H.C. ARORA Vs. UNION OF INDIA

JUDGEMENT

(1.) Shri Suchha Ram Ladhar/respondent No.4 belongs to the Indian Administrative Service cadre and seeks to substantively augment his income by claiming the entitlement to an arbitrator's fee while performing the task of an Arbitrator under Section 3G(5) of the National Highways Act, 1956 (hereinafter referred to as "the NHA Act") while holding the post of the Divisional Commissioner in Jalandhar and Patiala Divisions. It is this act of respondent No.4 which gave rise to some adverse publicity in the media that an exorbitant amount is being charged as arbitration fee without prior permission of either the State or Central Government in violation of the service rules. This culminated in filing of a public interest litigation by the petitioner, an Advocate, seeking appropriate criminal/ departmental action against respondent No.4 for his conduct and for recovery of the entire amount of arbitration fee charged.

(2.) The petitioner states that the respondent No.4 claims entitlement to the arbitration fee on the basis of own interpretation of Section 31(8) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Arbitration Act"). In terms of the said provisions, unless otherwise agreed to by the parties, the cost of an arbitration is to be fixed by an arbitral tribunal and such "costs" relate to the fee and expenses of the Arbitrator and witnesses, legal fee and expenses, administration fee and any other expenses incurred in arbitral proceedings. It is the case of respondent No.4 that he is, thus, entitled in law to charge such fee.

(3.) The petitioner has stated that there is prohibition as per Rule 13(4) of the All India Services (Conduct) Rules, 1968 (hereinafter referred to as "the Conduct Rules") as it prohibits a member of the All India Service (AIS) from accepting fee for any work done for any public body or private person without the sanction of the Government. This rules, the petitioner pleads, has to be read with the provisions contained in Supplementary Rule 12 of the Fundamental and Supplementary Rules (hereinafter referred to as "the FR") which permits that one-third of any fee in excess of Rs.400/-or a recurring fee of Rs.250/-a year, paid to a government servant, would be credited to the general revenues unless the President, by special order, otherwise directs. There are, however, certain exceptions to the same.