judgement:
has indisputably been done pursuant to an order of the Court of law and the party who has done the work must be paid its remuneration.
[400C] & CIVIL APPELLATE.JURISDICTION: Civil Appeal No. 2121 of 1989.
385 From the Judgment and Order dated 4.6.1987 of the Jammu and Kashmir High Court in Application No. 180 of 1987.
Altar Ahmed and S.K. Bhattacharya for the Appellant.
S.N. Kacker, E.C. Agarwala and Ms. Purnima Bhat for the Respondent.
The following Judgments of the Court were delivered: SHARMA, J.
The present respondent who is an approved contractor of the Jammu & Kashmir State Forest Corporation (appellant before us) filed an application under sections 8, 11 and 20 of the Jammu & Kashmir Arbitration Act, 2002 (Smvt.), on the original side of the High Court of Jammu & Kashmir praying for a direction to the Corporation defendant to file an agreement between them fully described therein, and to refer the dispute mentioned in the application to an arbi trator.
Jammu & Kashmir Arbitration Act is similar to the , enacted in identical language.
The Corporation objected, pleading inter alia that the entire work allotted to the plaintiff contractor under the agree ment had been completed by him without any dispute, and the present claim of the plaintiff is not covered by the agree ment in question or its arbitration clause A learned single Judge of the High Court allowed the prayer for reference to the dispute described in the respondent 's application, and further granted an interim relief.
This judgment is under challenge before this Court by the defendant Corporation.
Special leave is granted.
As stated in the affidavit of the plaintiff contrac tor, the Corporation was created under the Jammu & Kashmir Forest Corporation Act, 1978 and its main functions are: (i) to undertake research programmes and to render technical advice to the State Government on the matters relating to forestry, (ii) to manage, maintain and develop forests transferred or entrusted to it by the Government, and (iii) to undertake removal and disposal of trees and exploitation of forest resources entrusted to it by the Government.
In February 1986 the Corporation invited tenders for extraction of timber from an area described as Compartment No. 59 Marwa which included the work of felling and removal of trees.
The plaintiff submitted his tender and was ultimately granted the work contract with reference to 4 lac cft.
standing volume timber.
Subsequently in 1987 he was also entrusted with an additional work contract for a further quantity of 2 lac cft.
in the said Compartment 59 Marwa.
Although a deci sion by the authorities had 386 been taken for extraction of a total standing volume of 10,08,000 cft.
, the plaintiff was entrusted with the extrac tion work of only 6 lac cft.
Thus 4,06,000 cft.
of standing volume remained in the area to be extracted later.
According to his case the plaintiff was entitled to get this addition al work in accordance with the practice prevalent in the Corporation and assurances given to him.
It was alleged that since the Managing Director of the Corporation was not agreeable to allow this additional work, the plaintiff approached the Chief Minister of the State who asked the Managing Director to allot him the remaining work.
The Manging Director first agreed to issue necessary orders but later refused to carry out the Chief Minister 's direction which necessitated the filing of the application before the High Court.
The Corporation denied any such practice and refuted the allegation about any assurance given on its behalf as also the statement about the Managing Director agreeing at one stage to allot the additional work in ques tion on the intervention of the Chief Minister.
It was further stated by the Corporation that a large amount of extracted timber was lying in the area and had to be re moved.
Admittedly the timber had to be transported to a distant place through difficult terrain (as has been specif ically mentioned by the contractor himself) and was, there fore, likely to take a considerable time.
The Corporation said that a decision had been taken not to work the Compart ment further till the entire timber already extracted was removed to its destination, and there was, therefore, no question of entrusting the remaining work to anybody for the present.
A decision as to how and when the additional trees will be felled and the timber removed is for the Corporation to make and it is under no obligation to the contractor in this regard.
So far as the work allotted to the contractor under the agreement is concerned, it is already complete without giving rise to any difference between the parties.
Reliance has been placed on behalf of the plaintiff before us on paragraph 41 of the agreement under which the work contract in respect to 6 lac cft.
was obtained by him, and which says that the terms and conditions of the tender notice issued by the Corporation will be terms and condi tions of the agreement.
The 15th paragraph of the tender notice reads thus: 15.
