Sen, J. - (1.) THIS is an appeal against the judgment and order passed by Salil K. Roy Chowdhury, J. on the 15th Nov. 1973. By his order the learned Judge dismissed, for reasons recorded in the judgment, the application made, by the appellant for setting aside an award dated the 28th June, 1971 and also for a declaration that the order dated the 21st Feb. 1961 is invalid, without jurisdiction and of no effect.
(2.) THE facts of the case have been fully and correctly set out in the judgment of the learned trial Judge. THE facts material for the purpose of the appeal may be briefly stated. THE appellant is a building contractor and entered into an agreement dated the 11th April, 1962 with the Union of India for various construction works in and/or of the railway station building at Durgapur. THE said agreement contains an arbitration clause. THE relevant portion of the said clause reads as follows: "Clause 63 (3) (a) Arbitration. Matters in question, dispute or difference to be arbitrated upon shall be referred for decision to..................... (ii) Two arbitrators, who shall be Gazetted Railway Officers of equal status to be appointed in the manner laid down in Clause (3) (b) for all claims of Rs. 50,000/-and above, end for all clainig irrespective of the amount or value of such claims if the issues involved are of a complicated nature. THE General Manager shall be the sole judge to decide whether the issues are of a complicated nature or not. In the event of the two Arbitrators being divided in their opinions the matter under dispute will be referred to an Umpire to be appointed in the manner laid down in Clause (3) (b) for his decision. Clause 63 (3) (b): For the purpose of appointing two arbitrators as referred to in Sub-Clause (a) (ii) above, the Railway will send a panel of more than three names of officers of the appropriate status of different Departments of the Railway to the contractors, who will be asked to suggest a panel of three names out of the list so sent by the Railway. THE General Manager will appoint one arbitrator out of this panel es the contractor's nominee and then appoint a second arbitrator of equal status as the Railway's nominee either from the panel or from outside the panel, ensuring that one of the two arbitrators so nominated is invariably from the Accounts Department. Before entering into reference the two Arbitrators shall nominate an Umpire to whom the case will be referred in the event of any difference between the two Arbitrators." It appears that disputes arose between the parties. The appellant made various claims against the Union n respect of works done and the said claims were disputed by the Union. The appellant had called upon the Union of India to have the said dispute adjudicated upon by arbitration in terms of the arbitration agreement and had asked for appointment of arbitrators in terms of the agreement between the parties. The appellant ultimately made an application on the 29th Nov. 1965 to this Court under Section 8 of the Arbitration Act for the appointment of arbitrators. On the said application an order was passed by Mallick J. on the 21st Feb. 1966 and the material part of the said order reads as follows: "It is ordered that all matter in difference between the parties hereto including the question of the costs and of the reference hereby directed be referred to the arbitration of Mr. K. Ramani Office on Special Duty, South Eastern Railway, Garden Reach and Mr. K. C. Bose, Deputy Financial Adviser, Eastern Railway who are hereby appointed Joint Arbitrators under Section 8 of the Arbitration Act, 1940 read with Clause 63 of the Eastern Railway Engineering Department General Condition of Contract in the said petition mentioned. And it is further, ordered that the said arbitrators do make their award in writing and submit the same to this Court together with all proceedings had, deposition recorded and exhibits filed before them within four month from the date of service on them of an office copy of this order. And it is further ordered that in case of difference of opinion between the said arbitrators the matter involving such difference be referred to the decision of an umpire to be nominated by the said arbitrators before they take up such, reference who, in the event of a reference being made to him shall make his award in writing and shall submit the same in the like manner to this Court within four months from the date of such reference to him. And it is further ordered that the said arbitrators or the umpire as the case may be, be at liberty to examine the parties and their witness upon oath or solemn affirmation which they are hereby empowered to administer. And it is further ordered that the said arbitrators or the umpire as the case may be shall have such powers as are vested in an arbitrator under the provisions of the Arbitration Act, 1940. And it is further ordered that the said arbitrators shall enter upon and proceed with the reference on the copy of minutes of this order signed by the officer of this Court being shown to them. And it is further ordered that the costs of and incidental to this application be costs in the arbitration proceedings herein."
(3.) IT may be noted that the validity of this order has been challenged in this proceeding. After the said order had been passed, joint arbitrators appointed by the said order entered upon the reference and the parties filed their statements and counter-statements Before them. In or about December, 1966 the appellant made an application before the Court, inter alia, for removal of the said arbitrators and for revocation of the arbitration agreement. The said application, however, was subsequently withdrawn on the 7th May, 1968. IT has been alleged that the said application was withdrawn by the appellant as he had been assured that his claim would be settled departmentally. On the 6th Jan. 1970 a letter was addressed by the Solicitor for the appellant to the Solicitor of the Central Government at Calcutta and in this letter the fact of withdrawal of the application by the appellant had been mentioned. In this letter it was also alleged that the joint arbitrators could not act as one of the arbitrators had then become the Chief Engineer and in this letter the railway administration was asked to decide the claim of the appellant departmentally without going into the formalities of fresh arbitration proceedings. This letter and the reply which was sent by the Solicitor to the Central Government on the 8th May, 1970 have both been set out by the learned trial Judge in his judgment. From the reply it appears that the Union had no objection to an arbitrator being appointed through Court in terms of the agreement but the Union was not agreeable to have the claim of the appellant decided by the railways departmentally. Various applications were thereafter made before the Court for extension of time to make the award by the arbitrators and the last order was passed by Salil K. Roy Chowdhury J. extending the time to make the award till the 30th June, 1971. The said award was duly made and published within the extended period. IT has been stated in the petition that the said award was filed in his Court on the 22nd June, 1972. The claim of the appellant in dispute is said to be over Rs. 17 lakhs and under the award the arbitrators awarded the appellant a sum of Rs. 37,230/-. The validity of the said award has been questioned by the appellant in this proceeding. The grounds on which the said award has been impeached are set out in para 42 of the petition and the main prayers of the appellant in the petition are that 'the said purported Award dated 28th June 1971 be set aside and/or be declared null and void' and 'that it be declared that the said order dated 21st Feb. 1961 is invalid without jurisdiction and of no effect.';