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1987 (8) TMI 448 - SUPREME COURT

1987 (8) TMI 448 - SUPREME COURT - TMI - C.M.P. No. 46931 of 1985. - Dated:- 11-8-1987 - MUKHARJI, SABYASACHI AND OZA, G.L., JJ. A.K. Ganguli and K. Swami for the Petitioner Shankar Ghosh, S. Padmanabhan, K.K. Venugopal, C.S. Vaidyanathan, A.T.M. Sampath, P. Choudhary, S.R. Setia and S.R. Bhatt for the Respondent JUDGMENT SABYASACHI MUKHARJI, J. There were disputes between the partners of the firm Balasubramania Foundry (hereinafter called 'the firm') and several legal proceedings were t .....

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d in accordance with the Arbitration Act. In order to complete the narration, there was an application for appointment of Receiver which was directed to be proceeded with in the trial court. This Court, however, by the said order directed the trial court to dispose of that application. By the said order as mentioned hereinbefore in the absence of Justice K.S. Palaniaswamy, Justice C.J.R. Paul duly heard and considered the matter and published the award on 3rd April, 1985. It is claimed by Mr. Gh .....

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ve petition No. 2271 of 1983 was filed by the firm against the order of the High Court confirming the order of appointment of Receiver'of the firm. In those proceedings the Court was pleased to pass an order on 17th of February, 1984 that all the claims of the workers for their past dues would be referred for arbitration to the Arbitrator and considered by him. On 27th of July, 1984 this Court was pleased to refer the money claims of one Velmurugan Factory and the money claims of the workers .....

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behalf of the workers also that their claims had not been fully protected. Mr. Sampath, appearing on their behalf has contended that the claims of the workers would amount to about rupees seven lakhs while provision had been made only for rupees three lakhs and even, then there was not sufficient provision. The workers, gratuity, it was contended would come to about rupees seven lakhs while the Arbitrator had really estimated erroneously rupees four lakhs and provisions had been made only for &# .....

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rkers. Indeed it appears that of the 27 workers whose claims had to be settled on account of gratuity, 14 had received the same and a document indicating the payments to them was sought to be filed before us. We are satisfied that sufficient provisions have been made for the existing liabilities of the workers and for any further contingencies in respect of the workers' claims. It cannot be said, therefore, that the award of the Arbitrator is incomplete and left undetermined this dispute. Th .....

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of his objection that the Arbitrator while holding that the lease in favour of the firm was bad had awarded substantial sum on the basis of the lease. It was further submitted that the Arbitrator while noting the reasons and recording the formal award had applied a reasoning altogether unconnected with the merits of the controversy which amounted to legal misconduct. It was further alleged that the award was inconsistent. In those circumstances, it was submitted that the award so far as it was a .....

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error apparent on the face of the record. It was submitted that the Arbitrator committed a grave error in rejecting the claim of the applicant for a sum of ₹ 39,27,940.11 which was due from Palaniappan and Doraiswamy as suppressed profits. It was submitted by Mr. Ganguly that at least rupees nine lakhs should have been left out in item No, 9. This was not duly noted. On the other hand, it was urged that the alleged errors were not amenable to be corrected in this application by this Court .....

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decision on questions not referred, which were severable from those referred. The Court had also power to remit the award when it had left some matters referred undetermined, or when the award was indefinite, where the objection to the legality of the award was apparent on the face of the award. The Court might also set aside an award on the ground of corruption or misconduct of the ' arbitrator, or that a party had been guilty of fraudulent concealment or wilful deception. But the Court co .....

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e decision was binding, if it be reached fairly after giving adequate opportunity to the parties to place their grievances in the manner provided by the arbitration agreement. This Court reiterated in the said decision that it was now firmly established that an award was bad on the ground of error of law on the face of it, when in the award itself or in a document actually incorporated in it, there was found some legal proposition which was the basis of the award and which was erroneous. This vi .....

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he award, or in a document actually incorporated thereto, as, for instance a note appended by the arbi trator stating the reasons for his judgment, some legal proposition which was the basis of the award and which one can say is erroneous." In the instant case there is no legal proposition either in the award or in any document annexed with the award which was erroneous. In Allen Berry and Co. (P) Ltd. v. Union of India, New Delhi, [1971] 3 S.C.R. 282, this Court reiterated that the princip .....

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