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K.K. Suresh Vs. State of Goa, Through the Chief Secretary, Secretariat - Court Judgment

SooperKanoon Citation
SubjectArbitration
CourtMumbai High Court
Decided On
Case NumberCivil Revision Application No. 132 of 1997
Judge
Reported in1998(4)ALLMR663; 1998(3)BomCR717
ActsArbitration Act, 1940 - Sections 20 and 33
AppellantK.K. Suresh
RespondentState of Goa, Through the Chief Secretary, Secretariat
Appellant AdvocateC. Mascarenhas, Adv.
Respondent Advocate M.S. Joshi, Addl. Govt. Adv.
Excerpt:
the case questioned on whether the superintending engineer, who was appointed as the sole arbitrator, would give biased decisions - the court was challenged that since he was a government officer, there was a real apprehension that he would not give a decision against the respondent government - the court held that merely on the ground that the superintending engineer was a government servant would not apprehend that he would act in biased manners. - - nadkarni, superintending engineer, irrigation department, colvale as the sole arbitrator to enter the reference pursuant to the dispute referred for arbitration by the trial court by its order dated 9th september 1996. before appointing the said superintending engineer as the sole arbitrator, the trial court had called and invited the..........has appointed one s.m. nadkarni, superintending engineer, irrigation department, colvale as the sole arbitrator to enter the reference pursuant to the dispute referred for arbitration by the trial court by its order dated 9th september 1996. before appointing the said superintending engineer as the sole arbitrator, the trial court had called and invited the parties to the proceedings to propose the name of the arbitrator and, accordingly, the petitioner as well as the respondents had submitted three names each. upon hearing the parties, the trial court passed the impugned order.2. while assailing the impugned order shri mascarenhas, learned advocateappearing for the petitioner, submitted that the trial court had acted with materialirregularity in discarding the objection raised on the.....
Judgment:
ORDER

R.M.S. Khandeparkar, J.

1. This revision application challenges the order dated 20th June 1997 passed by the Civil Judge, Senior Division, Quepem in Special Civil Suit No. 84/94/A. By the impugned order the trial Court has appointed one S.M. Nadkarni, Superintending Engineer, Irrigation Department, Colvale as the sole arbitrator to enter the reference pursuant to the dispute referred for arbitration by the trial Court by its order dated 9th September 1996. Before appointing the said Superintending Engineer as the Sole Arbitrator, the trial Court had called and invited the parties to the proceedings to propose the name of the Arbitrator and, accordingly, the petitioner as well as the respondents had submitted three names each. Upon hearing the parties, the trial Court passed the impugned order.

2. While assailing the impugned order Shri Mascarenhas, learned advocateappearing for the petitioner, submitted that the trial Court had acted with materialirregularity in discarding the objection raised on the part of the petitioner to the personappointed as Sole Arbitrator. According to the learned Advocate, the trial Court oughtto have considered that the person appointed as Sole Arbitrator is a person serving inthe Department of the Government and, therefore, the said appointee would be hesitantto arrive at any decision against the respondents and, therefore, it is but natural for thepetitioner to apprehend that there is possibility of bias by the Arbitrator towards therespondents and the apprehension being reasonable apprehension in the mind of thepetitioner, the trial Court erred in ignoring the same and appointing the SuperintendingEngineer as Sole Arbitrator and thereby acting with material irregularity justifying theinterference of this Court in its revisional jurisdiction. Placing reliance on the judgmentof the Apex Court in the matter of Nandyal Co-op Spinning Mills Ltd. v. K.V. MohanRao, reported in : [1993]2SCR280 the learned advocate submitted that the justicemust not only be done but seemingly appear to have been done and, therefore, in viewof reasonable apprehension of the petitioner as against bias in favour of therespondents, the trial Court should not have appointed the Superintending Engineer asthe Sole Arbitrator. Further drawing my attention to the judgment of the Single Judgeof the Andhra Pradesh High Court in the matter of State of Andhra Pradesh andanother v. Chelamani Ramalinga Reddy, reported in 1990(1) Arb.L.R. 207 submittedthat a person interested cannot be entrusted with the task of deciding the matter. Healso placed reliance on the judgment of the Apex Court in the matter of State ofKarnataka v. Shree Rameshwara Rice Mills, Thirthahalli, reported in A.I.R. 1987 S.C.1359 and submitted that the interest of justice and equity requires that a person whois a party to a contract cannot be entrusted the task oE deciding the issue arising underthe contract between the parties. The learned advocate further submitted that theSuperintending Engineer cannot be termed as an independent person who can decidethe matter without being influenced by the respondents,

3. Shri M.S. Joshi, the learned Additional Government Advocate appearing for therespondents, on the other hand, submitted that the trial Court after considering theobjection raised by the petitioner has rightly rejected the same and has appointed theSuperintending Engineer for the reasons disclosed in the impugned order. Placing reliance on the judgment of the Apex Court in the matter of Ranjit Thakur v. Union, of India and others, reported in : 1988CriLJ158 , the learned Additional Government Advocate submitted that there must be reasonable material available on record to justify the alleged bias and without such material by mere allegation on the part of the petitioner it cannot be said that the Superintending Engineer is biased and, therefore, there is no case made out for interference in the impugned order in the revisional jurisdiction of this Court.

