Jaiashed & Co. vs J & K Cement Ltd.& Ors.

This appeal is directed against the Judgement and decree of learned District Judge, Srinagar, dated 23.05.2000, refusing to set aside the award

passed by the Arbitrator in the arbitration proceedings conducted by him under Arbitration Act 1940, dated 30.11.1998 in case Jamshed and Co.

through G.A. Mir vs. J&K Cement Ltd. and others.

The facts leading up to this appeal are that a labour contract for material handling case to be allotted to the petitioner/appellant by the

respondent, J&K Cement Ltd. Srinagar through its General Manager respondent No. 2 herein under his allotment order No.

KCW:GM"":LC:9620998 dated 05.04.1996.

That during the subsistence of the contract disputes across between the par ties which resulted in to the termination of the contract by the

respondent No. 1 through its Deputy General Manager, the respondent No. 4 by virtue of this letter dated 23.05.1997 addressed in the name of

the appellant. That the appellant petitioner approached before this court through the medium of an application in terms of Section 20 of the Jammu

and Kashmir Arbitration Act for appointment of General Manager of the respondent factory for passing of an award and same be made rule of the

court with further prayer that the order of termination of contract be kept in abeyance till the passing of the award passed by the Arbitrator. This

petition came to be transferred to the learned District Judge Srinagar by virtue of this court order dated 10.07.1997. The learned District Judge on

receipt of the file, after hearing the parties on 27.07.1997 came to appoint respondent No. 2 as sole Arbitrator with a direction to enter into

reference for the determination of the dispute in between the parties and to submit its report within four months from the date he enters into

reference. That the learned Arbitrator pursuant to this order of this court came to file his award dated 30.11.1998 before the learned trial court on

01.05.1999. That on receipt of the award the learned trial court appears to have is sued notices of the same to the learned counsel for the parties.

That the respondent did not prefer the objections to the award, however, the respondent filed their objections on 17.05.1999, wherein they

came to assail the correctness of the award on the grounds that the arbitrator misconducted himself as well as in the arbitration proceedings. The

respondents file their objections but the trial court without affording any opportunity to the appellant to substantiate its objections came to accept

the same and make the award rule of the court.

Heard the learned counsel for the parties.

Section 30 of the Arbitration Act (short act) lays down the grounds for setting aside the award which are that a) the arbitrator or umpire has

misconducted himself or in the proceedings, b) that the award has been made after the arbitration was superseded by the court or after the

arbitration proceedings have become in valid under section 85 of the Act and c) the award has been improperly procured or its otherwise invalid.

On proof of any one of the afore grounds the award can be set aside. Section 33 of the Act lays down the procedure and provides that when any

party to an agreement or any person claim under him desire to challenge the existence or validity of an arbitration agreement on an award or to

have the effects to either determined shall apply to the court and court shall decide the question on affidavits. This being so, when a party to the

agreement objects to the validity of the award on the ground that the Arbitrator has misconducted himself which is factual in nature in that case the

court has no choice but to decide such objection by giving an opportunity to such party to prove his claim by affidavits or by other evidence after

framing necessary issues in this behalf of course, with a right of rebuttal to the other side. Having regard to this law let us examine the record of the

case. The record of the case reveals that the learned trial court on receipt of the objection ostensibly under Section 30 of the Act horn the

appellant to the award filed in the case wherein he has assailed the award on the ground that the arbitrator has misconducted himself has not

granted any opportunity to him to prove his claim put forth by him to the award, when the mandale of the law is that an opportunity was to bog

giver, to him in terms of Section 33 of the Act for proving his claim by affidavit or by other evidence. This being so, the judgement and the decree

is not sustainable and case for remanding the file back to the trial court is made out.

Therefore, the appeal is accepted. The impugned judgement and decree is set aside and the case is remanded back to the trial court with the

direction to dispose of it of in the light of aforesaid observations. Let the record of the case be sent back tothe Ld Trial Court alongwith the copy

of this Judgment, where the parties shall cause their appearance on 20.L3.2002.No costs.