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High Court Of Madhya Pradesh
H. R. Krishnan and S. B. Sen, JJ.
RAMSAHAI SHEDURAM - Appellant
Versus
HARISHCHANDRA DULLCHANDJI AND ANR. - Respondents
Misc. Appeal 57 Of 1959
Decided On : 03/26/1962
ARBITRATION - AWARD - VALIDITY - FOUR MONTHS PERIOD - ENTRY OF REFERENCE - NOTICE TO ACT - PERSONAL DISQUALIFICATION OF ARBITRATOR - LEGAL MISCONDUCT.
Fact of the Case:
The appellant, a building contractor, challenged the validity of two arbitration awards made in respect of two building works carried out by him for the owners. The appellant raised various objections, including partiality of the arbitrator, procedural irregularities, and exceeding the jurisdiction of the reference.
Finding of the Court:
The Court held that the arbitrator had entered on the reference in March 1952, and the award was made within four months from that date. The Court also held that the arbitrator was not guilty of any personal disqualification or legal misconduct. The Court further held that the arbitrator had not exceeded his jurisdiction and that the award was valid.
Issues: 1. Whether the arbitrator was partial and had exceeded his jurisdiction? 2. Whether the arbitrator was guilty of legal misconduct? 3. Whether the award was made within the four months period from the date of entry of reference?
Ratio Decidendi: 1. The Court held that the arbitrator was not partial and had not exceeded his jurisdiction. The Court observed that the arbitrator had been closely associated with the work throughout and had made a separate memorandum setting out the different units of controversy in regard to which the assessments of the parties in terms of money were materially discrepant. The Court also observed that the arbitrator had given both parties an opportunity to put up before him whatever they had to say and had set out his findings on each dispute. 2. The Court held that the arbitrator was not guilty of legal misconduct. The Court observed that the arbitrator had not refused to look into the evidence or other similar material that either party placed before him or invited him to examine. The Court also observed that the arbitrator had inspected the buildings from time to time and had discussed with the parties their items of claim. 3. The Court held that the award was made within the four months period from the date of entry of reference. The Court observed that the arbitrator had entered on the reference in March 1952, and the award was made within four months from that date.
Final Decision: The Court dismissed the appeals with costs and pleaders fee payable by the appellant-contractor to the owner respondent in each of them.
( 1 ) THESE appeals are by a building contractor from the District Judge's decree based on two awards in arbitration on his claims and the owner's counter claim in respect of two building works carried out by him for the owners. When the awards were filed, the appellant objected on various grounds, to be set out presently; but the District Judge has rejected them.
( 2 ) IN one case, the building is the "lantern Hotel" in North Tukoganj of which Capt. Dhanda is the owner and respondent in Appeal 56 of 1959. In the other, the building is the "viram Lodge" and the owners ars the other members of his family (respondents in Misc. Appeal No. 57 of 1959) on whose behalf he had been acting. The contractor and the arbitrator are the same and the questions that arise are identical. The District judge, therefore, consolidated them into one suit and delivered one judgment; the same procedure can be conveniently adopted here as well.
( 3 ) THE parties have during argument covered practically the entire field of the law of arbitration but more immediately the questions that arise were :
(i) Whether in view of the past relations between Capt. Dhanda on the one hand who occupied some position of importance in the Government of the erstwhile State of Indore and the arbitrator Shri joglekar on the other, who was a servant of that Government in the Engineering department, partiality on his part could be presumed? (ii) Whether the procedure adopted by the arbitrator and his failure to record in extenso the reasoning leading to his award, amount to judicial misconduct in the arbitration? (iii) Whether in respect of any item mentioned in the award he has exceeded the jurisdiction given by the reference which is actually a clause in the building contract? (iv) (a) Whether on being noticed on behalf of the contractor that he proposed to move the Civil Court for revocation of the reference, the arbitrator lost jurisdiction, and the award made by him after it is invalid? (b) Alternatively, whether by not waiting till an application for revocation could be filed in the civil Court the arbitrator is guilty of indecent haste amounting to misconduct? (v) finally, whether the award was given in contravention of Paragraph (3) of the First Schedule after the lapse of four months from the date of the arbitrator's entry on the reference and if so, whether there is any letter or request by either party which would give another term of four months?
( 4 ) THOUGH the mutual dealings between the parties have been long and complicated, the following summary is sufficient for our purposes. Some time in 1948, Capt. Dhanda and his family proposed to put up two buildings, one called the "lantern Hotel" in North Tukoganj and the other called the "viram Lodge" in south Tukoganj. The former was to be in his own name and the lattar, in the name of his wife and children, though he has been throughout acting as the properly empowered agent on their behalf. There were two agreements between the Dhanda group, who may be called the "owners", and Ramsahay, the appellant, who will be called for convenience the "contractor". Among the various conditions, these alone are relevant for our purposes.
" (3) Muntazim Bahadur P. G. Joglekar Superintending Engineer will be the consulting engineer for this building. (4) The contractor agrees to receive interim payment for the work from time to time according to the decision of the consulting engineer. (5) The contractor agrees to proceed with the work with due diligence. . . . . In the event of failure to complete the work as agreed to by the contractor, he shall be liable to pay such reasonable compensation as the Consulting Engineer may fix. On the other hand, the owner agrees to pay to the contractor a further sum not exceeding Rs. 3500/-, if the consulting engineer is satisfied with the quality and speed of work of the contractor on completion. (6) The contractor also agrees that in all matters of dispute, if any, regarding th
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