{"id":249836,"date":"2009-02-20T00:00:00","date_gmt":"2009-02-19T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/visakhapatnam-port-trust-vs-ms-continental-construction-on-20-february-2009"},"modified":"2015-06-23T01:08:54","modified_gmt":"2015-06-22T19:38:54","slug":"visakhapatnam-port-trust-vs-ms-continental-construction-on-20-february-2009","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/visakhapatnam-port-trust-vs-ms-continental-construction-on-20-february-2009","title":{"rendered":"Visakhapatnam Port Trust vs M\/S. Continental Construction &#8230; on 20 February, 2009"},"content":{"rendered":"<div class=\"docsource_main\">Supreme Court of India<\/div>\n<div class=\"doc_title\">Visakhapatnam Port Trust vs M\/S. Continental Construction &#8230; on 20 February, 2009<\/div>\n<div class=\"doc_bench\">Bench: Markandey Katju, R.M. Lodha<\/div>\n<pre id=\"pre_1\">                             IN THE SUPREME COURT OF INDIA\n                   CIVIL APPELLATE JURISDICTION\n\n                 CIVIL APPEAL NO 5849-5850 OF 2002\n\n\n\nVisakhapatnam Port Trust                       ... Appellant\n\n                                Versus\n\nM\/s Continental Construction Company         ... Respondent\n\n\n\n\n                           JUDGEMENT\n<\/pre>\n<p id=\"p_1\">R.M. Lodha, J.\n<\/p>\n<p id=\"p_1\">\n<p id=\"p_2\">     Both these appeals by special leave, arise out of one and the<\/p>\n<p>same judgment dated 26th April, 2002 rendered by the High Court<\/p>\n<p>of Judicature Andhra Pradesh whereby it allowed the two appeals<\/p>\n<p>being CMA No. 1559\/1994 and CMA No. 77\/1995.\n<\/p>\n<p id=\"p_3\">2.   For the sake of convenience, we shall refer the appellant &#8211;<\/p>\n<p>Visakhapatnam Port Trust, &#8220;VPT&#8221; and the respondent &#8211; M\/s<\/p>\n<p>Continental Construction Company, &#8220;the Contractor&#8221;.<\/p>\n<p id=\"p_4\">3.   In CMA No. 1559\/1994 before the High Court, the dispute<\/p>\n<p>between the parties was in respect of refund of an amount of Rs.<br \/>\n<span class=\"hidden_text\" id=\"span_1\">                                                              2<\/span><\/p>\n<p>74,810.38 which was recovered by VPT from the         contractor&#8217;s<\/p>\n<p>running bill no. 21.    VPT entered into an agreement with the<\/p>\n<p>contractor on 7th January, 1973 whereunder the contractor was to<\/p>\n<p>construct the ore berth 263       meters long 29.73 meters wide<\/p>\n<p>comprising of eight numbers of 18 meters x 27.73 meters long<\/p>\n<p>concrete cribs spaced at 35M centres on prepared foundations and<\/p>\n<p>connected by pre-cast pre-stressed deck     and R.C.C. slab and<\/p>\n<p>construction of two Mooring Dolphins comprising    concrete deck<\/p>\n<p>supported on 900mm internal diameter Racker bored piles. For the<\/p>\n<p>execution of the said contract,     VPT was to     supply various<\/p>\n<p>equipments comprising of hydraulic jacks, hydraulic pumps, steel<\/p>\n<p>yoke assembly, jack rods etc. and it appears to be fairly admitted<\/p>\n<p>position that 950 nos. of jack rods were supplied by VPT to the<\/p>\n<p>contractor. Towards cost of 500 jack rods, on 8th August, 1974,<\/p>\n<p>from     the   contractor&#8217;s running bill no. 21, an amount of<\/p>\n<p>Rs.74,810.38 was recovered by VPT.\n<\/p>\n<p id=\"p_5\">4.     As there was a dispute between VPT and the contractor with<\/p>\n<p>regard to return of 950 jack rods valuing    Rs. 9,65,155\/-, VPT<\/p>\n<p>referred to the dispute to arbitration in the year 1975.      The<\/p>\n<p>statement of claim was filed by VPT before the arbitrators on 4th<\/p>\n<p>June, 1976.     