Kodanda Rami Reddy Vs.State
of A.P. & Ors.
JUDGMENT
R.V. Raveendran J.
1.
The
first respondent (State of A.P.) entered into an agreement dated22.6.1987 in
regard to execution of the work "Ongole Water Supply Improvement Scheme
with NS canals as a source" in pursuance of acceptance of appellant's
tender on 31.3.1987.2. By GOM No. 430 dated 24.10.1983, the first respondent
issued the following revised procedure in regard to arbitration introduced by
GOM dated 31.7.1975. The relevant portions of the revised procedure (paras 2,
3& 4) are extracted below: GOM No. 430 [Irrigation (IRA V) Dept, dated
24.10.1983 " xxxxx
2.
The
question of revising the above procedure has been receiving the attention of
government for some time past. The government, after careful consideration of
various aspects to issues involved direct the procedure be revised as follows :
Value of Amount Panel of Arbitrators 1.Claims upto Rs. 10,000/ Superintending
Engineer of another Circle (a) Another Chief Engineer of the same Claims above
Rs. 10,000/ upto Department. Rs.50,000/ (b) Where there is only one Chief Engineer,
in the Dept., the Chief Engineer will submit proposals to Govt. in the
Administrative Dept. for nomination of another Chief Engineers as Arbitrator by
Govt. 3. Claims above Rs. 50,000/Court of competent jurisdiction.
3.
Claims
means all claims in the contract.
4.
The
orders referred to in paras 2 and 3 above shall be applicable to all the agreements
entered into by Govt. from the date of issue of this order and will be applicable
to all the Engineering Departments, in the State Govt. referred to para (6)
." xxxxxxxxxxx The above GOM dated 24.10.1983 was revised by GOM No.160
dated1.6.1987 as follows: "
ORDER Govt., after
careful consideration of various aspects, issued orders in para (2) of the G.O.
read above prescribing the revised procedure for arbitration. 3 2. It has come
to the notice of the Govt., that some of the contractors are approaching Courts
to decide the claims above Rs. 50,000/ under the provisions of the Arbitration
Act taking advantage of para 2(3) of the G.O. read above. The intention of the
Govt. incorporating the above provision is to dispense with the Arbitration
proceedings in respect of claims above Rs. 50,000/ and leave the parties to
have their remedy in Civil Court. As some of the contractors have misconstrued
that the claims above Rs. 50,000/ have to be decided under the Arbitration Act
and not under ordinary Law in a regular civil Court, the Govt., direct that the
following amendments to G.O.MS. No. 430, I(Irr.V) Deptt., dated 24101983 be
issued by way of clarification : (i) Item (3) of para (2) may be deleted. (ii)
Substitute para (3) by the following. "All claims above Rs. 50,000/ shall
be decided by the Civil Court of competent jurisdiction by way of a regular
suit." (iii) Para 3 to 7 are renumbered as para 4 to 8." 3. By letter
dated 15.2.1990 the appellant lodged fourteen claims (of which claims 12, 13
and 14 related to pre-reference, pendente lite and future interest
respectively) in regard to the said work, with the first respondent and demanded
payment. As the first respondent did not settle the claims, the appellant filed
a petition before the Subordinate Judge, Nellore, under Clause73 of the A.P.
Standard Specifications, requesting the said court to act as the arbitrator and
settle the claims, in terms of the provision for arbitration, contained in the
contract dated 22.6.1987. This was on the assumption that Item(3) of para 2 of
GOM dated 24.10.1983 required all claims aboveRs.50,000/ to be decided by
arbitration, the named Arbitrator being `the court of competent jurisdiction'.
