UNION OF INDIA Vs. BILASH SINGH CO

JUDGEMENT

(1.) THIS is an application for setting aside the award dated 12-9-84 made in Sp. Suit No. 41 of 1975 under Ss.30, 33 and 16 of the Indian Arbitration Act, on the grounds, inter alia, that the disputes raised in Special Suit No. 41 of 1975 had already been raised and decided in the earlier reference ordered in Sp. Suit No. 6A of 1970. What Bilas Singh and Co. had done in Sp. Suit No. 41 of 1975 was to inflate the claims in respect of the same old disputes which were agitated and decided by the Joint Arbitrators in Sp. Suit No. 6A of 1970. In Sp. Suit No. 41 of 1975, Bilas Singh and Co. also claimed interest on the sum awarded in Sp. Suit No. 6A of 1970, which had been duly paid by the petitioner. By entertaining these claims the Arbitrator legally misconducted himself and the proceeding. Bilas Singh and Co. ought to have claimed that interest in the earlier proceeding in Sp. Suit No. 6A of 1970. These grounds are set out in paragraphs 26, 27, 28, 29 and 30 of the present petition. The petition was amended by an order dated 10-4-85 and a few new grounds were added subject to the right of Bilas Singh and Co. to raise the question of limitation as the new grounds were taken after the expiry of 30 days from the date of receipt of S.14(2) notice under the Arbitration Act by the petitioner. In the affidavit-in-opposition all these allegations were denied. During hearing, the counsel for the petitioner as well as the respondent made their respective submissions on the added grounds as well, but this decision is not based on the added new grounds.

(2.) THE facts of the present application are as follows :- By an agreement No. 36J/KB dated 21-3-64, the petitioner issued works order in favour of Bilas Singh and Co. (hereinafter referred to as the firm) for execution of certain earth work in Section 13/14 group 'A' in Kuper Hiroly Reach of Kottawalvals Bailatilla New Railway line. THE total value of the work was Rs. 11,30,300/-. THE firm completed the work within the extended period which was 30-6-65. THE petitioner alleged that it made final payment for all works done by the firm under this contract and the amount of total payment was Rs. 9,11,081/-. THE firm, however, raised certain disputes and took out an application under Section 20 of the Arbitration Act being Special Suit No. 6A of 1970 and on 13-9-71 an order was made for filing the arbitration agreement and referring the disputes for arbitration. In terms of the arbitration clause, Joint Arbitrators were appointed who entered upon the reference after appointing an umpire. In the statement of claim filed by the firm in Special Suit No. 6A of 1970, the firm at first made a claim for Rs. 10,23,333.70. Subsequently, the firm by a letter dated 16-475 alleged that its claims would amount to a further sum of Rs. 24,34,899.53 to which the petitioner took strong objection. As a result, the Joint Arbitrators refused to entertain these additional claims. Under the circumstances, the firm took out another application under Section 20 of the Act being Special Suit No. 41 of 1975 and obtained an order for reference on 7-5-76 referring the disputes to the same Joint Arbitrators. THE petitioner preferred an appeal from the said order being Appeal No. 293 of 1976. On 10-8-78 the said appeal was dismissed. As a result, a statement of claims was filed by the firm in which the claims were further inflated to Rs. 46,48,757.11 and the petitioner filed a counter-statement of facts denying the said claims. Subsequently, in Sp. Suit No. 41 of 1975, a sole arbitrator was appointed by removing the Joint Arbitrators. On 10-4-81 an award was made and published in Sp. Suit No. 6A of 1970 awarding Rs. 4,30,172/- in favour of the firm which was duly paid by the petitioner. In Sp. Suit No. 41 of 1975 Sri R. Das was appointed as the sole arbitrator by removing the previous arbitrator. On 12-9-84 an award was made and published by Sri R. Das in Sp. Suit No. 41 of 1975 awarding a sum of Rs. 19,45,550/-. This award is a non speaking award. In the present application, the petitioner challenged the validity of this award and prayed for setting aside the same. It is alleged that before the sole arbitrator Sri R.N. Das the petitioner demonstrated that all that the firm had done in Sp. Suit No. 41 of 1975 was to inflate the claims on the disputes already referred to the Joint Arbitrators in Sp. Suit No. 6A of 1970 and decided by the Joint Arbitrators by award dated 10-4-81.

(3.) THEREFORE, in Sp. Suit No. 41 of 1975 the firm only enhanced its alleged claims in respect of the same old disputes decided by the award dated 10-4-81 in Sp. Suit No. 6A of 1970.