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2000 DIGILAW 219 (JK)

UNION OF INDIA v. VISHNU KUMAR GUPTA

2000-10-05

O.P.SHARMA, T.S.DOABIA

body2000
JUDGMENT This Letters Patent appeal is against the judgment dated 1-2-1999 by virtue of which learned Single Judge made the award dated 24-7-1991 made by the Arbitrator rule of the court. The appellant challenges the judgment on the following grounds : (i) That the appellant was not afforded reasonable opportunity to produce evidence in support of the objections against the award being made rule of the court; (ii) that the award was liable to be set-aside on the admitted facts of the case that the arbitrator Brig. M. M. S. Parihar had become functus officio; (iii) that the award was liable to be set-aside even in the absence of evidence; (iv) that since the award was not opened by the learned single Judge, he had no occasion to see its contents, and, therefore, same could not be made rule of the court; (v) that there was no evidence to prove the damages claimed by the contractor. 2. Facts of this appeal are identical to the facts of LPA (C) No. 7 of 1999 decided on 25-5-2000 by a bench of which one of us (Sharma J.) was a member. Paras 2 to 4 of the said judgment are extracted below : "(2) The contention of Mr. Bhat, Sr. CGSC appearing for the appellant is that Shri M. M. S. Parihar the sole Arbitrator had resigned vide his letter dated 15-12-1990 with effect from 1st January, 1991 on the ground that he was to superannuate from 31-10-1991. His resignation was accepted by the Engineer-in-Chief who appointed Brig. Y. W. Joshi as the sole Arbitrator vide letter dated 10-1-1991. Brigadier Parihar, therefore, according to the learned counsel had ceased to be the Arbitrator and had no authority to continue the arbitration proceedings. He also argued that reasonable opportunity to produce evidence was denied while rejecting the request. His further argument is that the award was made rule of the Court without examining its contents which was necessary to consider its legality or otherwise. These contentions have been repelled by Mr. P. C. Markanda appearing for the respondents that the Arbitrator had continued the proceedings in defence to this Court order dated 20-12-1990 passed in C.M.P. No. 125/1990 seeking his removal. Besides, the parties had also agreed to his continuation and even filed a joint application asking him to make the award by 30-7-1991. These contentions have been repelled by Mr. P. C. Markanda appearing for the respondents that the Arbitrator had continued the proceedings in defence to this Court order dated 20-12-1990 passed in C.M.P. No. 125/1990 seeking his removal. Besides, the parties had also agreed to his continuation and even filed a joint application asking him to make the award by 30-7-1991. Regarding the opportunity to produce evidence his submission is that four years was a fairly long time to produce evidence. The argument that award was not considered by the learned single Judge according to Mr. Markanda is not substantiated by the facts. 3. We may now consider the rival contention with reference to the record of the proceedings before the Arbitrator and the Court. It is a question of fact that the Arbitrator Shri Parihar had tendered his resignation vide letter dated 15-12-1990 and desired to be relieved because he was is superannuate on 31-1-1991. It is also a fact that Engineer-in-Chief vide his letter dated 16-1-1991 accepted his resignation and appointed one Brigadier Y. W. Joshi as the sole Arbitrator. However, these facts could be established by leading evidence which the appellant failed to produce. But assuming that these having not been disputed, the question is whether the award is invalid on this ground. The award is not invalid because before the Arbitrator had tendered his resignation, the respondents had filed Arbitration Application No. 125 of 1990 for his removal. This application it appears was resisted by the appellant. This application was dismissed by a learned single Judge of this Court on 20-12-1990 with the following direction : "Accordingly this petition is dismissed with a direction to respondent No. 6 to dispose of the arbitration proceedings and file the award positively before 31st of March, 1991. Intervening delay shall stand condoned." It is clear that the counsel for Union of India instead of informing the Court about the resignation of the Arbitrator submitted by the Arbitrator, resisted his removal. S. Brigadier Parihar had no option but to comply the Court order dated 20-12-1990 and ignore the order dated 16-1-1990 as he could not affect to violate Court direction. 4. Subsequently the Arbitrator sought extension of time. A learned Single Judge of this Court on 26-6-1991 extended the time by four months while disposing of CMP No. 139/91. S. Brigadier Parihar had no option but to comply the Court order dated 20-12-1990 and ignore the order dated 16-1-1990 as he could not affect to violate Court direction. 