APHC010599732003 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3529] MONDAY, THE TWENTY SECOND DAY OF SEPTEMBER TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO THE HONOURABLE SRI JUSTICE T.C.D.SEKHAR CIVIL MISCELLANEOUS APPEAL Nos: 1860, 1503 & 1505 of 2003 CIVIL MISCELLANEOUS APPEAL NO: 1860/2003 Between: 1. UNION OF INDIA, REP. BY THE DIRECTOR GENERAL THE DIRECTOR GENERAL UNION OF INDIA NAVAL PROJECT, ...APPELLANT AND 1. M/S RENUK INDUSTRIES LTD, M/s. Renuk Industries Ltd., 11-A, Abdul Gaffar Khan Road, Worli Sea Face, ...RESPONDENT Appeal Under Section_____against orders IA NO: 1 OF 2003(CMP 9927 OF 2003 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to suspend the operation of the Judgment and Decree made in O.P.No. 305 of 1994, dt. 2.12.2002 on the file of the I Addl. Senior Civil Judge, Visakhapatnam, including the Award of the learned Arbitrator dt. 17.5.1994 in respect of claim Nos. 1,3,5 o 11, 13, 15, 17 to 22, pending disposal of the above Civil Misc. Appeal. IA NO: 2 OF 2003(CMP 13054 OF 2003 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to 2 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch enlarge the time granted by this Hon'ble Court for a further period of 3 months to comply with the orders passed by this Hon'ble Court in C.M.P.No.9927 of 2003 in C.M.A.No. 1860 of 2003 dated 30.4.2003 i.e. to deposit the 50% of the awarded amount with costs IA NO: 3 OF 2003(CMP 24157 OF 2003 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased To vacate the interim order in CMP No.9927/2003 in CMA No.1860 of 2003 dated 30-04-2003. Counsel for the Appellant: 1. M UMADEVI Counsel for the Respondent: 1. ... 2. N ASHWANI KUMAR CIVIL MISCELLANEOUS APPEAL NO: 1503/2003 Between: 1. M/S. RONUK INDUSTRIES LIMITED,, 11-A, ABDUL GAFFAR KHAN ROAD, WORLI SEA FACE, MUMBAI - 400 025. ...APPELLANT AND 1. UNION OF INDIA, Represented by its Director General, Naval Project, Naval Base P.O., Visakhapatnam. ...RESPONDENT Appeal Under Section_____against orders IA NO: 1 OF 2015(CMAMP 521 OF 2015 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to 3 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch set aside the dismissal orders dated 23-2-2015 and restore the CMA NO. 1503 of 2003 and pass CIVIL MISCELLANEOUS APPEAL NO: 1505/2003 Between: 1. M/S. RONUK INDUSTRIES LIMITED,, 11-A, ABDUL GAFFAR KHAN ROAD, WORLI SEA FACE, MUMBAI - 400 025. ...APPELLANT AND 1. UNION OF INDIA, Represented by its Director General, Naval Project, Visakhapatnam. ...RESPONDENT Appeal Under Section_____against orders IA NO: 1 OF 2015(CMAMP 522 OF 2015 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to set aside the dismissal orders dated 23-2-2015 and restore the CMA NO. 1505 of 2003 and pass Counsel for the Appellant: 1. N ASHWANI KUMAR Counsel for the Respondent: 1. M UMA DEVI (CENTRAL GOVT COUNSEL) 4 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch The Court made the following Common Judgment: (per Hon’ble Sri Justice R. Raghunandan Rao) As these three Civil Miscellaneous Appeals arise out of the same arbitral process between the same parties, they are being disposed of, by way of this common judgment. 2. The appellant in C.M.A.No.1503 of 2003 and the appellant in C.M.A.No.1505 of 2003, is being referred to as the Contractor. The appellant in C.M.A.No.1860 of 2003, is being referred to as the Employer. 3. The employer had issued a tender for a Contract for electro plating and metal surfacing treatment in Division Block No.15, Ferrous Chemicals Cleaning and Phosphating Division in Block No.18 and Industrial Treatment Plant at the Naval Dockyard, Visakhapatnam. 4. The Contractor was the successful bidder and had been awarded the said work. As certain disputes arose regarding the scope of the Contract as well as the amounts that need to be paid to the Contractor. The matters were referred to a sole arbitrator. 5. The sole arbitrator, after hearing both sides, passed an Award, dated 17.05.1994. The Contractor initially raised 9 claims and subsequently, raised another 13 claims. The Employer also filed counter claims. The Arbitrator rejected all the claims of the Employer. As far as the Contractor was concerned, claims 1, 2, 4, 8, 9, 10, 12, 13, 14 & 15, were partly allowed. Claim Nos.3, 6 & 7 were allowed and all the other claims were rejected. 5 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch 6. Aggrieved by the said Award, the Employer filed O.P. No.305 of 1994, for setting aside the Award under the provisions of the Arbitration Act, 1940 before the learned I Additional Senior Civil Judge, Visakhapatnam. Similarly, the Contractor, filed O.P. No.230 of 1994, for making the Award a Rule of the Court. The learned I Additional Senior Civil Judge, Visakhapatnam, disposed of both the petitions, by way of a Common Order, dated 02.12.2002. The learned I Additional Senior Civil Judge, dismissed O.P.No.305 of 1994 and partly allowed O.P.No.230 of 1994. The learned I Additional Senior Civil Judge, set aside the claims 2, 4, 12, 14 & 16, which had been allowed by the learned Arbitrator. The remaining claims which had been made Rule of Court by the learned I Additional Senior Civil Judge, passed by the learned Arbitrator, are claims 1, 3, 5 to 11, 13, 15, 17 to 22. 