Inder Sain Mittal vs Executive Engineer, Housing Board, Karnal

R.L. Anand, J.—By this judgment I dispose of four Civil Revision Nos. 1490, 1491, 1492 and 1493 of 1996, as common question of law and fact is involved in all the four revision petitions. For the purpose of facts, I am taking the assistance of C.R. No. 1490 of 1996. In all the four revision petitions challenge has been given to the judgment of the learned District Judge, Sonepat, dated 22.1.1996, who affirmed the order dated 9.12.1994 passed by the Court of Sub Judge Ist Class, Sonepat, who dismissed the objections of the petitioner under Section 30/33 of the Indian Arbitration Act and made the award dated 30.1.1993 as rule of the Court.

Brief facts of the case are that Shri Inder Sain Mittal, Contractor, entered into an agreement for doing the construction work with the Housing Board Haryana, through its Executive Engineer at Karnal. Some disputes arose between the parties and the same were referred for arbitration and award was passed against the Contractor on 30.1. 1993. Against the said award the objector petitioner filed objections under Section 30/33 of the Indian Arbitration Act, pleading that the Arbitrator travelled beyond the scope of agreement. He charged Rs. 4,000/ as arbitration fee, which act of the Arbitrator amounts to misconduct on his part as the could not accept more than Rs. 500/ as fee under the rules that the Arbitrator did not award on various disputed items. In short the Arbitrator has misconducted himself and the award dated 30.1.1993, therefore, is liable to be set aside.

The reply to the objections of the contractor were field by the Department and it pleaded that there was no illegality in the appointment of the Arbitrator, who was appointed with the consent of the parties. The fee of Rs. 500/ is fixed for a serving officer but a retired Government officer, who is appointed as Arbitrator, can recover more than Rs. 500/ as his fee. The Arbitrator gave reasonable opportunity to the parties to lead evidence and gave the award after considering the evidence of the parties and all the materials before him. The award was passed within the extended time and before pronouncing the award, both the parties singed the proceedings. The Contractor never raised any objection before the Arbitrator to the effect that he was not competent to pass the award. In these circumstances, the award should be made the rule of the Court by dismissing the objections.

The trial Court dismissed the objections and made the award rule of the Court. Aggrieved by the decision of the trial Court, the Contractor filed the first appeal in the Court of District Judge, Sonepat, who affirmed the judgment and decree of the trial Court and dismissed the appeal. Hence the present revision petitions.

I have heard Shri V.K. Jain, Senior Advocate, with Shri J.L. Malhotra, Advocate, appearing on behalf of the petitioner, and Shri P.S. Rana, Advocate, appearing the behalf of the contesting respondent Nos. 1 and 2, and with their assistance have gone through the record of this case.

Learned counsel for the petitioner submitted that the award of the Arbitrator is liable to be set aside on the short ground that the award was not a speaking one and in support of his contention he has relied upon Clause 33 of the Arbitration agreement by which it was stipulated by the parties that the Arbitrator would pass a speaking award, otherwise it would be nullified and would not be binding upon the parties. Learned counsel for the petitioner submitted that it was mandatory on the part of the Arbitrator to give a speaking award, specially when the parties had agreed mutually that the award of the Arbitrator must be a speaking one. The counsel also submitted that in fact there were eight objections petition filed by the Contractor against different awards of the Arbitrator. The trial Court rejected all the eight objections petitions but the first appellate Court i.e. the Court of Additional District Judge set aside the judgment of the trial Court and remanded the case back to the Arbitrator for making a speaking award. The judgment of the Additional District Judge has become final and in view of that the learned first appellate Court, i.e., the Court of District Judge, also ought to have set aside the decision of the trial Court and further ought to have remanded the case to the Arbitrator with the directions to pass a speaking award as was done by the Court of Additional District Judge.

I have considered the submissions raised by Mr. V.K. Jain, Senior Advocate, appearing for the petitioner, and I am of the considered view that these are without any merit. The decision given by the Court of Additional District Judge could not operate as judgment in personam visavis the trial Court because every contract is itself is a separate cause of action. We have to see whether the orders of the trial Court as well as the first appellate Court, i.e., the Court of District Judge, suffer from any illegality or infirmity so as to appreciate the argument of Mr. Jain. The learned appellate Court gave the reasons while affirming the judgment of the trial Court and those are contained in paras Nos. 10 to 16 which are reproduced as under, in order to appreciate the frontal argument raised by Mr. Jain when the stated that the impugned order as a nonspeaking one and which itself amounts to misconduct on the part of the Arbitrator, specially when he has violated clause 33 of the Arbitration Agreement:

``10. After hearing submissions from both sides and on going through the record, it would now be worthwhile to scrutinize the whole matter in order to arrive at a true conclusion.

Learned counsel for the appellant could not substantiate his objection that a retained. person should not have been appointed as an Arbitrator. In fact, the appellant did not raise any such objection at the time of the appointment of the Arbitrator. On the other hand, the joined the Arbitration proceedings with his own sweet will and without any protest. Now, it does not lie in his mouth to say that a Retd. person should not have been appointed as an Arbitrator.

An Arbitrator, if he is in service, is entitled to a fee of Rs. 500/ as per the P.W.D. Code of the Haryana Government, but a retd. person, having been appointed as an Arbitrator, no amount of fee has been prescribed. If the Arbitrator has charged fee of Rs. 4,000/, it does not mean that he has misconducted himself or with the arbitrator proceedings.

Appellant has not raised any such objection while in the trial court that the award in question was not a speakingone. Now he cannot go beyond his pleadings ad he cannot challenge the Awad on the ground that the Award is not a speakingone. Moreover, there is nothing in the Award to dub is as a nonspeaking one.

The Arbitrator has dealt with almost all the points in dispute and has given his findings on each and every item. So, it cannot be said that he had left any item undealt.