On 23rd March, 1980, the arbitrators rejected the<br \/>\n<span class=\"hidden_text\" id=\"span_1\">                                                                  3<\/span><\/p>\n<p>claim of VPT. The award dated 23rd March, 1980 was challenged<\/p>\n<p>by VPT before the Civil Judge, Visakhapatanam by filing a petition<\/p>\n<p>under <a href=\"\/doc\/1503578\/\" id=\"a_1\">Sections 30<\/a> &amp; <a href=\"\/doc\/1154891\/\" id=\"a_1\">33<\/a> of the Arbitration Act, 1940 (for short, `Act,<\/p>\n<p>1940&#8242; ).    The Civil Judge, Visakhapatanam dismissed the said<\/p>\n<p>petition on 10th September, 1984.\n<\/p>\n<p id=\"p_6\">5.    It is pertinent to notice here that until the rejection of claim<\/p>\n<p>made by VPT for Rs. 9,65,155\/- towards the cost of 950 jack rods<\/p>\n<p>vide award dated 23rd March, 1980, the contractor did not raise<\/p>\n<p>any dispute with regard to recovery of Rs. 74,810.38 made by VPT<\/p>\n<p>on 8th August, 1974 from the contractor&#8217;s running bill no. 21.        It<\/p>\n<p>was only thereafter, to be specific on 27th March, 1980 that the<\/p>\n<p>contractor called upon VPT to release the sum of Rs. 74,810.38.<\/p>\n<p>Then on 22nd of September, 1984,            the contractor initiated<\/p>\n<p>proceedings under the Act, 1940 in respect of claim of<\/p>\n<p>Rs.74,810.38 by appointing its arbitrator and also called upon VPT<\/p>\n<p>to appoint its arbitrator. The arbitrators entered upon the reference<\/p>\n<p>on 1st February, 1985 and they also appointed an Umpire. The<\/p>\n<p>contractor filed its statement of claim before the arbitrators on 16th<\/p>\n<p>March, 1985. The arbitrators by their award dated 27th October,<\/p>\n<p>1985 accepted the claim of the contractor and passed an award for<\/p>\n<p>Rs.74,810.38 in favour of the contractor.\n<\/p>\n<p><span class=\"hidden_text\" id=\"span_2\">                                                                    4<\/span><\/p>\n<p id=\"p_7\">\n<p id=\"p_8\">6.        VPT challenged the award by filing petition (O.P.No.<\/p>\n<p>10\/1986) under <a href=\"\/doc\/1503578\/\" id=\"a_2\">Sections 30<\/a> and <a href=\"\/doc\/1154891\/\" id=\"a_3\">33<\/a> of the Act, 1940, inter alia<\/p>\n<p>raising the objection that the claim of the contractor was time<\/p>\n<p>barred.      The   Court   of   the   Principal   Subordinate     Judge,<\/p>\n<p>Visakhapatnam vide his judgment dated 16th February, 1994<\/p>\n<p>allowed OP No. 10\/1986; set aside the award of the arbitrators and<\/p>\n<p>held that the claim of the contractor was barred by limitation.<\/p>\n<p id=\"p_9\">7.    The contractor challenged the judgment of the Principal<\/p>\n<p>Subordinate Judge, Visakhapatanam dated 16th February, 1994 by<\/p>\n<p>filing an appeal before the High Court which was registered as<\/p>\n<p>CMA No. 1559\/1994. The High Court upturned the judgment of the<\/p>\n<p>Principal Subordinate Judge, Visakhapatnam and held that the<\/p>\n<p>claim of the contractor for Rs. 74,810.38 was within limitation.<\/p>\n<p id=\"p_10\">8.   The other appeal being CMA No. 77\/1995 before the High<\/p>\n<p>Court arose out of C-3 contract for execution of marine works and<\/p>\n<p>break waters at the outer harbour at Lova Garden, Visakhapatnam .<\/p>\n<p>The dispute seems to have arisen between              VPT       and the<\/p>\n<p>contractor on 3rd February, 1975 in respect of the charges for<\/p>\n<p>power driven survey boat used by the contractor. The dispute was<\/p>\n<p>referred to the consulting engineers who opined vide their report<\/p>\n<p>dated 3rd May, 1975 that it was the responsibility of the contractor to<br \/>\n<span class=\"hidden_text\" id=\"span_3\">                                                                   5<\/span><\/p>\n<p>provide the    survey vessel and consequently,        the contractor&#8217;s<\/p>\n<p>claim in this regard was untenable.      