Full Judgment Text
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REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 7041 OF 2021
(Arising out of SLP (C) No. 10859 of 2018)
Saluja Construction Company ..Appellant(S)
VERSUS
Northern Coalfields Limited ..Respondent(S)
O R D E R
Leave granted
1. Feeling aggrieved and dissatisfied with the impugned judgment
and order dated 02.01.2018 passed by the High Court of Madhya
Pradesh at Jabalpur in A.A. No. 30 of 2012, by which the High
Court has allowed the said appeal filed under Section 37 of the
Arbitration and Conciliation Act, 1996 (Arbitration Act) and has
quashed and set aside the award passed by the learned Arbitrator,
Signature Not Verified
Digitally signed by R
Natarajan
Date: 2021.11.30
16:23:39 IST
Reason:
the original claimant has preferred the present appeal.
2. That the appellant herein was awarded the contract for
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construction of 100 Nos. BType Quarters at Bina (hereinafter
referred to as the Bina project). An agreement was entered into
between the parties on 11.01.1986. A dispute arose between the
parties with respect to the Bina project. The contractor issued a
notice under Clause 9 of the agreement to appoint an arbitrator in
respect of Bina Project only. The respondent rejected the claim of
the contractor. The appellant raised a Bill of Rs.2,23,215/ and
then filed an application under Section 8/20 of the Arbitration Act
for filing of agreement and appointment of arbitrator. Thus it
appears that the dispute at the relevant time was only with
respect to the work relating to the Bina Project. However, before
the learned Arbitrator, the claim was raised with respect to the
other projects and in relation to the sister concerns regarding
‘Amlohri Project’ and ‘Jhingurda Project’. The learned Arbitrator
passed an award with respect to the dispute relating to other
agreements/contracts even in relation to sister concerns over and
above the dispute with respect to the Bina Project. The appeal
under Section 34 of the Arbitration Act against the judgment and
award passed by the learned Arbitrator came to be dismissed
against which the respondent preferred an appeal under Section
37 before the High Court. It was submitted that the learned
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Arbitrator appointed only for the contract relating to Bina Project
and the agreement relating to the Bina Project was filed before the
learned Arbitrator. It was submitted that as per Section 2(a), 8
and 20 of the Arbitration Act, the mandatory requirement was to
decide the dispute in relation to a written agreement which was
filed before the arbitrator. Therefore, it was submitted that the
learned Arbitrator has travelled beyond in passing the award in
respect of four contracts. The High Court in the impugned
judgment and order has accepted the submissions on behalf of the
respondent and has quashed and set aside the award passed by
the learned Arbitrator.
3. Feeling aggrieved and dissatisfied with the impugned judgment
and order passed by the High Court, the contractor has preferred
the present appeal.
4. We have heard Shri Pijush K. Roy, learned counsel appearing on
behalf of the appellant and Shri Vikas Singh, learned senior
counsel appearing on behalf of the respondent.
5. We have gone through the judgment and order passed by the High
Court. It is to be noted that the application under Section 8/20 of
the Arbitration Act was filed by the appellant – Saluja
Construction Company – a partnership firm, with respect to the
contract for construction of 100 Nos. BType Quarters at Bina
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Project only. The agreement between the appellant and respondent
with respect to the Bina Project was produced in application
under 8/20 of the Arbitration act. Therefore, the learned
Arbitrator was required to adjudicate and decide the dispute
between the parties with respect to the Bina Project only.
However, learned Arbitrator passed an award not only with
respect to the dispute relating to Bina Project but also with
respect to the other projects that too not only with the appellant
but with the sister concerns. Therefore, the High Court has rightly
observed and held that the arbitrator while decreeing the award
exceeded in his jurisdiction in passing the award in respect of 4
contracts/contracts. Therefore, as such the High Court is right in
quashing and setting aside the award passed by the learned
Arbitrator with respect to the dues/claims with respect to the
contracts other than the Bina Project and the contracts with other
projects/contractors may be by sister concerns.
6.
However, at the same time, learned counsel appearing on behalf of
the appellant is right in making the submissions that the High
Court at least ought to have confirmed the claim/amount awarded
by the learned Arbitrator with respect to the Bina Project. It is
submitted that the High Court has set aside the entire award
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passed by the learned Arbitrator including the award with respect
to the Bina Project. Therefore, to that extent the present appeal is
required to be allowed in part and the judgment and order passed
by the High Court is required to be modified to the extent setting
aside the award passed by the learned Arbitrator with respect to
the claims with respect to other projects/other contracts other
than Bina Project.
7. In view of the above, the present appeal is allowed in part. The
impugned judgment and order passed by the High Court is
modified to the extent quashing and setting aside the entire
judgment and award passed by the learned Arbitrator. The
judgment and award passed by the learned Arbitrator except the
claims with respect to the Bina Project was required to be quashed
and set aside and is accordingly quashed and set aside. Meaning
thereby, award passed by the learned Arbitrator with respect to
the Bina Project i.e. Rs.5,99,158/ is hereby confirmed. The
impugned judgment and order passed by the High Court quashing
and setting aside the award passed by the learned Arbitrator with
respect to the projects other than Bina Project is rightly set aside
by the High Court. We confirm the same. It is reported that
pursuant to the earlier order passed by the High Court, the
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respondent has deposited 50% of the amount awarded by the
learned Arbitrator. Therefore, whatever the amount deposited in
excess of Rs.5,99,158/ with interest @ 8% per annum from the
date of the award passed by the learned Arbitrator till the amount
was deposited pursuant to the interim order passed by the High
Court, shall be returned by the appellant to the respondent, if any
excess amount is deposited and withdrawn by the appellant. The
present appeal is allowed to the aforesaid extent. In the facts and
circumstances of the case there shall be no order as to costs.
…………………………………J.
(M. R. SHAH)
…………………………………J.
(SANJIV KHANNA)
New Delhi,
November 25, 2021
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ITEM NO.3 COURT NO.13 SECTION IV-C
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Special Leave Petition (C) No(s). 10859/2018
SALUJA CONSTRUCTION COMPANY Petitioner(s)
VERSUS
NORTHERN COALFIELDS LIMITED Respondent(s)
Date : 25-11-2021 This matter was called on for hearing today.
CORAM :
HON'BLE MR. JUSTICE M.R. SHAH
HON'BLE MR. JUSTICE SANJIV KHANNA
For Petitioner(s) Mr. Pijush K. Roy, Adv.
Mrs. Kakali Roy, Adv.
Mr. Rajan K. Chourasia, AOR
For Respondent(s) Mr. Vikas Singh, Sr. Adv.
Mr. Ashwani Kumar Dubey, AOR
Mr. Pankaj Sharma, Adv.
Mr. Kshitij Mudgal, Adv.
Ms. Deepika Kalia, Adv.
Mr. Satvik Mishra, Adv.
Mr. Kapish Seth, Adv.
Mr. Ashwini Kr. Upadhyay, Adv.
UPON hearing the counsel the Court made the following
O R D E R
Leave granted.
The present appeal is allowed to the extent as indicated
in the signed order.
Pending applications, if any, stand disposed of.
(R. NATARAJAN) (NISHA TRIPATHI)
ASTT. REGISTRAR-cum-PS BRANCH OFFICER
(Signed order is placed on the file)