STATE OF ANDHRA PRADESH Vs. G ANANTHAIAH

JUDGEMENT

(1.) This revision petition is filed by the petitioners who are the respondents 1 & 2 in O.P. No.426 of 1989 on the file of the IV Addl. Judge, City Civil Court, Hyderabad questioning the orders dated 26-12-1991 by which a sole arbitrator was appointed in the place of the panel of arbitrators who are respondents 3 to 5.

(2.) The first respondent herein is the contractor who had entered into an agreement bearing C.R. No.98/90-81 dated 21-4-1981 with the second petitioner herein who is the Superintending Engineer, Irrigation Department, T.B.P., H.L.C. Circle, Ananthapur, for executing the work of excavation of Penna Ahobilam Balancing Reservoir Right Canal from KM 30.500 to 31.500. The value of the work to be done as per the terms of the agreement was Rs.1,78,021/-. As per the terms of the agreement, the Respondents 3 to 5 who are (i) The Chief Engineer, Roads & Buildings Department, Erramanzil, Hyderabad, (ii) The Deputy Secretary to Government, Finance and Planning (FW) Department, Secretariat, Hyderabad and (iii) The Director of Accounts, Sriramsagar Project, L.M.D. Colony, Karimnagar District were designated as arbitrators to adjudicate the disputes if any arising between the parties in the execution of the agreed work. As some dispute arose between the parties, the first respondent, who is the Contractor, referred the claims on 10-11-1987 to the above said panel of arbitrators for decision. As there was some delay in deciding the disputes, the first respondent filed O.P. No.426 of 1989 before the lower Court seeking removal of trie designated arbitrators and for appointment of a sole arbitrator under Secs.ll & 12 of the Arbitration Act, contending that the said arbitrators failed to act with reasonable despatch and make the award within time, and more than one and half years had elapsed without taking any steps for passing the award and that, therefore, a sole arbitrator should be appointed by removing the above said panel of arbitrators. The first petitioner herein is the State of Andhra Pradesh and the second petitioner is the Superintending Engineer, Irrigation Department, T.B.P., H.L.C. Circle who are respondents 1 and 2 before the lower Court. They opposed the petition contending that the IV Addl. Judge, City Civil Court, Hyderabad before whom the petition was filed, does not have territorial jurisdiction to entertain the petition as the agreement was entered into and the work had to be executed only within the limits of Ananthapur District and as such, the Court in the District of Ananthapur alone has got jurisdiction to entertain such petition and that a sole arbitrator cannot be appointed as the agreement contemplates that there should be panel of arbitrators and that the petition is, therefore, liable to be dismissed.

(3.) The lower Court allowed the petition and appointed the second respondent herein, who is a retired District Judge, as sole arbitrator after revoking the authority of the panel of arbitrators who were contemplated under the terms of the agreement and the sole arbitrator was directed to take up the matter and proceed to make his award in accordance with law. The present revision petition is filed by the respondents 1 & 2 before the lower Court contending that the lower Court has acted in an illegal and irregular manner in appointing the sole arbitrator which is not in accordance with the terms of the agreement and such orders shall, therefore, be set aside.