HARYANA ENGINEERING AND FOUNDERY WORKS Vs. UNION OF INDIA

JUDGEMENT

(1.) By this order I propose to dispose of O.M.P. No. 359/85 filed by M/s. Haryana Engineering & Foundry Works under Sections 33 & 40 of the Arbitration Act against Union of India as respondent No 1 and Shri Shyam Jee Singhal, sole arbitrator, as respondent No. 2. In this petition it has been prayed that 'this Hon'ble Court may be pleased to determine the scope of the arbitration proceedings and be specifically pleased to declare that the arbitrator is bound to consider the counter-claims raised by the petitioner in the arbitration proceedings and the award to be made shall also take into account the said counter-claims'. This application has been opposed on behalf of the Union of India. The parties have filed affidavits in support of the application and the reply and no other evidence has been led by the parties. Even otherwise all the facts leading to this application are admitted between the parties and consequently, no other evidence was necessary and needed.

(2.) I have heard the learned counsel for the parties and have gone through the file and after giving my considered thought to the matter before me, I have come to the following findings.

(3.) The facts giving rise to this application are that the petitioner entered into an agreement with respondent No. 1. Union of India through the Department of Railways and in pursuance thereof purchase order No. 211 S/ l03/TSO dated 30th September l978 was placed upon the petitioner and when part of the supplies had been made there under by the petitioner, the said contract was rescinded by respondent No. 1 and respondent No. 1 thereafter proceeded with risk purchase against the petitioner. It was under these circumstances that the petitioner filed an application under Section 20 of the Arbitration Act in the court of Senior Sub-Judge, Ambala, but on the representation of respondent No. 1 made vide letter No. 211/S/163/TSO dated 20th May, 1983 (annexure 'P2') the said application was withdrawn by the petitioner and thereafter the matter in dispute between the parties was referred to the arbitration of respondent No.2 vide letter No, 211/S/163/TSO dated 30th May, 1983 (annexure 'P3'). After the arbitrator had entered upon reference, the petitioner filed its statement of claim (annexure 'P4') and when it was insisted by the petitioner upon the arbitrator that the claim of the petitioner be also adjudicated upon, the arbitrator directed vide order dated 28th August, 1985 (annexure 'P7') that 'the arbitrator will consider matters only referred to him in the term of reference', which has led the petitioner to file this petition. The contendtion of the petitioner is that the arbitrator should be categorically told to adjudicate upon the entire matter in dispute including the claim of the petitioner. These facts have not been disputed by the respondent but it is contended that the order of reference relates only to the claim arising out of risk purchase and as such the arbitrator cannot be directed to take into account the claim of the petitioner.