Extension for the additional volume available in the coupe will not be claimed as matter of right.
But may be consid ered by the Management where the achievement is 100%.
" 387 The arbitration clause being Clause 42 of the agreement states thus: "42.
Any dispute, difference or question which may at any time arise between the parties in respect of the work to be executed by the second party under this agreement shall be referred for arbitration to the Managing Director, J & K. State Forest Corporation, whose decision shall be final and binding on both the parties.
" As it appears from the plaintiff 's application before the High Court, his claim was rounded on "procedure", "practice," "custom", and "assurances extended to the peti tioner to that effect by the respondent Corporation through its functionaries from time to time." Although it has been contended before us that since paragraph 15 of the tender notice refers to additional volume of work to be allotted in the future, the agreement between the parties including the arbitration clause must be interpreted to include within its sweep the present claim of the respondent to the additional work of extraction, the case for reference pressed before the High Court rested mainly on the alleged "practice" and "assurances".
The High Court has emphasized in its judgment the fact that the trees in question had already been marked for extraction and, therefore, have to be felled "one day or the other" and deprecated the attitude of the Corporation in the following words: "The contention of the learned connsel for the respondents is that the respondents do not want the remaining timber to be extracted presently for unknown reasons and as such the corporation cannot be compelled for grant of sanction for extraction of remaining marked timber.
1 think the attitude of the respondent corporation is most derogatory to the facts and circumstances of the case when the peti tioner is prepared to accept all sorts of offers.
It cannot be denied that the remaining timber is to be extracted one day or the other and simply to put the petitioner to loss would not be justifiable in any manner.
" There was absolutely no justification for the Court to have commented as above when it was leaving the matter to be decided by the arbitrator.
A court, while considering the question whether an alleged dispute between the parties has to be referred for arbitration or not should refrain from expressing its opinion on the merits of the dispute which may embarrass the arbitrator.
However, the main issue before us is whether the dispute mentioned in the contractor 's application 388 could have been referred to arbitration at all.
If the foundation of the claim of the respondent be any alleged assurance or custom or practice, it cannot be said that such claim arises out of the written agreement between the parties; and so the prayer for reference has to be rejected.
If the case pleaded is true, the appropriate forum for the respondent will be a court of law directly granting the relief in an appropriate legal proceeding.
It was, however, argued on behalf of the respondent before us that in view of paragraph 15 of the tender notice, quoted earlier, which must be treated as a part of the agreement, the respondent has a right to be considered for allottment of the additional work since his past performance has been excellent.
We are afraid, the impugned judgment of the High Court cannot be defended on this basis and the prayer of the respondent for reference of the dispute, as mentioned in his application before the High Court, cannot be granted under the 15th paragraph of the tender notice aforementioned.
The language of the said term is explicit in declaring that the contractor would not be allowed to claim as a matter of right additional volume of work.
His right extends only to a consideration of his case by the management when the ques tion of allotment of additional work is taken up.
But by the application filed before the High Court the respondent did not ask for reference of a dispute as to whether he is entitled to consideration or not; the prayer is for refer ence of a higher claim of immediately getting the additional work, and this prayer has been allowed.
This issue cannot be said to have any connection with the 15th term of the tender notice or any other provision thereof or of the agreement.
A reference to the decision of this Court in Seth Thawardas Perumal vs The Union of India, [1955,] 2 SCR 48, will be helpful.
The appellant, a contractor, entered into a con tract with the Dominion of India for the supply of bricks.
A Clause in the contract required, " . . all questions and disputes relating to the meaning of the specification and in structions hereinbefore mentioned and as to quality of materials or as to any other ques tion, claim, right, matter or thing whatsoever in any way arising out of or relating to the contract, specification, instructions, orders or these conditions, or otherwise concerning the supplies whether arising during the progress or delivery of after the completion of abandonment thereof . " emphasis added) to be referred to arbitration.
It was agreed that the bricks would be 389 prepared in lots and it would be the duty of the Government to remove the bricks as soon as they were ready for deliv ery.
In order to keep to the schedule for delivery, the contractor had to prepare 'kateha ' bricks and place them in his kilns for baking, and while this lot was baking he had to prepare another lot of 'kateha ' bricks ready to take the place of the baked bricks as soon as the Government removed them.