The contractor then on 15th<\/p>\n<p>May, 1975 appointed Shri G.N. Bajpai as its arbitrator and called<\/p>\n<p>upon VPT to appoint its arbitrator.    VPT appointed one Mr. T.V.<\/p>\n<p>Rajaram as its arbitrator and the arbitrators in turn appointed Mr.<\/p>\n<p>A.W. De&#8217;Lima as Umpire. The arbitrators, however, could not enter<\/p>\n<p>upon the reference. The contractor, accordingly, approached the<\/p>\n<p>Principal Subordinate Judge, Visakhapatnam for the appointment of<\/p>\n<p>arbitrators by invoking <a href=\"\/doc\/1232861\/\" id=\"a_4\">Sections 8<\/a>, <a href=\"\/doc\/1120409\/\" id=\"a_5\">9<\/a> and <a href=\"\/doc\/811701\/\" id=\"a_6\">20<\/a> of the Act, 1940.<\/p>\n<p>The Principal Subordinate Judge, Visakhapatnam treated that suit<\/p>\n<p>under <a href=\"\/doc\/1232861\/\" id=\"a_7\">Section 8<\/a> of the Act, 1940 and vide its order dated 10th<\/p>\n<p>September 1984 allowed the suit filed by the contractor and<\/p>\n<p>directed each party to appoint its arbitrators        within 15 days<\/p>\n<p>therefrom. Each party, accordingly, appointed its arbitrator and the<\/p>\n<p>appointed arbitrators entered upon reference.         On 14th March,<\/p>\n<p>1985, the contractor filed claim in the sum of Rs. 8,49,000\/- with<\/p>\n<p>interest and cost pertaining to the charges for power driven survey<\/p>\n<p>boat.\n<\/p>\n<p id=\"p_11\">9.      The arbitrators passed the award on 20th November, 1985<\/p>\n<p>allowing the claim of the contractor for Rs. 6,44,500\/- but no interest<\/p>\n<p>or cost were allowed.\n<\/p>\n<p><span class=\"hidden_text\" id=\"span_4\">                                                                          6<\/span><\/p>\n<p id=\"p_12\">\n<p id=\"p_13\">10.   VPT challenged the award dated 20th November, 1985 in the<\/p>\n<p>Court of    Subordinate Judge, Visakhapatnam by filing petition<\/p>\n<p>numbered as OP No. 164\/1986.            The award was mainly opposed<\/p>\n<p>by VPT on the ground of limitation and that the award was non-<\/p>\n<p>reasoned.\n<\/p>\n<p id=\"p_14\">11. The sub-ordinate Judge, Visakhapatnam allowed the petition<\/p>\n<p>vide its order dated 16th February, 1994 and set aside the award<\/p>\n<p>holding that the claim was barred by limitation.<\/p>\n<p id=\"p_15\">12.   The contractor, then carried the matter to the High Court by<\/p>\n<p>filing CMA No. 77\/1995.            The said appeal has been allowed by<\/p>\n<p>the High Court vide its judgment dated 26th April, 2002.<\/p>\n<p id=\"p_16\">13.   As noticed above, it is from the common judgment dated 26th<\/p>\n<p>April, 2002 disposing of       CMA No. 1559\/1994 and              CMA No.<\/p>\n<p>77\/1995 that these two appeals arise.\n<\/p>\n<p id=\"p_17\">14.   We    shall   first   deal      with   the   contractor&#8217;s   claim       of<\/p>\n<p>Rs.74,810.38. The only issue that falls for our consideration with<\/p>\n<p>regard to this claim is whether it is barred by limitation.<\/p>\n<p id=\"p_18\">15.   <a href=\"\/doc\/1656413\/\" id=\"a_8\">Section 37<\/a> of the Arbitration Act, 1940 and <a href=\"\/doc\/249731\/\" id=\"a_9\">Article 137<\/a> of the<\/p>\n<p><a href=\"\/doc\/1317393\/\" id=\"a_10\">Limitation Act<\/a>, 1963 are relevant for the purpose.<\/p>\n<p id=\"p_19\">      <a href=\"\/doc\/1052228\/\" id=\"a_11\">The Arbitration Act<\/a>, 1940;\n<\/p>\n<p><span class=\"hidden_text\" id=\"span_5\">                                                            7<\/span><\/p>\n<p id=\"p_20\">\n<p>&#8220;37. Limitations. &#8211; (1) All the provisions of the <a href=\"\/doc\/1317393\/\" id=\"a_12\">Indian<br \/>\nLimitation Act<\/a>, 1908 (9 of 1908), shall apply to arbitrations as<br \/>\nthey apply to proceedings in Court.