IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Ex. Petition. No. 30 of 2010. Judgment reserved: 7.7.2011. Date of Decision:18.7.2011. _______________________________________________ Jaswant Rai Verma ….Appellant. Versus. State of H.P. ….Respondent. Coram: Hon’ble Mr. Justice Dev Darshan Sud, Judge. Whether approved for reporting1?.No. For the appellants :Mr. J.S.Bhogal, Sr. Advocate with Mr. T.S.Bhogal, Advocate. For Respondent. : Mr. P.K.Sharma, Addl. Advocate General with Ms. Shubh Mahajan, Dy. Advocate General. Dev Darshan Sud, J. This execution petition has been preferred by the petitioner herein seeking enforcement of the award made by the adjudicator on 29.1.2010. He was appointed to mediate in the differences between the parties. His appointment was pursuant to Clause 25 of the contract. That clause reads: “25 Procedure for Resolution of Disputes 25.1 The Adjudicator shall give a decision in writing within 28 days of receipt of a notification of a dispute. 25.2. The Adjudicator shall be paid daily at the rate specified in the Contract Date together with reimbursable expenses to the types specified in the Contract Date and the cost shall be divided equally between the Employer and the Whether reporters of the Local papers are allowed to see the judgment yes. 2 Contractor, whatever decision is reached by the Adjudicator. Either party may refer a decision of the Adjudicator to Arbitration within 28 days of the Adudicator’s written decision. Arbitration shall be under the Arbitration and Conciliation Act 1996. If neither party refers the dispute to Arbitration within the above 28 days, the Adjudicator’s decision will be final and binding………………………………..” It is undisputed before me that he entered into reference on 9.12.2009 and the award was made on 29.1.2010. Based on the judgment of this Court in OMP No. 113 of 2005 titled Satluj Jal Vidyut Nigam Limited Vs. M/s Nathpa Jhakri Joint Venture, decided on 7.6.2006, learned senior counsel submits that the award becomes executable forthwith as the reference to arbitration as contemplated by Clause 25.2 was not made within the stipulated period of 28 days. Learned counsel points out that the award having been made on 29.1.2010, is outside the period of limitation and non est. He refers to Annexure JD-IV. “No.PW-CTR-29-637/2009-2845-46 dated: 10.5.2010. From: Chief Engineer(S.Z.) To Sh.Jaswant Rai Verma, Govt. Contractor, M/s Jaswant Rak Verma, # 3209 Sector 44-D, Chandigarh. Subject: Adjucation in the matter of disputes arisen during construction of Kandhar Beral road under PMGSY with the assistance of World Bank under Package No.HP-11-22. Sir, The adjudicator Sh. J.S.Roodkee, acting under clause 25.1 and 25.2 of conditions of contract of above mentioned work has conveyed his decision vide letter No. Nil dated 29.1.2010, copy of which was addressed to you as well as to the Executive Engineer PWD Arki Division Arki. The same has been examined and it is found that the decision of adjudicator is against the facts and 3 circumstances of the case not acceptable, therefore, it has been decided to refer the matter to Arbitration, as per provisions contained in clause 25.2 and 25.3 of the contract. It is therefore requested that name and address of Arbitrator, to whom you intend to appoint on your behalf may kindly be conveyed to this office immediately so that further action is taken to constitute the Arbitral Tribunal at the earliest. Yours faithfully, Sd/- (Employer), Chief Engineer(SZ), H.P.PWD, Nirman Bhawan, Nigam Vihar Shimla-171002.” He submits that there is a bar for reference to adjudication after 28 days of the award of the adjudicator. In fact, learned counsel submits that the last part of Clause 25.2 contain a clear prohibition to the effect: 25.2. ……………………………………………………………... If neither party refers the dispute to Arbitration within the above 28 days, the Adjudicator’s decision will be final and binding.” Learned counsel appearing for the respondents submits that the award of the adjudicator is itself beyond the period of 28 days of the receipt of notification of dispute, reference was made on 9.12.2009 and the award was made on 29.1.2010 which is beyond the period of limitation and in that event, it cannot be treated as valid and binding. I have heard learned senior counsel appearing for the Decree holder and learned Deputy Advocate General for the State. Both the adjudicator’s award as also the reference to arbitration are prima facie beyond 28 days. The time period beyond 28 days has been explained by learned senior counsel appearing for the decree holder by referring to the award, which states that the 4 proceedings were held according to the convenience of the parties and the time taken by them to submit documents etc. and by continuing proceeding the parties have waived this condition. He submits that a reference to arbitration was totally barred and in fact, such proceedings cannot continue. On the second submission made by the learned senior counsel appearing for the decree holder, all that I need say is that it will be open to the petitioner to challenge the jurisdiction of the arbitrator to continue with the proceedings. It is well settled that the authority of the arbitrator is derived from the contract itself. In Waverly Jute Mills Co. Ltd. Vs. Raymon & Co., AIR 1963 S.C. 90, the Court holds: “……………………………………………………………………… 21 Now an agreement for arbitration is the very foundation on which the jurisdiction of the arbitrators to act rests, and where that is not in existence, at the time when they enter on their duties, the proceedings must be held to be wholly without jurisdiction. And this defect is not cured by the appearance of the parties in those proceedings, even if that is without protest, because it is well settled that consent cannot confer jurisdiction. But in such a case there is nothing to prevent the parties from entering into a fresh agreement to refer the dispute to arbitration while it is pending adjudication before the arbitrators, and in that event the proceedings thereafter before them might be up-held as referable to that agreement & the award will not be open to attack as without jurisdiction. But it will make all the difference in the result whether the parties have entered into an arbitration agreement as defined in S. 2(a) of the Arbitration Act or have merely taken steps in the conduct of proceedings assumed or believed to be valid. In the former case the award will be valid; in the latter, a nullity.” (Pp. 97 & 98). 5 In these proceedings, it will not be open to this court to adjudicate as to whether the proceeding before the arbitral Tribunal are void ab initio. On the apprehension expressed by the learned senior counsel that participation of the decree holder would amount to waiver, all that I need say is that Waverly Jute Mills’s case supra takes care of the situation to hold that where the tribunal lacks jurisdiction, this defect is not cured by the appearance/participation of the parties. I must also note that I do not find from the reading of the award of the adjudicator as to which of the parties was responsible for causing delay. In any event, the Arbitrator will have to decide on the following points: (a) Whether the reference made for arbitration is within the parameters of Clause 25.2. (b) If not then in such event all proceedings are void ab initio. On other aspect, I note that without entering into the controversy of limitation at this stage, it will be the duty of the Arbitrator to adjudicate on the question of jurisdiction not by mere expression of opinion but on the settled law. This petition is accordingly disposed of. (Dev Darshan Sud), Judge. July 18, 2011(R).