LAWS(DLH)-1991-5-42

SHARMA TIMBER WORKS Vs. UNION OF INDIA

Decided On May 02, 1991
SHARMA TIMBER WORKS Appellant
V/S
UNION OF INDIA Respondents

JUDGEMENT

(1.) RESPONDENT No. 1, the sole arbitrator, on receiving the notice issued in this petition filed u/S, 14 of the Arbitration Act, had filed the award and the proceedings in Court. On notice being served of the filing of the award on the petitioner, the petitioner has filed the objections to the award which are opposed by the U.O.I. respondent and following issues were framed, (1) Is award liable to be set aside for reasons stated in objections filed ? (2) Relief.

(2.) IT was directed that the matter shall be decided by way of affidavits and arbitration proceedings shall be read in evidence. Petitioner has filed the affidavit None has been filed on behalf of U.O.I.

(3.) BE that as it may, the short question which arises for decision is whether the arbitrator had committed judicial misconduct or not in not directing the production of R.R's. which could have shown whether the consignee had diverted the goods. It is evident that according to the contract the goods could be inspected and could be rejected within 45 days of the receipt of the goods. The goods were sent by railway and thus, as soon as the wagons were to reach the place of destination the delivery of goods ought to been been taken by the consignee and period of 45 days to be calculated from the said date of receipt of the goods but in case the goods had been diverted to different destination by the consignee then obviously the consignee could not have taken up the plea that goods had been rejected within 45 days of the receipt of goods because the consignee has delayed the receipt of the goods. But this question would have been decided by the arbitrator as to which date should have been treated as the date of receipt of the goods. It is true that the petitioner had moved an application after the close of the evidence praying that the respondent should be directed to produce the R.R.'s but it cannot be said that the R.R.'s had no relevance at all. They were definitely material documents to prove the case of the petitioner as to whether the rejection of the goods by the respondent was beyond the stipulated period. It is settled law that if certain material documents are required for arriving at a fair decision of the matter in issue it is incumbent upon the arbitrator to have those documents produced for his consideration before giving any award. In K.P. Poulose Vs. State of Kerala AIR 1975 SC 1259, the Supreme Court has laid down that misconduct u/S. 30(a) of the Arbitration Act has not a connotation of moral lapse. It comprises legal misconduct which is complete if the arbitrator on the face of the award arrives at an inconsistent conclusion even on his own finding or arrives at a decision by ignoring very materiel documents which throw abundant light on the controversy to help a just and fair decision. In the said case, there were two very material documents which could have lot of bearing for just decision to resolve the controversy between the parties and they were not produced. It was held by the Supreme Court that even if department did not produce those documents before the arbitrator it was incumbent upon him to get hold of all the relevant documents including the two documents in question for the purpose of a just decision. It was held that the award suffers from a manifest error apparent ex facie and was liable to be set aside. A D.B. of this Court in Union of India Vs. Mehta Teja Singh and Co., AIR 1983 Delhi 297, also laid down the same proposition of law. In the said case, the claim of the Govt. before the arbitrator was for recovery of some amount from the contractor based on the report of the Technical Examiner and the arbitrator had not directed for production of such report although a specific and special request was made by the contractor to have that report produced from the Govt. It was held by the D.B. that the award allowing the claim without arbitrator himself looking into the report on which the claim was based and without allowing the contractor inspection of the said report amounts to misconduct of the arbitration proceedings resulting in the denial of natural justice to the contractor and rendering the award liable to be set aside. It was found that Govt. had opposed the request of the contractor for production of the report before the arbitrator. The Court held that it was not a fit case for remission of the award to the arbitrator for re-decision. Following these two judgments, I hold that in the present case also the original R.R.'s which were in possession of the U.O.I, were material documents which could have helped the arbitrator in giving a just decision on the disputed claim of the respondent and by not directing the production of the same the arbitrator committed judicial misconduct. The award is, hence, liable to be set aside on this score. Issue is decided in favour of the petitioner.