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State of Orissa Vs. R.N. Misra - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtOrissa High Court
Decided On
Case NumberMisc. Appeal No. 254 of 1982
Judge
Reported inAIR1984Ori42
ActsArbitration Act, 1940 - Sections 30, 33 and 39
AppellantState of Orissa
RespondentR.N. Misra
Appellant AdvocateAddl. Govt. Adv.
Respondent AdvocateJagannath Das and ;K.K. Jena, Advs.
DispositionAppeal dismissed
Cases ReferredUnion of India v. Kalinga Construction Co.
Excerpt:
.....which had been considered by the arbitrator by this court was disapproved and it was observed that it was not open to this court to sit in appeal over the conclusion of the arbitrator in proceedings for setting aside the award......by the learned subordinate judge. bhubaneswar in o. s. no. 293 of 1981-1 making the award of the learned arbitrator a rule of the court subject to the modification that future interest is to be limited only to the principal claim of the respondent. 2. the respondent was entrusted with certain works under the ramiala irrigation project by the executive engineer. ramiala canal division under agreement no. 4 f-2 of 1978-79. as disputes arose between the parties, the additional director of designs, bhubaneswar was appointed as the arbitrator to decide the disputes. bv his order dt. 20-11-1981 the learned arbitrator gave an award for a sum of rs. 2,54,048.50 paise to be paid by the appellant to the respondent besides refund of the security deposit and earnest money. the learned arbitrator.....
Judgment:

B.N. Misra, J.

1. This appeal has been filed by the State of Orissa represented by the Executive Engineer, Ramiala Canal Division, Kamakhyanagar, Dis-trict-Dhenkanal against the judgment dated 16-2-1982 passed by the learned Subordinate Judge. Bhubaneswar in O. S. No. 293 of 1981-1 making the award of the learned Arbitrator a rule of the Court subject to the modification that future interest is to be limited only to the principal claim of the respondent.

2. The respondent was entrusted with certain works under the Ramiala Irrigation project by the Executive Engineer. Ramiala Canal Division under agreement No. 4 F-2 of 1978-79. As disputes arose between the parties, the Additional Director of Designs, Bhubaneswar was appointed as the Arbitrator to decide the disputes. Bv his order dt. 20-11-1981 the learned Arbitrator gave an award for a sum of Rs. 2,54,048.50 paise to be paid by the appellant to the respondent besides refund of the security deposit and earnest money. The learned Arbitrator also allowed interest at the rate of 10% on the whole amount of the award mentioned above.

Thereafter the appellant filed objections against the award and the same were registered as O. S. no. 293 of 1981-I in the court of the learned Subordinate Judge. Bhubaneswar. On consideration of the respective cases of the parties and after hearing them the learned Subordinate Judge upheld the award on the ground that it was not supported by reasons and that no error apparent on the face of the award had been brought to the notice of the court to justify setting it aside. The learned Subordinate Judge however modified the award to the extent that future interest at the rate of 10% per annum shall be paid only on the principal sum of Rs. 2.23,067/- and not on the whole amount of the award.

3. As rightly observed by the learned Subordinate Judge, the award of the learned Arbitrator is not supported by reasons and there is no error apparent on the face of it and as such it is not open to this Court to review the same award. The learned Additional Government Advocate appearing on behalf of the appellant has urged that the award and the judgment of the learned Subordinate Judge cannot be upheld insofar as they relate to the claim of the respondent with regard to the cost of extra items of works actually executed. It is submitted that the extra items of works are covered under Clause 11 of the agreement and as indicated in the proviso to the said clause, the matter should have been decided only by the concerned Superintending Engineer and not the learned Arbitrator. In support of this contention, reliance is placed on a decision of the Supreme Court reported in AIR 1971 SC 1646 (The President, Union of India v. Kalinga Construction Co. (P) Ltd.) wherein it was held :--

'Once it was found that under the terms of the contract the order of the Chief Engineer in writing had to be obtained before the work involving additional leads was executed and in the absence of any such written order it was not open to the Court to hold that the appellant--Union of India--was liable for payment of extra leads beyond 10 by applying some principle or rule analogous to estoppel. It is no doubt true that the company had been writing to the Engineering Department in the matter and that the latter did not, for a considerable time, send any reply but the company was debarred from asking for any additional payment in the absence of the Chief Engineer's order in writing. If the arbitrator came to that conclusion it could not be said that there was any error apparent in his award which would justify setting it aside.'

4. First of all it is necessary to refer to the proviso to Clause 11 which provides as follows :--

'Provided always that if the contractor shall commence work or incur any expenditure in regard thereof before the rates shall have been determined as last hereinbefore mentioned, then and in such case he shall only be entitled to be paid in respect of the work carried out or expenditure incurred by him prior to the determination of the rates as aforesaid according to such rates as shall be (fixed) by the Engineer-in-charge.

In the event of a dispute the decision of the Superintending Engineer of the Circle will be final.'

A perusal of the award in this case reveals that the respondent had claimed a sum of Rs. 2.36,934/- as the cost of extra items of works actually executed The learned Arbitrator awarded a sum of Rs. 1.35,000/- against that item. In the absence of any materials it is not possible to come to a conclusion that in this case the respondent had commenced work or incurred any expenditure in regard to the additional items of works before the rates for such items had been fixed by the Engineer-in-Charge. There is no basis on which it can be said that the proviso to Cl. 11 of the agreement is applicable to the facts of this case. The learned Additional Government Advocate suggested that the records which were placed before the learned Arbitrator should be called for and examined to find out the details with regard to the extra items of works. This suggestion must be outright rejected. In this proceeding it is not open to this Court to sit in appeal over the conclusion of the learned Arbitrator and re-examine the evidence which had been considered by the learned Arbitrator, particularly when the award is a non-speaking one and is not supported by reasons. In the Supreme Court case referred to above, re-examination and re-appraisal of the evidence which had been considered by the Arbitrator by this Court was disapproved and it was observed that it was not open to this Court to sit in appeal over the conclusion of the Arbitrator in proceedings for setting aside the award. Accordingly, the contention of the learned Additional Government Advocate with regard to the additional items of works must be rejected.

5. In the result, this appeal which has no merit is rejected. The impugned judgment is confirmed. There should be no order as to costs. The cross-objection which has no merit is also rejected.


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