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High Court Of Delhi
STHAPATI ENGINIRS AND BUILDERS - Appellant
Versus
CENTRAL BUILDING RESEARCH INSTITUTE - Respondent
Suit 1164A of 1984
Decided On : 03/06/1997
ARBITRATION - AWARD - NON-SPEAKING AWARD - POWER OF COURT TO INTERFERE - LIMITED AND RESTRICTED SPHERE - COURT CANNOT SPECULATE AS TO WHAT IMPELLED ARBITRATOR TO ARRIVE AT HIS CONCLUSION - LUMP SUM AWARD NO GROUND TO DECLARE AWARD BAD - ARBITRATOR HAS POWER TO GRANT PRE-SUIT, PENDENTE LITE AND FUTURE INTEREST - ARBITRATOR CAN ISSUE DIRECTION THAT IN CASE AWARDED AMOUNT ALONG WITH INTEREST IS NOT DEPOSITED WITHIN 45 DAYS FROM DATE OF PUBLISHING THE AMOUNT, THE SAME WOULD CARRY A FUTURE INTEREST @ 12% PER ANNUM FROM DATE OF EXPIRY OF 45 DAYS.
Fact of the Case:
Petitioners and respondent No. 1 entered into a contract for fabrication of R. C. C. Channel Units for School Building Project. Disputes arose between the parties and were referred to sole arbitration. Arbitrator passed a non-speaking award granting Rs. 28,930 to petitioners and Rs. 13,890 to respondent No. 1 on their counter-claim. Petitioners filed a petition under Sections 14 and 17 of the Arbitration Act for direction to Arbitrator to file the award and records of arbitration proceedings and to make the award a Rule of the Court. Respondent No. 1 filed objections under Sections 16, 30 and 33 of the Arbitration Act.
Finding of the Court:
Court held that it has jurisdiction to entertain the petition and try the same. Court also held that Arbitrator did not misconduct himself in conducting the proceedings and there was no violation of principles of natural justice. Court further held that Arbitrator has power and jurisdiction to grant pre-suit, pendente lite and future interest and that the award passed by the Arbitrator is without any sufficient documentary proof.
Issues: 1. Whether the Court has jurisdiction to entertain the petition and try the same? 2. Whether the Arbitrator misconducted himself in conducting the proceedings? 3. Whether the Arbitrator has power and jurisdiction to grant pre-suit, pendente lite and future interest? 4. Whether the award passed by the Arbitrator is without any sufficient documentary proof?
Ratio Decidendi: 1. Court has jurisdiction to entertain the petition and try the same as the Central Building Research Institute is a Unit of Council of Scientific and Industrial Research, which is a society having its registered office in Delhi. 2. Arbitrator did not misconduct himself in conducting the proceedings as he considered the statements of both the parties, oral and documentary evidence, written arguments and duly weighed and considered the facts before passing the award. 3. Arbitrator has power and jurisdiction to grant pre-suit, pendente lite and future interest. 4. Court cannot interfere with the award in absence of any reason for making the award, unless it could be shown that there is an error apparent on the face of the records.
Final Decision: Objection filed by respondent No. 1 is held to be without any merit and the same stands rejected. The award passed by the Arbitrator is made a Rule of Court. Petitioners shall also be entitled to interest at the rate of 15% per annum from the date of decree till realisation, in terms of Section 29 of the Arbitration Act.
( 1 ) DISPUTES having arisen between the parties to the Contract entitling "fabrication of R. C. C. Channel Units for School Building Project, C. B. R. I. , Aligarh", the same were referred to the sole arbitration of the respondent No. 2.
( 2 ) THE respondent No. 2 entered into the reference and on receiving evidence on record and on hearing the parties made and published his award on 30. 6. 1984 grantingasumofrs. 28,930. 00 tothepetitionersand Rs. 13,890. 00 to the respondent No. I in terms of their counter-claim. The Arbitrator further passed an award awarding simple interest @ 9% per annum from 1. 4. 1977 to 30. 6. 1984 on the net amount of the award in favour of the petitioners with the stipulation that if the respondents did not make the payment as awarded to the petitioners within 45 days from the date of publishing the award, a simple interest @ 12% per annum would be payable to the petitioners from the date of expiry of 45 days.
( 3 ) THE petitioners filed a petition in this Court under Sections 14 and 17 of the Arbitration Act praying for a direction to the respondent No. 2 to file the award and the records of the arbitration proceedings and also for making the award a Rule of the Court. On the aforesaid petition, notice was issued to the Arbitrator to file the award and upon filing of the award by the Arbitrator, notice was issued to the respondent No. I of filing of the award in the Court. The respondent No. 1 filed an objection under Sections 16, 30 and 33 of the Arbitration Act on which I heard the learned Counsel appearing for the parties.
( 4 ) THE award is admittedly a non-speaking award and by the aforesaid award, the Arbitrator awarded a lump sum Rs. 28,930. 00 in favour of the petitioners against the various claims raised by the petitioners before the Arbitrator. In respect of the counter-claim filed by the respondent No. 1, the Arbitrator allowed the counterclaim in full awarding Rs, 13. 890. 00.
( 5 ) THE power and jurisdiction of the Court in respect of interfering with a nonspeaking award is well settled. It is not open to the Court to speculate, where no reasons are given by the Arbitrator, as to what impelled him to arrive at his conclusion. The fact that a lumpsum award has been given is no ground to declare the award bad. Therefore, in respect of a non-speaking award, the Court can set aside the award only under a very limited and restricted sphere. Keeping in mind the aforesaid legal proposition, let me examine the contention of the learned Counsel appearing for the parties.
( 6 ) THE first objection raised is with regard to the territorial jurisdiction of this Court to entertain the petition and try the same. It was submitted by Mr. A. K. Sikri, Counsel appearing for respondent No. 1 that this Court has no jurisdiction to entertain this application inasmuch as, the respondent No. 1 has its office at Roorkee, where the tenders were invited and the tenders were also submitted at Roorkee and accepted at Roorkee and the subject-matter of the claim is also stated to be in the State of U. P. I have given my thoughtful consideration to the submissions made. However; I find myself unable to agree with the aforesaid submission. The Central Building Research Institute is admittedly a Unit of Council of Scientific and Industrial Research, which is a society having its registered office in Delhi. In that view of the matter, this Court shall have jurisdiction to try and decide the present petition, Besides, the Arbitrator has also filed the award in this Court. Accordingly there could be no objection to this Court trying and deciding as to whether the award passed by the Arbitrator could be made a Rule of the Court or not. The preliminary objection of the learned Counsel for the respondent No. 1 stands rejected.
( 7 ) THE next contention of the learned Counsel appearing for the respondent No. 1 was that the Arbitrator has misconducted himself in conducting the proceed- ings as there was violation of
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