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Executive Engineer Irrigation ... vs Abaaduta Jena on 22 September, 1987
Citedby 12 docs - [View All]
State Of Karnataka And Another vs R.N. Shetty And Co., Engineers And ... on 19 January, 1990
Gujarat Water Supply & Sewerage ... vs Unique Erectors (Gujarat) (P) ... on 24 January, 1989
M. Paramasivam vs Food Corporation Of India, ... on 29 March, 1988
Food Corporation Of India vs Surendra, Devendra & Mohendra ... on 10 December, 1987
Union Of India (Uoi) vs Jai Forging And Stampings Private ... on 18 March, 2004

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Supreme Court of India
State Of Orissa And Others A vs Construction India on 4 December, 1987
Equivalent citations: 1988 AIR 1530, 1988 SCR (2) 145
Author: S Mukharji
Bench: Mukharji, Sabyasachi (J)
           PETITIONER:
STATE OF ORISSA AND OTHERS A

	Vs.

RESPONDENT:
CONSTRUCTION INDIA

DATE OF JUDGMENT04/12/1987

BENCH:
MUKHARJI, SABYASACHI (J)
BENCH:
MUKHARJI, SABYASACHI (J)
RANGNATHAN, S.

CITATION:
 1988 AIR 1530		  1988 SCR  (2) 145
 1987 SCC  Supl.  708	  JT 1987 (4)	588
 1987 SCALE  (2)1245
 CITATOR INFO :
 R	    1989 SC 973	 (12)
 RF	    1990 SC1340	 (16)


ACT:
     Unreasoned award  by arbitrator-Award  of interest from
the date of reference-Validity thereof.



HEADNOTE:
%
     A contract	 was entered into by the parties in 1970-71.
The award  was made by the Arbitrator in 1982. The award was
challenged before the subordinate Judge who upheld the same.
Appeal	to   the  High	 Court	against	 the  order  of	 the
Subordinate Judge  was dismissed. The petitioners moved this
Court by  special leave	 against the order of the High Court
and contended  inter alia  that since  a similar  matter  of
unreasoned award  had  been  referred  by  the	Court  to  a
Constitution Bench  of the  Court, this petition for special
leave be also similarly referred to the Constitution Bench.
     Dismissing the  petition with  a  modification  of	 the
award, the Court,
^
     HELD: In  the facts  and circumstances of this peculiar
case, the  matter is not referred to the Constitution Bench.
[147B]
     It appears	 from the  order of  the High Court that the
point of  unreasoned award,  though taken in the petition of
appeal, was  not pressed before the High Court. Further, the
Arbitrator had been appointed by the Court out of the panels
submitted by the contesting parties. Also, in the case of an
allied contract	 in respect  of another	 flat  in  the	same
building, an  award had been made and the same had been made
the rule  of the  Court subject	 to the	 certain conditions.
[146G-H]
     The award	is modified  to the extent that the interest
awarded from  the commencement	of the	reference before the
Arbitrator to  the date of the award, is set aside, which is
in consonance  with the	 views expressed  by this  Court  in
Executive Engineer  Irrigation Galimala and Ors. v. Abaaduta
Jena, [1987] 2 Scale 675. [147C-D]



JUDGMENT:

CIVIL APPELLATE JURISDICTION: S.L.P. (Civil) No. 7389 of 1987.

146

From the Judgment and order dated 18.3.1987 of the Orissa High Court in Miscellaneous Appeal No. 423 of 1982.

R.K. Mehta for the Petitioners.

Anil B. Divan and Vinoo Bhagat for the Respondent. The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J. This is a petition for leave to appeal against the judgment and order of the High Court dismissing an appeal from the order of the learned Subordinate Judge dismissing a challenge to the award. This is an unreasoned award. The petitioners challenge the award made in this case and ask for leave in view of the order passed by this Court on 16th July, 1986 in similar matters where the question of the validity of the unreasoned award has been referred to the Constitution Bench for consideration. Mr. R.K. Mehta, learned counsel for the petitioners submitted that this matter should also be referred for consideration before the Constitution Bench In this matter it appears that the contract was entered into by the parties in 1970-71 and the award was made in 1982. The High Court disposed of the objections to the award in 1987. It is true that the grounds of objections were filed before the learned Subordinate Judge and before the High Court. The ground was taken that it was an unreasoned award, inter alia, amongst many other grounds in the order of the High Court which have been gone into and these were that the arbitrator had misconducted himself and the proceedings and the award did not allow or reject the counter claim made by the appellants and further that the award of interest with effect from a date prior to the date of reference is bad in law. The High Court in its judgment had gone into all these aspects but it appears from the order of the High Court that this point of unreasoned award though taken in the petition of appeal was not pressed before the High Court. It also appears that in the grounds of appeal of the special leave petition no grievance has been made on the point although it had been taken by the petitioners. It appears to us that this point was not pressed before the High Court. It further appears that the arbitrator had been appointed by the court out of the panels submitted by the contesting parties. Furthermore in an allied contract, i.e. in respect of a contract of another nat in the same building an award has been made and the same has been made the rule of court subject to certain conditions.

147

It is true that the question of validity of unreasoned award is pending consideration before the Constitution Bench of this Court. It is for consideration before the Constitution Bench as to whether even if unreasoned award be bad, such award of ancient vintage be bad. That would be a matter of grave consequence. In that view of the matter we are not inclined to interfere with the order of the High Court in this case. In the facts and circumstances of this particular case and the features mentioned hereinbefore, we declined to refer the matter to the Constitution Bench.

We must note that the award inasmuch as the interest which had been awarded is set aside to the extent that the award of interest from the commencement of the proceedings before the Arbitrator to the date of the award. Subject to this modification the special leave petition is dismissed. The award will stand modified by deletion of interest for that period namely from the commencement of reference before the arbitrator to the date of award. This is in consonance with the views expressed by this Court in the case of Executive Engineer Irrigation Galimala & Ors. v. Abaaduta Jena, [1987] 2 Scale 675. The special leave Petition is dismissed as indicated before.

S.L.					 Petition dismissed.
148