The High Court set aside multiple arbitral awards and remitted the matter for a fresh arbitration because the presiding arbitrator had previously submitted a report as a member of the relevant committee, raising a conflict of interest.
Awards set aside; matter remitted to General Manager (Railways) to appoint a fresh arbitrator within one week.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
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IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 18.07.2019
CORAM
THE HONOURABLE MR.JUSTICE N.SATHISH KUMAR
O.P. Nos.800 of 2010, 446 of 2011, 59 of 2015 & 61 of 2015
M/s.Harsha Construction
rep.by its Managing Director,
P.Ramesh,
No.70, Hunters Road, Vasu Priya,
Vepery, Chennai-600 112.
... Petitioner in O.P.Nos.800/2010 & 446/2011
M/s.Harsha Construction
No.70, Hunters Road,
Vasupujya, Vepery,
Chennai 600 112
rep.by its
Managing Partner, D.Ramesh
... Petitioner in O.P.Nos.59/2015 & 61/2015
Vs.
1.Union of India rep.by its
The Chief Engineer, MTP(Railways)
Southern Railway, Poonamallee High Road,
Egmore, Chennai-8.
2.Smt.Sujatha Jayaraj
Presiding Arbitrator & FA &
CAO/General/MAS
3.Shri.A.K.Shina
Arbitrator & Chief Engineer/Works/
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Southern Railway Chennai 600 003.
4.Shri.N.K.Toppo Arbitrator & Chief Works Manager/Loco Works/ Southern Railway, Chennai 600 023.
... Respondents in O.P.No.800/2010
2.Smt.Sujatha Jayaraj Presiding Arbitrator & FA & CAO/General/MAS
3.Rajendra Prasad Arbitrator and Chief Engineer/ICF, Chennai.
4.T.M.Sridhar,
Arbitrator and CSTE/construction/North, Southern Railway, Egmore, Chennai 600 008.
... Respondents in O.P.No.446/2011
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Southern Railway, Ernakulam, Kerala.
4.Shri.K.A.Ananthasubramanian, Deputy Financial Adviser & Chief Accounts Officer, Construction, New Joint office, S.Railway, Egmore, Chennai-8.
5.Shri.M.K.Subramanian, Southern Railway. Deputy Chief Electrical Engineer, LOCO Works/PER, Chennai.
... Respondents in O.P.No.59&61/2015
Prayer in O.P.No.800/2010 :Petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 to set aside the award of the Tribunal dated 22.03.2010 as far as the claims of the petitioner is not considered and rejected, made in relation to the disputes arising out of the Agreement No.MTP/Civil/425-04 dated 15.06.2004 between the petitioner and the 1st respondent.
Prayer in O.P.No.446 of 2011 :Petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 to set aside the award of the Tribunal dated 19.02.200 and additional award dated 05.05.2011 and to direct a fresh tribunal to decide all the issues based on the evidence already submitted by both the party to this tribunal.
Prayer in O.P.No.59&61 of 2015 :Petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 to set aside the award of the Tribunal dated 17.06.2014, 07.07.2014 and 13.10.2014 as far as the
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claims of the petitioner is not considered and rejected, made in relation to the disputes arising out of the Agreement Nos.MTP/Civil/424-04 & MTP/Civil/425-04 dated 23.04.2004 & 15.06.2004 between the petitioner and the 2nd respondent.
For Petitioner in all O.P.s : Mr.P.Subba Reddy For Respondent in all O.P.s : Dr.S.R.Sundaran for R1 COMMON ORDER Challenging the awards of the Arbitrator, these Original Petitions have been filed. 2. The preliminary objection raised by the petitioner in these Original Petitions is that the Arbitrator relied upon the report of the Committee. The Presiding Arbitrator in the arbitration is one of a member of the same committee, who filed the report. The member, who filed the report was also appointed as a Presiding Arbitrator in the same matter and therefore, Awards passed were not in according to law and hence, the same was challenged in these Original petitions.
first instance, is of the view that the Presiding Arbitrator is also one of a
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party in the committee and gave a report against the petitioner and subsequently the same party became a Presiding Arbitrator in the same matter and decided the issue against the petitioner and therefore, certainly, it is not according to law. It is just like a person deciding his
own case.
18.07.2019
sk
Note:Issue order copy on 22.07.2019.
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N.SATHISH KUMAR.,J. Sk
O.P. Nos.800 of 2010, 446 of 2011,
59 of 2015 & 61 of 2015
18.07.2019
2 issues framed by the court
Whether an arbitral award is invalid when the presiding arbitrator previously served on a committee that filed a report against the party.
Whether the arbitral award passed by an arbitrator who relied on a report from the same committee to which he belonged violates principles of natural justice.
1 provisions across 1 enactments
M/s. Harsha Construction
Union of India
N. Sathish Kumar
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
