PARADIP PORT TRUST AND ORS. ETC. versus UNIQUE BUILDERS ETC.

Citation: [2001] 1 S.C.R. 668 · Decided: 30-01-2001 · Supreme Court of India · Bench: S. RAJENDRA BABU · Disposal: Case Partly allowed

Judgment (excerpt)

A 
PARADIP PORT TRUST AND ORS. ETC. 
v. 
UNIQUE BUILDERS ETC. 
JANUARY 30, 200 I 
B 
[S. RAJENDRA BABU AND SHIVARAJ V. PATIL. JJ.] 
Arbitration: 
Arbitration Act, 1940--Sections 30, 33-Claims-Award of-Arbitrator 
C awarding a lump sum award and not separate award for each claim-· 
Contention that award was beyond the scope of arbitration agreement as ii 
could not be made in respect of certain claims-Tenability of-Held, it is not 
possible to say uhether the Arbitrator awarded any amount under the claims 
alleged to be olllside the scope of arbitration clause when the award was 
D made in lump sum-There is nothing to show that the award passed by the 
Arbitrator was beyond the scope of either the arbitration clause or the terms 
of the contract or it was iiz excess or opposed to the terms of reference-
Arbitrator not bound to give a separate award for each claim-lump sum 
award, held, not bad per se. 
.'/I' 
E 
Arbitration Award-Amenability to Court's jurisdiction--Scope a/-
Held, the arbitrator's award is final both on facts as well as law and can be 
set aside only in situations specified in Sections 30 and 33 of the Arbitration 
Act. 
Interest-Future interest--Grant of-Held, just and appropriate in the 
F facts and circumstances of the case. 
Administrative law: 
Principles of Natural Justice-Compliance of-Parties not leading any 
oral evidence and re~ving only on the correopondence between them-Held, 
G contents of award clearly indicating that fair and sufficient opportunity was 
given to parties by !he Arbitrator-·No violation of Principles of Natural 
Justice. 
Appellant-Trust entered into an agreement with respondent-Company 
H 
for sale of scrap. Certain disputes arose between the parties which were 
668 
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1 
P/\RADll' PORTTRlJSTv. lJNIQUE BUILDERS 
669 
referred to an arbitrator pursuant to the arbitration clause contain.ed in the A 
--.i--
said agreement. B, an advocate, was appointed as Arbitrator. He entered into 
reference and after conducting the proceedings passed an award to the effect 
that the Company was entitled to receive a sum of Rs. 8,51,315 together with 
interest@ 18 per cent per annum from the Trust. The parties did not lead 
any oral evidence before the Arbitrator and relied only on the correspondence B 
between them. The award passed by the Arbitrator did not contain any reasons 
and was a non-speaking one. The Court of Subordinate Judge, on receipt of 
the award, issued notices to the parties. The Trust filed objections challenging 
the award on various grounds which were upheld and award was set aside. 
Aggrieved, the Company filed a Miscellaneous Appeal before the High Court. 
The High Court allowed the appeal and made the award a rule of the court C 
subject to the modification as to the award of interest as indicated in the 
order. Hence the appeal by the Trust. The other appeal has been preferred by 
_..,,,-
the Company challenging the aforesaid order to the extent it was denied 
interest. 
. ,.--
On behalf of the appellant-Trust, it was contended that the award had D 
been passed in violation of principles of natural justice inasmuch as cer~ain 
documents were received without notice to the Trust, after the closing of the 
proceedings before the Arbitrator and thereafter the award was passed; that 
the award passed by the Arbitrator was beyond the scope of the arbitration 
agreement, as it could not be made in respect of certain claims; that although 
recording of reasons in the award could not be insisted and on that account 
itself, award could not be vitiated, yet no award could be passed arbitrarily. 
On behalf of the respondent-Company, it was contended that there was 
no justification for the High Court to deny pendente lite and future interest. 
Dismissing the appeal filed by the trust and partly allowing the appeal 
filed by the Company in regard to the payment of interest, the Court 
HELD : I. The claims made in the statement by the Company are clearly 
covered by the arbitration clause in the agreement and they fall within the 
E 
F 
scope of arbitration clause. The contention that some of the claims were G 
outside the terms of agreement, cannot be upheld. It is an award made in 
lump sum. It is not possible to read the mental process of the Arbitrator as to 
how he came to the conclusion in passing the award for lump sum amount. 
further the award passed by the Arbitrator cannot be set aside assuming 
that another view is possible. Thus, it can111;1t be held that the 

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