\n<\/p>\n<p id=\"p_21\">(2) Notwithstanding any term in an arbitration agreement to<br \/>\nthe effect that no cause of action accrue in respect of any<br \/>\nmatter required by the agreement to be referred until an<br \/>\naward is made under the agreement, a cause of action shall,<br \/>\nfor the purpose of limitation, be deemed to have accrued in<br \/>\nrespect of any such matter at the time when it would have<br \/>\naccrued but for that term in the agreement.\n<\/p>\n<p id=\"p_22\">(3) For the purposes of this section and of the <a href=\"\/doc\/1317393\/\" id=\"a_13\">Indian<br \/>\nLimitation Act<\/a>, 1908 (9 of 1908), an arbitration shall be<br \/>\ndeemed to be commenced when one party to the arbitration<br \/>\nagreement serves on the other parties thereto a notice<br \/>\nrequiring the appointment of an arbitrator, or where the<br \/>\narbitration agreement provides that the reference shall be to a<br \/>\nperson named or designated in the agreement, requiring that<br \/>\nthe difference be submitted to the person so named or<br \/>\ndesignated.\n<\/p>\n<p id=\"p_23\">(4) Where the terms of an agreement to refer further<br \/>\ndifferences to arbitration provide that any claims to which the<br \/>\nagreement applies shall be barred unless notice to appoint<br \/>\nan arbitrator is given or an arbitrator is appointed or some<br \/>\nother step to commence arbitration proceedings is taken<br \/>\nwithin a time fixed by the agreement, and a difference arises<br \/>\nto which the agreement applies, the Court if it is of opinion<br \/>\nthat in the circumstances of the case undue hardship would<br \/>\notherwise be caused, and notwithstanding that the time so<br \/>\nfixed has expired, may on such terms, if any, as the justice of<br \/>\nthe case may require, extend the time for such period as it<br \/>\nthinks proper.\n<\/p>\n<p id=\"p_24\">(5) Where the Court orders that an award be set aside or<br \/>\norders, after the commencement of an arbitration, that the<br \/>\narbitration agreement shall cease to have effect with respect<br \/>\nto the difference referred, the period between the<br \/>\ncommencement of the arbitration and the date of the order of<br \/>\nthe Court shall be excluded in computing the time prescribed<br \/>\n<span class=\"hidden_text\" id=\"span_6\">                                                                  8<\/span><\/p>\n<p>      by the <a href=\"\/doc\/1317393\/\" id=\"a_14\">Indian Limitation Act<\/a>, 1908 (9 of 1908) for the<br \/>\n      commencement of the proceedings (including arbitration) with<br \/>\n      respect to the difference referred.&#8221;\n<\/p>\n<p id=\"p_25\">\n      <a href=\"\/doc\/1317393\/\" id=\"a_15\">The Limitation Act<\/a>, 1963 ;<\/p>\n<pre id=\"pre_1\">\n\n      \" 137. Any other application       three years      When the\n             for which no period of                    right to apply\n             limitation is provided                      accrues.\"\n             elsewhere in this division.\n\n\n\n<\/pre>\n<p id=\"p_26\">16.   It is apparent from the bare reading of <a href=\"\/doc\/1317393\/\" id=\"a_16\">Section 37<\/a> that the law<\/p>\n<p>of limitation is applicable to the proceedings before the arbitrators<\/p>\n<p>as it applies to proceedings before the Courts. Under Sub-section<\/p>\n<p>(3), arbitration proceedings are to be deemed to have commenced<\/p>\n<p>when notice is served by one party upon the other &#8211; (i) requiring<\/p>\n<p>him to appoint an arbitrator, or (ii) if the arbitrator was named or<\/p>\n<p>designated in the arbitration agreement, requiring him to submit the<\/p>\n<p>difference to arbitrator named or designated.