{"id":115840,"date":"1996-02-14T00:00:00","date_gmt":"1996-02-13T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/ms-dodsal-private-limited-vs-delhi-electric-supply-on-14-february-1996"},"modified":"2018-09-15T19:06:54","modified_gmt":"2018-09-15T13:36:54","slug":"ms-dodsal-private-limited-vs-delhi-electric-supply-on-14-february-1996","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/ms-dodsal-private-limited-vs-delhi-electric-supply-on-14-february-1996","title":{"rendered":"M\/S. Dodsal Private Limited vs Delhi Electric Supply &#8230; on 14 February, 1996"},"content":{"rendered":"<div class=\"docsource_main\">Supreme Court of India<\/div>\n<div class=\"doc_title\">M\/S. Dodsal Private Limited vs Delhi Electric Supply &#8230; on 14 February, 1996<\/div>\n<div class=\"doc_citations\">Equivalent citations: 1996 SCC  (2) 576, \t  JT 1996 (5)\t626<\/div>\n<div class=\"doc_author\">Author: H B.L.<\/div>\n<div class=\"doc_bench\">Bench: Hansaria B.L. (J)<\/div>\n<pre>           PETITIONER:\nM\/S. DODSAL PRIVATE LIMITED\n\n\tVs.\n\nRESPONDENT:\nDELHI ELECTRIC SUPPLY UNDERTAKING OF THE MUNICIPALCORPORATIO\n\nDATE OF JUDGMENT:\t14\/02\/1996\n\nBENCH:\nHANSARIA B.L. (J)\nBENCH:\nHANSARIA B.L. (J)\nVENKATASWAMI K. (J)\n\nCITATION:\n 1996 SCC  (2) 576\t  JT 1996 (5)\t626\n 1996 SCALE  (2)123\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n<p>\t\t       O R D E R<br \/>\n     An\t absolutely  inequitable  stand\t taken\tby  the<br \/>\nrespondent (Delhi  Electric Supply Undertaking) has led<br \/>\nus to  examine some  fundamental questions  of law.  We<br \/>\nhave opened  with  this\t observation  inasmuch\tas  the<br \/>\nrespondent has\tchallenged the award of the arbitrators<br \/>\nmade in\t favour of the appellant on the ground that the<br \/>\ncontract, which\t contained  arbitration\t agreement,  is<br \/>\nvoid, because  of which\t there is no agreement to refer<br \/>\nthe dispute to arbitration; and so, the arbitrators had<br \/>\nno jurisdiction\t to pass  impugned award.  Such a stand<br \/>\nflies on  the face of the respondent inasmuch as of the<br \/>\ntwo arbitrators,  one, namely  Shri K.L. Vijh, had been<br \/>\nappointed by  the respondent  itself. But  as the award<br \/>\nultimately went\t in favour  of the appellant, it raised<br \/>\nthe question  of jurisdiction.\tWe have no doubt in our<br \/>\nmind that  such a  stand is  inequitable, indeed highly<br \/>\ninequitable. Question,\thowever,  is  whether  the  law<br \/>\npermits such a question to be raised.\n<\/p>\n<p>2.   The High  Court accepted  the contention  that the<br \/>\ncontract was  void inasmuch  as sections 201 and 203 of<br \/>\nthe Delhi  Municipal Corporation  Act read with bye law<br \/>\n3(1) (a)  were violated. Dr. Singhvi, appearing for the<br \/>\nrespondent has\turged that  the\t contract  being  void,<br \/>\nalong with  it fell the arbitration agreement contained<br \/>\nin the\tcontract, because  of which the arbitrators had<br \/>\nno jurisdiction to pass the award in question.\n<\/p>\n<p>3.   It is  further  submitted\tthat  in  such\ta  case<br \/>\nappearance of  the respondents\tin the proceeding, i.e.<br \/>\nits acquiescence, would not alter the situation in view<br \/>\nof what\t has been  held by a Constitution Bench of this<br \/>\nCourt in  <a href=\"\/doc\/74498\/\">Waverley Jute\t Mills Co.Ltd.\tvs. Raymon  and<br \/>\nCo.<\/a>(India) Pvt.Ltd., AIR 1963 SC 90, in paragraph 21 of<br \/>\nwhich it  was stated that &#8220;an agreement for arbitration<br \/>\nis the very foundation on which the jurisdiction of the<br \/>\narbitrators to\tact rests,  and where  that is\tnot  in<br \/>\nexistence, at the time when they enter on their duties,<br \/>\nthe proceedings\t must be  held\tto  be\twholly\twithout<br \/>\njurisdiction. And  this defect\tis  not\t cured\tby  the<br \/>\nappearance of  the parties in those proceedings even if<br \/>\nthat is\t without protest,  because it  is well\tsettled<br \/>\nthat consent cannot confer jurisdiction&#8221;.\n<\/p>\n<p>4.   The  aforesaid   stand  brings  to\t the  fore  the<br \/>\nfollowing fundamental questions of law :-\n<\/p>\n<p>     (1)Whether the  present was  a  case  of  contract<br \/>\nbeing void or voidable ?\n<\/p>\n<p>     (2)Whether a  mandatory provision cannot at all be<br \/>\nwaived ?