At a certain stage the Government department failed to remove the baked bricks in time which caused a jam in the kilns and prevented the contractor from placing a fresh stock of unburnt bricks in the kilns.
Consequently the stock pile of kateha bricks kept on mounting up when the rains set in, destroying 88 lacs of katcha bricks.
The contractor claimed the loss arising out of the neglect of the Govern ment department in performing its duty in time.
The Govern ment denied the claim and a reference of the dispute was made to the arbitrator designated in the agreement who made an award and filed it in court.
On the Constitution coming into force the Dominion of India was replaced by the Union of India as the defendant in the case and it was contended on its behalf that the katcha bricks did not form part of the contract and that the loss that was occasioned by the damage to them was too remote to be covered by the arbitra tion clause.
The second ground of defence was based on Clause 6 of the agreement which absolved the Government from any liability for a damage to unburnt bricks.
The stand of the contractor was that the chief reason of the destruction of the katcha bricks was the failure of the department to lift the monthly quota of the bricks in accordance with the written agreement; and, Clause 6 of the agreement referred only to such cases where the department had no control, and would not cover a case of its own default.
The Supreme Court did not agree with him and set aside the award, inter alia observing, that if he chose to contract in the terms includ ing Clause 6 of the written agreement he could not go back on his agreement when it did not suit him to abide by it.
In the case before us, the plaintiff contractor is trying to connect the allotment of future work by a reference to paragraph 15 of the tender notice which specifically says that additional work could not be claimed as a matter of right.
The High Court, therefore, was not correct in inter preting the aforementioned Clause 15 in the following words: "There was clause 15 in the tender notice according to which extension of addi tional volume available in the coupe would not have to be claimed by the contractor as a matter of fight but he would have to be con sidered by the management where his achieve ment was 100%.
In the present case the achievement of the petitioner was 300% and 390 under such circumstances the petitioner had all the right to claim additional work in the said coupe.
" Besides, if this view be assumed to be correct, what was there left for the arbitrator to decide? Further, it is not alleged or suggested that the Corporation has ever indicated its unwillingness to consider the respondent when it takes up the question of allotting the additional work.
In absence of a repudiation by the Corporation of the respondent 's right to be considered, if and when occasion arises, no dispute can be said to have arisen which may be referred for arbitration.
In order that there may be reference to arbi tration, existence of a dispute is essential and the dispute to be referred to arbitration must arise under the arbitra tion agreement.
When in the future, the Corporation makes a decision for the execution of the additional work and takes up the question of executing a contract for the purpose, the stage for consideration of the plaintiff respondent 's claim would be reached and a dispute may then arise if the Corpo ration refuses to consider the claim.
Neither the agreement nor the tender notice deals with the question as to the conditions and time for grant of any additional work to the plaintiff and if his claim be interpreted as a demand for immediate allotment of any future work, the same cannot be connected with the agreement or the tender notice.
We, therefore, do not agree with the observations of the High Court that the conduct of the Corporation in not taking up immediate deforestation of a part of Compartment No. 59 Marwa is reprehensible, simply for the reason that the trees in the area concerned are "to be extracted one day or the other" or that the plaintiff has the right to claim the additional work on the ground that his achievement in the past has been more than 100%.
We also hold that the claim raised by the plaintiff in his application before the High Court is not covered by the arbitration clause and cannot be referred for a decision of the arbitrator.
The order of reference passed by the High Court, therefore, has to be set aside.
By the interim order the High Court permitted the plaintiff to execute the additional work claimed by him without waiting for the award.
On the quashing of the main order of reference, the interim order automatically disap pears, but we would, however, like to briefly indicate the scope of Court 's power to issue interim orders at the time of reference of a dispute to arbitration, and point out how in the present case the High Court was in grave error in granting the interim relief.
The relevant provision in the Jammu & Kashmir Arbitration Act, 2002 (Smvt.) is in section 41(b) which is quoted below: 391 "41. ,Procedure and powers of Court.
