SUPREME COURT OF INDIA
S.B. Sinha & Dalveer Bhandari
M/s. Pandey & Co. Builders Pvt. Ltd - PETITIONER
VERSUS
State of Bihar & Anr-RESPONDENT
Appeal (civil) 4780 of 2006
(Arising out of SLP (C) No. 8861 of 2006)
Decided on : 10/11/2006
JUDGMENT:
S.B. SINHA, J.
Leave granted.
The parties hereto entered into a contract in terms whereof Appellant herein undertook a contract for execution of canal repair work for Rs. 11,33,421/-. An additional agreement was entered into by and between the parties. The said contract contained an arbitration clause being Clause 23 of the contract.
Disputes and differences having arisen between the parties, Appellant invoked the said arbitration clause. The Superintending Engineer of the Circle who was the named Arbitrator entered into reference. There being alleged undue delay in conclusion of the proceedings of the arbitral tribunal, a notice was served by Appellant purported to be in terms of Sections 14 and 15 of the Arbitration and Conciliation Act, 1996 (for short "the 1996 Act"). The named Arbitrator retired and his successor did not proceed with the reference for a long time. Another notice was issued by Appellant asking the then incumbent of the office of Superintending Engineer to proceed with the arbitration. He, however, instead of proceeding with the arbitration sought for directions in this behalf from his superior officers. On 23.8.2002, he expressed his inability to continue with the proceedings. A notice under Section 14 of the 1996 Act was again served. A proposal was made thereunder to nominate another independent person as an Arbitrator. The Irrigation Department of the State of Bihar asked the Superintending Engineer to conclude the arbitration proceedings within three months by an office order dated 20th November, 2002.
An objection, however, was filed by Appellant questioning the jurisdiction of the said Arbitrator on the premise that his nomination has already been terminated. On the said plea that the named Arbitrator in terms of Clause 23 could not have functioned as such, an application under Section 11 of the 1996 Act was filed before the Chief Justice of the Patna High Court. Justice P.S. Sahay, a former Judge of the Patna High Court was
appointed but the Superintending Engineer fixed a date for hearing on 12.2.2003 by an order dated 8.2.2003, to which an objection was raised by Appellant. Appointment of Justice P.S. Sahay was intimated to the said Superintending Engineer.
An award was passed by the Superintending Engineer on 20th February, 2003. In the meantime, Appellant had filed his claim before Justice P.S. Sahay. Respondents also appeared on 21.2.2004 and filed an application under Section 14 of the 1996 Act seeking termination of his mandate on the ground that the earlier Arbitrator has already given his award. The learned Arbitrator held that he had no jurisdiction to proceed with the matter.
A purported appeal was filed thereagainst by Appellant under Section 37 of the 1996 Act before the High Court. By reason of the impugned judgment, the High Court opined that it had no jurisdiction to hear the appeal as in terms of Sub-section (2) of Section 37 of the 1996 Act, the appeal lay before the District Court. A review application filed thereagainst was also dismissed.
It is not in dispute that in terms of Section 16 of the 1996 Act, the Arbitrator could have determined his own jurisdiction. The learned Arbitrator, nominee of the Chief Justice of the High Court, opined that there could not be two awards in one proceeding. It was held:
"19. Thus, on a careful consideration of the submission made on behalf of the parties and after going through the papers filed by them, I hold that I have no jurisdiction to continue with this proceedings for the reasons, mentioned above."
The High Court in passing the impugned judgment opined that the Patna High Court having no original jurisdiction, in view of the provisions contained in the Bengal, Agra and Assam Civil Courts Act, 1857 (for short "the 1857 Act"), the appeal filed under Section 37(2) of the 1996 Act was not maintainable before it stating:
"Accordingly, I am of the opinion that this Court being not a court of ordinary original civil
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