The Subordinate Judge, by order dated17.4.1990, held that he could not act as
an arbitrator. Thereafter, the appellant issued a notice dated 6.6.1990, under
section 8 of the Arbitration Act,1940 (`Act' for short) seeking reference of
the disputes to arbitration and furnished a panel of three names with a request
to the State Government to concur in the appointment of any one from that Panel
as sole arbitrator for adjudicating the disputes raised in his claim letter
dated 15.2.1990. As there was no response, appellant filed OP No. 62/1990 under
Section 8 of the Act in the Court of Subordinate Judge, Nellore, seeking
appointment of a sole arbitrator from out of the panel of three names suggested
by him, to decide the disputes arising out of agreement dated 22.6.1987.4. The
first respondent filed a counter to the said application disputing the claims
and contending that as per the terms of GOM dated 24.10.1983as clarified by the
GOM dated 1.6.1987, all claims over and aboveRs.50,000/ shall have to be
decided by civil court of competent jurisdiction by way of regular suit and not
by way of arbitration. We extract below para11 of the counter statement filed
by the first respondent in the proceeding sunder section 8 of the Act :
"11. As per the
conditions of the agreement, the settlement of all claims over and above
Rs.50,000/ shall be decided by the Civil Court of the competent jurisdiction by
way of regular suit only and not by arbitration. As per Government order in
G.O.Ms No.430, Irrigation (I&PD) Dept. dated 24.10.1983 an as clarified in
subsequent G.O.Ms No.160 Irrigation & CAD (project Wing) Department dated
1.6.1987 wherein it is clearly stated that all claims above Rs.50,000/ shall be
decided by civil court of competent jurisdiction, by way of regular suit for
the alleged claims by paying advalorem court fee. The Petitioner can not
invoke the provisions of the Arbitration Act, for the appointment of sole
arbitrator." The Subordinate Judge, Nellore by his order dated 25.3.1991
allowed the said application and appointed Sh. HS Bhat, retired Chief Engineer
as the sole arbitrator under Section 8(2) of the Act. The civil court accepted
the contentions of the appellant that the contract was concluded by acceptance of
his tender on 31.3.1987 and the subsequent execution of the agreement
on22.6.1987 was merely a formality; that the clarificatory GOM dated1.6.1987
was prospective in operation and therefore, did not apply to the contract
between appellant and respondent; and that GOM dated 24.10.1983alone applied,
which was capable of being interpreted as providing for arbitration in regard
to claims exceeding Rs.50,000/. The learned SubordinateJudge then proceeded to
nominate the Arbitrator, on the ground that under GOM dated 24.10.1983, in
regard to claims above Rs.50,000/, there was no named Arbitrator and the court
of competent jurisdiction had to appoint thearbitrator.
5.
The
first respondent did not challenge the said order dated 25.3.1991appointing an
arbitrator under Section 8(2) of the Act. The arbitrator appointed by the court
entered upon the reference on 11.4.1991 and after due hearing made an award
dated 8.6.1992. The arbitrator allowed claims 2, 3, 4and 9 and rejected claims
1, 5, 6, 7, 8, and 10 of the appellant. The arbitrator also allowed claim 11 by
directing release of the final bill amount and security deposit with interest
@18% per annum on the final bill amount from15.2.1990 and on the security
deposit amount from 1.10.1991 upto date of payment or decree, whichever was
earlier.
6.
The
arbitrator also granted a simple interest at 18% per annum on the amounts
awarded under claim Nos. 2,3, 4 and 9 for the preference period (15.2.1990 to
10.4.1991), pendent lite (11.4.1991 to 8.6.1992) and also as future interest
(9.6.1992 to date of decree).6. The Arbitrator filed the award before the
Subordinate Judge, Nellore under Section 14(2) of the Act which was registered
as OP No. 56/1992. The first respondent filed OP No. 81/1992 under Sections 30
and 33 of the Act for setting aside the award. The Subordinate Judge, Nellore
by common order dated 8.4.1993 dismissed OP No. 81/1992 filed by the first
respondent for setting aside the award, and allowed OP No.56/1992 filed under
Section14(2) of the Act and made the award, a rule of the court, and awarded
further interest at 18% per annum from the date of decree till the date of
realization.
