JUDGMENT D.P. Mohapatra, J. - Shri Karunakar Khatun, a contractor, has filed this appeal under Section 39(vii) of the Indian Arbitration Act, 1940 assailing the judgment passed by the learned Subordinate Judge, Dhenkanalin Title Suit No. 18 of 1983 dismissing the suit. The said suit had been filed by the appellant under Sections 30 and 33 of the Act challenging the award passed by the Arbitration Tribunal, Orissa (for short, "The Tribunal") holding, inter alia, that the claimant (appellant) was not entitled to any amount under any of the items of his claim except the amount found due to him under the final bill. As the judgment of the trial court shows, the award was challenged mainly on the grounds that the Tribunal has misconducted itself and the proceeding in passing the award; that the award had been improperly procured and was otherwise invalid and that the award was liable to be set aside as the documentary evidence adduced in the proceeding was not discussed at all and since the plaintiff (appellant) and the defendant (respondent) had both objected to the award by filing petitions under Sections 30 and 33 or the Act, it ought to be set aside. The learned Sub-ordinate Judge negatived the contentions of the appellant on all the points. 2. The main contention raised by Shri S.K. Sangnerin, learned counsel for the appellant was that the Tribunal failed to comply with the principle of natural justice in the proceeding inasmuch as it did not afford opportunity to the appellant to adduce oral evidence and to get the rock found at the site of work examined by an expert though he had specifically sought for opportunity for this purpose from the Tribunal. In view of the contention raised by the learned counsel the scope for consideration lies within a narrow compass. Therefore, it is not necessary to set out in detail the facts of the case. The facts relevant for the present purpose may be stated thus : The appellant-contractor had obtained a total sum of Rs. 2,44,052.00 from the respondent Executive Engineer, Prajang Canal Division under nine different items including Rs. 38,914 towards cost of excavation in foundation in a special type of compressed rock for which, according to the appellant, there is no rate either in the agreement or in the schedule of rates (claim item No. 1). Rs.
2,44,052.00 from the respondent Executive Engineer, Prajang Canal Division under nine different items including Rs. 38,914 towards cost of excavation in foundation in a special type of compressed rock for which, according to the appellant, there is no rate either in the agreement or in the schedule of rates (claim item No. 1). Rs. 20,000 for clearing heavy jungle at the site of work (claim item No. 3), Rs. 5,643 towards excavation of foundation of soil interlocked with trees and bushes (claim item 4), Rs. 83,280 comprising of claim of Rs. 66,330 for idle labour and Rs. 16,900 for idle establishment (claim item No. 6), Claim item No. 7 relates to the plea of the appellant that the contract may be closed with effect from 25.11.1981 without any penalty or compensation. The case of the respondent in this regard was for closure of the contract under clause 3(a) of the agreement forfeiting the security deposit and for compensation of Rs. 94,049 under clause 2 of the agreement. Claim item No. 9 is for Rs. 21,000 towards overhead expenditure for the construction of 20 labour sheds and one storage godown. As noted earlier, all the claim items were rejected by the Tribunal. The main reason which appears to have weighed with the Tribunal is that the contractor abandoned the work in the middle without any justification. 3. Coming to the contention raised by Shri Sangnerin that the Tribunal did not grant reasonable opportunity to adduce evidence to the appellant and therefore had misconducted the proceeding, the same needs careful consideration. The position has to be taken as well settled that the Arbitrator (in this case the Tribunal) is not bound to follow the provisions or the principles embodied in the Evidence Act. However, in the present case under rule 15 of the Arbitration Tribunal Rules the Tribunal is statutorily required to pass a reasoned award. The question therefore is whether the principle of natural justice applies to proceedings before the Tribunal and if so, whether in the facts and circumstances of the present case denial of opportunity to the appellant to adduce oral evidence has vitiated the proceeding. The former question has been answered in the affirmative by the Delhi High Court in the case of M/s. Mehta Teja Singh and Co.
