N. CHELLAPPAN versus SECRETARY, KERALA STATE ELECTRICITY BOARD & ANOTHER

Citation: [1975] 2 S.C.R. 811 · Decided: 21-11-1974 · Supreme Court of India · Bench: A.N. RAY · Disposal: Appeal(s) allowed

Cited by 5 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
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811 
N. CHELLAPPAN 
v. 
SECRETARY, KERALA STATE ELECTRICITY BOARD & 
ANOTIIBR 
November 21, 1974 
[A. N. RAY, C.J.; K. K. MA.THEW AND N. L. UNTWALIA, JJ,J 
Arbitration Act-Error apparent 011 the face of the record-Allowing timr. 
harred claims w/1eiher amoullt ta error apparent on the face of the record-
Wh.~ther an umpire has.jurisdiction to enter upon the reference in case arbitrator.< 
fail to make an award within the specified time-Parties participatinl{, b,.fore 
the Sole Arbitrator without demur whether precluded from 
cha//e11g111g 
the 
judsdiction of the Arbitrator by acquiescence. 
The appellant wa~ a contractor entrusted to construct a Dam by the Kerala 
State ElectriCity Board. Disputes arose b:tween the appeUant and the respon-
dent about the non-execution of the work: 5 points were referred for the deci-
sion of 2 arbitrators. The arbitrators appointed an Umpire. The Arbitrator did 
not make the award within the time limit which was extended from ·time to time. 
Thereupon the appeua·nt filed an application for revoking the authority of the 
arbitrators on the ground that the arbitrators did not make the award within the 
time limit and it was further prayed that the Umpire might be directed to enter 
upon the reference to proceed with the arbitration. One of the arbitrators in 
his statement submitted that he had no objection to his being discharged as he 
no longer wished to be an arbitrator. The appellant also filed anotlier applica-
tion praying to appoint the Umpire as a Sole. Arbitrator in place of the two arbi-
trators. The Court by its order dated the 22nd June, 1972 revoked the authority 
of the arbitrators and directed the Umpire to enter upon the reference in his capa-
city as Umpire and also appointed the Umpire as the sole arbitrator. The trial 
court noted in its ord~r that the Umoire was directed to make the award by con-
sent of parties, The appellant and the respQndent participated in the proceedings 
before the Umpire without demur. The Umpire made an award in favour of the 
· appellant for nearly Rs. 30 lacs. The respondent filed an aisplication challenging 
the awa~d under sections l6, 30 and 33 of the Arbitration Act and praying to set 
11slde the award. The appellant field an application to pass a decree in terms of 
the award. The Trial Court· dismissed the application filed by the respondent and 
passed decree in terms of the award. 
· 
On an appeal filed by the respondent, the High Court came to the conclusion 
that the Umpire as sole arbitrator had no jurisdiction to pass the award as the 
orders revoking the authority of the arbitrators lo pass an award and appointing 
the Umpire ns sole Arbitrator was bad in law and· that no sufficient opportunity 
was given to the respondent to substantiate its objections to the award. 
On appeal 'by special leave it was contended by the respondent before this 
Court that the Umpire as sole Arbitrator had no jurisdiction to enter upon the 
reference and pass the award. It was also contended that the Umpire has allow-
ed certain time barred claims of the appellant without examining the grievences 
of the claims. 
Allowing the appeal, 
HELD : Since the order was passed by the consent of the parties the Umpire 
had the jurisdiction. Even apart from the consent of the parties rule 4 in the 
First Schedule to the Arbitration Act authorities the Umpire to enter upon the 
reference in case arbitrators fail to make award within the time specified. The 
Umpire did not lose his jurisdiction to pass the award merely because he wanted 
nn order from court bv way of abundan! ca:ution au.thorising him to enter upon 
the reference. [818E-GJ 
· 
HELD FURTHER : There is no doubt that the order was consent orucr. The 
respondent made no endeavour to have that order vacated by filing a review, if the 
statement in that order that it was passed on the basis of consent proceeded on a 
812 
SUPREME COURT REPORTS 
(1975] 2 s.c.R. 
mistake of die court. On the other hand respondent participated in the proceed-
iags before the. Umpire. The respondent is precluded from challenging the juds· 
diction of the Umpire by acquiescence. 
[817G-H] 
HELD FURTHER : Negativing the contention that the Umpire should have 
examined the genuineness of the claims and whether the claims were time-barred. 
In the award the Umpire has referred to the claims under this head and the argn-
menl~ of the respondent for disallowing the claim and thereafter awarded t.he 
amou

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