\n<\/p>\n<p>5.   As we  are proposing  to refer  the  matter  to  a<br \/>\nConstitution Bench,  we may  not dilate\t the questions,<br \/>\nexcept stating\tthat a\tperusal of &#8216;Administrative Law&#8217;<br \/>\nby wade\t and Forsyth  (7th Edn. pages 339 to 344) would<br \/>\nshow that  in Ridae v. Baldwin, 1964 AC 40, some of the<br \/>\ndissenting judges  of the House of Lords suggested that<br \/>\neven ultra  vires  action  might  be  merely  voidable.<br \/>\nReference has  also been  made\tto  what  was  held  in<br \/>\nAnisminic  Ltd.\t v.  Foreign  Compensation  Commission,<br \/>\n(1969) 2  AC 147,  which has  dealt with  the  question<br \/>\nwhether there  are degrees  of nullity. As to of waiver<br \/>\nof a  mandatory provision,  we may  refer to  a\t recent<br \/>\ndecision of  this Court in Krishan Lal vs. State of J &amp;<br \/>\nK, 1994\t (4) SCC  422, in  which this  aspect has  been<br \/>\ndealt in  paras 16  to 25. It has been pointed out that<br \/>\neven a\tmandatory  provision  can  be  waived,\tif  the<br \/>\nprovision be  intended for the benefit of the concerned<br \/>\nperson, as  distinguished from\tone  which  serves  &#8220;an<br \/>\nimportant purpose&#8221;  in which  case there  would\t be  no<br \/>\nwaiver.\n<\/p>\n<p>6.   In this  connection  we  may  also\t refer\tto  the<br \/>\nprovision contained in section 4 of the Arbitration and<br \/>\nConciliation Ordinance,\t 1996, which  is on the subject<br \/>\nof &#8220;Waiver of right to object&#8221;. It has laid down that a<br \/>\nparty who  knows (a)  any provision  of this  Part from<br \/>\nwhich the  parties may derogate, or (b) any requirement<br \/>\nunder the  arbitration agreement, has not been complied<br \/>\nwith and  yet proceeds\twith  the  arbitration\twithout<br \/>\nstating his  objection to  such non-compliance\twithout<br \/>\nundue delay shall be deemed to have waived his right to<br \/>\nso object.\n<\/p>\n<p>7.   Another legal  aspect  is\talso  involved\tin  the<br \/>\npresent\t case.\tThe  same  is  whether\tan  arbitration<br \/>\nagreement can be read de hors what was contained in the<br \/>\ncontract. The respondent having itself appointed one of<br \/>\nthe arbitrators\t in  writing,  an  examinable  question<br \/>\narises whether this act cannot be said to constitute an<br \/>\nimplied agreement  to refer  the matter to arbitration.<br \/>\nIt  may\t be  pointed  out  that\t section  7(2)\tof  the<br \/>\naforesaid Ordinance  recognizes\t a  separate  agreement<br \/>\nalso.\n<\/p>\n<p>8.   Though the\t aforesaid questions  were not examined<br \/>\nin Waverley  Jute Mills&#8217;  case and  it would  have been<br \/>\nopen to\t us to\tdecide the  same ourselves,  we do  not<br \/>\npropose to  do so,  lest it  be\t thought  that\twe  are<br \/>\noverreaching the  decision by  a larger bench. Instead,<br \/>\nwe desire  that a  5-Judge Bench  &#8211;  Waverley  being  a<br \/>\nrendering by  such a  Bench &#8211;  should decide whether in<br \/>\nthe context of the legal aspects mentioned by us above,<br \/>\nit is open to a person like the respondent to raise the<br \/>\nquestion of  lack of  jurisdiction of the arbitrator(s)<br \/>\nand thereby  deny the  fruits (to  the other side) of a<br \/>\nlong fought  and won battle, involving huge expenditure<br \/>\nof time,  money and  energy, and  thereby cause serious<br \/>\ndamage to  equity also,\t which is  an equally important<br \/>\nfacet to  be borne  in mind  by the  courts when seized<br \/>\nwith deciding a lis between parties.\n<\/p>\n<p>9.   Let the Registry lay the papers before the Hon&#8217;ble<br \/>\nChief Justice of India for doing the needful.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Supreme Court of India M\/S. Dodsal Private Limited vs Delhi Electric Supply &#8230; on 14 February, 1996 Equivalent citations: 1996 SCC (2) 576, JT 1996 (5) 626 Author: H B.L. Bench: Hansaria B.L. (J) PETITIONER: M\/S. DODSAL PRIVATE LIMITED Vs. RESPONDENT: DELHI ELECTRIC SUPPLY UNDERTAKING OF THE MUNICIPALCORPORATIO DATE OF JUDGMENT: 14\/02\/1996 BENCH: HANSARIA B.L. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-115840","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>M\/S. 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