HIGH COURT OF HIMACHAL PRADESH AT SHIMLA Arb.C. No.: 15 of 2007. Reserved on: 22.4.2008. Decided on: 12.5.2008. M/s Gurcharan Industries ………Petitioner. Versus H.P. Housing Board and another ………Respondents. Coram: The Hon’ble Mr.Justice V.K. Ahuja, Judge. Whether approved for reporting? For the petitioner: Mr.Suneet Goel, Advocate. For the respondents: Mr.C.N. Singh, Advocate. V.K. Ahuja, J: This order shall dispose of an application filed by the claimant/petitioner under Section 34 of the Arbitration and Conciliation Act for setting aside the award, dated 2.3.2006, passed by the Superintending Engineer (South), HIMUDA, Shimla. A notice of the application was issued to the respondents, who also filed reply. Brief facts of the case are that the petitioner had entered into a contract with predecessor-in-interest of respondent No.1 through respondent No.2 for execution of work relating to “Construction of Central Jail at Kanda Ghanahati, Shimla – C/o High Security Barracks”. A formal contract was duly entered into in ___________ 1.Whether reporters of Local papers may be allowed to see the judgment? - 2 - between the parties. The work was completed in the extended time given to the petitioner and there arose a dispute in between the parties. The matter was referred to the Superintending Engineer, Arbitration, HPPWD, Solan. However, the matter was subsequently referred to the Superintending Engineer (South), HIMUDA, since it appears that the post held earlier of S.E., Arbitration, HPPWD was abolished. The award was passed by the Superintending Engineer (South), HIMUDA. Being aggrieved by the said award passed by the Arbitrator, the petitioner has filed the objections. The main plea taken by the learned counsel for the petitioner was that the award was passed by Shri S.C. Sood, who, at the relevant time, was the overall Incharge of the work and, therefore, after he was appointed as an Arbitrator, he should have given a notice to the parties in terms of Section 12 of the Arbitration and Conciliation Act. The notice was not given, therefore, the petitioner did not have any opportunity to object to Shri S.C. Sood acting as an Arbitrator and accordingly the award passed by the Arbitrator can be said to be against the public policy since he cannot be the judge of his own matter. A perusal of the petition filed by the petitioner clearly shows that these allegations were made that when the proceedings were held by the earlier Arbitrator but finally the award was passed by Shri S.C. Sood and he did not issue any notice to the parties to raise objections, if any, and he finally passed the award. In reply to the objections filed by the petitioner, the allegations were not denied specifically by the respondents that Arbitrator was not the overall Incharge of the work at the relevant time, who simply pleaded that the hearing - 3 - of the arbitration proceedings stood concluded during the tenure of Superintending Engineer (North) and only the award was required to be announced which was announced by Shri S.C. Sood and as such there was no illegality. Thus, it is clear that these allegations were not denied and stand admitted. It is not only a question that the proceedings were conducted during the tenure of the Arbitrator but the person who has passed the award once he was Incharge of the work cannot act as Arbitrator and the principles of natural justice were not followed in passing the award by the Arbitrator and the award passed by the Arbitrator is liable to be set aside and the same is set aside. The matter shall be sent back to the Government, who shall appoint an Arbitrator to hear the parties and pass the award. In case the said Arbitrator is not holding the post of Superintending Engineer (South), HIMUDA, Shimla, the reference shall be made to the said Superintending Engineer by designation who shall hear the parties and give his award accordingly. In view of above, the objection petition is allowed. A copy of this order be sent to the State Government. Record of the Arbitrator be returned back. In view of the final disposal of the main petition, all the pending miscellaneous application(s), if any, shall also stand disposed of. May 12, 2008. (V.K. Ahuja), (TILAK) Judge.