METALLURIGICAL ENGINEERING CONSULTANTS Vs. SCIL

JUDGEMENT

(1.) THE petitioner M/s. Metallurgical & Engineering Consultants (India) Ltd. (MECON) has filed the aforesaid petition under Section 30 of the Arbitration Act 1940 to impugn the majority award dated 19.11.1996 and the order dated 09.12.1997 modifying the said award made by the Arbitrators.

(2.) THE petitioner was awarded the contract to install 7 Meter Tall Coke Oven Batteries Nos. 1, 2 & 3 and associated Coke Dry Cooling Plants Nos. 1, 2 & 3 by Rashtriya Ispat Nigam Limited at their Vishakapatnam Steel Project at Visakhapatnam. The petitioner, in turn, appointed the respondent M/s. SCIL India Ltd. as the sub contractor and placed an order on them for execution of the work of erection, testing start up, commissioning and post -commissioning services of the 7 Meter Tall Coke Oven Batteries No. 1 & 2 and associated Coke Dry Cooling Plants 1 & 2 of the Visakhapatnam Steel Project for a total estimated price of Rs. 8,03,76,680/ - by a letter of Intent No. 11.83.0526 dated 6.10.1982. This was followed by a formal agreement being executed between the parties on 10.11.1983 containing the detailed terms and conditions for execution of the aforesaid works. Disputes arose between the parties on account of delay in the execution of the works. Since there was an arbitration agreement contained in the agreement dated 10.11.1983, disputes between the parties herein were referred to arbitration in accordance with the rules of the Indian Council of Arbitration. The arbitration panel consisted of Mr. Justice R.S. Pathak (retd. Chief Justice of India), who acted as the Chairman, Mr. Justice H.L. Anand (retd. Judge, Delhi High Court) and Mr. Justice S.N. Sapra (retd. Judge Delhi High Court). The petitioner was the claimant before the arbitrators. Petitioner made a claim of Rs. 9,52,61,788/ - against the respondent. The respondent SCIL repudiated the petitioners claim and made a counter claim of Rs. 68,22,43,745.67/ -. Mr. Justice H.L. Anand (Retd.) made a detailed reasoned award dated 04.10.1996. On the other hand, Mr. Justice S.N. Sapra (Retd.) made his award dated 30.09.1996 after having the benefit of perusing the award made by Mr. Justice H.L. Anand (Retd.). While substantially agreeing with the award made by Mr. Justice Anand (Retd.) on his findings on issue Nos. 1 to 10, 12 to 15, 17 to 23, 24 to 34 and 36 to 41 subject to his findings, he expressed his disagreement with the award made by Mr. Justice Anand (Retd.) on a few issues. The Chairman Mr. Justice R.S. Pathak (Retd.) after perusing the two awards made by Mr. Justice H.L. Anand (Retd.) and Mr. Justice S.N. Sapra (Retd.) and after giving his due consideration concurred with the award made by Mr. Justice H.L. Anand (Retd.). Consequently, the majority award as made by Mr. Justice H.L. Anand (Retd.) and concurred by Mr. Justice R.S. Pathak (Retd.) holds the field. On the applications of both the parties for modification of the majority award, the same was corrected on 09.12.1997. Mr. Justice S.N. Sapra (Retd.) agreed with these corrections.

(3.) MR . Mukherjee, learned Counsel for the petitioner has sought to raise a challenge to the majority award on four counts only. His first submission is that the award made by the learned arbitrators was not made in a single and common sitting. He submits that the arbitrators should have applied their minds at the same time in consultation with each other and then made the award. He submits that it was necessary and essential for the learned arbitrators to have made and signed the award at the same time on the same day for it to be a valid award. However, from a perusal of the award it is evident that Mr. Justice H.L. Anand (Retd.) prepared his award which was sent to Mr. Justice S.N. Sapra (Retd.). Mr. S.N. Sapra (Retd.) after perusing the same made his own award dated 30.09.1996. It appears that thereafter Mr. Justice H.L. Anand (Retd.) prepared the formal award dated 04.10.1986 and both these awards were forwarded to the Chairman Mr. Justice R.S. Pathak (Retd.) who thereafter made his award expressing his agreement with the award made by Mr. Justice H.L. Anand (Retd.).