INDIAN BUILDERS, JAMSHEDPUR Vs. STATE OF JHARKHAND

JUDGEMENT

(1.) Arbitration Appeal No. 17 of 2007 has been filed on behalf of the Indian Builders (herein-after to be referred as 'contractor') against the judgment dated 19.04.2007 passed by the learned Sub-Judge-1, Jamshedpur in Misc. Arbitration Case No. 01 of 2007 whereby sub-claims so far as the claim No. 3 on account of under utilized overheads, claim No. 4 on account of loss due to under utilized tools, plants and machineries and claim No. 6 on account of loss of profit has been disallowed.

(2.) Mr. Mittal, learned senior counsel appearing for the contractor In both the appeals, submitted that the learned Sub-Judge has wrongly disallowed the claims under the said heads on the ground that they were barred under Clauses 4.20.2 and 4.20.4. He further submitted that the judgment relied by the learned Court below has been set aside by the Supreme Court in the case Bharat Drilling and Foundation Treatment Private Limited v. State of Jharkhand & others, 2009 16 SCC 705 in which the Supreme Court accepted that similar clauses were only bar for department and not for the Arbitrator. In other words, he submitted that such claims could at best be rejected by the department but when all the disputes were referred to the Arbitrator, the Arbitrator was justified to consider and pass Award on such claims. He further submitted that the Arbitrator has passed a detailed and reasoned Award after considering and dealing with each and every claim and counter-claim of the parties. Mr. Mittal further submitted that the said claims were not objected by the State before the Arbitrator and therefore, the Court could not consider such issues not raised before the Arbitrator. In support of this submission, he relied on paragraph-23 of MSK Projects India (JV) Limited v. State of Rajasthan,, 2011 10 SCC 573 in which it was inter-alia observed that the Court fell in error considering the issue which was not taken by the State before the Tribunal during the arbitration proceeding. He lastly submitted that the scope of interference by the Court in such matters is very limited. In support of this submission, he relied on Ispat Engg & Foundry Works v. SAIL, 2001 6 SCC 347.

(3.) On the other hand, Mr. V.K. Prasad, learned counsel appearing for the State in both these appeals, submitted that the Arbitrator misconducted himself inasmuch as in spite of the order passed by this Court in Civil Revision No. 298 of 2003, he did not refund the amount received by him towards arbitration fees to the parties. He further submitted that only because the Supreme Court has set aside the judgment of the High Court, the claims of the contractor cannot be automatically allowed. He further submitted that the counter-claim has not been properly considered by the learned Sub-Judge.