Union of India vs Mehar Singh and Sons

V.S. Aggarwal, J.—The present appeal has been filed by Union of India and others, hereinafter described as "the appellants" directed against the order passed by the learned Civil Judge (Senior Division), Amritsar, dated 14-5-1998. By virtue of the impugned order, the learned trial Court dismissed the objections of the appellants and made award of the arbitrator a rule of the Court. It was held that the respondent-contractor was entitled to future interest at the rate of 12% per annum from the date of award till realisation of the amount.

The relevant facts are that Sh. K. D. Bali had filed award with the learned Civil Judge at Amritsar. Notice of the same was issued. The appellants Union of India and other filed objections. It was alleged that the award suffers from error apparent on the face of the record. It was contended that the award has been given without giving opportunity of being heard. The arbitrator could be appointed by the Chief Engineer but the respondent-contractor moved the Court u/s 8 of the Arbitration Act. During the pendency of the petition, Chief Engineer had appointed an arbitrator. No other arbitrator could be appointed. The court appointed Sh. K. D. Bali as arbitrator. The revision petition filed by the appellants was dismissed by this Court and further SLP also failed. The appellants contended that they have never accepted the appointment of Sh. K. D. Bali and they requested him to stay the proceedings. Furthermore, the Executive Engineer was not authorised to represent the Union of India. The arbitrator acted in a mala fide manner. The award was further assailed alleging that the arbitrator awarded 25% extra on account of increase in the market rate on the items which were to be supplied by the department. This could not have been so done. The extra payment so given were also alleged to be not correct.

Reply was filed. It was alleged that the Court cannot reappraise the evidence. It was further pointed out that once SLP was dismissed, Shri K. D. Bali could act as arbitrator. The contention of the appellants to the contrary were controverted. It was denied that the Court had no jurisdiction to entertain the application.

The objections of the appellants were dismissed and it was held further that the Court at Amritsar had the jurisdiction to entertain the award.

In this Court, at the time of arguments, only one contention was raised by the learned counsel for the appellants that the Civil Court at Amritsar had no jurisdiction.

After hearing parties counsel, it is obvious that the said contention has no force and is liable to be rejected. Before the trial Court, it had been admitted by the parties that the acceptance of the offer given by the contractor in response to the tender was conveyed at Amritsar. Thus, the contract became complete only when acceptance of tender was conveyed to the contractor. The acceptance had been conveyed at Amritsar and, therefore, the Civil Court at Amritsar had the jurisdiction to entertain the award and the objections thereto.

There is another way of looking at the matter. It is not being disputed that the present case was governed by the Arbitration Act, 1940. That being so, the award u/s 31 of the Arbitration Act, 1940 could only be filed in the Court which made the reference. Section 31 of the Arbitration Act reads as under :

"31. Jurisdiction :

(1) Subject to the provisions of this Act, an award may be filed in any Court having jurisdiction in the matter to which the reference relates.

(2) Notwithstanding anything contained in any other law for the time being in force and save as otherwise provided in this Act, all questions regarding the validity, effect or existence of an award or an arbitration agreement between the parties to the agreement or persons claiming under them shall be decided by the Court in which the award under the agreement has been, or may be, filed, and by no other Court.

(3) All applications regarding the conduct of arbitration proceedings or otherwise arising out of such proceedings shall be made to the Court where the award has been, or may be, filed, and to no other Court.

(4) Notwithstanding anything contained elsewhere in this Act or in any other law for the time being in force where in any reference any application under this Act has been made in a Court competent to entertain it, that Court alone shall have jurisdiction over the arbitration proceedings and all subsequent applications arising out of that reference and the arbitration proceedings shall be made in that court and in no other Court."

A perusal of the same provides the necessary answer and without any pale of controversy it shows that the award is to be filed in the Court having jurisdiction in the matter to which the reference relates. The reference was made by the Court at Amritsar rightly entertained the award and had the jurisdiction to consider the same.

No other point was raised.

The appeal being without merit must fail and is dismissed.

Appeal dismissed.