IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27th DAY OF FEBRUARY 2019 BEFORE THE HON’BLE MR. JUSTICE ALOK ARADHE WRIT PETITION NO.12948 OF 2017 (GM-RES) BETWEEN:
1. EXECUTIVE ENGINEER NO.2, CANAL DIVISION KNNL, ODDERAHATTI CAMP GANGAVATHI 583 227.
2. M/S KARNATAKA NEERAVARI NIGAM LTD., A COMPANY REGISTERED UNDER THE COMPANIES ACT AND HAVING REGD. OFFICE AT 4TH FLOOR, COFFEE BOARD BLDG.
NO.1, DR. B.R. AMBEDKAR VEEDHI, BANGALORE 560 001.
REP. BY ITS COMPANY SECRETARY.
... PETITIONERS (BY SRI M R C RAVI, ADV.) AND 1. SRI. D.Y. UPPAR CLASS I CONTRACTOR NO.148/6-1, 5TH CROSS RMV EXTN., SADASHIVANAGAR BANGALORE 560 080.
2. SRI. M. SHIVANANDA SOLE ARBITRATOR B.E.(CIVIL) ME (SOIL MECHANICS) MASc. (HIGHWAYS) NO.2040, SHIVAKRUPA, 19TH MAIN, 2ND BLOCK, RAJAJINAGAR, BANGALORE 560 010.
... RESPONDENTS (BY SRI. ARUN KUMAR K., SR. ADV. FOR R1 SRI M. SHIVANANDA, ADV. FOR R2) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ORDER DTD:2.3.2017 PASSED IN I.A.NO.1/16 IN A.S.NO.1/2016 AT ANNEXURE-A PASSED BY THE LEARNED PRINCIPAL JUDGE, KOPPAL AND DIRECT FOR IMPLEADING THE PETITIONER COMPANY AS A NECESSARY PARTY IN THE ARBITRATION PROCEEDINGS.
THIS PETITION COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER Sri. M.R.C.Ravi, learned counsel for the petitioners.
Sri. Arun Kumar.K, learned Senior counsel for the respondent No.1.
Sri. M.Shivananda, learned counsel for the respondent No.2.
Petition is admitted for hearing. With the consent of the parties, it is heard finally.
2. In this petition under Article 227 of the Constitution of India, the petitioners have challenged the validity of the order dated 02.03.2017 passed by the Principal District Judge at Koppal, by which application filed by the petitioners for stay of the arbitration award dated 26.12.2015 has been allowed and the second petitioner has been directed to deposit 50% of the award amount in Court or to furnish security for the remaining 50% of the award amount as required under law.
3. The facts giving rise to the filing of the writ petition briefly stated are:-
A short term tender notification dated 15.02.2010 was issued by the petitioners. The first respondent participated in the aforesaid bid and was declared successful. Thereafter, an agreement was executed in favour of the petitioners. However, subsequently, the dispute arose between the parties and the matter was referred to Arbitration. The Arbitrator passed award dated 26.12.2015, by which claim of the first respondent to the tune of Rs.60 crores approximately has been decreed. Being aggrieved, the petitioners have filed the petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’ for short) before the trial Court. The petitioners had also filed application for stay of the award dated 26.12.2015 The aforesaid application has been disposed of as stated supra.
4. Learned counsel for the petitioners submits that the trial Court ought to have asserted that the petitioner is a Government Company and therefore, instead of depositing the money in the Court, the same could be utilized by the petitioners for public purpose. It is also stated that a direction be issued to the trial Court to conclude the proceedings in a time bound manner and the petitioners are ready and willing to co-
operate with the trial Court for early conclusion of the proceedings.
5. On the other hand, learned counsel for the respondents submitted that the impugned order is just and proper and does not call for any interference.
6. I have considered the submissions made by both the parties and perused the records.
7. From the perusal of the records, it is evident that the Arbitration award is decreeing the claim of the respondents to the tune of Rs.60 crores with interest. The District Judge while passing the impugned order has directed the second petitioner to deposit 50% of the award amount in Court or to furnish surety for the remaining 50% of the aforesaid amount as required under law within 30 days from the date of the order. The aforesaid order cannot said to be perverse. The trial Court has also taken into account, the proviso to Section 36 of the Act and has stated that while granting the stay, the trial Court shall consider the principles as applicable in respect of a decree for payment of money under the provisions of Code of Civil Procedure, 1908. Therefore, the proceedings dealt with has been exercised on sound principles of law by the trial Court by directing the second petitioner to deposit 50% of the award amount in Court or to furnish surety for the remaining 50% of the award amount.
8. The aforesaid order neither suffers from any jurisdiction infirmity nor any error apparent on the face of the record warranting interference of this Court in exercise of powers under Article 227 of the Constitution of India. Even otherwise, it is well settled in law that the jurisdiction of this Court under Article 227 of the Constitution cannot be exercised to correct all errors of a judgment of a Court acting within its limitation. It can be exercised where the order is passed in grave dereliction of duty or in flagrant abuse of fundamental principles of law and justice. [See: ‘JAI SINGH AND OTHERS VS. M.C.D. AND OTHERS’, (2010) 9 SCC 385, ‘SHALINI SHYAM SHETTY VS. RAJENDRA SHANKAR PATIL’, (2010) 8 SCC 329 and ‘RADHE SHYAM AND ANOTHER VS. CHABBI NATH AND OTHERS’, (2015) 5 SCC 423].
9. In view of the aforesaid enunciation of law and in the facts of the case, I do not find any merit in the writ petition. The writ petition fails and hereby dismissed.
In view of dismissal of the main petition, I.A.No.1/2017 does not survive for consideration. Hence, it is dismissed.
Sd/- JUDGE VMB