STATE OF ORISSA AND OTHERS versus CONSTRUCTION INDIA

Citation: [1988] 2 S.C.R. 145 · Decided: 04-12-1987 · Supreme Court of India · Bench: SABYASACHI MUKHERJI · Disposal: Dismissed

Judgment (excerpt)

• 
STATE OF ORISSA AND OTHERS 
v. 
CONSTRUCTION INDIA 
DECEMBER 4, 1987 
A 
[SABYASACHI MUKHARJI AND S. RANGANATHAN, JJ.] 
B 
Unreasoned award by arbitrator-Award of interest from the 
date of reference-Validity thereof. 
A contract was entered into by the parties in 1970-71. The award 
was made by the Arbitrator in 1982. The award was challenged before C 
the subordinate Judge who upheld the same. Appeal to the High Court 
against the order of the Subordinate Judge was dismissed. The peti-
tioners moved this Court by special leave against the order of the High 
Court and contended inter alia that since a similar matter of 
unreasoned award had been referred by the Court to a Constitution 
Bench of the Court, this petition for special leave be also similarly D 
referred to the Constitution Bench. 
Dismissing the petition with a modification of the award, the 
Court, 
HELD: In the facts and circumstances of this peculiar case, the 
E 
matter is not referred to the Constitution Bench. I 147B I 
It appears from the order of the High Court that the point of 
unreasoned award, though taken in the petition of appeal, was not 
pressed before the High Court. Further, the Arbitrator had been 
appointed by the Court out of the panels submitted by the contesting F 
parties. Also, in the case of an allied contract in respect of another flat 
in the same building, an award had been made and the same had been 
made the rule of the Court subject to the certain conditions. I 146G-H] 
The award is modified to the extent that the interest awarded 
from the commencement of the reference before the Arbitrator to the G 
date of the award, is set aside, which is in consonance with the views 
expressed by this Court in Executive Engineer Irrigation Galimala and 
Ors. v. Abaaduta Jena, 11987] 2 Scale 675. I 147C-D] 
CIVIL APPELLATE JURISDICTION: S.L.P. (Civil) No. 
7389 of 1987. 
H 
145 
146 
SUPREME COURT REPORTS 
(1988] 2 S.C.R. 
A 
From the Judgment and Order dated 18.3.1987 of the Orissa 
High Court in Miscellaneous Appeal No. 423 of 1982. 
R.K. Mehta for the Petitioners. 
Anil B. Divan and Vinoo Bhagat for the Respondent. 
a 
The Judgment of the Court was delivered hy 
SABY ASA CHI MUKHARJI, J. This is a petition for leave to 
a challenge to the award. This is an unreasoned award. The peti-
appeal against the judgment and order of the High Court dismissing 1
an appeal from the order of the learned Sfibordinate Judge dismissing _ 
C tioners challenge the award made in this case and ask for leave in 
view of the order passed by this Court on 16th July, 1986 in similar 
matters where the question of the validity of the unreasoned award 
has been referred to the Constitution Bench for consideration. Mr. 
• 
R.K. Mehta, learned counsel for the petitioners submitted that this 
0 matter should also be referred for consideration before the Consti-
tution Bench. 
In this matter it appears that the contract was entered into by 
the parties in 1970-71 and the award was made in 1982. The High 
Court disposed of the objections to the award in 1987. It is true that 
the grounds of objections were filed before the learned Subordinate 
·-1
E Judge and before the High Court. The ground was taken that it was 
an unreasoned award, inter alia, amongst many other grounds in the 
order of the High Court which have been gone into and these were 
1 
that the arbitrator had misconducted himself and the proceedings and 
)r
the award did not allow or reject the counter claim made by th~ 
( 
appellants and further that the award of interest with effect from a 
F date prior to the date of reference is bad in law. The High Court in 
j 
its judgment had gone into all these aspects but it appears from the 
order of the High Court that this point of unreasoned award though 
taken in the petition of appeal was not pressed before the High 
Court. It also appears that in the grounds of appeal of the special 
leave petition no grievance has been made on the point although it 
G had been taken by the petitioners. It appears to us that this point was 
not pressed before the High Court. It further appears that the arbi-
trator had been appointed by the court out of the panels submitted by 
,..J, 
the contesting parties. Furthermore in an allied contract, i.e. in 
respect of a contract of another flat in the same building an award has 
been made and the same has been made the rule of court subject to 
H. certain conditions. 
j 
STATE OF ORISSA v. CONSTRUCTION INDIA [MUKHARJI,

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