Delhi High Court
Bharat Overseas Construction (P) Ltd. vs University Teachers Co-Operative ... on 4 August, 1989
Equivalent citations: AIR1991DELHI20, 1991(1)ARBLR234(DELHI), 39(1989)DLT446, AIR 1991 DELHI 20, (1991) 1 ARBILR 234 (1989) 39 DLT 446, (1989) 39 DLT 446
Author: D.P. Wadhwa
Bench: D.P. Wadhwa
JUDGMENT D.P. Wadhwa, J.
(1) This application under Order 12, Rule 6 and Section 151 of the Code of Civil Procedure read with Section 41 of the Arbitration Act. 1940 (for short 'the Act') has been filed by the petitioner. Petitioner wants that judgment be pronounced against the respondent in respect of that portion of the award for payment of certain money to the petitioner which is not under challenge and is admitted by the respondent as well.
(2) Certain disputes between the parties were referred to the sole arbitration of Justice D.R. Khanna on a petition filed under Section 20 of the Act by the petitioner. It appears there was a contract between the parties for construction of various flats of the respondent by the petitioner-contractor. This contract contained a clause constituting the arbitration agreement between the parties. The arbitrator gave his award on 25th September, 1987 and on the same day filed it in this court. At this stage it is not necessary to refer to the award in detail, which runs into as many as thirty four pages except to note that the arbitrator awarded a sum of Rs. 3.52.794.00 to the petitioner but directed that out of this amount a sum of Rs. 40,000.00 be withheld for a certain period.
(3) On notice of filing of the award being given, the petitioner-contractor filed objections under Section 15 read with Sections 30 and 33 of the Act. No objections to the award were filed by the respondent. In the objections filed by the petitioner it was stated that the arbitrator miscount dueled himself of the proceedings in awarding a sum of Rs. 5,50,000.00 to the respondent on the ground of defects in the work done by the petitioner and directing deduction of this amount from the amount payable to the petitioner by the respondent. It was stated that the architect appointed by the parties had the sole discretion to get the defects rectified and to determine the amount recoverable from the petitioner and that his decision was to be final and binding on the parties. It was stated that the architect had already deducted a sum of Rs. 34,000.00 from the final bill of the petitioner for the alleged defects in the work done by the petitioner. The petitioner, therefore, wanted that the award be corrected and modified to that extent and interest at the rate of 18% p.a. be awarded to the petitioner on the award as modified, from the dale of the award till payment.
(4) In the proceedings for making the award rule of the court and passing a decree in terms thereof, the question that arose for consideration is if the award is liable to be modified and or corrected in view of the objections of the petitioner-contractor.
(5) There could be no dispute about the payment of the amount of Rs. 3,12,794.00 to the petitioner by the respondent. The petitioner has, therefore, filed the present application praying that judgment be pronounced and a decree for an amount of Rs. 3,12,794.00 be passed against the respondent pending further consideration of his objections for modifying and or correcting the award. The application has been opposed. It is stated that the award is one whole and is not divisible and that the only jurisdiction which the court has is either to modify, remit or set aside the award. It is also stated that the payment of the amount ofRs.3,l2,794.00 is dependent upon petitioner's accepting the whole of the award. Provisions of Order 12, Rule 6 of the Code of Civil Procedure have also been stated to be not applicable in these proceedings.
(6) I do not think I will agree with the contentions raised by the respondent. As noted above, the respondent did not file objections to the award. The period for filing objections has since long over. The court is not going to upset the award of the amount of Rs.3,12,794.00 to the petitioner whether the objections by the petitioner to modify and or correct the award are accepted or not. The amount of Rs. 3.12,794.00 therefore, becomes payable if decree was to be passed in terms of the award as of today. There is no reason why the provisions of Order 12 Rule 6 of the Code of Civil Procedure cannot be made applicable in these proceedings under Sections 14 and 17 of the Act. Clause (a) of Section 41 of the Act clearly provides that subject to the provisions of the Act and the rules made there under the provisions of the Code of Civil Procedure shall apply to all proceedings before the Court, and to all appeals, under the Act. No provision of the Act or the rules has been pointed out which restricts the applicability of Order 12, Rule 6 of the Code of Civil Procedure to these proceedings. Then, Section 27 of the Act gives powers even to the arbitrator to make an interim award. Under Sections 15 and 16 of the Act the court has power to modify or remit the award. There is no question of modifying or remitting the award to the extent of the amount afore-mentioned which has been awarded to the petitioner. That a part of award which gives Rs. 3,12,794.00 is clearly severable without affecting any other portion of the award irrespective of the objections filed by the petitioner. To that extent the award cannot be set aside and in any case has to be made rule of the court and decree passed. I do not think that language of Section 17 of the Act is such as to bar passing of successive decrees. Therefore, where the court sew no cause to remit the award to that extent or refer the matter to arbitrator for re-consideration; the court has power to proceed to pronounce judgment on that portion of the award which is admitted and is severable.
(7) I may at this stage usefully refer to the principle of law laid by the Supreme Court in Mattapalli Chelamayya v. Mattapalli Venkatatatnam (though not referred to at the Bar) on the interpretation of the words "pronounce judgment according to award" as appearing in Section 17 of the Act. In this case the award was not registered, though a portion of the award related to immovable property and was thus compulsorily registerable. It was held that a decree could be passed in terms of that part of the award which was severable from the other part of it which was invalid for any other reason. Contention regarding this has been dealt in para 12 of the report and may be set out as under :- "It was further contended for the appellants that an award is one and indivisible and to direct that effect be given to a part of the award and not to the whole of the award would amount to modifying the award and that was impermissible. We do not think that there is any substance in this contention also. Where a severable part of an award cannot be given effect to for a lawful reason, there is no bar to enforce the part to which effect could be justly given. See Mt. Amir Begam v. Badr-ud-din Hussain Air 1914 Pc 105 where as a general principle it is laid down that when a separable portion of an award is bad, the remainder of the award, if good, can be maintained."
(8) I would, therefore, allow the application and pronounce judgment in favor of the petitioner and against the respondent for an amount of Rs. 3,13.794.00 with interest at the rate of 15% p.a. from the date of the judgment till payment. In case the respondent makes payment of Rs. 3.12.794.00 within two months from today, no interest shall be payable. A decree in accordance with this judgment will be drawn up.