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Andhra Pradesh High Court
Judges : B.S.RAIKOTE, P.L.N.SHARMA
Managing Director, Nagarjuna, Co-operative Sugars Limited, Gurazala - Appellant
Versus
T.K.Mohan Rao, Retd., Chief Engineer - Respondent
Decided On : 03-24-95
ARBITRATION - AWARD - UNREASONED AWARD - AMENDMENT ACT I OF 1990 - APPLICABILITY - AWARD PASSED PRIOR TO AMENDMENT - DECREE PASSED - APPEAL AND REVISION PENDING - AMENDMENT ACT NOT APPLICABLE - ARBITRATOR'S JURISDICTION - AWARD OUTSIDE THE CONTRACT - ESCALATED COST OF EXECUTION OF WORK - RESTRICTED BLASTING - OVERHEAD CHARGES - AWARDED BY ARBITRATOR - VALIDITY - ERROR APPARENT ON THE FACE OF THE RECORD - NON-SPEAKING AWARD - COURT'S POWER TO INTERFERE.
Fact of the Case:
The employer filed C.M.As. and C.R.Ps. against the judgment and decree passed by the lower court, which made the award passed by the arbitrator rule of the court and decreed the suit with costs. The employer contended that the impugned awards passed by the arbitrator in relation to Contracts Parts-1 and ii are illegal and without jurisdiction and the same are liable to be set aside. The employer also contended that the arbitrator was in error in passing an unreasoned awards. Alternatively, he contended that in view of the Arbitration (Andhra Pradesh amendment) Act, 1990 (Act I of 1990), this Court may remand the Awards to the arbitrator for giving reasons.
Finding of the Court:
The court held that the A.P. Amendment Act, 1990 does not apply to the awards already passed which were made rule of Court by passing decrees prior to the amendment. Now, what is pending before us in these revisions and appeals is, the decrees passed by the Court, before the amendment. The awards have already merged into decrees and those decrees are pending before us but not the awards. In these circumstances, it is not possible to accede to the contention of the learned counsel appearing for the appellants-employer that these awards are still pending in these revisions and appeals. In other words, the impugned judgments and decrees are the judgments and decrees already passed by the Court u /s. 17 of the Central Act; and as per the said section, "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." therefore, even to consider such decrees, we are sitting as appellate Court with a restricted appellate jurisdiction only with a limited question to find out whether such decree was in excess of the award or whether it is not in accordance with the award.
Issues: 1. Whether the A.P. Amendment Act, 1990 applies to the awards already passed which were made rule of Court by passing decrees prior to the amendment? 2. Whether the arbitrator was in error in passing an unreasoned awards? 3. Whether the arbitrator has jurisdiction to award items of claims which are outside the contract?
Ratio Decidendi: 1. The A.P. Amendment Act, 1990 does not apply to the awards already passed which were made rule of Court by passing decrees prior to the amendment. 2. The arbitrator is not required to give reasons for the award unless under the arbitration agreement or deed of settlement he is required to give such reasons. 3. The arbitrator has jurisdiction to award items of claims which are within the parameters of the contract.
Final Decision: The court dismissed the C.M.As. and the revision petitions filed by the employer, but in the circumstances of the cases, without costs.
( 1 ) THESE C. M. As. and C. R. Ps. arise out of common proceedings in relation to two Awards passed by the Arbitrators in respect of two contracts entered into between the Nagarjuna Co-operative Sugars Ltd. Gurajala, Guntur district,hereinafter referred to as "the employer", and Sri Venkateswara construction and Agencies, Engineers and Contracts, Banjara Hills, Hyderabad, hereinafter referred to as "the contractor".
( 2 ) CONTRACT No. 1 related to the construction of civil works (excluding structural steel fabrication and roofing) pertaining to sugar factory part work for cane carrier, Mill House, Boiler House and Work Shop, etc. including machine foundations and other connected works at Gurajala under Agreement no. Part 1/81-82, dated 25-2-1982, hereinafter referred to as "contract Part-I".
( 3 ) THE Second contract also was in regard to construction of civil works (excluding structural steel fabrication and roofing) pertaining to sugar factory part work for Boiling House, Power House, etc. , including machine foundations and other connected works at Gurajala under Agreement No. Part-II/81-82, dated 25-2-1982, hereinafter referred to as "contract Part II. "
( 4 ) SINCE a dispute arose between the employer and the contractor under clause 78 of general conditions of contracts, the matter was referred to two arbitrators. The contractor nominated Sri T. K. Mohana Rao, Retired Chief engineer, Hyderabad, as arbitrator, and the employer nominated sri. E. Ramaiah, Chartered Engineer, Vice Principal, Government Polytechnic, vijayawada, as arbitrator, hereinafter together referred to as arbitrator .
( 5 ) THE arbitrator decided both Contracts Parts 1 and 2 separately. Certain claims made by the contractor were allowed and certain other claims were rejected in terms of the Award. The counter claims made by the employer in both the contracts were rejected (hereinafter referred to as Award No. 1 and award. No. 2 ). To pass a decree in terms of Award No. l in relation to Contract no. 1, the contractor filed O. S. No. 218/86 in the Court of Prl. Subordinate Judge, narasaraopet, and the arbitrator filed O. P. No. 285 of 1986 in the same Court for making the Award No. 1 rule of Court. The employer also filed O. P. No. 385/86 in the said Court to set aside the said Award. By a common Judgment dated 21-4-1988, the learned Subordinate Judge decreed the suit with costs and the award regarding Contract No. 1 was made rule of Court with interest at 6% p. a. from the date of decree till the date of realisation. O. P. Np. 285/86 filed by the arbitrator to make Award No. 1 rule of Court is also allowed with costs. O. P. No. 385/86 filed by the employer to set aside the Award No. 1 is dismissed with costs. It is, in these circumstances, the employer filed C. R. P. No. 1839/88 against the judgment and decree, dated 21-4-1988 in O. S. No. 218/86; c. M. A. No. 1003/88 against the judgment in O. P. No. 285 of 1986 making the award No. l rule of Court; and C. M. A. No. 1026/88 against the Judgment rejecting the O. P. No. 385/86.
( 6 ) TO pass a decree in terms of Award No. 2 in relation to Contract Part-2, the contractor filed O. S. No. 219/86 in the Court of Prl. Subordinate Judge, narasaraopet. The arbitrator filed O. P. No. 286/86 for making the said award rule of Court and the employer filed O. P. No. 384/86 to set aside the Award No. 2 passed by the Arbitrator. All these matters were disposed of by a common judgment dated 21-4-1988, by which the suit was decreed with costs and the award No. 2 dated 7-6-1986 regarding Contract No. 2, was made rule of Court with interest at 6% p. a. from the date of decree till the date of realisation. O. P. No. 286/86 filed by the arbitrator to make the Award No. 2 rule of Court is also allowed with costs. O. P. No. 384/86 filed by the employer to cet aside the award No. 2 is dismissed with costs. It is, in these circumstances, the employer filed C. R. P. No. 1838/88 against the judgment and decree in
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