The trial Court has rightly observed in its impugned that the court is not sitting is appeal to judge the legality and validity of impugned Award and the interference can only be made in the even when an apparent error being legal, in nature, is found on the face of the Award. No such error has been pointed out by the ld. counsel for the appellant during the course of arguments. The appellant continued to participate in the proceedings before the Arbitrator even beyond the period of four months of the appointment of the Arbitrator and the Award was passed in the presence of the parties, which shows that neither party raised any objection about the Arbitrator, regarding his appointment or regarding the extention of time. Moreover, several opportunities were given to parties by the Arbitrator to adduce evidence, and so it cannot be said that sufficient time was not granted to the appellant and for adducing his evidence.

So, after hearing the ld. counsel for the parties and no perusing the record, I do not find any merit in the objections raised on behalf of the appellant regarding the appointment of the Arbitrator and the proceedings conducted by him and about the Award in question and, as such, the ld. trial Court has rightly dismissed those objections and rightly made the Award dated 30.1.1993 as the Rule of the Court. I do not find any illegality, irregularity or infirmity in the impugned judgment of the Trial Court and, as such, the same is hereby affirmed in appeal.''''

It is a settled law that objections must be specific. Learned counsel for the respondents Shri P.S. Rana read in extenso the objections which were filed by the objector to the award before the trial Court under Section 30/33 of the Indian Arbitration Act and on going through the same it transpired that the objector did not take any objection to the effect that the Award of the Arbitrator was not a speaking one. Section 30 of the Indian Arbitration Act lays down that any award shall not be set aside except on one of more of the grounds, namely, that the arbitrator or umpire has misconducted himself or the proceedings; that the award has been made after the issue of an order by the Court superseding the arbitration or after arbitration preceding have become invalided under sections 35; and that the award has been improperly procured or otherwise invalid. The entire gist of the objections of the Contractor before the trial Court was that the Arbitrator pronounced the award beyond the scope of the agreement; that he charged Rs. 4,000/ as fee; that the he did not consider the evidence by the parties; that he made the award after the expiry of limitation, that the appointment of the Arbitrator was not legal. When there was no specific objection with regard to that the award was passed in violation of Clause No. 33, such an award could be set aside or remitted, as desired by the learned counsel for the petitioner. It has been held in Union of India v. Romesh Kumar Rajgharia, AIR 1974 Calcutta 345, that specific averments and grounds for setting aside an award have to be stated to enable the court to set aside an award even though the award may be a nullity. The expression ``otherwise invalid'''' appearing in clause (c) of Section 30 of the Act includes awards that are nullities. The Division Bench of the Calcutta High Court further held that where an application is made to set aside an award on the ground that it deals with a matter not covered by the reference but the application states no facts to show that the arbitrators have exceeded their jurisdiction and dealt with a matter (sic) with the ambit of the reference, the award cannot be set aside on the ground of the arbitrators'' having exceeded their jurisdiction. If the string of Clause 33 upon the basis of which the learned counsel for the petitioner built his only argument is taken away, then the impugned awards do not suffer from any infirmity. The arbitrator is not supposed to give reasons in the award like a judgment of the Civil Court. It is a settled law that even a nonspeaking award of the Arbitrator cannot be set aside so long as it suggests that the Arbitrator had applied its mind to the evidence led by the parties before him. Though the Arbitrator is a quasi judicial authority, yet it is not expected from him to incorporate the detailed reasons in the award itself. Both the courts blow had taken note of the fact whether the award of the Arbitrator suffers from any infirmity or illegality so as to bring it within the purview of Section 30/33 of the Indian Arbitration Act, but they did not find anything wrong with the award in each case.

In order to overcome this difficultly the learned counsel for the petitioner, Shri V.K. Jain, submitted that his client has made a specific allegations that the award of the Arbitrator was without jurisdiction and this allegations covers the allegations that the award of the Arbitrator was not a speaking one. I am afraid and I am not in a position to accept the argument of Mr. Jain. The objections of the Contractor specifically do not touch this aspect. Even otherwise the impugned award are not liable to be set aside as it cannot be said that there was nonapplication of mind of the part of th Arbitrator. The counsel for the petitioner relied upon Raipur Development Authority and others v. M/s Chokhamal Contractor and others, (1989) 2 Supreme Court Cases 721; and College of Vocations Studies v. S.S. Jaitely, AIR 1987 Delhi 134; and submitted that when an Arbitrator gives the award without any reasons for his findings, this amounts to a misconduct on the part of the Arbitrator and, therefore, the award is liable to be set aside. The cited authorities are not helpful to Mr. Jain. Rather the Hon''ble Supreme Court is pleased to hold in Raipur Development Authority''s case (supra) that the award without giving reasons cannot be remitted or set aside by the court on the sole ground of the award being unreasoned in absence of any stipulation to the contrary in the arbitration agreement, or in deed of submission or in any direction of court such as under Section 20, 21 or 34 or in any provision in statute governing the arbitration. The rules of natural justice cannot be invoked to compel arbitrator to give reasons. In the present case both the Courts held that no fact can be considered beyond the pleadings. The trial court also held that though the arbitration agreement suggested making of the speaking award by the Arbitrator, yet such a condition ipso facto does not vitiate the award on merit because the arbitrator is a domestic tribunal and is not supposed to elaborate facts and reasons like judgment of the court of law. Once there is a proper application of mind on the part of the Arbitrator while considering the claims and rival claims of the parties, any award passed by the Arbitrator after appreciation of evidence cannot be held to be a nonspeaking one.

Resultantly, I do not see any merit in these revisions (Civil Revision Nos. 1490, 1491, 1492 and 1493 of 1996), which are hereby dismissed leaving the parties to bear their own costs.