ABRAHAM Vs. FOOD CORPN OF INDIA

JUDGEMENT

(1.) The Judgment of the court was delivered by Khalid, J.- The appellant is a government contractor. The first respondent is the Food Corporation of India and the second respondent, the Executive Engineer (Construction), Kerala Region, F. C. I. Vazhuthakkadu, Trivandrum. The appellant entered into a contract for the first respondent through the 2nd respondent for the construction of a 5000 tonnes capacity godown at Avaneswaram. Certain disputes and differences arose between the parties, which according to the terms had to be settled by arbitration. The appellant filed O.P. No. 11 of 1977 before the court of the Subordinate Judge at Kottarakkara, who by his order dated 14th August 1977, appointed Sri S. Ramanatha Pillai, Chief Engineer, Kerala State Housing Board, as the Arbitrator. The Arbitrator entered upon the reference on 13th December, 1977 and made his award on 11th May, 1978. The appellant filed O.P. No. 16 of 1978 under S.14 and 17 of the Arbitration Act, to pass a decree in terms of the award. The court below passed an order passing a decree in terms of the award but modifying the award of interest made by the Arbitrator, from 1st January, 1973 to 14th September, 1977. It is this part of the order that is under challenge in this appeal.

(2.) The claim No. 12 before the Arbitrator related to the award of interest. The appellant claimed interest at 18 per cent per annum from 30th July, 1972 when the amount became due. The respondents in their reply generally repudiated this claim for interest but did not specifically question the jurisdiction of the Arbitrator to decide this claim. Though the claim made by the appellant was with effect from 30th July, 1972, the Arbitrator restricted it to take effect from 1st January, 1973 at the rate of 9 per cent. The court below modified that part of the award relating to interest and granted interest with effect from 14th September, 1977. The learned counsel for the appellant assails the order of modification on the following grounds: (1) The court below can modify the award only under one or the other clauses mentioned in S.15 of the Arbitration Act, (2) the order of modification is not based on any of the grounds enumerated therein and for this reason the order of modification has to be faulted, (3) the respondents not having raised the question of jurisdiction of the Arbitrator in going into the question of interest before him, should not have been permitted to raise the question of jurisdiction before the court below, and (4) the court below committed an error of law in allowing this question to be raised afresh before it.

(3.) In support of the submission made by the learned counsel for the appellant on the second ground, he invited our attention to "Russell" on Arbitration Nineteenth Edition, at page 490, under the caption "Disability of party" which can be usefully read: