Arbitration Act, 1940 - Power of the Arbitrator to award pendente lite interest when contract contains bar for grant of
interest in a case covered by the Arbitration Act, 1940 -In our opinion, it would depend upon the nature of the ouster clause in each case
-In case there is express stipulation which debars pendente lite interest, obviously, it cannot be
granted by Arbitrator - The award of pendente lite interest inter alia must depend upon the overall intention of the agreement and what is expressly excluded - Thus, our answer to the
reference is that if contract expressly bars award of interest pendente lite, the same cannot be awarded by the Arbitrator - Also make it clear that the bar to award interest on delayed
payment by itself will not be readily inferred as express bar to award interest pendente lite by the Arbitral Tribunal, as ouster of power of Arbitrator has to be considered on various
relevant aspects referred to in the decisions of this Court. Held, The decision in Madnani Construction Corporation (2010) 1 SCC 549, has followed decision in Engineers-De-Space-Age, (1996) 1
SCC 516. Same is also required to be diluted to the extent that express stipulation under contract may debar the Arbitrator from awarding interest pendente lite. Grant of pendente lite
interest may depend upon several factors such as phraseology used in the agreement, clauses conferring power relating to arbitration, nature of claim and dispute referred to Arbitrator and on
what items power to award interest has been taken away and for which period. (2016)3 P.L.R.SC 493
Arbitration Act, 1940 (10 of 1940) - Arbitration and Conciliation Act, 1996 (26 of 1996) - Award
made under 1940 Act - Set aside - Award made thereafter under the coming into force of 1996 Act - Whether award under 1996 Act coming within the purview of the 1940 Act or the arbitration
resulting in award dated 11.02.2005 would be treated as fresh proceedings coming within the net of the1996 Act - Matter referred to larger bench. (173) P.L.R.
Arbitration Act, 1940 (10 of 1940) - Award - In the terms of the contract as spelt out through the
general instructions to be observed by the tenderers and the subsequent supply specifications, there are no references to knowledge as having been attributed to the petitioner that the
Electricity Board was actually looking to claim some subsidies which it had lost by the non-fulfillment of the contract by the petitioner - Claim to subsidy that was said to have been lost
and making it a part of the entitlement of the Electricity Board was not in the contemplation of the parties nor was it even suggested that if there was a dispute, the said aspect would
require to be also considered - I will, therefore, hold that the Arbitrator misconducted himself in so far as he provided also for a claim for a subsidy that was said to have been lost.(181)
Arbitration Act, 1940 (10 of 1940) S. 11(c) - There was also an objection that as per the
contractual term 11(c), there was no scope for claiming any enhancement of rates for delay in completion of work even if it had arisen on account of some factors contributed by the union -
Plea rejected - Order upheld.(181) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 14, 17 - Objection to an award - Made rule of the Court -
Jurisdiction - Loathe to interfere on an issue of jurisdiction for an arbitral award unless substantial prejudice is shown-The Union which had able assistance for representation throughout India ought to have taken the
issue of jurisdiction as a preliminary objection and got it transferred to the proper court of jurisdiction - I will not find this to be as appropriate and adequate ground for consideration
in revision. (181) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 20 - Civil Procedure Code, 1908 (V of 1908) Order 1 Rule 10
- Even in the absence of a specific reference to party to the arbitration agreement, the manner in which the rights of the parties have been dealt with as possible to be enforced through
Section 20 and other provisions of the 1940 Act leave no doubt that a person, who was not a party, could not have been brought on record. (173) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 20 - Contractor, having signed the final bill and `No claim
certificate' - Contractor had to sign the final bill and `No Claim Certificate' to receive the amount, which the petitioners themselves admitted to be due to the Contractor - If the
Contractor had not signed final bill and `No Claim Certificate', even the said amount, which was admitted to be due to the respondent, would not have been paid to him - However, after signing
the bill and the Certificate aforesaid, the Contractor lodged his protest - Dispute has been rightly ordered to be referred to the Arbitrator by the Court. (174) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 20 - Petitioner had accepted the final bill with endorsement
"no further claim" without any reservation - Once the final bill is signed with "no further claims" certificate, further claims are not arbitrable as after signing the final bill without any
protest or reservation, the contractor waives of his right to make further claims. (176) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 21 - A pre-emption decree was passed in favour of the
respondents - During the pendency of the appeal both the parties entered into an agreement at their own for the purpose of referring the dispute to the Arbitrator - The parties had no
