UNION OF INDIA Vs. MAHESHWARI BUILDERS
LAWS(RAJ)-2005-4-8
HIGH COURT OF RAJASTHAN
Decided on April 19,2005

UNION OF INDIA Appellant
VERSUS
MAHESHWARI BUILDERS Respondents

JUDGEMENT

TATIA, J. - (1.) HEARD learned counsel for the parties.
(2.) THE facts in brief are that there is a work contract between the respondent No. 1 and petitioner for construction of MD Accommodation (Quarters) for which contract agreement C. E. /btz- 12/90-91 was executed between the parties. Some dispute arose between the parties and ultimately, the respondent No. 1 had to move an application under Section 11 of Arbitration and Conciliation Act, 1996 (for short `the Act') before this Court which was registered as Arbitration Application No. 28/2004. This Court vide order dated 27. 5. 2004 appointed Hon'ble Justice Shri D. N. Joshi (Retd.) as sole arbitrator. However, while appointing Arbitrator, it was specifically observed that the objections with regard to appointment of arbitrator or the validity of reference to the arbitrator or the maintainability of the arbitration proceedings may be raised before the arbitrator but since the conditions requisite for invoking the powers under Section 11 has been satisfied, therefore, this Court appointed arbitrator. The petitioner not satisfied with the order dated 27. 5. 2004 submitted an application for recalling the same. That application (SB Civil Misc. Application No. 57/2004) was decided by the learned Designated Judge of this Court vide order dated 27. 8. 2004 by observing that the objection as to the authority to act as an arbitrator shall be raised before the Arbitrator under Section 11 and it is to be decided by the arbitrator. After obtaining this order, the petitioner submitted preliminary objections before the arbitrator, copy of which is placed as Annex. 7. The arbitrator, after considering the interim order passed by Hon'ble Supreme Court in SLP No. 1380/2003 rejected the petitioner's objection about the authority to act as arbitrator, therefore, the petitioner has preferred this writ petition challenging the order of arbitrator dated 16. 10. 2004 and the order dated 27. 10. 2004 passed by District Judge under the Act of 1996. According to learned counsel for the petitioner, exactly identical controversy was before the Delhi High Court in the case of UOI & Anr. vs. M/s. J. R. C. Grid Engineers P. Ltd. (1), and the Delhi High Court vide order dated 26. 7. 2002 rejected the contention which was raised by UOI in that case and this objection raised by the petitioner before the Arbitrator. However, the Hon'ble Supreme Court in SLP stayed the order dated 26. 7. 2002 of Delhi High Court. According to learned counsel for the petitioner, as per Clause 70 of the agreement, the arbitrator could have been appointed only an Engineer Officer and none else can be appointed arbitrator. The relevant portion of Clause 70 of the arbitration agreement reads as under:- " 70. Arbitration:-All disputes, between the parties to the Contract (other than those for which the decision of the C. W. E. or any other person is by the Contract expressed to be final and binding shall after written notice by either party to the Contract to the other of them, be referred to the sole arbitration of an Engineer Officer to be appointed by the authority mentioned in the tender documents. "
(3.) ACCORDING to learned counsel for the petitioner as per Section 11 (8) (a) of the Act of 1996, the arbitrator can be appointed who is qualified to be appointed and for that purpose, due regard is required to be given to the qualifications required of arbitrator and as provided in agreement of the parties. In view of the above, according to learned counsel for the petitioner, the arbitrator committed error of law by wrong interpretation of clause 70 of the arbitration agreement and further committed error of law in interpreting Section 11 (8) (a) of the Act of 1996. According to learned counsel for the respondent No. 1, all objections about competence of the arbiter tribunal and about its jurisdiction can be raised before the arbitrator and that has been raised by the petitioner after the orders passed by the learned designated judge of this Court dated 27. 5. 2004 and 27. 8. 2004. ;


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