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IN THE HIGH COURT OF PUNJAB AND HARYANA
Before
The Hon’ble Mr. Justice A.N. Jindal
F.A.O. Non. 5700 of 2011 (O&M)
M/s Chandi Construction Company Limited
v.
Executive Engineer & Ors.
{Decided on 20/05/2013}
Arbitration--Award--Setting aside of--Fraud at the time when contract was accepted--Separate suit for setting aside decree obtained by fraud is to be filed.
Arbitration--Award--Setting aside of--Limitation--Application could be filed only within three months from the date of passing of the award and not from the of the amended award.
(A) Arbitration & Conciliation Act, 1996, S.33--Award--Review petition against arbitral award is not maintainable--Act of 1996, only provides for correction and interpretation of award by the Arbitral Tribunal and not by the appellate court--The Arbitration Act being complete Code, not providing any remedy of review, therefore review petition is not maintainable. (Para 18)
(B) Evidence Act, 1872--Proof of Document--Mere tendering of the affidavits by the respondents would not dispense with the mode of proof and would hardly be used as evidence in the case against the appellants. (Para 17)
(C) Arbitration & Conciliation Act, 1996, S.33--Award--Review petition is not maintainable--Only a Arbitral Tribunal or the Arbitrator, as the case may be, can within 30 days from the receipt of the arbitral award, correct any computation, clerical or typographical errors or any other errors of similar nature, but the section does not enable any judicial review of the judgment--The Arbitral Tribunal has specific and limited jurisdiction of review which cannot be beyond the scope of Section 33 of the 1996 Act. (Para 20)
(D) Civil Procedure Code, 1908, S.151--Decree obtained by Fraud--Fraud is of two types: one is played upon the party and the other upon the court--Where there is a fraud played upon the party, then the award could be challenged only by way of suit and when it is played upon the court, then the petition under Section 151 of CPC to set aside the order (passed by the civil court) could be filed. (Para 24)
(E) Arbitration & Conciliation Act, 1996, S.33--Award--Setting aside of--Fraud at the time when contract was accepted--Separate suit for setting aside decree obtained by fraud is to be filed.
(F) Arbitration & Conciliation Act, 1996, S.33--Award--Setting aside of--Limitation--Application could be filed only within three months from the date of passing of the award and not from the of the amended award--Therefore, if very filing of the objection petition becomes time barred, then the objection petition having lost its entity, the review petition is of no consequence.
In the instant case, the award was passed on 5.12.2003 and the objection petition was filed on 21.5.2004, passing of the amended award would not make a way to hold that the limitation began to run from the date of passing of the amended award. (Para 26)
(G) Arbitration & Conciliation Act, 1996, S.33--Award--Setting aside of--Contention that fraud was played at the time when contract was awarded by producing fake documents--Rejected--Held; Such plea raised after passing of award, in review petition but not during arbitrial proceedings.
No such evidence has been brought on record for proving the alleged fraud--Neither the complainant, who had lodged the complaint regarding fraud, was also examined, nor such witness was examined to prove that the appellants had misrepresented something containing fraud before them--No witness before whom they placed any forged documents was examined--The documents were with the respondents which could only be examined before allowing the tender--Now after 10 years, it does not lie in their mouth to say that the certificates were not issued by the office concerned--The original documents having changed hands cannot be said to have been produced by the appellants--The officers whose signatures were appended on the allegedly forged documents were examined, who could only say that those were not their signatures. (Para 16)
Mr. A.N. Jindal, J.:- This appeal has arisen out of the order dated 10.8.2011 passed by the Additional District Judge, Karnal, whereby the review petition against the judgment dated 1.12.2006 was accepted and the award was set aside.
2. The factual background of the case is that as per agreement No.6 dated 10.10.1997, work of replacing head regulator/bridge at RD No.144895 and MLL was allotted to the appellants- M/s Chandi Construction Company. The work was to be completed within one year after excluding the period of rainy reason from July to September. However, the appellants were asked by the respondent vide letter No.13559/60/3A dated 13.10.1997 to proceed with the work. On 16.10.1997, the work was commenced by the appellants. However, on 22.5.1998, on account of differences between the parties over the measurement of the work, the work was stopped, consequently, the committee of three Executive Engineers was constituted by the Engineer-in- Chief to take final measurements of the work done. On 8.7.1998, the respondents terminated the agreement vide letter No.5-9/Spl/Camp. Dated 8.7.1991. The Committee submitted the report vide No.732-35/Steno dated 26.5.1998. However, the appellants, aggrieved by the acts of the respondents for not making payment, filed civil writ petition No.7270 of 1998, which was disposed of by this Court on 9.7.1998 with the direction to make payment within a month. The relevant portion of the observations made by this Court are reproduced as under :
“We are not at all satisfied with the averments made in paragraph 15, reference whereof has been given above. The word “shorague. No definite time has been spelled out. In totality of the facts and circumstances of the case, we direct respondents to make over to the petitioner the payments due to him for the work that has since already been done, within a month from today.”
3. Pursuant to the said order, on 19.8.1998, the respondents released the payment vide No.11 dated 19.8.1998 of Rs.6,76,054/- and the next payment of Rs.5,00,275/- vide draft No.363589 to the appellants.
4. Here it may be observed that up to that date, neither the respondents raised any objection about the qualification and competency of the appellants to apply for tenders, nor any such objection was raised by any of the respondents including any outsider regarding their competency to apply for the contract and allotment of work. No objection was raised at the time of making part payments as aforesaid regarding any dis-qualification of the appellants to receive the same.
5. On 27.10.1998, the appellants applied for appointment of the Arbitrator vide its letter No.149/CCPLKR and also moved an application on 2.2.1999 before the civil court at Karnal for appointment of the sole arbitrator. The civil court appointed Mr. B.S. Sandhu, Retired Chief Engineer, Punjab Irrigation Department as the sole arbitrator. The arbitration proceedings commenced and an award was passed by Mr. B.S.Sandhu, Arbitrator on 5.12.2003, which was amended vide award dated 19.12.2003 and 23.2.2004.
6. At the time of appointment of the Arbitrator or during the pendency of the proceedings before the Arbitrator, no such objection was raised that the company was not authorised to apply for the contract. The dispute was only with regard to the measurements. The original award dated 5.12.2003 and 1912.2003 and 23.2.2004 (both amended awards) were challenged before the District Judge on 21.5.2004, whereas the limitation for challenging the original award dated 5.12.2003 was at the most, only up to 4.3.2004. The respondents while challenging the award took the following objections :-
1. No full opportunity of hearing was given to the objectors- respondents.
2. The matter dealt with by the arbitrator was not within the scope of the arbitration.
3. Civil Court at Kurukshetra had no territorial jurisdiction to deal with the matter.
4. The contractor firm had not approached the adjudicator as per Clause 24.1 of GCC with
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