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1 - 9 of 9 (2.91 seconds)Gujarat Water Supply & Sewerage Board vs Unique Erectors (Gujarat) (P) Ltd. & Anr on 24 January, 1989
11. In this background, the contention of Shri Mehta that consolidated Award giving lumpsum amount to the contractor is bad in eyes of law has to be examined. There is no dispute that if the Award is unreasoned Award it automatically does not become invalid, but if we examine the claim of the contractor prima facie it is found that it was pressed under six heads. The contractor claimed Rs. 30,425/- for abandonment of contract. This was first claim, the second claim was for Rs. 30,213/- for illegal deductions made by the O.N.G.C. The third claim was for Rs. 2,00,0007- for not supplying the material in time by the O.N.G.C. - appellant. The fourth claim was loss occasioned by the contractor for keeping his establishment alive and on this head the claim was for Rs. 3,50,000/-. The fifth claim was loss of profit at the rate of 20 percent amounting to Rs. 1,80,000/- and the last was interest at the rate of 18% p.a. As against this lumpsum Award of Rs. 5,98,438/-was rendered by the Umpire and we are unable to find out from the plain reading of the Award whether Umpire awarded each claim totally or refused any of the claims or allowed each claim partly. Of course, detailed reasons need not have been given by the Arbitrator, but he should have stated in the Award that under each of the six claims he is awarding certain specified amount and he should not have given reasons for reducing the amount. The fact remained that the total claim set-up by the contractor was not awarded by the Umpire and in these circumstances lumpsum award becomes unintelligible, and is hit by the observations of the Apex Court in Gujarat Water Supply and Sewerage Board v. Unique Erectors (supra), where the Apex Court emphasised that short intelligible indications of the grounds should be discernible to find out the mind of (he arbitrator for his action even if it be enjoined that in all cases of award by an arbitrator reasons have to be stated. Thus, the first objection of the learned Counsel for the appellant has to be sustained and is hereby sustained.
Associated Engineering Co vs Government Of Andhra Pradesh And Anr on 15 July, 1991
21. Shri Mehta pointed out in the course of argument that prima facie it was not a case of abandonment of contract by the O.N.G.C. and he had drawn our attention to a letter dated 17-3-1977 on record wherein the O.N.G.C., requested the contractor to start work, but he refused to start the work, Thus, the material on record prima facie shows that it was not a case of breach
of contract or abandonment of the contract by the O.N.G.C. If this was so, then specific prohibition in Clause (14) of the Arbitration Agreement that no compensation by way of claim is admissible, but only extension of time-limit could be granted will render the award suffering from manifest error on record. If the record including the arbitration agreement would have been carefully examined by the Umpire, we are sure he would not have rendered Award granting compensation on any ground whatsoever to the contractor. Since this was not done, it not only amounts to error manifest on the record, but also misconduct with the arbitration proceedings. If the Umpire without carefully going through the agreement between the parties proceeded to decide the claim of the contractor it could be said that he acted without jurisdiction and also his act amounts to misconduct with arbitration proceedings. It also amounts to jurisdictional error on the part of the Umpire inasmuch as in face of Clause (14), he had no jurisdiction to award any compensation to the contractor. The objection raised by Shri Mehta on this ground finds support from the pronouncement of the Apex Court in Associated Engineering Co. v. Government of Andhra Pradesh, AIR 1992 SC 232 where the Apex Court held that where the Arbitrator granted claim not covered by the Agreement it amounts to error apparent on the face of the record. It was further observed that the conclusion reached by the Arbitrator, not by interpreting contract, but by merely looking at it is no conclusion and as such the Arbitrator can be said to have misdirected and misconducted himself which in turn amounts to jurisdictional error which calls for setting aside of such award. The Apex Court further proceeded to observe that the Arbitrator cannot act arbitrarily, irrationally, capriciously or independently of the contract. His sole function is to arbitrate in terms of the contract. He has no power apart from what the parties have given him under the contract. If he has travelled outside the bounds of the contract, he has acted without jurisdiction. But if he has remained inside the parameters of the contract and has construed the provisions of the contract, his award cannot be interfered with unless he has given reasons for the award disclosing an error apparent on the face of it. A conscious disregard of the law or the provisions of the contract from which he has derived his authority vitiates the award.
The New India Civil Erectors(P) Ltd vs Oil & Natural Gas Corporation on 17 February, 1997
23. The contention of Shri Mehta that the Umpire could not have travelled beyond the agreement between the parties further finds support from the Apex Court's verdict in New India Civil Erectors (P) Ltd. v. Oil & Natural Gas Corporation,. reported in AIR 1997 SC 980 (at page 982) where it was laid down that it is axiomatic that the arbitrator being a creature of the agreement, must operate within the" four corners of the agreement and cannot travel beyond
it. More particularly, he cannot award any amount which is ruled out or prohibited by the terms of the agreement.
Section 14 in The Arbitration Act, 1940 [Entire Act]
Section 30 in The Arbitration Act, 1940 [Entire Act]
Puri Construction Pvt. Ltd. vs Union Of India (Uoi) on 20 January, 1989
8. We find force in the contention of the learned Counsel for the respondent that the Court cannot examine the correctness of Award on merits. The Apex Court in Puri Construction Pvt. Ltd. v. Union of India, reported in AIR 1989 SC 777 has laid down that "when a Court is called upon to decide the objections raised by a party against an arbitration award, the jurisdiction of the Court is limited, as expressly indicated in the Act, and it has no jurisdiction to sit in appeal and examine the correctness of the award on merits".
Section 35 in The Arbitration Act, 1940 [Entire Act]
Grid Corporation Of Orissa Ltd. & Anr vs Balasore Technical School on 30 March, 1999
In support of his contention he has referred to the Apex Court judgment in Grid Corporation of Orissa Ltd. v. Balasore Technical School, reported in AIR 1999 SC 2262 where the Apex Court has laid down that Arbitrator deciding question otherwise than in accordance with contract commits jurisdictional error and in such circumstances the Court can interfere with the Award and can set aside the same.
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