<\/p>\n<p id=\"p_27\">17.   In the backdrop of aforesaid legal position, let us now turn to<\/p>\n<p>the facts.   On 8th August, 1974, VPT recovered an amount of<\/p>\n<p>Rs.74,810.38 being the cost of 500 jack rods from running bill no.<\/p>\n<p>21 tendered by the contractor. The dispute with regard to claim of<\/p>\n<p>Rs. 74,810.38, thus, arose on that date. The contractor ought to<br \/>\n<span class=\"hidden_text\" id=\"span_7\">                                                                  9<\/span><\/p>\n<p>have given notice calling upon VPT to appoint arbitrator within three<\/p>\n<p>years therefrom or apply to the Court within this time.     However,<\/p>\n<p>it was after ten years on 22nd September, 1984 that the contractor<\/p>\n<p>appointed its arbitrator and called upon       VPT     to appoint its<\/p>\n<p>arbitrator.   Significantly, VPT had already made a claim of Rs.<\/p>\n<p>9,65,155\/- against the contractor for withdrawal and return of jack<\/p>\n<p>rods and the dispute was referred to arbitration at the instance of<\/p>\n<p>VPT in the year 1976.    Although the contractor contested the said<\/p>\n<p>claim of VPT before the arbitrators but curiously no counter claim<\/p>\n<p>for Rs. 74,810.38 was made in those proceedings. It is true that<\/p>\n<p>arbitrators rejected the claim of VPT on 23rd March, 1980 and the<\/p>\n<p>petition before the Civil Judge, Visakhapatnam also came to be<\/p>\n<p>dismissed on 10th September, 1984 but that does not improve the<\/p>\n<p>case of the contractor in so far as limitation is concerned as the<\/p>\n<p>limitation began to run from 8th August, 1974. It was too late on 22nd<\/p>\n<p>September, 1984       for the contractor to agitate the claim of<\/p>\n<p>Rs.74,810.38 for which the cause of action accrued on 8th August,<\/p>\n<p>1974. The contractor ought to have made counter claim before the<\/p>\n<p>arbitrators in the year 1976 itself when VPT made a claim of<\/p>\n<p>9,65,155\/- for withdrawal of jack rods. In any view of the matter,<\/p>\n<p>the claim of Rs. 74,810.38 raised for the first time after 10 years of<br \/>\n<span class=\"hidden_text\" id=\"span_8\">                                                                 10<\/span><\/p>\n<p>accrual of cause of action is apparently barred by time and rightly<\/p>\n<p>rejected by Principal Subordinate Judge, Visakhapatnam vide<\/p>\n<p>judgment dated 16th February, 1994.\n<\/p>\n<p id=\"p_28\">\n<p id=\"p_29\">18.    As a matter of fact, Mr. S.B. Upadhyay, Senior Counsel for<\/p>\n<p>the respondent could not show that claim for Rs. 74,810.38 was<\/p>\n<p>within time.\n<\/p>\n<p id=\"p_30\">\n<p id=\"p_31\">19.   As noticed above, CMA No. 77\/1995 before the High Court<\/p>\n<p>related to non-payment of the charges of the power driven survey<\/p>\n<p>boat used by the contractor. Admittedly, the dispute in this regard<\/p>\n<p>arose between the parties on 3rd February, 1975 and the matter<\/p>\n<p>was referred to the consulting engineers. The consulting engineers<\/p>\n<p>rejected the claim of the contractor on 3rd May, 1975 holding that it<\/p>\n<p>was the responsibility of the contractor to provide survey vessel.<\/p>\n<p>The contractor on 15th May, 1975 appointed its arbitrator and gave<\/p>\n<p>notice to VPT requiring them to appoint their arbitrator. VPT also<\/p>\n<p>appointed its arbitrator but the arbitrators could not enter upon the<\/p>\n<p>reference. It was in the year 1979,       then that the contractor<\/p>\n<p>approached the Principal Subordinate Judge, Visakhapatnam by<\/p>\n<p>filing suit under the <a href=\"\/doc\/1052228\/\" id=\"a_17\">Arbitration Act<\/a>, 1940 which was allowed vide<\/p>\n<p>order dated 10th September, 1984 directing each party to appoint its<br \/>\n<span class=\"hidden_text\" id=\"span_9\">                                                               11<\/span><\/p>\n<p>arbitrator within 15 days.      