Case: State of Orissa Vs. Orient Paper &amp; Industries Ltd

The disputes referred to the Arbitrator for determination are"As provided in Note (i) under clause 10 of the Agreement, the C.C.F., Orissa had determined that 2300 mtrs. or 7475 running ft. of Salia bamboos and 600 miters. Or 1950 running ft. of Daba bamboos respectively make a tonne vide his letter No. 24755 dated 17.12.1974 (copy of which is placed in the States written argument) and the same is held to be final and binding on both parties."2. "The respondent company was entitled to a refund of Rs. 2,03,325/for excess royalty paid."The Arbitrator by his award held as followsprovided in Note (i) under clause 10 of the Agreement, the Chief Conservator of Forests has determined that 2300 metres of 7475 running feet of Salia Bamboos and 600 metres of 1950 running feet of Daba bamboos respectively make a tonne vide his letter No. 24755 dated 17.12.1974 copy of which is placed in the States written argument and the same is held to be final and binding on both parties."2. Based on the finding in dispute No. 1, he made a consequential award on the second issue. The said award of the Arbitrator was made a Rule of Court by the Judgment of the learnedBhubaneswar dated 7.8.1980 in Misc. Case No. 442/78.3. Being aggrieved by the said order of the learnedy preferred Misc. Appeal No. 260/80 before the Honble High Court of Orissa at Cuttack. The High Court by its judgment dated 19th of November, 1986 allowed the Misc. Appeal setting aside the order of the Subordinate Judge as well as the award of the Arbitrator and remitted the matter back to the Arbitrator for redetermination.4. Being aggrieved by the order of the High Court referred to above, this appeal is preferred. The High Court came to the conclusion that the learned Arbitrator had not decided the disputes referred to him for arbitration. Therefore, the award was unsustainable in law. Consequently, the High Court held such an award could not have been made a rule of court by the learned Subordinate Judge.

Reasoning:
8. I agree.9. I may, however, add that in this case the agreement was entered into in January, 1974. After disputes and differences arose and parties went for arbitration, the Arbitrator gave his Award on November 30, 1978. The Award was challenged by the respondent before theBhubaneshwar who upheld the Award by judgment and order dated August 7, 1980. The matter was taken in appeal before the Orissa High Court by the respondent. High Court by its judgment dated November 19, 1986 allowed the appeal holding that the Arbitrator had failed to decide the actual disputes specifically referred to him and remitted the matter to the Arbitrator for reconsideration under Section 16 of the Arbitration Act. This appeal was filed by the State of Orissa against the judgment of the High Court and it has taken more than 12 years for the decision of the appeal. However, it was not necessary that the State Government should have challenged the order of the High Court in the circumstances of the case causing unnecessary expenses to the parties and the time this Court had to spend in hearing the appeal. Had the State Government abided by the order of the High Court the matter before the Arbitration would have been completed years ago. State cannot act like a private litigant that it must challenge every order made against it. State has to be advised properly if a case required determination of this Court under Article 136 of the Constitution.