Madhya Pradesh High Court
Shri Narmada Enterprises And Anr. vs State Of M.P. And Ors. on 1 October, 2002
Equivalent citations: 2003(2)ARBLR420(MP), 2003(1)MPHT515
Author: Arun Mishra
Bench: Arun Mishra
ORDER Arun Mishra, J.
1. Petitioners are assailing the award (P-4) dated 24-12-2001 which has been made a Rule of the Court by Vth A.D.J., Bhopal as per order P-5. Main challenge is on the ground that Arbitrator has exceeded the terms of contract and has virtually rewritten the contract between the parties M/s. B.D. Bhanot and M.P. State Mining Corporation to the detriment of right of other contractors and public exchequer.
2. In the year 2000 tenders were invited for 'one year' for extraction of sand as per advertisement (P-1), dated 24-10- 2000, Sand was to be extracted from the sand mines. Advertisement (P-1) provided that the tenderers would be required to remove 4,44,567 cubic meters of sand within 'one year' and would deposit royalty in accordance with the prescribed rates. The work order was given w.e.f. 8-11-2000, Respondent No. 3 worked the mines for about 4 months and made a request for reduction of the quantity of extraction of sand by at least 31045 cubic meters which was reduced to 413522 cubic meters. This was to be removed within the period of one year from 8-11-2000 to 7-11-2001 and the contract was executed between the parties on 19-3-2001. Respondent No. 3 was required to deposit a sum of Rs. 1,34,87,320/- as instalments for the period between 8-11-2000 and 20-5-2001. By 25-5-2001, the respondent No. 3 had deposited only Rs. 89,81,005.75 paisa. There was outstanding balance of Rs. 45,04,514 in the instalments, since it was not paid in time, the respondent No. 3 was liable to pay interest Rs. 1,27,994.00. The total amount of Rs. 46,94,308.25 was outstanding against the respondent No. 3. This was a clear breach of condition No. 6 of the agreement (P-2). Order P-3 for terminating agreement was passed on 30-5-2001.
3. Several letters were issued and the order P-3 was passed on 30-5-2001. The petitioner was also asked to deposit the outstanding amount. In accordance with Clause 6 of the agreement, the respondents State Mining Corporation Ltd., rescinded the agreement/contract for extraction of sand and forfeited the amount of security in the sum of Rs. 75,81,237/-. Respondent No. 2 directed respondent No. 3 to deposit the amount of Rs. 45,06,314.25 with interest as per order P-3. After the receipt of order P-3 dated 30-5-2001 respondent No. 3 applied for appointment of an Arbitrator. In the agreement (P-2) Clause 18 there is a provision for arbitration wherein it is provided that in the event of there being any dispute between the Corporation, (respondent No. 2) and the contractor (respondent No. 3), an Arbitrator has to be appointed by respondent No, 2 acting through its Managing Director. Respondent No. 4 Shri Ravindra Sharma was appointed as an Arbitrator.
4. Before the Arbitrator petitioners filed an application for intervention and to participate in the proceedings which application was rejected by learned Arbitrator. Arbitrator ultimately passed an award (P-4) on 24-12-2001. The Arbitrator has ordered that termination of contract by State Mining Corporation was not in accordance with law as well as the forfeiture of the security amount. As per agreement the quantity to be lifted is 4,13,522 cubic meters. Respondent No. 3 had lifted the quantity of 1,74,000 cubic meters only by the time the agreement was terminated. As such adequate time be given to respondent No. 3 M/s. B.D. Bhanot & Sons and respondent No. 3 be allowed to lift minimum of 17,000 cubic meters per month and possession of all the leased quarries be handed over to lift minimum of 17,000 cubic meters of sand per month. In case some of the quarries out of 59 are not available in lieu unavailable quarry thereof some other quarry be made available to M/s. B.D. Bhanot so that he is able to take out the requisite quantity of 17,000 cubit meters and to keep the separate account for that purpose. Other ancillary directions have also been issued which are to operate till respondent No. 3 is not able to lift the total quantity of 4,13,522 cubic meters of sand taking out 17,000 cubic meters per month of remaining quantity of 2,39,552 cubic meters. The security amount shall remain in deposit with the State Mining Corporation without any interest. However, security amount be reduced in proportion to quantity of 1,74,000 cubic meters which has been already removed by respondent No. 3 before termination of contract. The Arbitrator had passed an interim order not to auction the quarry till the decision of the matter. Said injunction has been vacated while passing the award (P-4).
