Case Note & Summary
The dispute arose between the Goa, Daman and Diu Housing Board and the respondent concerning four contracts for the construction of tenements. The Housing Board terminated the contracts due to the respondent's failure to complete the work despite several extensions. Subsequently, the respondent sought arbitration, leading to the appointment of an Arbitrator who awarded claims exceeding Rs.8 lakhs in favor of the respondent. The Housing Board challenged these awards, alleging the Arbitrator's misconduct for not framing the main issue of abandonment of work and for failing to provide reasons for the awards. The Civil Court upheld the awards, but the High Court set aside this decision, remanding the awards back to the Arbitrator for reasons, citing a violation of clause 25 of the arbitration agreement. The Supreme Court, however, dismissed the appeals, stating that while the Arbitrator failed to provide reasons, there was no evidence of misconduct or bias. The Court emphasized that the Arbitrator had adequately considered the issues and upheld the awards, making them Rule of the Court.
Headnote
A) Arbitration Law - Misconduct of Arbitrator - Remittance of Award - Arbitration Act, 1940, Section 16 - The High Court found the Arbitrator guilty of misconduct for failing to provide reasons for the awards but did not establish any other misconduct or bias. The Supreme Court held that the High Court's decision to remit the awards for reasons was not warranted, as the Arbitrator had considered all issues and made findings with cogent reasons. The awards were upheld and made Rule of the Court. (Paras 710D-711A).
Issue of Consideration
Whether the High Court's remand of the awards to the Arbitrator for giving reasons was justified under the Arbitration Act, 1940.
Final Decision
The Supreme Court dismissed the appeals, upheld the awards made by the Arbitrator, and set aside the High Court's order remanding the awards for reasons.
Law Points
- Arbitration Act
- 1940
- Section 16
- Misconduct of Arbitrator
- Legality of Award
- Remittance of Award
Case Details
1991 LawText (SC) (09) 15
Civil Appeal Nos. 3236-39 of 1984
B.C. Ray, M.H. Kania, K.J. Shetty, L.M. Sharma, Jagdish Saran Verma
1991 AIR 2089, 1991 SCR (3) 904, 1991 SCC (4) 293, JT 1991 (3) 604, 1991 SCALE (2) 488
Ashok H. Desai, Ravinder Narain, Aditya Narain, Rajan Narain, S. Sukumaran, D.N. Mishra, Pallav Sishodia, G.L. Sanghi, S.K. Mehta, Dhruv Mehta, Aman Vachher
Goa, Daman and Diu Housing Board
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Nature of Litigation
Dispute regarding arbitration awards related to construction contracts.
Remedy Sought
The Housing Board sought to set aside the Arbitrator's awards.
Filing Reason
The respondent filed for arbitration after the Housing Board terminated the contracts.
Previous Decisions
The Civil Court upheld the awards, which were later set aside by the High Court.
Issues
Whether the High Court's remand of the awards was justified.
Whether the Arbitrator's failure to provide reasons constituted misconduct.
Submissions/Arguments
The appellant argued that the High Court should have set aside the awards instead of remanding them.
The respondent contended that the remand was appropriate under Section 16 of the Arbitration Act.
Ratio Decidendi
The Court held that the High Court's remand for reasons was unwarranted as there was no evidence of misconduct beyond the failure to provide reasons, and the Arbitrator had adequately considered the issues.
Judgment Excerpts
The High Court found the Arbitrator guilty of misconduct for failing to provide reasons for the awards but did not establish any other misconduct or bias.
The awards cannot under any circumstances be considered to be made by the Arbitrator without recording any reasons for the same.
Procedural History
The appellant filed a suit claiming damages, the respondent sought arbitration, the Arbitrator issued awards, the Civil Court upheld the awards, the High Court remanded the awards for reasons, and the Supreme Court dismissed the appeals.
Acts & Sections
- Arbitration Act, 1940: Section 16, Section 30