4. Subsequently the Arbitrator sought extension of time. A learned Single Judge of this Court on 26-6-1991 extended the time by four months while disposing of CMP No. 139/91. Further it is also a matter of record that a joint request was made by the appellant as well as the contractor for extension of time vide letter dated 19-3-1991 signed by Lt. Col. G. S. Dhillon on behalf of Union of India and the contractor. It was on this basis that the time was extended by order dated 26-3-1991. Even if there was no order of the Court extending the time, this joint request would extend the time in terms of sub-section (2) of Section 26 of the Arbitration Act. In view of the above the Arbitrator was perfectly justified in continuing the arbitration proceedings and the award cannot be questioned on this ground. 5. So the contention of Mr. Subash Bhat that the Arbitrator had become functus officio after submitting his resignation is not longer available to him. Even otherwise this argument is against the letter dated 19-3-1991 written by Lt. Cal. G. S. Dhillon to the Arbitrator which reads as under : "Reference request made by you at the hearing held at your chambers on 19th March, 1991 at 1100 hrs. We hereby give our consent for making and publishing the award by 30th September, 1991." Similarly, the challenge to the judgment on the ground that reasonable opportunity to produce evidence was not affected was also rejected by the Bench on the ground that the evidence was not produced despite seeking adjournments. A perusal of the original file reveals that issues were framed on 27-4-1994 and Union of India was directed to produce evidence in the form of affidavits within the months. No evidence was produced and the case was directed to be listed for hearing. It was listed for hearing before a learned Single Bench of this Court on 10-7-1995, but could not be heard. No request was made for extension of time to produce the evidence on behalf of the appellant. Same was the position on 7-8-1995 when it was listed. It was listed for hearing before a learned Single Bench of this Court on 10-7-1995, but could not be heard. No request was made for extension of time to produce the evidence on behalf of the appellant. Same was the position on 7-8-1995 when it was listed. On 25-11-1998, learned single Judge of this Court passed the following orders : "This case has been taken upon a mention memo filed on behalf of the petitioner today. Record of the file shows that issues were framed as far back as on 27th April, 1994. It is going to be more than 4 1/2 years yet affidavits have not been filed by way of evidence in terms of the orders of Court. At the request of Shri Slathia another opportunity is allowed to objector-respondents to now file affidavits on or before 29th December, 1998. This case will be listed before the Court on 30th December, 1998 for further orders." Even this order was not complied. The case was again listed on 30-12-1998 when another opportunity was granted to the Union of India for adducing evidence, but even this order was not complied. 6. Finally, by judgment dated 1-2-1999, learned single Judge not only closed the evidence, but also directed that award be made rule of the Court. From the facts narrated above, it is clear that sufficient time was granted to appellant to produce the evidence which they failed. So we are therefore, inclined to agree with the learned Single Judge that there was no justification to adjourn the case any further to enable the appellant to produce evidence in the form of affidavits which it failed despite seeking adjournments from time to time. 7. This brings us to the challenge that the learned Single Judge had not opened the award and, therefore, same could not be made rule of the Court. This argument is self-defeating firstly because the appellant could not have challenged the award unless its copy was available with it. Moreover, copy of the award was forwarded to the appellant as well as contractor vide letter dated 5-9-1991. The application under Sections 30 and 33 is so comprehensive that it deals with every claim. Moreover, the observation made by the learned Single Judge that award is not reasoned award shows that he has first read the award and thereafter announced the judgment. The application under Sections 30 and 33 is so comprehensive that it deals with every claim. Moreover, the observation made by the learned Single Judge that award is not reasoned award shows that he has first read the award and thereafter announced the judgment. So all the grounds of challenge having failed, the appeal is found without any merit and dismissed. Appeal dismissed.