7.
Feeling
aggrieved, on 17.4.1993, the first respondent filed an appeal and a revision
against the order dated 8.4.1993. CMA No. 1251/1993 was filed challenging the
dismissal of its application under Sections 30 and 33 of the Act. CRP No.
4055/1993 was filed challenging the direction that a decree be made in terms of
the award under Section 14(2) of the Act. Along with the said appeal and
revision, it filed another revision petition (CRP No.134/1995) on 14.7.1993
challenging belatedly the order dated 25.3.1991made in OP No. 62/1990 under
Section 8(2) of the Act appointing the arbitrator.
8.
The
said appeal and two revision petitions were disposed of by the High Court by a
brief common order dated 5.10.1999, which is the subject matter of challenge in
these appeals. The High Court held that having regard to decision of this Court
in State of Andhra Pradesh vs. Obulu Reddy (Civil Appeal No. 7246/1993 decided
on 21.9.1999) holding that disputes relating claims of more than Rs.50000/
shall not be adjudicated by appointment of an Arbitrator under section 8 of the
Act, but should be resolved by a competent civil court, the revision petition
challenging the order dated 25.3.1991appointing the arbitrator (CRP No.
134/1995), had to be allowed. Consequently, the High Court allowed CMA No. 1251
of 1993 filed against the dismissal of the application under Sections 30 and 33
of the Act and CRP No. 4055/1993 filed against the order making the award a
rule of the court and permitted the appellant to convert OP No.62/1990 filed
under Section 8of the Act into a regular civil suit by carrying out necessary
amendments and by payment of necessary court fee. The appellant filed two
petitions for reviewing the order allowing CMA 1251/1993 and CRP 4055/1993 and
the said review petitions were dismissed by an order dated 28.4.2000. Feeling aggrieved,
the appellant has filed these five appeals challenging the common order dated
5.10.1999 of the High Court made in CMA No.1251/1993, CRPNo.4055/1993 and CRP
No.134/1995 and the common order dated28.4.2000 dismissing the review petitions
in CMP Nos. 5446/1993 and5447/2000.
9.
On
the contentions urged, the following questions arise for consideration in this
case :(i) Whether the GOM dated 24.10.1983 provided for arbitration?(ii) Whether
the order dated 25.3.1991 appointing an arbitrator under section 8 (2) of the
Act, could be challenged by the State Government, two years later, after
participating in the arbitration proceedings without protest and after the
arbitral award being made a rule of the court? 9 (iii) Whether the High Court
was justified in setting aside the order dated 25.3.1991 appointing the
arbitrator under section 8(2) of the Act and the common order dated 8.4.1993
rejecting the first respondent's application for setting aside the award and
making the award, a rule of the court. Re : Question No.(i)
10.
10.
The GOM dated 24.10.1983 first came up for consideration of this Court in State
of Andhra Pradesh vs. I. Devendra Reddy (decided on2.3.1990 and reported in
1999 (9) SCC 571). This Court held that the provisions of the GOM dated
24.10.1983 were vague and uncertain and consequently if a reference to
arbitration had been made under section 8(2) of the Act, the same should not be
interfered with. It was also held that the GOM dated 1.6.1987 revising the GOM
dated 24.10.1983 by providing that all claims above Rs.50,000 shall be decided
not by arbitration, but by way of a regular suit by the civil court of
competent jurisdiction, was prospective in application and did not apply to the
contracts entered prior to its date(1.6.1987). However in a subsequent decision
in Vishakhapatnam Urban Development Authority v. V. Narayana Raju [decided on
16.2.1995 reported in 1999 (9) SCC 572], this Court held that GOM dated
24.10.1983 clearly provided that the arbitration was available only in regard
to claims uptoRs.50,000/ and not in regard to claims above Rs.50,000/ which had
to be adjudicated by the court of competent jurisdiction; that though the
expression "court of competent jurisdiction" was mentioned in the GOM
dated24.10.1983 under the heading of "panel of arbitrators", that was
only a defective drafting of the GOM and could not be construed to mean that
the claims above Rs.50,000/ were to be adjudicated by arbitration. The decision
in Vishakapatnam Urban Development Authority did not notice the earlier decision
in Devendra Reddy.
