UNION OF INDIA AND OTHERS Vs. SHIMTILIN KHARKRANG

JUDGEMENT

(1.) The sole question which falls for consideration in this appeal is as to whether the learned District Judge, Shillong is correct in holding that an application under Sec. 34 of Arbitration and Conciliation Act, 1996 ("the Act" for short) does not lie against the arbitration award dated 20-9-2007 of the Committee of Arbitrators constituted in accordance with the judgment and order dated 19-6-2003 passed by this Court in W.P. (C) No. 32(SH) of 2000.

(2.) The facts giving rise to this appeal are that the occupancy right of the land over which Bungalow No. 7 and 24 stood was purchased by the predecessor-in-interest of the respondent in a public auction in an execution proceeding before the learned Deputy Commissioner, Khasi and Jaintia Hills (as it then was) in Title Execution No. 4 of 1904. Since April, 1943, the said bungalows were taken on hire by the Army on payment of a monthly rental of Rs. 160.00 which was determined on the basis of the plinth area, and the Government of India, for and on behalf of the President of India, resumed the bungalows by the notice dated 1-4-1971 by offering Rs. 12,081.00 as compensation for the authorised erection made on the said land. The compensation was so assessed after taking into account the age of the building, plinth area and other fixtures existing at the relevant point of time. Apparently aggrieved by the resumption notice, the predecessor-in-interest of the respondent instituted Title Suit No. 3(SH) of 1975 before the learned Munsiff, Shillong for declaration that the bungalow No. 24 and the building and structures standing thereon belonged to her predecessor-in-interest and that the resumption notice dated 1-4-1971 was void. The suit was duly contested by the appellants. The learned Munsiff by the judgment and decree dated 23-7-1979 partially decreed the suit by holding that the appellants could resume the suit land on payment of the value of the building standing thereon belonging to the predecessor-in-interest and that a Committee of Arbitrators be constituted in terms of the provisions of Clause 8 of Order 179 Ext. E at an early date for valuation of the said building, etc. so as to settle the disagreement between the parties. The Committee of Arbitrators consisting of four members was accordingly constituted, and this Committee vide the minutes dated 20-4-1983 assessed the compensation payable for the building, cook house, water supply and electrification at Rs. 12,140.00. The predecessor-in-interest of the respondent was not satisfied with the compensation so assessed and thereupon filed Civil Rule No. 32 (SH) of 1989 before this Court, which by the judgment and order dated 12-3-1992 allowed the writ petition and directed the appellant to constitute a fresh Committee of Arbitrators to assess the compensation payable to the predecessor-in-interest not only in respect of the building and other fixtures but also the compensation for deprivation of her occupancy right over the suit land. It may be noticed that the aforesaid directions were made by this Court on the finding that the Committee of Arbitrators had decided the matter ex-parte and assessed the compensation behind the back of the predecessor-in-interest of the respondent.

(3.) The Special Leave Petition filed by the appellants against the said judgment and order of this Court was, however, dismissed by the Apex Court. In the meantime, the predecessor-in-interest of the respondent died and was substituted by her vide the order dated 5-10-1994. When the appellants failed to constitute the Committee of Arbitrators, the respondent once again approached this Court in W.P.(C) No. 52(SH) of 2000, which finally compelled the appellants to constitute the Committee of Arbitrators. The Committee entered the reference on 28-11-2003 and passed the award on 27-3-2006. Aggrieved by the award, the appellants preferred an appeal there against under Sec. 34 of the Act before the learned District Judge, Shillong. The learned District Judge dismissed the appeal by the impugned judgment and order on the ground that the case did not come within the purview of Sec. 34 of the Act, According to the learned District Judge, arbitration being a consensual adjudication by a private judge, jurisdiction of the arbitrator emanates from the arbitration agreement and since the instant award was not passed by arbitrators constituted under an arbitration agreement entered into between the parties, such award cannot be challenged by the appellants by taking recourse to Sec. 34 of the Act. Mr. S.C. Shyam, the learned CGC, appearing for the appellants, submits that the learned District Judge has miserably failed to appreciate that the arbitration proceeding was held and conducted in accordance with the procedure laid down by the Act and has in the process failed to exercise the jurisdiction vested in him by law by dismissing the application filed by the appellants under Sec. 34 of the Act. For this reason alone, contends the learned CGC, the impugned judgment is liable to be set aside and the learned District Judge be directed to entertain and hear the application afresh and dispose of the same in accordance with law after hearing the parties. Per contra, Mr. T.T. Diengdoh, the learned counsel for the respondent supports the impugned order and submits that the arbitration award made under Clause 8 of Order 179 cannot be challenged by way of appeal or otherwise under Sec. 34 of the Act, and the same has now attained finality.