A.K. Banerjee, J. - (1.) Respondent was entrusted for construction of a building by the State through a regular tender process. There had been delay in execution of the contract. However, work was completed within the extended period. Even after completion of the work. State was not inclined to take possession of the building in question as they had some internal problem. However, ultimately the building was handed over to the State. The respondent was duly paid the running bills and final bill. He accepted final bill without any protest. The security deposit was withheld for sometime and thereafter it was paid. The respondent however lodged a claim of Rs. 6.00 lacs and odd on account of idle labour and guarding charges for the period when the State was not able to take possession despite completion. The matter was referred to arbitration of a Government nominee who made and published his award awarding a sum of Rs. 2.89 lacs together with interest @11% per annum from the date of the award. The award was a non -speaking and lumpsum one. The State filed an application for setting aside of the award which was heard by me on the above mentioned dates. Points urged before me: The award of the arbitrator was assailed before me on various grounds. However, the following points were principally urged before me to assail the award. (i) Once the final bill was paid and was accepted by the respondent in full and final settlement without any protest there could not have been any further claim on the contract which stood concluded upon payment of the final bill. (ii) The arbitrator travelled beyond the scope of reference and permitted the respondent to enlarge their claim which was originally lodged by the respondent. (iii) There were certain claims which were expressly prohibited under the contract even then the arbitrator entertained the same. (iv) There were excepted matters which were kept out of the purview of the arbitration. Those claims were entertained by the arbitrator. To support the award the following points were urged before me by the respondent: (i) The award was a lumpsum one and non -speaking too, hence judicial scrutiny was not permissible. (ii) There was no enlargement of claim as would be apparent on a comparative study of the original claim and the statement of claim. Hence, factually such plea was not tenable. iii) The reference was made without any intervention of Court. The parties invited the arbitrator to decide the Issues placed before him who was a Government nominee and his decision was final and blinding upon the parties more so, because of the reason that no objection whatsoever was raised by the State before the Arbitrator at any stage of reference. (iii) The respondent notified the claims well before the settlement of the Final bill and payment of final bill in Full and Final settlement could not operate as a bar to place their claim which was raised earlier. (v) The prohibitory clauses being clause 7 and 14 were related to war or any other like events and that too related to supply of materials whereas the claim was principally lodged on account of idle labour for delay on the part of the State to hand over the site and drawing. Hence, such clauses were not applicable in the instant Case and the arbitrator was free to decide the same as the Parties invited him to do it, (vi) Similarly on the issue 4 guarding changes, the State was not in a position to take possession of the building in question even though the same was completed within the extended time. Hence, the State was obliged to reimburse the respondent the cost of guarding charges of the said premises till the same was handed over to them. The parties invited the arbitrator to decide on the said issue. The State left the matter to the discretion of the arbitrator in course of hearing. Hence, the same could not be said to be an issue outside the scope of reference.
(2.) Cases cited before me. : The petitioner cited the following decisions: (i), 1994, Suppl 3 SCC 126 (M/s. P.K. Ramaiah & Co. as Chairman & Managing Director, National Thermal Power Corporation). (ii) : AIR 2002 SC 1272 (GM., Northern Railway vs. Sarvesh Chopra) (iii) : AIR 2000 SC 3185 (Union of India vs. Popular Builders ). (iv), 2005 1 CLT 566 (coal India Ltd. vs. Manish Traders). (v) : AIR 1977 SC 2014 (Orissa Mining Corporation ltd. vs. Prannath Bishwanath Railway). (vi) : AIR 1992 SC 1809 (Santosh Singh Arora vs. Union of India & Ors.). (vii), 1998 II, CLT 420 (State of West Bengal & Ors. vs. Chittadas Roy). (viii) : AIR 1999, SC 3275 (Steel Authority of India Ltd. vs. J.C. Budharaja, Government and Mining Contractor) (ix) My unreported decision in A.P. No. 297 of 2003 (Union of India vs. M/s. S.R. Ghosh). Respondent cited the following decisions: (i), 1999 6 SCC 1888 (H.I., Batra & Company