5. Respondent No. 4 passed an award (P-4) in favour of respondent No. 3 M/s. Bhanot & Sons. The petitioners were not parties to this award. Respondent No. 3 was required to deposit the amount of instalments as per agreement (P-2) which fell short. The respondent No. 3 requested for appointment of an Arbitrator and respondent Nos. 2 and 3 joined hands to appoint the respondent No. 4 as the Arbitrator. Respondent No. 3 was to work on the Mines till 7-11-2001 about 6 months were left when contract was terminated on 30-5-2001. Arbitrator has given the award (P-4) on 24-12-2001 when thb period of one year under the agreement had already expired. During the period of the arbitration the respondent No. 2 Corporation was restrained from putting mines on auction which resulted in loss of royalty.
6. Petitioner submits that he is not having the remedy of filing an appeal against the impugned award (P-4). The Arbitration & Conciliation Act, 1996 confines the right of filing an appeal to a party as defined in Section 2(h) of the Act. As per definition 'party' means 'a party to an arbitration agreement'. Section 34 gives the right of filing an appeal to such a party only who is party in arbitration agreement. Petitioner submits that since the quarries in question have to be made available for fresh process of tender on expiry of the period of one year on 741-2001, the matter concern with distribution of public largess Arbitrator has extended the period of operation of quarry than what is provided in the agreement P-2 which is detrimental to the interest of the other persons and also has the effect of financial loss to State Govt. & Corporation. The period which has been given to respondent No. 3 in which more than double of revenue could be earned, Arbitrator had misconducted himself and has committed error apparent on the face of the record and Arbitrator is bound by the terms of the agreement and could not proceed beyond the terms of the agreement (P-2) fixed by the parties. The petitioner further submits that period of actual operation in the contract has been extended by Arbitrator for 'two years' whereas the auction was made only for a period of 'one year' and royalty fixed was to be paid in one year only.
7. A return has been filed by respondent No. 2, M.P. State Mining Corporation. Preliminary objection has been raised that petitioner is a stranger to the arbitration proceedings and is questioning the validity of the award in this petition which has become Rule of the Court. The award has now become Rule of the Court as per order P-5, dated 28-1-2002 and has been implemented by the Mining Corporation. The grounds raised by the petitioner are frivolous in nature. The petition filed by the petitioner is devoid of merits and substance and, therefore, deserves to be dismissed. Petitioners have filed the petition with an ulterior motive. The petitioners have no locus to challenge the award in the writ petition.
8. A return has been filed by respondent No. 3 M/s. B.D. Bhanot and Sons contending that the award has been properly passed and has been made Rule of the Court by A.D.J. as per order P-5. The tender of respondent No. 3 was the highest one and was accepted as per order R-3/2 by the State Mining Corporation on 1-11-2000. Respondent No. 3 deposited a sum of Rs. 1,01,87,993.75 on 7-11-2000. The Corporation after the deposit of the aforesaid amount was required to hand over all the 59 quarries, which were the part of tender floated by them. However, charge of only some of the quarries was given to respondent No. 3 on 8-11-2000. Out of 59 quarries, 80% were old quarries 30-40 years old and 20% were new quarries. Some of the new quarries out of 20% were Jugpara, Bilaspur, Pabla, New Chargawan, Khari, Belkhedi, Kundakalan. Respondent Corporation did not hand the aforesaid quarries to the respondent No. 3 nor any demarcation was done in respect of these quarries. Agreement was entered into on 27-2-2001. The agreement was executed under protest on 19-3-2001. The demarcation was done on 22-3-2001. Respondent No. 3 had also submitted a representation to the Managing Director of the respondent Corporation on 22-3-2001 requested the Collector to stop illegal excavation of sand from the mines. There was total failure of the Corporation to take the steps. The transit passes were also not issued timely. Instead of allotting demarcated sand quarries to respondent No. 3 and taking the remedial steps to resolve the dispute, the agreement was terminated on 30-5-2001 as per order P-3 without granting the opportunity of hearing to respondent No. 3. The Arbitrator has not misconducted. The Court has made the award Rule of Court. If answering respondent is stopped from excavating the sand, the State exchequer will suffer heavy financial loss. Thus, no interference is called for in the writ petition and the same deserves to be dismissed.