11.
The
divergence between the two decisions was noticed by this Courtin State of
Andhra Pradesh vs. Obulu Reddy 1999 (9) SCC 568 and the matter was referred to
a larger Bench on 1.9.1999. Subsequently, a three Judge Bench of this Court
decided the issue in State of Andhra Pradesh vs.Obulu Reddy 2001 (10) SCC 30,
upholding the view expressed in Vishakapatnam Urban Development Authority. This
Court held : "But having examined GOMs No.430, we have no hesitation to
agree with the conclusions arrived at in Vishakapatnam case and hold that under
the said GOMs question of deciding claims above Rs.50,000/ by way of
arbitration does not arise. It merely provided that disposal of claims up to Rs.50,000/
by way of arbitration indicating as to who would be the arbitrator depending
upon the claims and all claims above Rs.50,000/ are to be filed before the
civil court of competent jurisdiction. This being the position, the second GOMs
No.160 is nothing but a clarificatory one and was required to be issued because
of the confusion arising in the minds of some of the claimants as well as the
civil court, inasmuch as the civil court did entertain application under
section 8 and appoint arbitrator in respect of claims above Rs.50,000/. The
earlier judgment of this Court in D. Reddy case has interpreted GOMs No.430 in
a manner which is not the correct interpretation according to us. The orders
appointing arbitrator under section 8 in the two appeals filed by the State are
set aside. The appeals filed by the State are allowed. 11 In CA No.7246 of 1993
filed by the State, it is brought to our notice that not only an arbitrator was
appointed by the Subordinate Judge, but an award has already been given. In
view of our aforesaid decision, the said award is a nullity and stands
annulled." Therefore it has to be held that the GOM dated 24.10.1983 does
not contain any provision for arbitration in regard to claims exceeding
Rs.50,000/though the said GOM was in fact interpreted in many cases prior to
1995, asa provision for arbitration.
Re : Questions (ii)
and (iii)
12.
In
the application under section 8(2) of the Act, the appellant had specifically
contended that there was an arbitration agreement between the parties and
therefore, the disputes were arbitrable. The first respondent resisted the said
petition by specifically contending that there was no arbitration agreement
between the parties. The issue was adjudicated, and by order dated 25.3.1991,
the Subordinate Court, Nellore, held that there was an arbitration agreement
and consequently appointed the arbitrator. The said court in allowing the
application under Section 8(2) of the Act filed by the appellant, by order
dated 25.3.1991, followed the decision of this Court in State of Andhra Pradesh
v. I. Devender Reddy [C.A. No.3578/1989 decided on 2.3.1990] and several
decisions of the Andhra Pradesh High Court and held that the GOM dated 1.6.1987
was prospective in operation, that in regard to contracts concluded prior to
1.6.1987, GOM No.403 dated24.10.1983 alone applied and consequently disputes
involving claims of more than Rs.50,000/ had to be referred to Arbitration by
the court of competent jurisdiction under section 8(2) of the Act. The said
order dated25.3.1991 was not challenged and attained finality. The Arbitrator
entered upon the reference on 11.4.1991. The first respondent participated in
the arbitration proceedings fully and contested the claims of the appellant, on
merits without challenging the jurisdiction of the arbitrator. More
importantly, the first respondent did not even plead or contend before the
Arbitrator that there was no arbitration agreement or that the entire
proceedings were invalid. The failure of the first respondent to raise any such
contention was obviously because the said contention had already been expressly
raised in the proceedings under section 8 of the Act and negatived by the
Subordinate Court in its order dated 25.3.1991 appointing the Arbitrator and
that orderhad been accepted and had attained finality.