In compliance thereof, the parties<\/p>\n<p>appointed their arbitrators and on 16th March,1985 the contractor<\/p>\n<p>filed its statement of claim for payment of hire charges for power<\/p>\n<p>driven survey boat.\n<\/p>\n<p id=\"p_32\">20.   Sub-Section (3) of <a href=\"\/doc\/1656413\/\" id=\"a_18\">Section 37<\/a> of the Act, 1940, inter alia,<\/p>\n<p>provides that an arbitration shall be deemed to be commenced<\/p>\n<p>when one party to the arbitration agreement serves on the other<\/p>\n<p>party thereto a notice requiring the appointment of an arbitrator.<\/p>\n<p>The core controversy is:     in the facts and circumstances of the<\/p>\n<p>case, when the arbitration can be said to have commenced.<\/p>\n<p id=\"p_33\">21.   In what we have already noticed above, the dispute with<\/p>\n<p>regard to charges for the power driven survey boat arose on 3rd<\/p>\n<p>February, 1975 and after the claim was rejected by the consulting<\/p>\n<p>engineers on 3rd May, 1975, the contractor appointed the arbitrator<\/p>\n<p>on 15th May, 1975 and asked VPT to appoint its arbitrator.       In<\/p>\n<p>other words on 15th May, 1975, the contractor served on VPT         a<\/p>\n<p>notice requiring them to appoint their       arbitrator under the<\/p>\n<p>agreement.    Thus under <a href=\"\/doc\/382407\/\" id=\"a_19\">Section 37(3)<\/a>, the arbitration shall be<\/p>\n<p>deemed to have commenced on 15th May,1975 i.e. well within time<\/p>\n<p>and the High Court rightly rejected the objection of VPT that the<br \/>\n<span class=\"hidden_text\" id=\"span_10\">                                                                12<\/span><\/p>\n<p>claim with regard to charges for the survey vessel was time barred.<\/p>\n<p>Merely because, the arbitrators could not enter upon reference and<\/p>\n<p>the contractor had to approach the Court in the year, 1979 by filing<\/p>\n<p>suit which was allowed on 10th September, 1984 and new<\/p>\n<p>arbitrators were appointed by the parties and statement of claim<\/p>\n<p>was filed by the contractor on 14th March, 1985, that would not<\/p>\n<p>render the contractor&#8217;s claim time barred.\n<\/p>\n<p id=\"p_34\">\n<p id=\"p_35\">22.   Mr. Kailash Vasudev, Senior      Counsel contended that the<\/p>\n<p>non-reasoned award is bad in law.       In this connection, learned<\/p>\n<p>Senior Counsel     referred   to <a href=\"\/doc\/1171700\/\" id=\"a_20\">Section 17<\/a> of the Act, 1940 which<\/p>\n<p>came to be amended by insertion of proviso vide <a href=\"\/doc\/264421\/\" id=\"a_21\">Andhra Pradesh<\/p>\n<p>Act<\/a> (1 of 1990).\n<\/p>\n<p id=\"p_36\">\n<p id=\"p_37\">23.   <a href=\"\/doc\/1171700\/\" id=\"a_22\">Section 17<\/a> of the Act, 1940 reads thus ;\n<\/p>\n<p id=\"p_38\">\n<blockquote id=\"blockquote_1\"><p>      &#8220;17. Judgment in terms of award. &#8211; Where the Court sees &#8212;<br \/>\n      no cause to remit the award or any of the matters referred to<br \/>\n      arbitration for reconsideration or to set aside the award, the<br \/>\n      Court shall, after the time for making an application to set<br \/>\n      aside the award has expired, or such application having been<br \/>\n      made, after refusing it, proceed to pronounce judgment<br \/>\n      according to the award, and upon the judgment so<br \/>\n      pronounced a decree shall follow and no appeal shall lie<br \/>\n      from such decree except on the ground that it is in excess of,<br \/>\n      or not otherwise in accordance with, the award.