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Madhya Pradesh High Court
A. P. SEN,M. L. MALIK
Chief Administrator, Dandakaranya Project, Koraput, Orissa - Appellant
Versus
Prabartak Commercial Corporation Ltd., Calcutta - Respondent
Decided On : 08/06/1974
When an award is accepted on certain points and is remitted for reconsideration only on the remaining points the order would amount to a refusal to set aside an award on the points the award is accepted, and as such, will be appealables AIR 1956 Nag. 245 relied on AIR 1946 Sindh 141. AIR 1957 Madras 414, AIR 1960 Madras 43 distinguished. Civil Appeal No 1094 of 1963 decided on 9th September 1964 (Supreme Court) referred to. [Paras 22 and 23]
(2) Arbitration Act, 1940 - Ss. 39 (1) (VI), 33 and 30 - maintainability of appeal -limitation.
Appellant raised certain objections against the remitted award. The Court refused to hear the objections and passed a preliminary decree. The appellant filed on appeal which was barred by 242 days. During the course of arguments the appellant affixed copy of another order along with requisite Court fee and prayed that the appeal may be treated as one under section 39 (1) (vi).
Held : The act of enclosing a certified copy of the order was a mere contrivance to defeat the bar of limitation. The application for amendment of the memorandum of appeal cannot, therefore be allowed. 1969 JLJ 651 distinguished. [Paras 27 and 28]
(3) Arbitration Act. 1940 - S. 2 (a) - arbitration agreements – Interpretation of - matters to be considered.
The general rule that the grammatical and ordinary sense of the words in a contract is to be adhered to, unless such adherence would lead to some manifest absurdity or some repugnance or inconsistency applies to building and construction contracts. The meaning and the intention of the parties have to be gathered from the language used. The question, over what subject-matters the arbitrator is to exercise his powers must be answered by a reference to the particular words of the arbitration agreement. [Para 34]
(4) Arbitration Act, 1940 - Ss. 20, 30 and 33 - when submission can be made to an arbiter - arbitration clause subject to 'otherwise provisions of the contract' - clause B-A of the contract providing for finality of decision of Super-intending Engineer in certain matters -such matters cannot be referred to arbitration.
Where the arbitration clause of the contract excludes matters 'otherwise provided in the contract' and clause 13-A of the contract provides that the work shall be done to the satisfaction approval or acceptance of an architect or engineer, such architect or engineer is thereby constituted sole arbiter between the parties and the parties are bound by his decision in the absence of fraud or mistake. More so, where there is a stipulation that his certificate made or approval is a condition of he contractor's right to receive payment such certificate or approval must be, as it is, conclusive as to all matters within his authority. Halsbury's Law of England, 4th Edition, Volume 4, Para 1215, Page 619, (1954) 1 WLR at Page 973, (1873) 8 Ch 597, LR (1871) 6 QB 11, (1858) 28 LJ Ch 230, (1886) 18 QB 7, LR (1905) 1 KB 294, 1973 JLJ 38, relied on. [Para 44]
A. P. SEN, J. : - This judgment shall also govern the disposal of Miscellaneous (First) Appeal No. 174 of 1970 (The Chief Administrator, Dandakaranya Project v. M/s. Prabartak Commercial Corporation Ltd.).
This appeal under Section 39 (1) (vi) of the Arbitration Act, 1940, is directed against an order of the Additional District Judge, Jagdalpur, dated 25-7-1969 remitting the award of Shri S. D. Jha, Advocate, Jagdalpur, dated 16-12-1968 for reconsideration on certain issues, and the connected appeal is directed against the preliminary decree drawn by the District Judge, Jagdalpur, dated 2-7-1970 in conformity with the awards.
2. The facts, in brief, are as follows : - The respondent, which is a firm of contractors, entered into a contract with the appellants, for the collection and supply of "hard granite chips", for the construction of NH/43, at four reaches, namely, (a) Mile 154/0 to Mile 166/0, (b) Mile 166/0 to Mile 179/4, (c) Mile 183/4 to Mile 191/0 and (d) Mile 196/0 to Mile 198/0. The respondent, however, experienced difficulty in supplying "hard granite chips". That was because the metal quarried was not of superior quality. The question of substituting 'hard stone chips' for "hard granite chips" was, therefore, negotiated and the Superintending Engineer permitted the respondent in terms of clause 13-A of the agreement, to deviate from the term of the contract and supply, instead, 'hard stone chips' at the following reaches, viz., (a) 166/0 to 179/4, (b) 183/4 to 191/0, and (c) 196/0 to 198/2. He held that the respondent would be entitled to payment for the substituted material according to the Schedule of Rates of the Dandakaranya Project, i.e., for 'hard stone chips' (other than granite), which was inclusive of carriage to site of work and stacking, complete.
3. The respondent unequivocally, accepted payment with respect to two out of the three reaches, via., 183/4 to 191/0 and 196/0 to 198/2, without any reservation whatever. That had to be so because it could not obviously claim payment for "hard granite chips", when actually it supplied 'hard stone chips', which was altogether a different class of material. The rate quoted by the respondent for the supply of "hard granite chips" was almost the double of the rate quoted in respect of 'hard stone chips'.
4. While making supply to reach 166/0 to 179/4, the respondent, however, claimed that payment for lead should be made according to the terms of the contract. This was contrary to the decision of the Superintending Engineer, conveyed by the Executive Engineer vide his letter No. 721/G-8 dated 4-2-1961 to the effect : -
"The rate for collection of stone materials not covered in your agreement will be paid at DNK Schedule of Rates... ......... The rate for carriage of such materials will be paid for actual lead of carriage of such materials at DNK Schedule of Rates less the percentage abatement of your tender." The principle on which the .payment was to be made for the substituted material was the same in case of all the three reaches.
5. The respondent, by its letter dated 19-4-1962, asserted -
"We accepted payment on actual lead for supply of stone materials in the reach l83/4 to 191/0 and 196/0 to 198/2 and, therefore, we are to accept the same principle for the other reaches also. If required, for this we have very clearly mentioned that what we accepted for the reaches 183/4 to 191/0 and 196/0 to 198/2 was on very special consideration and was for the particular reaches and was not definitely a general acceptance for all the reaches."
The correspondence nowhere discloses what these very special considerations were.
6. The Superintending Engineer held that the rate quoted by the plaintiff for the reach in Mile 166/0 to Mile 179/4 had to be rejected, for the reasons -
"Since the class of material substituted, i.e. hard stone is in the agreement, the contractor is eligible only for the extra cost involved in breaking hard stone metal into hard stone chips." The respo
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