jurisdiction to refer the matter to the Arbitrator as the reference could have only be made through the Court. (176) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 28 - Enlargement of time for making award - It shall become
possible for the parties during the course of the arbitral proceedings to consent for enlarging the time for making theaward - The parties have indeed given a written consent - There was therefore no bar of limitation
and the objection taken by the Corporation on this score is not tenable. (173) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 30, 33 - Awarding of liquidated damages - Surely losses
which are caused to an Airline on account of a Pilot leaving before the contractual period has various ramifications of which the cost of the training is only but one aspect - Therefore, in
such cases, once the actual damages which are caused to the Airline, cannot be exactly calculated and proved, then, there is no illegality in awarding fixed/liquidated damages as specified in
the contract and which in the facts of the present case thus would not be in the nature of penalty as specified in Section 74 of the Indian Contract Act, 1872 (1 of 1872). (174) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 30, 34 - Misconduct - As has been laid down, does not always
have a moral connotation - To elaborate, it may not have any connection with the individual/personal conduct of the arbitrator - The said conduct would be in sphere of moral misconduct - As
far as legal misconduct is concerned, as the authorities would demonstrate, the same must be manifest or palpable from the proceedings before the arbitrator - To substantiate a stance of
legal misconduct on the part of the arbitrator, examination of any witness in court is impermissible. Held, that misconduct as has been laid down, does not always have a moral connotation. To
elaborate, it may not have any connection with the individual/personal conduct of the arbitrator. The said conduct would be in sphere of moral misconduct. As far as legal misconduct is
concerned, as the authorities would demonstrate, the same must be manifest or palpable from the proceedings before the arbitrator. To elaborate, a person urging the ground of legal misconduct
has to satisfy the court from the records of the arbitral proceedings that there has been a legal misconduct on the part of the arbitrator as a consequence of which the award gets vitiated.
The question of adducing any kind of oral evidence to substantiate the plea or stand or stance does not arise. It has to be shown from the proceedings carried on before the arbitrator and the
evidence adduced before the arbitrator. Evidence cannot be adduced in court to substantiate the challenge on the score of legal misconduct. Held, further, that to substantiate a stance of
legal misconduct on the part of the arbitrator, examination of any witness in court is impermissible. It is because it must be palpable from the proceedings and the learned single Judge has
already directed that the proceedings before the arbitrator to be requisitioned by the civil court. Least to say, it will be open for the respondent to establish the ground of legal
misconduct from the arbitral proceedings. (S.C.) (183) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 34 - Arbitration and Conciliation Act, 1996 (26 of 1996) S.
85 - Proceedings under the 1940 Act - Challenging of the award - Petition which was under Section 34 of the 1996 Act, has definitively been held not to be maintainable because the 1996 Act
would not apply and it was the 1940 Act which would apply - Award was made a rule of the Court under the 1940 Act, it could not be objected to under Section 34 of the 1996 Act - The
objections or remedies would have been under the 1940 Act itself either under Sections 30/33 of the 1940 Act. (180) P.L.R. (Del.)
Arbitration Act, 1940 (10 of 1940) S. 34 - Arbitrator himself had no power to rewrite a policy for
the Corporation or make possible a compulsory recognition of a transfer of allotment made by the original allottee to another person without express orders of concurrence by the Corporation -
Public bodies are run on trust by people that they are governed by pre-set rules and regulations - Discretion, wherever they exist ,must stay confined to areas which expressly permit the
exercise of discretion - They shall be on matters of day-to-day administration and cannot be on issues of policy - Punjab Small Industries and Export Corporation. (173) P.L.R.
Arbitration Act, 1940 (10 of 1940) S. 41 - Since Section 41 of the 1940 Act allows for the
provisions of the Civil Procedure Code to apply to all proceedings and on all appeals under the Act - The provision under Section 105 of the Civil Procedure Code must be taken as incorporated
under the 1940 Act -Section 105 of the Civil Procedure Code allows for a party to urge as a ground of appeal also the
correctness of the order passed at the interlocutory stage- Civil Procedure Code, 1908 (V of 1908) S. 105. (173) P.L.R.
Arbitration Act, 1940 (10 of 1940) Section 14, 17 – Arbitrator had distributed the properties owned by various members of the family in present - The rights were
being created through the arbitration award for the first time - In such circumstances, the arbitration award was required to be registered under Section 17 of the Indian Registration Act, 1908
(16 of 1908) – Even in the case of a deed of the family settlement dealing with the immovable properties, if a deed of the family settlement is reduced into writing and it is dealing with the
properties in presenti, the same is required to be registered – Cannot be made rule of the Court. (2018-1) PUNJAB LAW REPORTER