vs. State of Haryana). (ii), 1999 Vol -IX, S.S.S. 249 (State of Orissa vs. Asis Ranjan Mohanty). (iii) : AIR 1963 SC 1677 (Smt. Santi Sila Devi vs. Dhirendra Nath Sen). (iv) : AIR 1965 SC 214 (Jivarajbhai Ujamshi Seth vs. Chittaman Rao Balaji) (v) : AIR 1974 SC 158 (D.V.C. vs. K.K. Kar) (vi) : 1982, 1. SCC 625 (M/s B.H.E. Ltd. vs. M/s. Amar Nath Bhan Prakash). vii) : AIR 1988 SC 1172 (Union of India vs. I.K. Ahuja). viii), 2000 (Suppl) ALR 458 (Jayesh Engineering vs. New India Assurance Co. Ltd.). ix) : 2004, 2, SCC 663 (Chairman & MD. N.T.P.C. Ltd. vs. Reshmi Construction). x) : AIR 1981 Cal 101 (Jiwani Engineering Works vs. Union of India). xi) : AIR 1997 Bom 284 (R.A. Deshmukh vs. C&I Development Corporation). xii), AIR 1984 NOC, 132 (Mehta & Co. vs. Union of India) xiii), AIR 1984 NOC, 266 (B.D. Chawla vs. Union of India) xiv), AIR 1982 Kar 50 (S.K. Konda Reddy vs. Union of India) xv) : AIR 1966 SC 1034 (V.R. Subramayam vs. B. Thayappa). xvi) : AIR 1996 SC 2853 (Board of Trustees for Port of Calcutta xvii) : AIR 2002 SC 1272 (GM. Northern Railway as. Sarvesh Chopra). xviii) : AIR 1989 SC 890 (Sudarsan Trading vs. Govt. of Kerala) xix) : 1992 4, SCC 217 (Hindustan Construction us. State of Jammu and Kashmir) xx) : AIR 1999, SC 2010 (Kundale & Associate vs. M/s. Konkan Hotels). xxi), 1999, 9, SCC 427 (M/s. Arosan Enterprise vs. Union of India). xxii), 1989 1 C.J. (S.C.) 399, (P.M. Pal vs. Union of India) xxiii), 2003 I, ALR 157 (Channa Brothers vs. Union of India). xxiv) : 1989 2 SCC 721 (Raipur Development vs. M/s. Chokhamal).
(3.) My decision mi the issues raised : Full and Final Settlement : The parties cited several decisions on this issue. I, however, wish to discuss about the latest decision in the case of NTPC Ltd. (Supra). Two Bench decision of the Apex Court presided over by then Chief Justice of India considered the issue after distinguishing earlier judgments of the Apex Court. Their Lordship framed a guideline to decide on this issue as set out in paragraph 39 of the said judgment which is quoted below : "39. The fact situation in the present case, would lead to the conclusion that the arbitration agreement subsists because : (i) Disputes as regards final arose prior to its acceptance thereof in view of the fact that the same was prepared by the respondent but was not agreed upon in its entirely by the appellant herein. (ii) The appellant has not pleaded that upon submission of the final bill by the respondent herein any negotiation or settlement took place as a result whereof the final bill, as prepared by the appellant, was accepted by the respondent unequivocally and without any reservation therefore. (iii) The respondent herein, immediately after receiving the payment of the final bill lodged its protest and reiterated its claims. (iv) Interpretation and/or application of Clause 52 of the agreement would constitute a dispute which would fall for consideration of the arbitrator. (v) The effect of the correspondences between the parties would need to be determined by the arbitrator, particularly as regards the claim of the respondent that the final bill was accepted by it without prejudice. (vi) The appellant never made out a case that any novation of the contract agreement took place or that the contract agreement. was substituted by a new agreement. Only in the event, a case of creation of new agreement is made out the question of challenging the same by the respondent would have arisen. (vii) The conduct of the appellant would show that in receipt of the notice of the respondent through its advocate dated 21 -12 -1991 the same was not rejected outright but existence of dispute was accepted and the matter was sought to be referred to arbitration. (via) Only when the clarificatory letter was issued the plea of settlement of final bill was raised. (ix) The finding of the High Court that a prima facie case, in the sense that there are triable issues before the arbitrator so as to invoke the provisions of Section; 20 of the Arbitration Act, 1940 cannot be said to be perverse or unreasonable so as to warrant interference in exercise of extraordinary jurisdiction under Article 136 of the Constitution of India. (x) The jurisdiction of the arbitrator under the 1940 Act although emanates from the reference, it is bite, that in a given situation the arbitrator can determine all questions of the and fact including the construction of the contract agreement. (xi) The cases cited by the learned counsel for the appellant would show that the decisions therein were rendered having regard to the finding of the fact that the contract agreement containing the arbitration clause was substituted by another agreement. Such a question has to be considered and determined in each individual case baring regard to the fact situation obtaining therein.;