RAMACHANDRA REDDY AND CO. versus STATE OF ANDHRA PRADESH AND ORS.

Citation: [2001] 2 S.C.R. 186 · Decided: 27-02-2001 · Supreme Court of India · Bench: G.B. PATTANAIK

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
RAMACHANDRA REDDY AND CO. 
v. 
STATE OF ANDHRA PRADESH AND ORS. 
FEBRUARY27, 2001 
B 
[G.B. PATTANAIK, U,C. BANERJEE, BRIJESH KUMAR, JJ.] 
c 
D 
E 
The ArbitraJion Act, 1940 : 
Section 16-Remission of award-Power of Court-Discretionary-Ex-
ercise of-When-Held, when there are omissions and defects in the award 
which cannot be modifiedorcon~cted-Appella!e Court---lnterference-When-
Held, when discretion misused by Trial Court. 
Sections 16, SO and 33-Award-lnterference-Envr apparent on the 
face of award-Meaning of-Held, when basis of award erroneous Courts not 
to investigate beyond aivard of arbitrators and documents actually incorpo-
raJed therein for purpose of finding out any alleged envr. 
Contractor seeking higher rate for extra quantity of work-Agreement 
not providing for escalated rate either expressly or imp/i,dly---Competent 
Authority granting extension of time but specifically intimating it will not make 
contractor eligible for extra claim-Whether contractor entitled to higher 
rate-Held, contractor not entitled to higher rate for additional excavation 
work-Arbitrator being creature of agreement, cannot pass award beyond 
tenns of agreement. 
Appellant-Claimant was awarded excavation work under a contract 
p 
by respondent. Dispute arose between parties which was referred to panel 
of arbitrators which rejected claim item Nos. 1, 2 and 3 while allowing 
claim item nos. 4 and 5. Claim Item No. 1 relates to increase in quantity of 
hard rock abnormally and appellant claimed Rs. 93,76,000 for such extra 
excavation. Claimant filed objection in the Civil Court under Section 16 of 
the Arbitration Act, 1940 against award of arbitrators rejecting claim 
G 
item Nos. 1, 2 and 3. Trial Court set aside award in relation to claim item 
No. 1 and some others and remitted the same for reconsideration to panel 
of arbitrators. Against the judgment of Trial Court, respondent preferred 
appeal under Section 39 which was allowed by the High Court in so far as 
it related to remitting claim item no. l while upholding other directions of 
H 
the Trial Court. Aggrieved by the judgment of High Court, claimant-
186 
RAMACHANDRA REDDY v. STATE 
187 
contractor has filed the present appeal. 
Appellant contended that High Court committed serious error in 
re(erring to clause 59 as well as letters dated 15.7.1980 and 19.5.1983 while 
refusing payment at higher rate for additional excavation work; that 
arbitrators committed error apparent on the face of award;· that payment 
at higher rate for additional excavation was implied in view of recommen-
dations of Executive Engineer; and that contractor was entitled to he paid 
at higher rate for additional excavation in accordance with Clause 63 of· 
-t 
the agreement. 
A 
B 
Respondent contended that the award did not contain any error 
C 
apparent on the face of it; that contention regarding payment at higher 
rate for additional excavation under clause 63 of the agreement was raised 
for the first time and should not he allowed to be raised and alternatively, 
that Clause 63 has no application for additional excavation since it applies 
only to supplemental items and additional excavation is not a si;pplemen-
tal item; that claim for payment at higher rate for additional e:<cavation 
D 
was not sustainable in view of letters of respondent dated 15.7.1980 and 
· 19.5.1983 while allowing extension of time for completion of work; and 
that judgment of Trial Court tantamounts to gross error of jurisdiction in 
interfering with an award as ·no reasons have been given for remitting 
claim item Nos. 1, 2 and 3 for reconsideration. 
E 
Dismissing the appeal, the Court 
HELD : I.I. Under the Arbitration Act, Section 16 is the provision 
under which the Court may remit the award for reconsideration of an 
arbitration and necessity for remitting the award arises when there are 
F 
omissions and defects in the award, which cannot he modified or cor-
rected. Remission of an award is in the discretion of the Court and the 
powers of the Court are circumscribed by the provisions of Section 16 
itself. Ordinarily, therefore, a Court may be justified. in remitting the 
matter if the arbitrator leaves any of the matters undetermined or a part 
of the matter which had not been referred to and answered and that part 
cannot be separated from the remaining part, without affecting the deci-
sion on the matter, which was referred to arbitration or the award is so 
indefinite and incapable of execut

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