HINDUSTAN CONSTRUCTION CO LTD Vs. STATE OF J&K

JUDGEMENT

(1.) THIS is an appeal under section 39 of the Jammu and Kashmir Arbitration Act 1940 against the judgment of the learned Judge in Chamber dated 25th July, 1973, whereby he partly allowed the application of the respondent, the State of Jammu and Kashmir, and made the award given by the Arbitrator in respect of claims 1,4,6 and 8 (details whereof are given hereunder) Rule of the Court and set aside the award in respect of claims 2 and 5. The respondent, State of Jammu and Kashmir, has also filed cross objections under order 41 Rule 22 C.P.C. to the appeal of the appellant and has contended that the claim in respect of item No. 6 should have also been set aside.

(2.) IT appears that on 19 -9 -1964. lumpsum tenders were invited by the Chief Engineer Jammu, for construction of bridge on river Chenab at "Baradari" near Reasi. After the invitation of tenders the dates of submission of tenders were extended from time to time. The time for completing the work was set down as two years from 16th day of allotment of the work. The appellant firm was the successful tenderer and the work was allotted to it. At the time of settlement of the bill after the completion of the work certain disputes arose between the appellant and the respondent. Pursuant to clause 32 of the agreement dated 1st September, 1965, entered into between the parties, the disputes arising out of the contract, were referred to joint arbitration of M/s N. D. Daftary of Bombay (retired Chief Engineer of Gujarat State) nominee of the appellant, and Shri B. N. Mengi (Ex. Chief Engineer of Jammu and Kashmir State), nominee of the respondent i. e. State of Jammu and Kashmir. The disputes were formulated by the learned arbitrators on the basis of the statement of claims made by the appellant the description of the claims as finally formulated by the arbitrators were as follows: -

(3.) The arbitrators entered upon the reference on 3rd Feb. 1970, and gave a unanimous award on 24th October, 1972. In their award the learned arbitrators Allowed the entire claim of the appellant with regard to items Nos. 1 and 2. Claims with respect to item Nos. 3 and 7 were totally rejected while claim in respect of items Nos. 4, 5, 6 and 8 were partially allowed. After the filing of the award in the Court, the respondent made an application under sections 30/33 of the Jammu and Kashmir Arbitration Act, for setting aside the award on various grounds mentioned therein. The award was assailed in respect of claims relating to item Nos. 1, 2, 5, 6 and 3. No objection was, however, raised in regard to the award relating to claim No. 4 i.e. refund of excess as Sales Tax on cement amounting to Rs. 15583 -74. In the application for setting aside the award, the respondent maintained that the arbitrators had grossly erred in construing the terms and conditions of the agreement thereby vitiating the award. It was also averred in the aforesaid application that there had been legal misconduct on the part of the arbitrators and that there was an error of law apparent on the face of the record since the arbitrators had based their award on improper and inadmissible evidence. The application of the respondent State of Jammu and Kashmir for setting aside the award was resisted by the appellant -firm and it was maintained by it in its reply to the petition that the award was final and binding on the parties and there were no grounds to set aside the same. The appellant also prayed that the award be made a rule of the Court.