9. Shri Vipin Yadav, learned Counsel for the petitioners, vehemently submitted that the award (P-4) and the order (P-5) of Court making it Rule of the Court are bad in law. Petitioners have no other remedy except to file the writ petition. The period for which the quarry was auctioned was only 'one year'. The Arbitrator is bound by the terms of the agreement. Arbitrator has proceeded beyond it. The actions in taking the matter to the Arbitrator, appointment of the arbitrator, receiving of the award and getting it made the Rule of the Court are all illegally done. The respondent Nos. 2 and 3 are in collusion. If impugned award is allowed to stand it would to detrimental to revenue of respondent Nos. 1 and 2 as the royalty fixed under the agreement was 'payable' within 'one year' and thereafter fresh tenders were to be invited by enlarging the period gross illegality has been done. Respondent No. 3 had operated the quarry for about 7 months, when agreement was terminated only 5 months 7 days period remained that has been now extended to one year 4 months which is impermissible and bad in law and is against the interest of exchequer as the petitioner is not a party to the arbitration agreement is not having right to file an appeal as provided in Section 34 of Act of 1996. Thus, the writ petition is maintainable and interference is called for in the facts and circumstances of the case. As it is a matter of distribution of public largesse which cannot be allowed to be usurped by respondent No. 3 M/s. B.D. Bhanot & Sons in gross contravention to the terms of the agreement P-2 as well as for the period it was auctioned.
10. Shri Vivek Tankha, learned Senior Counsel appearing for respondent No. 2, M.P. State Mining Corporation and Shri S.C. Sharma, learned Counsel appearing for respondent No. 3, M/s. B.D. Bhanot & Sons, submit that the writ petition is not maintainable in the matter of award. When right of appeal is given to party to an arbitration agreement by necessary implication the other modes of challenge are ousted. Once it is made Rule of Court it is not open to challenge it except by way of filing an appeal under Section 34, that too is rightly confined by the Legislature to a party to an arbitration agreement. Thus, no interference is called for in the writ petition.
11. First question for consideration is that what is the scope of interference in the matter when award has been passed by an Arbitrator. Another question is whether writ petition is maintainable and petitioner has locus to file it.
12. I advert to the first question; as to the scope of interference in an award made by Arbitrator and what is the scope of Arbitrator. Law is well settled in this regard that an Arbitrator cannot travel beyond the terms of the agreement. It is not open to an Arbitrator to rewrite the terms of agreement which have been agreed to between the parties.
13. Learned Counsel for the petitioner has rightly attracted the attention of this Court to the decision of the Apex Court in Ispat Engineering & Foundry Works, B.S. City, Bokdro v. Steel Authority of India Ltd., B.S. City, Bokaro, (2001) 6 SCC 347. The Apex Court has laid down that it is not open to the Court to speculate, where no reasons are given by the Arbitrator, as to what impelled the Arbitrator to arrive at his conclusion and it is not open to the Court to attempt to assess the mental process by which the Arbitrator has reached his conclusion where it is not disclosed by the terms of the award. The Arbitrator or umpire, as the case may be, has no authority or jurisdiction to 'abdicate the terms' of the "contract" or what the "parties desired" under the "contract". The Apex Court held :--
"15. The Arbitrator or umpire, as the case may be, has no authority or jurisdiction to abdicate the terms of the contract or what the parties desired under the contract and not beyond the same. As a matter of fact in Associated Engg. the umpire has, as regards the claim, directed payment of a sum of Rs. 4.25 (Rupees four and paise twenty five) per sq. meter of napa slab lining toward escalation in the cost off napa slabs and there was, in fact, no provision in the contract allowing escalation for napa slabs and it is on this score, this Court came down heavily upon the authority of the Arbitrator to direct payment of escalation charges when the agreement does not provide for the same. The decision thus in Associated Engg. also is of no assistance to the respondents herein."
