JIWANI ENGINEERING WORKS P LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is an application for setting aside an award under Sections 30 and 33 of the Arbitration Act.

(2.) PURSUANT to a contract for execution of earth work in formation, bridge work, building and other miscellaneous works, a tender was called by the Union of India represented by the South Eastern Railway, and the petitioner's tender was accepted on the 17th of April, 1964, and a formal con-tract was entered into being dated 21st may, 1964.

(3.) MR. D. K. Sen with MR. P. K. Sen appeared for the petitioner and challenged the award mainly on two grounds; firstly, that the respondent, the award holder, has executed a no claim certificate which is annexure 'A' to the petition and, therefore, he is not entitled to any claim in the reference as he has mentioned specifically in no unequivocal terms that there was no dispute or difference relating to the agreement contained in the arbitration clause in the arbitration agreement. He submitted that on the basis of the said no claim certificate the order of reference and the award become a nullity as the arbitrator has no jurisdiction to enter into the reference and as there was no difference or dispute between the parties arising out of the said contract. But I am afraid the same cannot be accepted as whether there was no claim certificate or not that itself is a dispute which was referred to arbitration and covered under the arbitration clause in the agreement as it is for the arbitrators to decide such question. The said point was taken by the Union of India in so many arbitrations which were couched in the same language and it is so well known and a notorious fact that unless a no claim certificate is issued by the contractor payment of the final bill will not be made. But that does not prevent the contractor from raising his claim before the arbitrator in terms of the arbitration clause for the value of his work or other claims within the scope of the agreement between the parties. The said question came up before this Court from time to time and in one of the unreported decisions of the appeal Court in Award Case No. 124 of 1978 (Union of India v. D. Bosc) of C. J. and S. C. Ghose, J. dated 15th Feb., 1980 (), the same contention of MR. P. K. Sen, who is appearing before me, as to the no claim certificate, has been rejected and, therefore, in my view, there is no substance in the said contention. MR. Sen thereafter referred to Clause 16 (2) of the Contract which disentitled the respondent award holder from any interest. But, in my view, that clause docs not prevent the arbitrator from granting pendente lite interest on the claim adjudicated by the arbitrators in the reference before them. In this case the arbitrator has awarded interest from, the date of entering upon the reference being 18th Nov., 1976, till the date of the publication of the award which, it is now well settled, that the arbitrator has power to grant pendente lite interest by a series of Supreme Court decisions starting from Tharwardas Pherumal v. Union of India, Union of India v. Bungo Steel Furniture, and State of Madhya Pradesh v. Smith and Skelton. MR. Sea referred to a decision of Sir Ashu-tosh Mukherjee in (1920) 32 Cal LJ 239: (AIR 1920 Cal 737) in J. W. Crewdson v. Ganeshdas Hari Bus, wherein it was held that Court has no jurisdiction to grant pendente lite interest on damages i. e., on unascertained sum or unliquidated damages but it was held in that decision that Court has power to grant pendente lite interest on ascertained sum and, therefore, the said decision is not really helping MR. Sen in any way whatsoever. This is a claim of a contractor for the value of the work done under a contract and the award has ascertained the amount and granted interest pendente lite i. e., from the date of entering upon the reference till the award, which jurisdiction the arbitrator has and the said principle is now well settled by the series of Supreme Court decisions and various decisions of this Court. Those being the two grounds of attack on the award MR. Sen on behalf of the petitioner Union of India submitted that the award should be set aside.