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2016 Supreme(Guj) 2026

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
Rajesh H. Shukla, J.
N.G. Projects Limited - Petitioner
Versus
Backbone Projects Limited & Ors. - Respondents
Special Civil Application No. 12993 of 2016 with Special Civil Application No. 12834 of 2016
Decided On : 21-09-2016

Advocates Appeared:
For the Petitioner:Mr. A.L. Shah with Mr. A.B. Munshi, Mr. S.N. Thakkar, Advocate.
For the Respondent:Mr. D.C. Dave, Sr. Advocate, with Mr. Jigar M. Patel, Caveator.

Important Point—When parties have themselves accepted a particular forum once award is made it would be open for party to challenge award on all counts.

Headnote:Arbitration and Conciliation Act, 1996—Section 37—Challenge to arbitral award— There is a specific provision like Section 37 providing for procedure before award is made or finalised—Similarly, when parties have themselves accepted a particular forum once award is made it would be open for party to challenge award on all counts and it could not be said that party to proceedings is denied any right of contesting—Section 29B refers to fast track procedure which is in tune with scheme of Arbitration Act and it prescribes procedure which parties may accept for early disposal of their dispute—Order passed by sole Arbitrator cannot be said to be erroneous or having a jurisdictional error which may call for exercise of discretion under Article 227 of Constitution in present petitions assuming that there are no fetters on exercise of discretion under Article 227.

       Result—Petitions dismissed.

JUDGMENT :

Rajesh H. Shukla, J.

Both these petitions are filed challenging the order passed by the Arbitrator under the provisions of Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'Arbitration Act') as well as under Article 226 and 227 of the Constitution on the grounds stated in detail in the memo of petitions as both the petitions are cross petitions.

2. Special Civil Application No. 12993 of 2016 is filed by the petitioner, original respondent No. 1, for the prayers, inter alia, that appropriate writ, order or direction may be issued for quashing and setting aside the impugned order passed by the Arbitrator at Annexure-J dated 11.4.2016. It has been further prayed that appropriate writ, order or direction may be issued to respondent No. 1 to produce and supply copies of the documents, papers, records before the Hon'ble arbitral tribunal as stated vide application dated 10.12.2015.

3. Similarly, Special Civil Application No. 12834 of 2016 is filed by the petitioner, original respondent No. 2, for the prayers, inter alia, that appropriate writ, order or direction may be issued for quashing and setting aside the impugned order dated 11.4.2016 at Annexure-A passed by respondent No. 3 Arbitrator and also for similar directions on the same grounds in another petition for supply of the records and documents.

4. The facts of the case, briefly summarized, are as follows:

4.1. A Joint Venture Agreement (for short 'JVA') dated 20.2.2001 was entered into and executed between the petitioner in SCA 12993 of 2016 and respondents Nos. 1 & 2. This JVA was between the petitioner company and respondents Nos. 1 and 2 in respect of the contract to be awarded by National Highways Authority of India (for short 'NHAI') for widening of four lanes and strengthening of the existing two lane carriage way of Udaipur-Ratanpur-Gandhinagar. As per the JVA the petitioner company and respondents Nos. 1 and 2 are recognised as the performing parties of the joint venture and they had decided to distribute the profit arising out of the joint venture business in the proportion of 50:25:25. Respondent No. 1 in SCA No. 12993 of 2016, Backbone Projects Ltd., was the lead company. Clause 5(a) of the JVA provides the percentage in which the profit and loss is to be distributed. However, there was no apportionment of the work among the parties and clause 15 of the JVA provides for settlement of all outstanding obligations of liabilities of the joint venture to be decided in the manner provided in this agreement.

4.2. It appears that respondent No.1 which was designated as the lead company in the joint venture had a statement of claim filed before the Arbitral Tribunal and the amount received from NHAI was subject to the final account for the work carried out which was to be shared among the parties as stated in the JVA. There arose some differences with regard to the share of distribution ratio leading to arbitration proceedings and the amount of award from NHAI was deposited in the bank account. However, as there was some disagreement on this issue of distribution of share, ultimately, led to the arbitration where one expert opinion was also taken into account and thereafter the petitioner informed respondents Nos. 1 and 2 about the appointment of Shri BJ Parmar as an arbitrator as per the clause in the JVA and therefore respondent No. 1 preferred an arbitration petition before the High Court being IAAP No. 59 of 2013 praying for appointment of an arbitrator and vide the order passed by the High Court, the sole Arbitrator (M.S. Parikh, J.) has been appointed.

4.3. Pending the proceedings before the Arbitrator, the issue was raised for filing an application by the petitioner in SCA 10993 of 2016 regarding supply of documents by respondent No. 1, Backbone Projects Ltd. After considering the reply and on the basis of the material the Hon'ble Arbitrator passed an order below Application exh. 20 & 21 that the applications are filed and they are premature




















































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