14. When an award is made plainly contrary to the terms of the contract not by misinterpretation but which is plainly contrary to the terms of the contract it would certainly lead to an inference that there is an 'error apparent' on the face of the award which results in 'jurisdictional error' in the award. In Grid Corporation of Orissa Ltd. and Anr. v. Balasore Technical School, (2000) 9 SCC 552, the Apex Court has held :--
"3. In this case, the High Court is of the view that a Civil Court does not sit in appeal against the award and the power of the Court when an award is challenged is rather limited. The award of the Arbitrator is ordinarily final and conclusive as long as the Arbitrator has acted within his authority and according to the principle of fair play. An Arbitrator's adjudication is generally considered binding between the parties for he is a Tribunal selected by the parties and the power of the Court to set aside the award is restricted to cases set out in Section 34 of the Arbitration Act. It is not open to the Court to speculate where no reasons are given by the Arbitrator, as to what impelled him to arrive at his conclusion. If the dispute is within the scope of the arbitration clause it is no part of the province of the Court to enter into the merits of the dispute. If the award goes beyond the reference or there is an error apparent on the face of the award it would certainly be open to the Court to interfere with such an award. In New India Civil Erectors (P) Ltd. v. Oil & Natural Gas Corporation, this Court considered a case of a non-speaking award. In that case the Arbitrator had acted contrary to the specific stipulation/condition contained in the agreement between the parties. It was held that the Arbitrator being a creature of the contract must operate within the four corners of the contract and cannot travel beyond it and he cannot award any amount which is ruled out or prohibited by the terms of the agreement. In that contract it was provided that for construction of a housing unit, in measuring the built-up area, balcony areas should be excluded. However, the Arbitrator included the same which was held to be without jurisdiction. In the same manner it was also held that the price would be firm and not subject to any escalation under whatsoever ground till the completion of the work and awarding any sum as a result of escalation was not permissible. To the same effect is the decision in Associated Engg. Co. v. Govt. of A.P., It was stated that if the Arbitrator commits an error in the construction of the contract, that is an error within his jurisdiction. But if he wanders outside the contract and deals with matters not allotted to him, he commits a jurisdictional error and an umpire or Arbitrator cannot widen his jurisdiction by deciding a question not referred to him by the parties or by deciding a question otherwise than in accordance with the contract. A conscious disregard of the law or the provisions of the contract from which he has derived his authority vitiates the award. The principle of law stated in N. Chellappan case on which strong reliance has been placed by the learned Counsel for the respondent would make it clear that except in cases of jurisdictional errors it is not open to the Court to interfere with an award. That proposition is unexceptionable. However, from a reading of the decisions of this Court referred to earlier it is clear that when an award is made plainly contrary to the terms of the contract not by misinterpretation but which is plainly contrary to the terms of the contract it would certainly lead to an inference that there is an error apparent on the face of the award which results in jurisdictional error in the award. In such a case the Courts can certainly interfere with the award made by the Arbitrator."
15. In Bharat Coking Coal Ltd. v. L.K. Ahuja and Co., (2001) 4 SCC 86, the Apex Court has held :--
"10. The law is well settled that if the award made by the Arbitrator is a non-speaking one the difficulty of showing that there is an error apparent on the face of the award becomes insurmountable and ordinarily such award cannot be challenged at all unless it is shown that the Arbitrator has wholly travelled outside the contract which gives him the jurisdiction. The law is equally well settled that in cases of speaking awards the Court can interfere if there is an error apparent on the face of the award itself; it could also be shown that the Arbitrator has misconducted himself in arriving at certain conclusions which are either plainly contrary to law or to the terms of the contract or ignored the provisions of contract or the evidence on record and such other similar matters.
11. Realising these difficulties, Shri M.L. Verma, learned Senior Advocate and Shri Ajit Kumar Sinha, learned Advocate for the appellant, very cautiously treated their path to put forth before us the difficulties in upholding the award. Shri S.B. Upadhyay, learned Counsel for the respondent, with equal astuteness and competence contended as to the manner in which the award made by the Arbitrator could be maintained though it is bristled with many difficulties."
