1 ARBP97/08 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO.97 OF 2008 Union of India ...Petitioners v/s M/s K.J. Constructions ...Respondents Mr Suresh Kumar for Petitioners. Ms Suchitra Kamble for Respondents. CORAM : D.K.DESHMUKH J. DATE : 9TH JUNE 2011. 2 ARBP97/08 P.C. :- 1] By this petition, filed under section 34 of the Arbitration and Conciliation Act 1996, the petitioners challenge the award made by the learned Arbitrators. The learned counsel appearing for petitioners submitted that the award against item No.2(vii) i.e. idling charges for props and award made against item No.7 i.e. under-utilization of overheads directing the petitioners to pay an amount of Rs.1,56,000/- to the respondents and award made against item No.9 i.e. under-utilization of labour directing the petitioners to pay to the respondents an amount of Rs.2,50,000/- is contrary to the judgment of the Division Bench of this Court in appeal No.36 of 1999 (M/s K.J. Construction Co. v/s Union of India) dated 12th March 2003 and that the counter claim made by the petitioners has been wrongly rejected. 2] I have heard the learned counsel for both the sides. Claim Nos.7 and 9 relate to the extended 3 ARBP97/08 period of contract. So far as payment of damages for the period subsequent to grant of extention of contrary is concerned, it is considered b the Division Bench in the aforesaid judgment in paragraph 8 and the Division Bench has held that in view of clause 17(1) of the contract, damages cannot be awarded. That judgment is between the same parties and therefore, in my opinion, the learned Arbitrators could not have awarded amounts against claim Nos.7 and 9. So far as the rejection of counter claim made by the petitioners is concerned, the only reason given for rejecting the counter claim is that the counter claim has been made after arbitration is commenced. This really shows total ignorance on the part of the learned Arbitrators as to the point of time at which counter claim can be filed. Perusal of provisions of section 23 of the Act shows that after the arbitral proceedings commence, statement of claim is to be filed by the claimant and it is thereafter that the statement of defence is to be filed by the respondents and counter claim is always contained in the statement 4 ARBP97/08 of defence. Therefore, the only time when counter claim can be filed is after commencement of the arbitral proceedings. Thus, the reason given by the learned Arbitrators for not considering the counter claim is totally devoid of any substance. In the result therefore, petition succeeds and is allowed, the award made by the learned Arbitrators against claim Nos.7 and 9 is set aside. Similarly, the award made by the learned Arbitrators rejecting the counter claim is also set aside. Petition is disposed off. Parties to act on the copy of this order duly authenticated by the Associate / Private Secretary of this Court. Certified copy expedited. ( JUSTICE D.K. DESHMUKH )