13.
Ultimately,
when the arbitrator made an award dated 8.6.1992, the award was challenged by
the first respondent by filing a petition (OPNo.81/1992) under sections 30 and
33 of the Act, on the following grounds:
the Arbitrator had
travelled beyond the terms of the agreement; (ii) that as the contractor had
himself terminated the contract on 28.10.1989, he was disentitled to make any
claim under the contract; and (iii) that the contractor was not entitled to any
of the amounts claimed under the contract. The first respondent did not
challenge the award on the ground that there was no arbitration agreement and
that consequently, the award was invalid. On the other hand, the first
respondent clearly admitted that it had raised such a contention in its
objection statement to the application under section 8 of the Act and that was
negatived by the Subordinate Court. We extract below the relevant portion of
para (4) of the petition under sections 30 and 33 of the Act: "As the
petitioner rejected the said claims the 1st respondent filed a petition before
this Hon'ble Court in O.P. No.62 of 1990 under Section 8 of the Arbitration
Act for the appointment of sole arbitrator to adjudicate the disputes raised
by him. The petitioner opposed the said petition on the ground that the
arbitration clause termed in the agreement do not empower the 1st respondent/contractor
to file a petition before this Hon'ble Court under the provisions of the
Arbitration Act and that they can only file a civil suit before this Hon'ble
Court on payment of ad valorem Court fee on the amounts claimed by him.
However, this Hon'ble court was pleased to allow the petition and appointed
the 2nd respondent herein as sole arbitrator under Section 8 of arbitration Act
to adjudicate the disputes raised by the 1st respondent. The 2nd respondent
entered into the reference and was pleased to pass the Award dated
8.6.1992." Thereafter, the first respondent specifically admitted that the
arbitrator was appointed in terms of the agreement between the parties. We
extract below the relevant portion of Para 5 of the said petition under
sections 30 and 33 of the Act. "The Hon'ble Arbitrator has travelled
beyond the terms of agreement and allowed the above said claims. The Arbitrator
travelled outside the terms of the Agreement in awarding the claims and thereby
mis-conducted himself and also the proceedings. It is submitted that the 2nd
respondent was appointed as sole arbitrator as per the terms of the agreement
entered into between the parties. Since the arbitrator is the creature of the
agreement, he must operate his proceedings within the confines of the terms of the
said agreement. His right emanates from the terms of the agreement only." (emphasis
supplied) Having failed to contend that there was no arbitration agreement in
the proceedings under sections 30 and 33 of the Act, and on the other hand
having specifically conceded that the Arbitrator was appointed in terms of the agreement,
the first respondent was estopped from subsequently contending in the appeal
(filed against the order dated 8.4.1993 rejecting the challenge to the
arbitration award), that there was no arbitration agreement and the remedy of
the contractor was only by way of a suit. Such a contention would be barred by
the principle of res judicata as it was directly and substantially in issue in
the proceedings under section 8 (2) of the Act and the decision therein had
attained finality.
14.
The
next question is whether the first respondent could have challenged the order
dated 25.3.1991 passed under section 8(2) of the Act appointing an arbitrator
by filing a belated petition in 1993 two years later. The issue is not one
relating to merely delay. The issue is whether the first respondent having
allowed the order dated 25.3.1991 to remain unchallenged and implemented, and
having participated in the arbitration proceedings before the arbitrator
without protest and without raising the contention that there was no
arbitration agreement, and without challenging the award on the ground that
there was no arbitration agreement, could raise the issue in an appeal against
the rejection of the application under sections 30 and 33 of the Act. The
answer is clearly in the negative. The first respondent could not challenge the
order dated 25.3.1991, appointing the Arbitrator, which had attained finality,
belatedly on 17.4.1993 by contending that there was no arbitration agreement
between the parties.
15.
