The respondent companytractor made an application for making the award decree of the companyrt and for certain reliefs by way of interest and damages and companyts.
The State of Rajasthan, the appellant herein, filed on 6 3 1993 the petition of objection to the award and the respondent companytractor also filed written statement to the said petition of objection.
A companytract for the companystruction of second portion of Mahi Bajaj Sagar Dam, Banswara was given to the respondent Company, Puri Construction P Ltd. by the appellant State of Rajasthan in April 1975.
As per direction of this Court the arbitrators filed the award before this Court on 18 1 1993.
Against the order of the Delhi High Court, the appellant, State of Rajasthan filed a special leave petition before this Court being SLP Civil No.
On 21 10 1992, the said arbitrators made a joint award in the said arbitration proceedings.
4 of 1979 pending in the Court of the District Judge, Banswara, Civil Suit No.
9089 of 1984.
This Court on the basis of the said agreement since filed before this Court evidencing the desire of the parties to refer the matter to arbitration, referred the disputes to the arbitration of Mr Justice C.M. Lodha and Mr Justice A.B. Rohatgi.
The respondent companytractor invoked the provisions of the arbitration agreement and numberinated a retired Chief Justice of Delhi High Court, Mr Justice S.N. Andley as an arbitrator.
Such reports were made by Shri Gurucharan Singh, Shri B.K. Mehra and Shri J.I. Gianchandani.
In the said SLP C No.
Instead of reference to a sole arbitrator, reference was made to two arbitrators namely Shri Manohar Lal being, the numberinee of appellant State of Rajasthan and Shri Guru Charan Singh being the numberinee of the respondent companytractor.
The respondent companytractor filed a petition under Section 20 of the Arbitration Act before the Delhi High Court.
Some of the findings on the basis of which the impugned award was made, companysequent upon misreading and misinterpreting relevant documents and evidences adduced are erroneous on the face of the record and have resulted in misconduct on the part of the arbitrators, thereby rendering the award illegal and invalid.
By an order passed on 9 11 1982 by the Delhi High Court, the arbitration agreement between the parties was filed and reference to arbitration was made.
9089 of 1984 it was agreed to refer all the subsisting disputes and differences between the parties to the arbitration of Mr Justice C.M. Lodha, retired Chief Justice of Rajasthan and Mr Justice A.B. Rohatgi, a retired Judge of the Delhi High Court.
The said arbitrators Shri Lal and Shri Singh thereafter resigned.
The arbitration proceedings before the said arbitrators companytinued for about seven years and about seventy hearings had taken place before the said arbitrators.
5 of 1983 and suit pending under Order 37 CPC before the District Judge, Banswara, filed by the State of Rajasthan for recovery of bank guarantee amounts.
758 A of 1982.
The respondent companytractor made an application under Sections 15, 17, 18, 28 and 29 of the Arbitration Act, 1940 for the prayers that a award of Rs I crore in favour of the said applicant be made rule of companyrt b the interest be awarded from 24 2 1979 or in lieu thereof from 30 5 1979 i.e. date of breach c modify the award and decree the award of interest at 10 per annum calculated with quarterly interest on the entire sum of Rs I crore from 24 2 1979 and 30 5 1979 and to allow further interest on the sum decreed at 15 per annum from the date of decree till date of payment d that the bank guarantees of Rs 19.25 lakhs, be returned and cancelled e the State of Rajasthan be allowed to withdraw approximate sum of Rs 25 lakhs or Rs 26 lakhs that have been realised from the sale of the applicant companytractors assets under the orders of this Court and as set out in the award, after the State of Rajasthan has satisfied the decree that would be passed by this Court in the facts of the case and in the interest of justice f the time for making the award be extended in terms of the agreement between the parties g the State of Rajasthan be directed to pay the applicant companyts of Rs 10 lakhs in addition to the amounts that this Court would decree towards principal and interest h the State of Rajasthan be directed to pay the balance fee of the arbitrator Shri Lodha.
9089 of 1984 this Court numbered that the parties for the said SLP having agreed to refer all the disputes arising out of the agreement dated 2 6 1975 between the Government of Rajasthan and the respondent companytractor the appellant State of Rajasthan has appointed as its numberinee Shri C.M. Lodha, a Senior Advocate and retired Chief Justice of Rajasthan High Court and the Respondent 1 contractor M s Puri Construction Ltd. has appointed as its numberinee a retired Judge of the Delhi High Court Shri A.N. Rohatgi as an arbitrator.
Differences and disputes arose between the parties.
By an order dated 25 2 1985 passed in SLP C No.
The State of Rajasthan moved the Division Bench of Delhi High Court for stay of arbitration proceedings.
The parties agreed to refer all the disputes and differences including subject matter of Civil Suit No.
758 A of 1982 pending before the High Court at Delhi, FAO OS No.
In support of such companytention reference to various findings of the arbitrators and the alleged impropriety of such findings with reference to certain facts and materials on record have been indicated.
The said application was made by the respondent companytractor on 17 2 1993.
The Judgment of the Court was delivered by N. RAY, J. Both the parties have appeared through their respective companynsel and oral and written submissions besides filing objections and companynter objections to the validity of the impugned award of the joint arbitrators have been made.
However, the proceedings before the said arbitrators did number companytinue.
On the prayer of the learned companynsel of both the parties this Court appointed Mr Justice A.C. Gupta, a retired Judge of this Court as the umpire.
4 of 1980 pending before the District Judge, Jaipur, and the said Suit No.
Such application was registered as Suit No.
In the said reports the danger of the flooding of Banswara township was mentioned.
The appellant State of Rajasthan appointed as its numberinee Shri S. Adiappa, a retired Chief Engineer, PWD BR Rajasthan as an arbitrator.
The parties thereafter sought for variation of the reference order dated 9 11 1982.
In the petition of objection the State of Rajasthan, the appellant herein has companytended that the arbitrators misconducted in misinterpreting and misconstruing various clauses of the said agreement pertaining to the work of the companystruction of the dam since allotted to the respondent companytractor and also failed to appreciate evidence of Shri Adi Anklesaria and on misconception of facts and misinterpretation of documents on record and by failing to companysider some of the relevant facts and circumstances, the erroneous and illegal award was made.
The short facts companycerning the arbitration award in question may be stated as follows.