16. Coming to the terms of the contract/agreement (P-2) the lease between the parties it is "essential* that period of contract is 'one year' from 8-11-2000 to 7-11-2001 and NIT (P-1) was issued for a period of one year. There is no clause for extension provided in the agreement (P-2). Various clauses of the agreement insist for lifting the quantity of 4,13,522 cubic meters fixed under the agreement (P-2) by 7-11-2001 within a period of 'one year'. The Clauses 2, 6, 7 and 14 are relevant. They are quoted below :--
^^2 vof/k rFkk ewY;%& ek=k ,oa vof/k Bsds dk ewy rRo gksxkA Bsdsnkj dks ; dh tkus okyh ek=k 4]13]522 pkj yk[k rsjg gtkj ikap lkS ckbl ?kuehVj fnukad 7&11&2001 rd mBkuh gksxhA Bsdsnkj dks blh vof/k esa fuxe }kjk fu/kkZfjr fd;s x;s ewY; :i;s 55@& :i;s ipiu izfr ?kuehVj ds fglkc ls dqy ewY; :i;s 2]27]43]710 :i;s nks djksM+ lkkbZl yk[k frrkfyl gtkj lkr lkS nl fuxe dks vuqcU/k dh dafMdk 6 ,oa 7 ds vuqlkj vnk djuk gksxkA 6 Bsdsnkj dks Bsds dh dqy jkf'k dks fMek.M MkV }kjk layXu dk;Z ;kstuk ds vuqlkj tek djkuk gksxkA fn- 8&11&2000 ls fn- 19&2&2001 dh vof/k esa okLrfod mRiknu ek=k 95624 ?k-eh- vU; ekfld fd'rsa izR;sd ekg dh chl rkjh[k rd vfxze rkSj ij fuxe ds midk;kZy; tcyiqj esa tek djkuh gksaxhA ;fn fu/kkZfjr frfFk rd ekfld fd'r dh jkf'k tek ugha djk;h tkrh gS rks Bsdsnkj dk dk;Z vkxkeh lkr fnol rd vkSj fujUrj jg ldrk gS c'krsZ Bsdsnkj fd'r dh leLr jkf'k e; 24 izfr'kr okf"kZd nj ls foyac 'kqYd ds lkFk lkr fnolksa ds vUnj tek djk nsosaA vU;Fkk Bsdsnkj ls fcuk fdlh iwoZ lwpuk ds jsr [knku@jsr [knkuksa dk dCtk okil ys fy;k tkosxk ,oa mldk Bsdk fujLr dj mldh lqj{kk jkf'k rFkk vU; jkf"k dks tCr fd;k tkosxkA 7 Bsds dh dqy ek=k dks fu/kkZfjr vof/k esa mBkuk gksxk rFkk blds fo:) dk;Z ;kstuk vuqlkj ekfld fd'r vfuok;Z :i ls tek djkuh gksxhA ;fn izR;sd ekg esa fu/kkZfjr ekfld fd'r ds fo:) ek=k ml ekg dh lekfIr ds iwoZ gh mBk yh tkrh gS rks vfrfj ek=k ds fy;s tkjh dh tkus okyh izR;sd fiVikl cqd dh leLr jkf'k vfxze esa tek djkbZ xbZ jkf'k dh vkxkeh ekfld fd'r dh jkf'k esa lek;ksftr fd;k tkosxkA 14 ;fn Bsdsnkj }kjk vuqca/k vof/k esa fd'r dh iwjh jkf'k tek ugha djk;h tkrh gS rks mlds }kjk vfxze tek dh xbZ fd'r dh jkf'k ,oa lqj{kk /kujkf'k fuxe }kjkk tCr dj yh tkosxhA fu/kkZfjr ek=k ls vf/kd jsr mBkus ij Hkh fuxe dks izfr ?ku ehVj fuxe }kjk fu/kkZfjr fd;k x;k ewY; izfr ?kuehVj vfrfj nsuk gksxkA fdlh Hkh ifjfLFkfr esa vkWQj dh xbZ ek=k dks fuxe }kjk de ugha fd;k tkosxkA u gh jkf'k esa deh dh tkosxhA**
17. On the bare reading of the aforesaid clauses leaves no room to doubt that the payment of Rs. 2,27,43,710/- was to be made within a period of one year and even if less quantity is lifted the amount of royalty remains static for one year as provided in Clause 14 of agreement (P-2). Thus, it is clear that the amount of royally fixed under the agreement (P-2) has the corclation with the period. The time is 'essence' of the contract and petitioner was allowed to lift the quantity of 4,13,522 cubic meters. Thus, the State Mining Corporation and the State arc bound to suffer the loss if the period is extended for operation of the quarry for two years on the basis of the same amount of royalty which is to be paid under the agreement (P-2) which is effect of the award (P-4).
18. The contract in question has the public element also. The quarries were auctioned for a period of 'one year'. It cannot be allowed to be 'operated' for a period of 'two years' which has been done as per the award (P-4) passed by the Arbitrator, The Arbitrator by allowing 17,000 cubic meters of sand to be lifted every month, has extended the period and 59 quarries to be operated by respondent No. 3 for the period of one year 4 months more whereas unexpired period was 5 months 7 days and entire period was one year. It is not in dispute that respondent No. 3 had already operated quarry for the period of 7 months approximately before order P-3 terminating contract was passed by respondent No. 2 Corporation. In my opinion, it was not open to the Arbitrator to allow the operation beyond 5 months and 7 days which was unexpired period when the contract was terminated on 30-5-2001 as per order (P-3). The action of the Arbitrator is an express contravention of the terms of the agreement (P-2) reached between the parties and is patently illegal.