We
may in this context refer to the following passage from Russell on Arbitration,
(22nd Edn., page 382): "Loss of right to object. A party who objects to
the award on the ground that the Tribunal lacks substantive jurisdiction,
should not only act promptly but should also take care not to lose his right to
object. A party who takes part or continues to take part in the proceedings is
in a different position from someone who takes no part in the proceedings. The
latter cannot lose his right to object as long as he acts promptly to challenge
the award once it is published. The former must however state his objection to
the Tribunal's jurisdiction either forthwith or within such time as is allowed
by the agreement or the Tribunal. That statement which should be recorded in
writing and sent to the Tribunal and the other parties should not only mention
the jurisdiction objection but also make clear that any further participation
in the arbitration will be without prejudice to the objection. If that is not
done, the party concerned may not be able to raise that objection before the
Court ...." We may also refer to the following observations of this Court
in State Bank of India vs. Ramdas [2003 (12) SCC 474] : "It is an
established view of law that where a party despite knowledge of the defect in
the jurisdiction or bias or malice of an arbitrator participated in the
proceedings without any kind of objection, by his conduct it disentitles itself
from raising such a question in the subsequent proceedings. What we find is
that the appellant despite numerous opportunities made available to it,
although it was aware of the defect in the award of the umpire, at no stage
made out any case of bias against the umpire. We, therefore, find that the
appellant cannot be permitted to raise the question of bias for the first time
before this Court."
16.
Strong
reliance was placed by the first respondent on the decision in State of Andhra
Pradesh vs. Obulu Reddy 2001 (10) SCC 30 wherein a three Judge Bench of this
Court had observed that even if an award had been made after the appointment of
the arbitrator by the Subordinate Judge, the award would be a nullity and
stands annulled if there was no arbitration agreement. The said decision is
clearly distinguishable and is inapplicable to the facts of this case. In Obulu
Reddy, this Court was considering four appeals two appeals preferred by the
State of Andhra Pradesh and the other two preferred by the contractors. The
appeals filed by the State Government related to cases where the contractors
had made an application before the Subordinate Judge for appointment of an
arbitrator in terms of GOM dated 24.10.1983 and the learned Subordinate Judge
had appointed an arbitrator which were assailed by the State in the High Court
contending that even under the GOM dated 24.10.1983, claims for more than Rs.50,000/
were required to be decided by filing a suit and not by arbitration. The High
Court rejected the said appeals of the State. Consequently, the State filed the
two appeals and by the time the matters were heard by this Court, in one of
those two appeals, the Arbitrator appointed by the Subordinate Judge, had even made
an award. In the other two appeals filed by the contractors, there was a slight
variation. The Subordinate Judge had appointed arbitrators in terms of the GOM
No.403 dated 24.10.1983 as the claims were of more thanRs.50,000/. The State
assailed the appointment of arbitrators before the High Court. By the time, the
matters came up for hearing before the High Court, this Court had rendered its
decision in Vishakapatnam Urban Development Authority. Following the said
decision, the High Court allowed the appeals and set aside the appointments of
the arbitrator made by the Subordinate Judge in those two cases. Those orders
were challenged by the contractors before this Court. The crucial difference is
that all the four appeals considered by this Court in Obulu Reddy, related to
cases where the order of the Subordinate Judge under Section 8 of the Act,
appointing the arbitrator had been challenged by the State without any delay
and the High Court in two of the matters had accepted the challenge and in
other two matters rejected the challenge and that is how all four appeals came
up before this Court. But in this case, as noticed above, the order under
section 8(2) of the Act, by the Subordinate Judge was not challenged and was
allowed to attain finality. It was challenged only after the award was made and
that award was made a rule of the court. In such circumstance, the rule of
finality would come into play in regard to the order under section 8(2) of the
Act appointing the Arbitrator.
17.
