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2023 Supreme(Cal) 721

IN THE HIGH COURT AT CALCUTTA
KRISHNA RAO, J.
State of West Bengal – Petitioner
Versus
Rajpath Contractors and Engineers Ltd. and Another – Respondents
A.P. No. 915 of 2011
Decided On : 04-05-2023

Advocates:
Advocate Appeared:
For the Petitioners: Kishore Datta, Arindam Mandal, Paritosh Sinha, Shourya Samanta, Varun Kothari.
For the Respondents: Priyankar Saha, Amritam Mandal, Hemant Tiwari.

Headnote:

Arbitration and Conciliation Act, 1996 - Sections 34, 21 , 11 , 30, 2(1)(h) 31(5) and 34(2) - Code of Civil Procedure,1908 - Section 80 - Limitation Act - Section 29 (2) - Suit for recovery of claims - Means a party to an arbitration agreement - Evidence Act - Section 145 - As per Clause 25 required a notice to be issued to the Chief Engineer of the Department requesting to act as sole Arbitrator or to nominate such other person as deem fit and proper - Officers who have participated in the arbitration proceeding and have given consent were not authorised to represent the petitioner in the absence of any written authorization of the secretary – Held, Proposal of Superintending Engineer and Executive Engineer the terms of settlement was arrived between the parties and in terms of said settlement, Arbitrator has passed award and thus at the later stage, the petitioner cannot say that the petitioner had no knowledge about award passed by the learned Arbitrator and respondent - application filed by the petitioner under Section 34 of the Act of 1996 is barred by limitation - A.P No. 915 of 2011 is thus dismissed

JUDGMENT :

KRISHNA RAO, J.

1. This is an application under Section 34 of the Arbitration and Conciliation Act, 1996 challenging the consent award dated 7th August, 2009 wherein the learned sole Arbitrator directed the respondents to pay the sum of Rs. 3,50,71,399/- to the claimant as final settlement of all the claims of the claimant within three months from the date of the award and in default the respondents shall pay interest at the rate of 8% on the award amount from the date of award till payment.

2. The State of West Bengal had preferred the instant application for setting aside the award dated 7th August, 2009 on the following grounds:

    2.1. The work order issued to the respondent dated 11th October, 1999, in clause 5 under the heading Arbitration it is mentioned that no arbitration is admissible.

2.2. No formal notice under Section 11 or Section 21 of the Arbitration and Conciliation Act, 1996 was issued by the respondent seeking a reference of the disputes to the arbitration.

2.3. As per Clause 25 of the West Bengal Form No. 2911 (ii) required a notice to be issued to the Chief Engineer of the Department requesting to act as sole Arbitrator or to nominate such other person as deem fit and proper.

2.4. The principal Secretary or the Joint Secretary of the Department did not authorised to enter into any kind of settlement with the respondent in connection with the transaction of the instant award.

2.5. No copy of the award was served by the sole Arbitrator to the petitioners.

2.6. If one proceeds on the basis that there was a settlement between the parties as contemplated under Section 30 of the Arbitration Act, it would be clear that arbitral award has not been passed on agreed terms by recording the settlement in the form of arbitral award.

2.7. No notice was issued intimating that the Chief Engineer, Public Works (Roads) had decided to act as arbitrator.

2.8. The petitioners did not get any reasonable opportunity to present their case before the arbitrator.

2.9. No copy of the statement of claim have been served upon the petitioner.

2.10. The officers who have participated in the arbitration proceeding and have given consent were not authorised to represent the petitioner in the absence of any written authorization of the secretary.

2.11. The Superintending Engineer had no authority to represent the State of West Bengal in the arbitral proceeding without the authorization from the Secretary or the joint Secretary of the concerned department or to instruct his subordinates to represent the State in the said proceedings.

2.12. There is no record in the file to show how the officers have admitted the sum of Rs. 3,50,71,399/- which was purportedly payable to the respondent.

2.13. The respondent had issued notice under Section 80 of the Code of Civil Procedure for institution of civil suit for recovery of claims as the respondent had the knowledge that there was no provision of arbitration in the context between the petitioner and the respondent.

2.14. The petitioners have found the award dated 7th August, 2009 in the files left behind by the respondent no. 2 was neither published nor delivered to the petitioners at any point of time.

2.15. The award passed by the sole Arbitrator is not an award within the meaning of section under Section 31 of the Arbitration and Conciliation Act, 1996.

2.16. The award is not based on genuine consent and has procured by the respondent by fraud.”

3. The respondent no. 1 submits that the respondent no. 1 as well as the authorities have acted in accordance with law by following due process of law which are as follows:

    3.1. The respondent no. 1 by a letter dated 8th December, 2012, requested the Executive Engineer for release of the amount claimed by the respondent no. 1 within 15 days and the said letter was duly communicated to the Chief Engineer as well as Superintending Engineer.

3.2. The petitioners faile

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