Jindal India Thermal Power Ltd vs Quartz Infra And Engineering Pvt
2022 Latest Caselaw 5245 Ori

                 IN THE HIGH COURT OF ORISSA AT CUTTACK
                                 ARBA No.4 Of 2021
                               (Through hybrid mode)

            Jindal India Thermal Power Ltd.       ....           Appellant

                                  Mr. C. Mukhopadhya, Senior Advocate
                                        Mr. S.P.Mishra, Senior Advocate
                                         Mr. Satyajit Mohanty, Advocate
                                          Mr. Prashant Mehta, Advocate
                                         Mr. Asit Kumar Dash, Advocate
                                              Ms. Divita Vyas, Advocate
                                     -versus-

            Quartz Infra and Engineering Pvt.     ....         Respondent
            Ltd.
                                      Mr. Vegesna Subba Raju, in person

                     CORAM: JUSTICE ARINDAM SINHA
                                     ORDER

29.09.2022 Order No.

20. 1. Mr. Mukhopadhya, learned senior advocate appears on behalf

of appellant resumes his argument. He reiterates findings in

paragraphs 242 and 243 in the award regarding his client's unfettered

right to terminate under it, held to have been qualified by right to

reduce the quantity of work, if any contingency arose. He relies on

judgment of the Supreme Court in Indian Oil Corporation Ltd. v.

Shree Ganesh Petroleum, reported in (2022) 4 SCC 463, paragraphs

43 and 44. Paragraph 44 is reproduced below.

// 2 //

"44. An Arbitral Tribunal being a creature of contract, is bound to act in terms of the contract under which it is constituted. An award can be said to be patently illegal where the Arbitral Tribunal has failed to act in terms of the contract or has ignored the specific terms of a contract.

He submits, the Tribunal in ignoring the contract term was in breach

of mandate under sub-section (3) in section 28, Arbitration and

Conciliation Act, 1996.

2. On the Tribunal having rejected his client's application under

section 27, he draws attention to paragraphs 486 and 487 in the award.

He submits, facts are that the measurement book was signed by

respondent. Relying on some scoring out, it disputed the same in the

reference. Facts are also that there was joint measurement between

respondent and the next contractor engaged by his client. His client

wanted to examine said contractor to prove said measurements, to

corroborate the measurement book disputed by respondent. This was

not allowed by the Tribunal.

3. He submits, on wrongful termination and prejudice caused

straightaway his client has demonstrated patent illegality in the award

to extent of approximately Rs.2.7 crores. Clause (iv) under sub-section

(2) in section 34 only allows for severance of award in respect of the

// 3 //

part therein on matters not submitted to arbitration. Here the case is,

the disputes were referred culminating in award of Rs.6 crores and

odd. At this point he submits, entire award is liable to be set aside on

adjudication in appeal that finding on wrongful termination and

prejudice by rejecting section 27-A application, going in favour of his

client. He relies on judgment of the Supreme Court in NHAI v. M.

Hakeem, reported in (2001) 9 SCC 1, paragraphs 2, 16, 41 and 42. He

submits, law declared is, there cannot be modification of the award by

either enhancing or reducing it.

4. There are other smaller claims, on which he would like to point

out apparent illegality as well as rejection of counter claims of his

client.

5. List on 19th October, 2022 marked at 2.00 P.M.

(Arindam Sinha) Judge Sks