Subject to the main provisions of this Act and of rules made thereunder (a). . . . . . . . (b) the Court shall have, for the purpose of, and in relation to, arbitration proceedings, the same power of making orders in respect of any of the matters set out in the Second Schedule as it has for the purpose of, and in relation to, any proceed ings before the Court: Provided that nothing in clause (b) shall be taken to prejudice any power which may be vested in an arbitrator or umpire for making orders with respect to any such mat ters.
" section 18 deals with the power of Court to.
pass interim orders after award is actually filed in Court.
So far as clause (a) of section 41 is concerned, it makes only the proce dural rules of the Civil Procedure Code applicable.
The source of power to grant interim relief cannot be traced to clause (a), otherwise as was pointed out in H.M. Kamaluddin vs Union of India, , clause (b) would become otiose.
So far as clause (b) is concerned, it circumscribes the Court 's power within the limits indicated in the Second Schedule and further qualifies it by declaring in the Provi so that it cannot be used to the prejudice of any of the powers of the arbitrator.
The interim direction can be issued only "for the purpose of" arbitration proceedings and not to frustrate the same.
In the present ease the plain tiff contractor was allowed by the High Court to execute the extraction work which was the subject matter of the arbitra tion.
Mr. Kacker, appearing for the plaintiff.
respondent, argued that in pursuance of this part of the impugned judg ment the plaintiff was able to cut down all the trees in question before this Court passed an order of stay.
In other words it is claimed on behalf of the plaintiff respondent that he was able to completely frustrate the arbitration proceeding in a very short time on the strength of the interim order.
This statement of fact has been seriously challenged by the petitioner Corporation; but whatever be the factual position, the High Court by granting the interim relief, not in the shape of an injunction in the negative form, but by a mandatory direction clothing the plaintiff with the right to do something which he could have been entitled to, only after a final decision on the merits of the case in his favour, committed a serious error.
Paragraph 1 of the 392 Second Schedule speaks of the preservation of subject matter of the reference and paragraph 3 also highlights that as pect.
The 4th paragraph which mentions "interim injunction or the appointment of a receiver" has also to be interpret ed in that light specially because of the language of clause (b) of section 41 and the Proviso thereto.
The second part of the judgment under appeal is also, therefore, set aside.
It has been averred before us on behalf of the plain tiffrespondent that all the trees in question were cut down, and so the plaintiff must be permitted to complete the remaining work including their transportation to the desti nation.
The learned counsel for the Corporation placed reliance on the statements in several affidavits and con tended that if the entire circumstances including the period which could have been available to the respondent for the purpose of felling the trees, are examined, there is no escape .from the conclusion that the respondent had felled the trees or majority of them after service of the stay order passed by this Court.
We do not think it necessary to examine and decide this controversy as in our view the respondent, in the facts and circumstances of this case, cannot take any advantage from or claim compensation for the hurried steps he alleges to have taken under the strength of the illegal order interim in nature, which we are setting aside.
In the result, the appeal is allowed.
The impugned judgment the High Court is set aside and the respondent 's application filed before the High Court for reference is dismissed.
The respondent shall pay the costs of this Court and of the High Court to the appellantCorporation.
SABYASACHI MUKHARJI, J.
I have read the judgment pro posed to he delivered by L.M. Sharma, J. with which the learned Chief Justice has agreed.
With great respect, I am unable to agree with them on the view that there was no arbitration agreement subsisting covering the dispute in question between the parties.
It is, therefore, necessary to refer to certain facts, as I view these.
This appeal by special leave is directed against the judgment and order of the High Court of Jammu & Kashmir, dated 4th June, 1987.
The Jammu & Kashmir Forest Corporation is the appellant.
The undisputed facts leading to this appeal are that one Abdul Karim Wani, the respondent No. 1, filed an application for referring certain matters alleged to he in dispute to an independent arbitrator; and that for the last 15 years the respondent had been working as a contractor for the 393 appellant Corporation, namely, Jammu & Kashmir Forest Corpn.
and was carrying on various activities in different forest areas in Jammu Province, including felling, machine sawing, pathroo, paccinali, rope span, mahan and transportation.
