shall, after written notice by either party to the contract to the either of them be referred to the sole arbitration of an Engineer Officer to be appointed by the authority mentioned is the tender documents.
* * * * * * * * * *
(Paragraph 6) : The Arbitrator shall give his award on all matters referred to him and shall indicate his finding along with the sums awarded, separately on each individual item of dispute.”
It is quite obvious from the terms of cl.70 that the learned Arbitrator shall, while giving the award, indicate his finding along with the sum awarded on each individual item of dispute. In other words, the Arbitrator is required by the terms of cl.70 to adjudicate upon and determine the sums payable with respect to each item of claim distinctly. On a plain reading of cl. 70, no other construction is possible. The learned Arbitrator has rendered a lump-sum award with respect to the disputes arising out of the three contracts aforesaid but he was required in view of the specific conditions contained in paragraph 6 of cl.70 to deal with each item of claim separately and to make an award thereon. In view of this it cannot be doubted that there is an error apparent on the face of the awards within the meaning of s.16 of the Arbitration Act. We are therefore constrained, though reluctantly and without meaning any disrespect to the learned Arbitrator, to remit the cases to the learned Arbitrator with a direction to make fresh awards in each of these cases. He shall endeavour to dispose of the matter as expeditiously as possible; and in any event, not later than December 31, 1987. The parties are directed to appear before the learned Arbitrator on October 26, 1987. They shall furnish agreed items of claim under the aforesaid contracts, failing which the learned Arbitrator may ask them to seek further direction from this Court.
4. The Union of India, Ministry of Defence (Garrison engineer), Dehradun shall pay to the appellant Santokh Singh the sum of Rs. 65,505 as awarded by the learned Arbitrator, subject to adjustment. The amount shall be paid before the learned Arbitrator, on October 26, 1987. The payment will be subject to the final result of the arbitration and subject to final accounting, that is, plus or minus. This shall be without prejudice to the rights and contentions of the parties.
5. The appellant Santokh Singh is permitted to withdraw the sum of Rs. 1,000 deposited by the ~4~ Union of India towards adjournment costs.
1. By a consolidated order dated November, 21, 1983 disposing of these appeals, this Court referred the disputes between the parties to arbitration by Sri A.C. Gupta, a retired Judge of the Supreme Court of India. The learned Arbitrator has rendered lump-sum awards in each of these three cases, all dated April 30, 1987. In Contract NO. GE/DDN/31 of 1967-68 the learned Arbitrator has awarded a total sum of Rs. 2,087, in Contract No. CWE/DDN/34 of 1966-67 he has awarded Rs. 36,770, and in Contract No. CEW/DDN/35 of 1967-68 a is entitled to Rs.65,505 in all towards his outstanding claims. There is no doubt or difficulty as to the law applicable, the impugned awards being for a lump-sum. See : CHAMSEY BHARA & COMPANY VS. THE JIVRAJ BALLOO SPINNING & WEAVING COMPANY LTD. LR (1922-23) 50 IA 324, JIVARAJBAHAI UJAMSHI SHETH & ORS. VS. CHINTAMANRAO BALAJI & ORS. (1964) 5 SCR 480 and HINDUSTAN STEEL WORKS CONSTRUCTION LTD. VS. C. RAJASEKHAR RAO (1987) 4 SCC 93. We accordingly indicated to the appellant who argued his case personally, that it was not open to the Court to question the correctness of the adjudication made by the learned Arbitrator and that the awards were binding on the parties.
2. The only contention advanced by the appellant before us is that there was an error apparent on the face of the awards within the meaning of s.30 of the Arbitration Act, 1940 inasmuch as the impugned awards were not in conformity with cl.70 of the agreement i.e. the arbitration clause. We are afraid, the contention must prevail. Learned counsel appearing for the Union of India indeed does not contest the legal position. The order of reference made by this Court in terms invokes and incorporates cl.70 of the agreement between the parties.
3. It appears that the attention of the learned Arbitrator was not drawn to the provision contained in cl.70 of the agreement and in particular, to the requirement of paragraph 6 thereof. Clause 70, insofar as material, is in the following terms:
“70 Arbitration – All disputes, between the parties to the contract )other than those on which the decision of the C.W.E. or any other person is by the contract expressed to be final and binding) shall, after written notice by either party to the contract to the either of them be referred to the sole arbitration of an Engineer Officer to be appointed by the authority mentioned is the tender documents.
* * * * * * * * * *
(Paragraph 6) : The Arbitrator shall give his award on all matters referred to him and shall indicate his finding along with the sums awarded, separately on each individual item of dispute.”
It is quite obvious from the terms of cl.70 that the learned Arbitrator shall, while giving the award, indicate his finding along with the sum awarded on each individual item of dispute. In other words, the Arbitrator is required by the terms of cl.70 to adjudicate upon and determine the sums payable with respect to each item of claim distinctly. On a plain reading of cl. 70, no other construction is possible. The learned Arbitrator has rendered a lump-sum award with respect to the disputes arising out of the three contracts aforesaid but he was required in view of the specific conditions contained in paragraph 6 of cl.70 to deal with each item of claim separately and to make an award thereon. In view of this it cannot be doubted that there is an error apparent on the face of the awards within the meaning of s.16 of the Arbitration Act. We are therefore constrained, though reluctantly and without meaning any disrespect to the learned Arbitrator, to remit the cases to the learned Arbitrator with a direction to make fresh awards in each of these cases. He shall endeavour to dispose of the matter as expeditiously as possible; and in any event, not later than December 31, 1987. The parties are directed to appear before the learned Arbitrator on October 26, 1987. They shall furnish agreed items of claim under the aforesaid contracts, failing which the learned Arbitrator may ask them to seek further direction from this Court.
4. The Union of India, Ministry of Defence (Garrison engineer), Dehradun shall pay to the appellant Santokh Singh the sum of Rs. 65,505 as awarded by the learned Arbitrator, subject to adjustment. The amount shall be paid before the learned Arbitrator, on October 26, 1987. The payment will be subject to the final result of the arbitration and subject to final accounting, that is, plus or minus. This shall be without prejudice to the rights and contentions of the parties.
5. The appellant Santokh Singh is permitted to withdraw the sum of Rs. 1,000 deposited by the ~4~ Union of India towards adjournment costs.