19. The submission raised by Shri S.C. Sharma, learned Counsel appearing for respondent No. 3 that essence of agreement is the 'quantity' not the 'time', which submission I am unable to accept. Time is main essence even if less quantity is lifted. The essential term is of payment of the amount fixed of 2,27,43,710 in one year. No doubt quantity is relevant but time prevail over the quantity and is not extendable. The period of operation of quarries was fixed for one year. Thus, by no stretch of imagination Arbitrator or State Mining Corporation could allow the operation of the quarry to the respondent No. 3 beyond the period which was fixed under the 'agreement' even if the agreement was terminated unlawfully on 30-5-2002. The period fixed under the agreement of one year could not be extended to two years in the method & manner it has been done. The State exchequer is bound to suffer the loss of revenue if the period is extended by further 1 year 4 months in which State Mining Corporation would have earned more royalty to the extent of 2 crores, approximately. Fresh tenders are required to be invited from the contractors on lapse of one year. NIT was issued for one year.
20. The petitioner cannot be said to be stranger as contended by learned Counsel for respondent No. 3, He has the right to participate in the fresh tender process and had also participated in the tender process in which the tender of respondent No. 3 was accepted pursuant to which agreement (P-2) was entered into. All these important aspects have been illegally discarded by Court while passing order (P-5) making award Rule of the Court.
21. Coming to the question of maintainability of the writ petition it be noticed that in the Arbitration Act, 1940 the word 'party' was not defined. In the Arbitration and Conciliation Act, 1996 'party' has been defined in Section 2(h). It reads as under :-- "(h) "party" means a party to an arbitration agreement."
22. Section 34 gives the right to file an appeal. Reading of definition of party as well as the right to file an appeal is available only to a party to an arbitration agreement. Petitioner not being a party to the arbitration agreement cannot file appeal but definitely is interested and cannot be said to be stranger in the facts and circumstances of the case and nature of the grant made in favour of respondent No, 3 and also considering the fact that it is a matter of distribution of public largesse and State or Corporation cannot be allowed to act arbitrarily in these matters. Thus, petitioner is having 'locus' to file and maintain the writ petition. The Apex Court in Anglo American Direct Tea Trading Co. Ltd. v. Their Workmen and Anr., AIR 1963 SC 874, has held in appropriate cases writ petition is maintainable against arbitration award.
"15. The argument, therefore, is that against an award pronounced by an Arbitrator appointed under Section 10A, a writ of certiorari would lie under Article 226, and so, the Arbitrator should be deemed to be a Tribunal even for the purposes of Article
136. In our opinion, this argument is not well founded. Article 226 under which a writ of certiorari can be issued in an appropriate case, is, in a sense, wider than Article 136, because the power conferred on the High Courts to issue certain writs is not conditioned or limited by the requirement that the said writs can be issued only against the orders of Courts or Tribunals. Under Article 226(1), an appropriate writ can be issued to any person or authority, including in appropriate cases any Government, within the territories prescribed. Therefore even if the Arbitrator appointed under Section 10-A is not a Tribunal under Article 136 in a proper case, a writ may lie against his award under Article 226."
23. Learned Counsel for respondent No. 3 has pressed into service the decision of the Apex Court in ITI Ltd. v. Siemens Public Communications Network Ltd., 2002(5) SCC 510, wherein the Apex Court considered the question of maintainability of petition before the Apex Court under Article 136 of the Constitution of India. The appeal was filed directly before the Supreme Court by passing remedy of the Appellate Court under Section 34 of the Arbitration Act. Here the right of filing an appeal is not available to the petitioner as he is not a party to arbitration agreement.
24. It was expected that the State Mining Corporation who was an objector before the District Court ought to have itself challenge the award. However, I leave matter as it stands as petitioner has rightly come forward to rescue of public exchequer.
25. Resultantly, I find challenge to the arbitration award (P-4) and to the order P-5 passed by the Court meritorious. Award (P-4) passed by Arbitrator and the order (P-5) passed by the Court of Vth ADJ are quashed. Costs of Rs. 5,000/- are imposed over the respondent No. 2 to be payable to petitioners. The respondent Slate Mining Corporation is directed to proceed in accordance with law to make fresh auction of quarries in question. No operation of quarries be done by respondent No. 3.