&#8221;\n<\/p><\/blockquote>\n<p><span class=\"hidden_text\" id=\"span_11\">                                                                    13<\/span><\/p>\n<p id=\"p_39\">24.   Vide Andhra Pradesh Act ( 1 of 1990), the following proviso<\/p>\n<p>have been inserted to <a href=\"\/doc\/1171700\/\" id=\"a_23\">Section 17<\/a>;\n<\/p>\n<p id=\"p_40\">\n<blockquote id=\"blockquote_1\"><p>      &#8220;Provided that where as award pending in the Court at the<br \/>\n      commencement of the Arbitration (Andhra Pradesh<br \/>\n      Amendment) Act, 1990 or an award filed in the Court,<br \/>\n      thereafter does not contain reasons therefore as required by<br \/>\n      the proviso to sub-section (1) of <a href=\"\/doc\/19362541\/\" id=\"a_24\">Section 14<\/a> the Court shall<br \/>\n      not proceed to pronounce the judgment according to the<br \/>\n      award, but shall remit the award to the arbitrators or the<br \/>\n      umpire for giving reasons therefore as required by the said<br \/>\n      proviso and thereupon the arbitrators or umpire shall, within<br \/>\n      thirty days from the date of remittance of the award to them by<br \/>\n      the Court give reasons for the award and file the same in the<br \/>\n      Court:\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_2\"><p>      Provided Further that on the application of the arbitrators or<br \/>\n      the umpire and for reasons to be recorded in writing, it shall<br \/>\n      be competent for the Court, to extend the period of thirty days<br \/>\n      aforesaid for a further period not exceeding fifteen days:\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_3\"><p>      Provided also that where an award pending in the court as<br \/>\n      aforesaid does not contain any reasons and there is no<br \/>\n      possibility to remit the award to the arbitrator or panel of<br \/>\n      arbitrators or umpire due to their incapacity, negligence,<br \/>\n      refusal to act or death, the Court shall set aside the award<br \/>\n      and direct the parties to initiate fresh arbitration in accordance<br \/>\n      with the terms of the agreement.&#8221;\n<\/p><\/blockquote>\n<p id=\"p_41\">25.   Firstly, amendment in <a href=\"\/doc\/1171700\/\" id=\"a_25\">Section 17<\/a> vide <a href=\"\/doc\/264421\/\" id=\"a_26\">Andhra Pradesh Act<\/a> (1<\/p>\n<p>of 1990) is not attracted in the present fact situation as the award<\/p>\n<p>was passed by the arbitrators on 20th November, 1985 i.e. much<\/p>\n<p>before the amendment. As per <a href=\"\/doc\/1171700\/\" id=\"a_27\">Section 17<\/a> then obtaining, it was<\/p>\n<p>not imperative for the arbitrators to give reasons in support of the<br \/>\n<span class=\"hidden_text\" id=\"span_12\">                                                                  14<\/span><\/p>\n<p>award.   Secondly, upon the award dated 20th November, 1985<\/p>\n<p>being challenged by VPT before Principal Sub-ordinate Judge,<\/p>\n<p>Visakhapatnam, the Principal Sub-ordinate Judge, Visakhapatnam,<\/p>\n<p>directed the arbitrators to give reasons for the award in the light of<\/p>\n<p>the amendment aforenoticed.\n<\/p>\n<p id=\"p_42\">26.   