7. Aggrieved by the said Common Order, the Employer filed C.M.A. No.1860 of 2003, while the Contractor has filed C.M.A. Nos.1503 & 1505 of 2003. 8. The case of the Employer, before this Court was that, the learned Arbitrator, had exceeded his jurisdiction, by permitting 13 additional claims to be made when the initial claims of the Contractor were only nine in number. It is contended that, the learned Arbitrator having taken up the claims 1 to 9 could not have subsequently permitted claims 10 to 22 to be referred again. 6 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch 9. The Employer would also contend that, the learned Arbitrator, by awarding pendente lite interest has exceeded his jurisdiction as there is no provision for grant of pendente lite interest. 10. The case of the Contractor before this Court is that, the scope of review, by the learned I Additional Senior Civil Judge, under Sections 15 & 16 of the Arbitration Act, 1940 is to ascertain whether there is an error apparent on the face of the record and that, the Court could not have been sat in Appeal over the Award. The Contractor, would also contend that, the Law relating to grant of pendente lite interest under the provisions of the Arbitration Act, 1940 are fairly well settled and relies upon the judgment of the Hon’ble Supreme Court of India in the case of Ferro Concrete Construction (India) Pvt. Ltd. Vs. State of Rajasthan1 11. The Contractor would also contend that, the subsequent addition of 13 claims from Claim Nos.10 to 22 are not to be treated as fresh claims in as much as all the 20 claims were raised before the Legal Advisor, who had mentioned the said 22 claims in the correspondence. 12. Consideration of the Court: (i). The grant of pendente lite interest by the Arbitrator, is permissible when there is no clause restraining or prohibiting the Arbitrator for grant of such pendente lite interest. The absence of a clause either way, would not take away the power of the Arbitrator, under the Arbitration Act, 1940, to grant 1 2025 SCC OnLine SC 708 7 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch such interest. This view of the Court is fortified by the judgment of the Hon’ble Supreme Court of India in the case of Ferro Concrete Construction (India) Pvt. Ltd. Vs. State of Rajasthan, which has also referred to the Constitution Bench judgment in the case of Secretary, Irrigation Department, Government of Orissa Vs. G.C. Roy2. This contention of the Employer would have to be rejected. (ii). A perusal of the Order of the learned I Additional Senior Civil Judge, would show that, she specifically referred to the correspondence between the claimant and the Legal Advisor, which reveals that the claims 1 to 22, were treated as disputes between the Contractor and the Employer and it was only a staggered reference of the claims. In such circumstances, this Court cannot accept the contention of the Employer that the addition of claims 10 to 22, after the commencement of the Arbitration is in some manner prohibited. (iii). As far as the question of the rejection of claims 2, 4, 12, 14 & 16 are concerned, the Trial Court had rejected the same, on the ground that, the Arbitrator had failed to consider the material documents placed before him. For example, claim No.2 was a claim made for additional payment for provision of catwalk on both working and non-working sides in Block No.18. 13. The Trial Court found that these works were part of the Original Order itself and they could not have been treated as additional work for which 2 (1992) 1 SCC 508 8 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch additional payments have to be made. The Trial Court, on this basis, had observed that the Arbitrator had not considered the said documents, which were already before him. A perusal of the Order of the learned I Additional Senior Civil Judge, in relation to her rejection of claims 12, 14 & 16, would show that, claims accepted by the Arbitrator were rejected on similar ground. 14. In that view of the matter, we do not agree with the contentions of the Contractor that the learned I Additional Senior Civil Judge had acted as a Court of Appeal. The view taken by the learned I Additional Senior Civil Judge was that the Arbitrator had drawn conclusions without verifying the relevant documents and as such, it would have to be accepted that the view taken by the learned I Additional Senior Civil Judge is in line with the Law relating to the scope of review under the provisions of the Arbitration Act, 1940. 15. In that view of the matter, nothing further survives and all the three Civil Miscellaneous Appeals are dismissed, accordingly. There shall be no order as to costs. As a sequel, pending miscellaneous applications, if any, shall stand closed. ________________________ R. RAGHUNANDAN RAO, J _________________ T.C.D. SEKHAR, J KPV 9 RRR,J & TCDS,J C.M.A.Nos.1860 of 2003 & batch 637 THE HON’BLE SRI JUSTICE R. RAGHUNANDAN RAO AND THE HONOURABLE SRI JUSTICE T.C.D.SEKHAR CIVIL MISCELLANEOUS Nos:1860, 1503 & 1505 of 2003 (per Hon’ble Sri Justice R. Raghunandan Rao) 22.09.2025 KPV