4. Upon hearing the learned Counsel for the parties and on perusal of thematerials placed before me, it is seen that undisputedly the parties to the proceedingsbefore the trial Court submitted lists, each one comprising of 3 names for theappointment of Sole Arbitrator in the said case. The list of the names submitted by therespondents contained 3 names of Superintending Engineers of the Government andwhereas the 3 names suggested by the petitioner comprised of retired SuperintendingEngineer and retired Executive Engineer. It was the case of the petitioner before thetrial Court for objecting the appointment of the person suggested by the respondentsthat they are Government Servants who are still in service in the Irrigation Departmentand, therefore, there is possibility of bias in favour of the respondents if any of themis appointed. The trial Court after hearing the parties and upon arriving at the-conclusion that the dispute relates to the work of Irrigation and that it would beadvice able to appoint an expert from the Department of Irrigation and since there beingno personal allegation made by the petitioner against the three persons suggested bythe respondents and the apprehension in the mind of the petitioner that the personssuggested by the respondents being Government servants may favour the respondentshaving not been substantiated with materials on record, appointed Shri S.M. Nadkarni,Superintending Engineer as the Sole Arbitrator. It is well established now that mereapprehension expressed by a party that the authority either hearing the matter or whichmay hear the matter may have bias in favour of the other party, without any reasonablejustification for the same, cannot be considered as a good ground of bias either todislodge the authority already appointed or which is to be appointed. The Apex Courtin the matter of International Airport Authority of India v. K.D. Bali and another,reported in : [1988]3SCR370 has clearly held thatit is not every suspicion felt by a party that must lead to the conclusion that theauthority hearing the proceedings is biased. The apprehension must be judged from ahealthy, reasonable and average point of view and not on mere apprehension or on anywhimsical suspicion. In the instant case it is apparent from the impugned order thatthe contention of the petitioner for objecting the appointment of the SuperintendingEngineer was that he was a Government servant still in service and, therefore, thepossibility of bias in favour of the respondents. It is not disputed that no material assuch was placed before the trial Court to substantiate the said submission of theCounsel on behalf of the petitioner. Merely because the appointed sole arbitratorhappens to be in Government service, there is no justification for apprehension that hemay favour or be biased towards the respondents. Such an apprehension without anybasis, as already held by the Apex Court, cannot be considered as a reasonableapprehension.

5. The decision of the learned Single Judge of the Andhra Pradesh High Court, the case of the respondent therein was that the named arbitrator was directly connected with the matter in issue and, therefore, there was apprehension of bias in favour of the Government. In the matter of Nandyal Co-op. Spinning Mills Ltd. (supra) it was not indispute that the named person had acted on earlier occasions as the arbitrator for one of the parties to the proceedings and in that context the allegation of bias was made. Being so, the decisions in both these cases are of no assistance to the petitioner. As regards the case in the matter of State of Karnataka (supra) it lays down a broad principle that the interest of justice requires that where a party to a contract disputes the committing of any breach of conditions, the adjudication should be by an independent person or body and not by the other party to the contract. However, equally it is held therein that the parties to the Contract are not prohibited from contracting to the contrary. As regards the judgment in the matter of The Secretary to the Government, Transport Deptt., Madras v. Munuswamy Mundaliar and others, reported in : AIR1988SC2232 , the learned advocate for the petitioner is right in contending that the said decision was in the case of named arbitrator in the contract itself. Nevertheless, it is also held that there must be reasonable evidence to satisfy that there was a real likelihood of bias. In the case of International Airport Authority of India (supra), the Apex Court has observed that in this country in numerous contracts with the Government clauses requiring the Superintending Engineer or some official of the Government to be the arbitrator are incorporated. It cannot be said that the Superintending Engineer, as such, cannot be entrusted with the work of arbitration and that an apprehension simpliciter in the mind of the contractor, without any tangible ground, would be a justification for his removal. The Apex Court has further held therein that mere imagination of a ground cannot be an excuse for apprehending bias in the mind of the chosen arbitrator. In the instant case the impugned order ex facie discloses that the learned advocate appearing for the petitioner had submitted on mere suspicion that since the appointee happens to be in the service of the Government, therefore, there is possibility of bias in favour of the respondents. There was no material placed on record in support of such suspicion. Being so, I do not find any irregularity committed by the trial Court or error in exercise of jurisdiction in appointing Shri S.H. Nadkarni, Superintending Engineer as the Sole Arbitrator in the instant case.

6. Since no case is made out for interference in the impugned order, the revision application is liable to be rejected and is, hereby, rejected. There shall be no order as to costs.

7. Application dismissed.


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