Consequently, the arbitrators gave the following reasons:<\/p>\n<p id=\"p_43\">      &#8220;Having gone through the various provisions in the contract<br \/>\ndocuments which have a bearing on the dispute between the<br \/>\nparties and after applying correct and proper interpretation for<br \/>\nadjudication of the said dispute, we find that the Visakhapatnam<br \/>\nPort trust, the Respondents in this case, were under a Contractual<br \/>\nobligation to make available a Survey Boat for use on these works<br \/>\nand that, although the survey boat was available with them, they<br \/>\nfailed totally to fulfil that contractual obligation necessitating the<br \/>\nclaimants to obtain a boat from their own resources and deploy the<br \/>\nsame on the works throughout the construction period. We find that<br \/>\nafter allowing some adjustments found necessary on perusal of the<br \/>\ncontract and after having considered the written as also the oral<br \/>\nsubmissions made to us by the parties, the claimants are entitled to<br \/>\nbe paid by the Respondent the sum as determined by us in our<br \/>\naward.&#8221;\n<\/p>\n<p id=\"p_44\">\n<p id=\"p_45\">27.   Although this exercise was unnecessary but the fact of the<\/p>\n<p>matter is, that subsequently the arbitrators did give their reasons.<\/p>\n<p>Reasonableness of the reasons given by arbitrators cannot be<\/p>\n<p>gone into by the Court. This objection of the Senior Counsel is,<\/p>\n<p>accordingly, overruled.\n<\/p>\n<p><span class=\"hidden_text\" id=\"span_13\">                                                                         15<\/span><\/p>\n<p id=\"p_46\">\n<p id=\"p_47\">28.   For the foregoing reasons, we dispose of these appeals as<\/p>\n<p>follows:-\n<\/p>\n<blockquote id=\"blockquote_4\"><p>      (1)       The judgment of the High Court of Judicature of<\/p>\n<p>                Andhra Pradesh in CMA No. 1559\/1994                   is set<\/p>\n<p>                aside. The claim of M\/s Continental Construction<\/p>\n<p>                Company for Rs. 74,810.38 stands dismissed.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_5\"><p>                The amount of Rs. 74,810.38 deposited with the<\/p>\n<p>                executing Court    by Visakhapatnam Port Trust<\/p>\n<p>                pursuant to the    order      dated 27th September,<\/p>\n<p>                2004 of this Court shall be          refunded to them<\/p>\n<p>                alongwith interest accrued thereon.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_6\"><p>      (2)       The judgment of the High Court in CMA No.<\/p>\n<p>                77\/1995 is affirmed. The amount of Rs. 6,44,500\/-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_7\"><p>                deposited by   Visakhapatnam Port Trust with the<\/p>\n<p>                executing Court pursuant to the order of this Court<\/p>\n<p>                dated 27th September, 2004 shall be paid to M\/s<\/p>\n<p>                Continental Construction Company                 alongwith<\/p>\n<p>                interest accrued thereon.\n<\/p><\/blockquote>\n<pre id=\"pre_2\">      (3)       The parties shall bear their own costs.\n\n\n\n                                            ................................J.\n<span class=\"hidden_text\" id=\"span_14\">                                                   16<\/span>\n\n\n                        (MARKANDEY KATJU)\n\n\n\n\n                     .................................J.\n                                    (R.M. LODHA)\n\nNew Delhi\nFebruary 20, 2009.\n<\/pre>\n","protected":false},"excerpt":{"rendered":"<p>Supreme Court of India Visakhapatnam Port Trust vs M\/S. Continental Construction &#8230; on 20 February, 2009 Bench: Markandey Katju, R.M. Lodha IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO 5849-5850 OF 2002 Visakhapatnam Port Trust &#8230; Appellant Versus M\/s Continental Construction Company &#8230; Respondent JUDGEMENT R.M. Lodha, J. Both these appeals [&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-249836","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>Visakhapatnam Port Trust vs M\/S. 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