The former question has been answered in the affirmative by the Delhi High Court in the case of M/s. Mehta Teja Singh and Co. v. Union of India and another (AIR 1971 Delhi 231), wherein it has been held : "The principles of natural justice require that a party must know what case he has to meet. Natural justice is nothing else but fair play in action. It is true that an arbitrator is not bound by the technical rules of evidence or court procedures. But certainly he has a duty to be fair. That duty is laid upon every one who is called upon to decide a dispute impartially. Refusal to order the production of a document which is the foundation of the claim is a denial of justice. The arbitrator's procedure should not be opposed to natural justice. He should perform his function in a quasi-judicial manner and should not make a face of the enquiry before him. If he does not follow the fundamental rule governing judicial procedure he commits misconduct. The word 'misconduct' does not involve more turpitude. It is a technical misconduct. The words 'misconducted the proceedings' in Section 30 mean 'such a mishandling of the arbitration as is likely to cause some substantial miscarriage of justice." The court placed reliance on the decision in Williams v. Walis reported in (1014) 2 x B 478. The Allahabad High Court in the case of Kamta Prasad Nigam v. Ram Daval and others ( AIR 1951 All 711 ), interpreting the word 'misconduct' in Section 30 of the Act held that it is the inherent right of a party in any judicial proceeding to offer all his relevant and material evidence before the authority seized of as matter to prove his claim of title. Where, therefore, there was unqualified refusal on the part of the arbitrator to record any oral evidence whatsoever in a case in which it was not intended that he should decide the matter without taking all relevant evidence as either party wished to produce, he is guilty of misconduct. A similar view was taken by the Lahore High Court in the case of Tirath Singh and another v. Isher Singh (AIR 1948 Lah 50), where the court observed : "The arbitrator may give his reasons for shutting out a certain amount of evidence sought to be tendered by a certain party.
A similar view was taken by the Lahore High Court in the case of Tirath Singh and another v. Isher Singh (AIR 1948 Lah 50), where the court observed : "The arbitrator may give his reasons for shutting out a certain amount of evidence sought to be tendered by a certain party. It is not, however, open to the arbitrator to refuse to grant an opportunity to a party to produce evidence on the ground that there was no necessary to examine witnesses or hear counsel. By telling the parties that there was no necessity to examine witnesses or hear counsel the arbitrator is guilty of judicial misconduct". From the principles enunciated in the aforementioned decisions with which I respectfully agree, it is clear that though the Tribunal is not bound by the technical rules of evidence or court procedure, it is bound by the principle of natural justice which is intended to ensure that the Tribunal has acted fairly in the case. 4. Coming to the second question formulated earlier, it is clear from the award passed by the Tribunal which is, in my view, a reasoned one, that opportunity of hearing was granted to both the parties and the Tribunal visited the site of work for proper understanding of the claims put up by the appellant and the contention raised by the parties. However, there is no mention in the award about the granting of opportunity to the appellant to adduce oral evidence. From the order-sheet in the proceeding, particularly the orders passed on 16.12.1982 and 12.1.1983 it is clear that the appellant had been repeatedly seeking orders from the Tribunal to produce oral evidence and the Tribunal had passed order that opportunity to adduce oral evidence will be given to him as and when necessary. No order was passed holding that there is no necessity to adduce oral evidence in the case. The net result therefore is that the appellant's requests for adducing oral evidence were not considered till the proceeding was disposed of by the Tribunal. On a fair reading of the claims put forth by the appellant it is manifest that on many items oral evidence could have been led by the parties. It is however difficult to say the exact nature of oral evidence which the appellant could have placed before the Tribunal.
On a fair reading of the claims put forth by the appellant it is manifest that on many items oral evidence could have been led by the parties. It is however difficult to say the exact nature of oral evidence which the appellant could have placed before the Tribunal. The Tribunal should have the heard the appellant on the matter and passed a considered order either accepting the prayer to adduce oral evidence or giving its reasons for not accepting the said prayer. I would not like to devolve further into the merits of the claims of the appellant since I propose to remit 'he matter to the Tribunal for reconsideration. It is also relevant to note that both the parties were dissatisfied with the award and had filed applications under Sections 30 and 33 of the Act to set it aside. 5. On giving my anxious consideration to the entire matter, I am satisfied that the Tribunal misconducted the proceeding in not dealing with the applications filed by and the prayer of the appellant to adduce oral evidence in the case and to send a sample of the rock found at the site of the work for examination by an expert. Accordingly the award is set aside and the case is remitted to the Tribunal for reconsideration. The Tribunal will give opportunity of hearing to both the parties only on the question whether the appellant's prayer to adduce oral evidence is to be allowed or not and dispose of the proceeding in accordance with law. Both the parties will bear their respective costs of this appeal. Appeal disposed of. *-*-*-*-*