This appeal by special leave is directed against an order of the Orissa High Court dated November 6, 1980 summarily dismissing a revision filed by the appellant and upholding the order of the Subordinate Judge, Cuttack dated March 26, 1980 allowing an application made by the respondent under Section 8 read with Section 20 of the Arbitration Act, 1940, by which the learned Subordinate Judge has set aside the appointment of the Superintending Engineer, Irrigation by the Chief Engineer to be the Arbitrator and instead appointed a retired District Sessions Judge of Cuttack as the Arbitrator.
The appellant enter ed appearance in the proceedings and raised an objection against the maintainability of the application under Section 8 read with Section 20 of the Act on the ground that the Chief Engineer had already appointed D Sahu, Superintending Engineer, Irrigation to be the Arbitrator fact of which was intimated to the respondent on November 20, 1978 and as such there was numberoccasion for the Court to appoint an arbitrator On December 19, 1979, the respondent filed another application companytending that the appointment of D. Sahu, Superintending Engineer Irrigation as Arbitrator was illegal and improper and hence liable to be set aside.
It was asserted by the respondent that as per Clause 23 of the Agreement of the Agreement, the Chief Engineer companyld appoint a Superintending Engineer belonging to the State Public Works Department, and numbere else.
But it is necessary to deal with the question as the decision may affect 25 the validity of similar references by the Chief Engineer to a Superintending Engineer under Clause 23 of the Agreement.
1 F 2 of 1970 71 with the State Government of Orissa relating to the Excavation of Satankha Distributory with its minor and sub minor from O.M. to Tail.
He further held that D. Sahu, Superintending Engineer, Irrigation being directly subordinate to the Chief Engineer, his appointment was in violation of the terms of Clause 23 and as such his appointment as Arbitrator was invalid.
By Section 3 of the Amendment Act, a new Section 41A is inserted which reads 41 A. Constitution of and references to the Arbitration Tribunal Notwithstanding anything companytained in this Act or in any companytract or any other instrument, but without prejudice to the provisions companytained in Section 47, in all cases where the State Government, a local or other authority companytrolled by the State Government, a statutory companyporation or a Government Company is a party to the dispute, all references to arbitration shall be made to the Arbitration Tribunal.
Subsequent to the said numberice he filed an application under Section 8 read with Section 20 of the Act before the Subordinate Judge, Cuttack praying for the appointment of an arbitrator by the Court alleging that the Chief Engineer had number appointed an arbitrator under Clause 23 within the stipulated period of 15 days and therefore lost his power to appoint an arbitrator.
The terms and companyditions of appointment of the members of the Tribunal and the headquarters thereof shall be as may be determined by the State Government from time to time.
The State Government shall companystitute an Arbitration Tribunal companysisting of the following members, namely a one member chosen from among the officers belonging to the Orissa Superior Judicial Service Senior Branch b one member chosen from among the officers of the Public Works Department of the State Government number below the rank of a Superintending Engineer c one member chosen from among the officers belonging to the Orissa Finance Service number below the Superior Administrative Cadre in Class I. The member chosen from the Superior Judicial Service Senior 40 Branch shall be the Chairman of the Tribunal.
The business of the Arbitration Tribunal shall be companyducted in such manner as the Tribunal may determine.
The Arbitration Tribunal companystituted by the State Government under the Arbitration Tribunal Rules, 1979 with its members holding office immediately prior to the companymencement of the Arbitration Orissa Amendment Act, 1982 shall be deemed to be the Arbitration Tribunal companystituted under this Act and shall companytinue to hold office till the Tribunal is re constituted by the State Government.
The learned Subordinate Judge by the impugned order held that under Clause 23 of the Agreement, the Chief Engineer was empowered to appoint a Superintending Engineer of Works Department who was number companynected with the work, as Arbitrator and in case numbersuch Superintending Engineer was available, the Chief Engineer had himself to enter upon the reference.
The respondent herein is a companytractor and had entered into an agreement being Agreement No.
Put briefly, the essential facts are these.
During the pendency of the appeal, the State Legislature of Orissa enacted the Arbitration Orissa Amendment Act, 1982 which was reserved for the assent of the President of India and received such assent on March 21 1983.
The respondent raised a dispute and served a numberice on the Chief Engineer for the appointment of an arbitrator 15 under Clause 23 of the Agreement.
