STATE OF RAJASTHAN Vs. CHANDI AND COMPANY

JUDGEMENT

(1.) IN view of the fact that the facts are not in dispute and only point of law is involved, facts in short will serve the purpose.

(2.) THE works contract was awarded to the respondent-Company by the Department of Mahi Bajaj Sagar Project, Banswara, a wing of the irrigation Department of the State of Rajasthan. Because of some dispute the contractor submitted two separate petitions under Section 20 of the Arbitration Act, 1940 (for short `the Act of 1940') on 16. 12. 1989 and 14. 3. 1990 before the court of District Judge. By the order of the court, arbitrator was appointed and the learned arbitrator passed the two separate awards on 12. 3. 1997. THE said awards were submitted by the learned arbitrator before the court of learned District Judge, Banswara on 13. 3. 1997. THE learned District Judge issued notices to the contractor as well as to the State. THE notices were served upon the State on 29. 3. 1997. THE contractor submitted an application under Section 17 of the Act of 1940 and prayed that the award be made rule of the court, whereas the State submitted objections under Section 30 and 33 of the Act of 1940 with application under Section 5 of the Limitation Act. in reply to the contractor's application under Section 17 of the Act of 1940 as well as in the application under Section 5 Limitation Act, the State submitted that proceedings of arbitration completed under the Act of 1940 but since the award was passed after coming into force of the Arbitration and Conciliation Act, 1996 (for short`the Act of 1996'), therefore, the proceedings after the award are governed by the Act of 1996 and in view of the fact that under the Act of 1996, objection can be filed within period of 90 days instead of within 30 days as provided under the Act of 1940, therefore, the State's objection against the award is within period of limitation. THE State also pleaded that in case the court reaches to the conclusion that the proceedings will be governed by the Act of 1940 then the delay in filing the objection may be condoned. THE trial court vide order dated 31. 7. 1997, proceeded to decide the State's applications the trial court observed in its order dated 31. 7. 1997 that it is not in dispute that the arbitration proceedings were completed and the award was passed under the old Act, therefore, amended Arbitration Act (New Act) will not apply. After recording this position, the trial Court in its order dated 31. 7. 1997 held that State has filed the objection petition after expiry of the limitation for filing the objection petition under the old Act of 1940 and the State failed to disclose sufficient cause for not filing the objection within limitation, therefore, delay in filing the objection cannot be condoned. THE trial Court, therefore, dismissed the State's application under Section 5 Limitation Act vide order dated 31. 7. 1997.

(3.) THE learned counsel for the appellants further vehemently submitted that the appellant-State never gave its consent nor it agreed for application of the Act of 1996. THE appellant-State only submitted their contentions in the application based on legal opinion that since the award was passed after coming into force of the Act of 1996, therefore, subsequent proceedings will be governed by the Act of 1996. Since the legal position was not clear, therefore, the appellant-State very specifically pleaded that in case the court reaches to the conclusion that the Act of 1940 would govern the proceeding before the District Court then the delay in filing the objections may be condoned. THE court below itself rejected the petitioner's plea that the Act of 1996 will apply and the petitioner did not press his this plea and got the order of condonation of delay in appeal from High Court, then the trial court was wrong in observing that the petitioner agreed for application of the Act of 1996. THErefore, after the order of the District Court on application under Section 5 of the Limitation Act taking a view that proceedings will be governed by the Act of 1940 and after the decision of this Court dated 30. 7. 2002, neither the Court had jurisdiction to apply the Act of 1996 nor the respondent-contractor was justified in submitting that the provisions of the Act 1940 will not apply and the Act of 1996 will apply.