The
observation in Obulu Reddy that when there was no arbitration agreement the
award is a nullity, was made as the state government had not accepted the
existence of the arbitration agreement at any stage and had all along
challenged the order under section 8 of the Act appointing the Arbitrator. In
this case, though the first respondent had initially contended that there was
no arbitration agreement, when the civil court held that there was an
arbitration agreement and appointed the arbitrator, the first respondent did
not challenge the decision, but accepted the said position and participated in
the arbitration proceeding without protest. More importantly, when the award was
made by the Arbitrator, the first respondent filed an application for setting
aside the award wherein it admitted specifically that the appointment of the
arbitrator was in terms of the agreement between the parties, but challenged
the award on other grounds. In the circumstances, when there was an adjudication
by a court of competent jurisdiction that there was an arbitration agreement
and when that was not challenged and the arbitrator was allowed to proceed on
the basis that there was an arbitration agreement, and when it was specifically
conceded that the appointment of arbitrator is in terms of the agreement
between the parties, the award will not be a nullity.
18.
The
order dated 25.3.1991 appointing an Arbitrator was also not a nullity, even
though it may be erroneous. It is well settled that a decree will be a nullity
only if it is passed by a court usurping a jurisdiction it did not have. But a
mere wrong exercise of jurisdiction or an erroneous decision by a court having
jurisdiction, will not result in a nullity. An order by a competent court, even
if erroneous, is binding, unless it is challenged and set aside by a higher
forum. Be that as it may.
19.
We
are fortified in our view by the decision in D. Ranganayakulu vs. Superintending
Engineer NSRC (CA No. 10871088 of 2008 decided on7.2.2008). This Court dealing
with an identical situation held : "Mr. Anoop Choudhary, learned senior
counsel appearing for the respondents, however, referred to a decision of three
Judge Bench of this Court rendered in State of A.P. & Anr. Vs. Oburu Reddy (2001)
10 SCC 30. 20 We are of the view that the facts of that case is not applicable
in the present case. In the case referred to by Mr. Anoop Choudhary, learned
senior counsel, it clearly appears that the appointment of arbitrator was
challenged in the High Court contending, inter alia, the jurisdiction of the
arbitrator. As already pointed out, in the present case, the respondent did not
challenge the order of the Court dated 30/04/1993 appointing Mr. Justice Punniah,
retired Judge of the High Court as sole arbitrator. They participated in the
entire proceedings before the arbitrator without any demur till the award was
passed on 02/03/1995. In the facts and circumstances as recited above, the
respondents waived their rights to file an objection at the time when the award
was made Rule of the Court." Conclusion :
20.
Therefore,
the order of the High Court dated 5.10.1999 in CRPNo.134 of 1995 setting aside
the order dated 25.3.1991 is liable to be set aside. When the order dated
25.3.1991 stands restored, the consequential direction in the order dated
5.10.1999 of the High Court allowing CMANo.12590 and CRP No.4055 of 1990,
becomes unsupportable and requires to be set aside. The High Court has to now
consider on merits the challenge to the order rejecting the application under
sections 30 and 33 of the Act.
21.
Therefore
these appeals are allowed as follows :
a. The impugned order
dated 5.10.1999 in CRP No.134 of 1995 (setting aside the order dated 25.3.1991
under section 8(2) of the Act in O.P. No.62/1992 on the file of Subordinate
Court, Nellore), is set aside and the said order dated 25.3.1991 stands
restored.
b. As a consequence, the
order dated 5.10.1999 allowing CMANo.1251/1993 and CRP No.4055/1993 is set
aside.
c. CMA No. 1251/1993 and
CRP No.4055/1993 are remanded to the High Court for fresh consideration and
disposal in accordance with law on merits.
d. Consequently, the
order dated 28.4.2000 dismissing the review CMPNos.5446/2000 and 5447/2000 is
set aside
.
...........................J. (R V Raveendran)
.............................J.
(Dalveer Bhandari)
New
Delhi;
November
11, 2010.
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