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1992 DIGILAW 123 (PAT)

HINDUSTAN STEEL WORKS CONSTRUCTION LTD v. ARVIND CONSTRUCTION CO. PVT. LTD

1992-04-07

CHAUDHARY, S.N.MISHRA

body1992
JUDGMENT Chaudhary & S. N. Mishra, JJ 1. This miscellaneous appeal at the instance of the defendant arises out of the judgment and decree passed by the 2nd Subordinate Judge, Chas, dated the 14th November, 1990, by which the learned Judge made the award the rule of the court and consequently decreed the suit of the plaintiff. 2. It appears that the plaintiff was awarded the work contract for a portion of expansion works in phase II of the Blast Furnace Zone III by a letter of intent No. MO/650-III/71/6563, dated 15/16th September, 1971. In terms of the agreement, the plaintiff was required to complete the work by the 30th November, 1975, but according to the plaintiff the said work could not be completed within the time aforesaid, rather even within the extended time due to the failure and defaults committed by the defendant in due performance of its obligation under the contract and ultimately, the works were closed by mutual consent. 3. Thereafter, a dispute arose in relation to the payment of final bill and accordingly the dispute was referred to the arbitrator in terms of clause 110 of the contract. The appellant also in terms of contract appointed one Major General Ramesh Lal as its arbitrator. The joint arbitrators appointed Sri Y. V. Chandrachud, the Ex-Chief Justice of the Hon'ble Supreme Court to act as umpire if and when necessary. 4. It further appears that the arbitrator appointed by the defendant-appellant died during the pendency of the arbitration proceeding and in his place one Sri Mahadevan was appointed as arbitrator on behalf of the appellant. The plaintiff respondent filed statement of claims before the arbitrator wherein the plaintiff made the following three claims against the defendant-appellant - |---------------|-----------------------|-----------------------|----------------| | | Particulars | Amount claimed | Amount as | | | | originally | modified | |---------------|-----------------------|-----------------------|----------------| | | | (Rs.) | (Rs.) | | Claim No. (1) | Balance due on | 4,65,740.89 + | 4,65,740.89 + | | | account of final bill | 55,725.00 | 55,725.00 | | | | | | | | | being the deduction | | | | | made by the | | | | | respondent on account | | | | | of royalty payable to | | | | | the State Government. | | | | | | | | Claim No. (2) | Extra cost due to | 13,53,000.00 | 1,85,000.00 | | | escalation in market | | | | | price, after 30.11.75 | | | | | | | | | Claim No. (3) | Extra expenditure due | 19,07,000.00 | 17,78,000.00 | | | to the notification | | | | | issued by the State | | | | | Government under | | | | | the Minimum Wages | | | | | Act | | | |---------------|-----------------------|-----------------------|----------------| | | | 37,81,465.89 | 24,81,465.89 | |---------------|-----------------------|-----------------------|----------------| plus the interest at the rate of 12 per cent per annum amounting to Rs. 52,41,129.00; the total being Rs. 92,98,317.46 Ps. 5. It further appears that the defendant-appellant refuted all the claims of the plaintiff-respondent and made a counter claim of Rs. 30.12,803 10 Ps. The joint arbitrators, on appreciation of the evidence on record and after having heard the parties, made an award, but since there was a disagreement between the joint arbitrators in making the award, the matter was referred to the umpire in terms of the contract aforesaid. 6. From a perusal of the award, it appears that both the plaintiff and the defendant agreed before the Umpire that a sum of Rs. 4,65,740.89 Ps. is payable by the defendant to the plaintiff towards Claim No. (1). 7. The learned Umpire, however, after consideration of the relevant facts, has allowed the entire claim of the claimant under Claim No. (1) viz., Rs. 4,65,740.89 Ps. + Rs. 55,725.00, which comes to 5,21,465.89. As regards Claim No. (2), the learned Umpire has rejected the claim of the plaintiff in toto. As to Claim No. (3), the learned Umpire allowed a sum of Rs. 10,000.00 to only under this head. The learned Umpire has, on appreciation of the facts, however, rejected the counter-claim of the defendant-appellant. 8. The other technical questions raised by the defendant-appellant, have been rejected by the arbitrator. The learned Umpire, by his order, dated the 24th February, 1990, allowed the claim of the plaintiff and gave the award as stated above. The award aforesaid was filed before the learned Subordinate Judge for passing the decree in terms of the award. 9. The appellant appeared before the court below and filed objection refusing the claims of the plaintiff. The learned Umpire, by his order, dated the 24th February, 1990, allowed the claim of the plaintiff and gave the award as stated above. The award aforesaid was filed before the learned Subordinate Judge for passing the decree in terms of the award. 9. The appellant appeared before the court below and filed objection refusing the claims of the plaintiff. The trial court however, on appreciation of the materials on record decreed the suit, as stated above. 10. As stated above, the Claim No. (3) i.e., escalation due to reduction in working hours is based upon the Notification dated 8.12.1972 issued by the Government of Bihar under the Minimum Wages Act reducing the working hours from 54 to 48 hours in a week. 11. The Principal, in fact, the only argument of Mr. Banerjee is that the effect of the Notification, aforesaid, has not been considered by the Umpire nor has he assigned any cogent reason for accepting the claim of the plaintiff, but the learned Umpire has wrongly relied upon an award given for an identical claim in a different proceeding. In substance, the submission of Mr. Banerjee is that the learned Umpire has not considered the effect of the Notification, aforesaid, in a right perspective and, therefore, the award given by him is vitiated in law on account of the error apparent on the face of the record. 12. I have perused the award, particularly on Claim No. (3). It appears that the Umpire has taken into consideration the Notification aforesaid, and has opined that due to reduction in the working hours, the claimant has incurred extra costs as a consequence of the Notification, aforesaid, issued by the Government of Bihar. 13. Mr. Banerjee incidentally also submitted that several documents were filed before the arbitrator as also before the Umpire in order to show that the plaintiff was taking work from the labourers at the rate of 8 hours per day prior to the issuance of the Notification, dated 8.12.1972 but the learned Umpire has not even mentioned there documents in his award which clearly goes to show his non application of mind in giving the award on Claim No. (3). Mr. Banerjee, in support of his submission, relied upon the decision in Dandasi Sahu v. State of Orissa (Rep. in AIR 1990 SC 1128 ). 14. Mr. Banerjee, in support of his submission, relied upon the decision in Dandasi Sahu v. State of Orissa (Rep. in AIR 1990 SC 1128 ). 14. In this connection, it may be stated here that the plaintiff has suggested before the Umpire that he should not assign any reason in making the award. The defendant has also left the matter to the discretion of the arbitrator. Therefore, in that view of the matter, it was not necessary for the Umpire to give a reasoned award after considering each and every document filed by the parties and further on account of the disagreement between the co-arbitrators in making the award, the matter was referred to the Umpire and the learned Umpire has given the impugned award on appreciation of the facts and circumstances of the case and, therefore, as well, it is not necessary for the umpire to consider each and every documents, which were filed before the arbitrators and/or umpire. 15. In the result, there is no merit in this appeal, which is, accordingly, dismissed, but without cost.