It is stated that in February, 1986 the said Corporation issued tenders for felling, handsawing, pathroo, paccinali and mahan work of timber to be extracted from compartment No. 59 Marwah, In response thereto the petitioner to the original application being the respondent herein, submitted his quotation and offered the lowest rate of 11.74 per cft.
and thereby secured the contract.
A formal agreement was also executed between the parties.
In October, 1987 after about 7 months from the issuance of first work order the appellant Corporation through its General Manager (Extrac tion) issued a sanction for further quantity of 2 lac cft.
sawn volume in compartment No. 59 Marwah, on the same rates, terms and conditions as contained in the original contract.
The sanction appears at pages 26 & 28 of the present appeal papers before us.
It appears that the total marking carried out in com partment No, 59 was 10,08,000 cft.
standing out of which only 6 lac cft.
was sanctioned in favour of the respondent.
The compartment in question is at a distance of Over 70 kms.
from the nearest road point and the timber extracted from the compartment had to travel by pathroo, paccinali and mahan through Chenab river for a total distance of 80 kms.
before it is collected at loading point of Dedpeth.
1t is, further, the case of the respondent that "as per the procedure, practice, custom and assurances extended to the respondent by the appellant Corporation through its functionaries, from time to time," the entire marking con ducted in a particular compartment for extraction was re quired (emphasis supplied) to be handed over to the respond ent in compartment No. 59.
As regards sale, it is suggested that as the compartment is situated in one of the remotest area of Jammu province where making arrangements for extrac tion of timber including cartage/carriage of foodgrains, saws, tools and implements is very difficult, it was never intended that the balance work remaining in the compartment for extraction would be given to any other contractor.
The case of the respondent is that acting upon the assurances and representations of the appellant Corporation that the entire work in the aforesaid compartment would be handed over to him, the respon 394 dent had made adequate arrangement after investing Rs.5 lacs by way of provision for rations, saws, tools and implements etc.
All these arrangements at that scale were necessary and were made just to extract entire marked timber from the compartment in question and not just initially tendered quantity.
That would have been wholly uneconomical.
It was further asserted that there was also the practice in the Corporation that once a compartment was handed over to the contractor for work, it was taken back from him only after the entire available work in the said compartment stood concluded.
The contractor further alleged that the appellant Corporation was not allotting rest of the work to him contrary to the policy adopted and assurances extended, as mentioned hereinbefore.
The respondent furnished in stances where such conduct or procedure of making allot ments, as alleged by the respondent, had been followed.
We were referred to the sanction in favour of M/s. Ghulam Hussain, Sukhjinder Singh in respect of compartment No. 82 Lander on 28.4.87, Mst.
Jana Begum in respect of compartment No. 30 B, Dachhan and 62 Marmat dated 10.3.87, Sh.
Rehmatul lah Bhat for compartment No. 19A Paddar dated 5.5.87, Nas sarnllah Malik for compartment No. 16 Ramban on 12.5.87 and Irshad Ahmed Shah in respect of compartment No. 62 Sewa dated 4.2.87.
On behalf of the Corporation and others, it was stated before the learned Judge of the High Court that there was no assurance and no practice regarding grant of the contract to the respondent contractor Abdul Karim Wani, in the manner alleged.
Further, it was alleged that the respondent and the Corporation had decided not to work on the compartment till the entire extracted timber was removed to sale depot.
Once that decision was there the instances quoted by the contrac tor proved useless, according to the appellant.
It, however, very clearly appears that in compartment No. 59 Marwah marked standing trees were to the extent of 10,08,000 eft.
The second aspect emerging is that out of this volume only 6 lac eft.
standing timber had been sanctioned in favour of the contractor on two different occasions, and such timber had been extracted, removed and taken to the loading point.
The only dispute subsisting was about the rest of the stand ing trees i.e., 4,80,000 cft.
It is not disputed that the said remaining cfts.
have been marked.
These remained as marked timber which required to be extracted.
The respondent claims preference for grant of contract of extraction by way under the clause in the relevant sanction.
The only conten tion of the appellant was that they had no intention to extract 395 the said timber till other extracted timber was taken to the depot.
The case of the appellant as noted by the learned Judge in his judgment, was that the remaining timber to be extracted presently for 'unknown reasons ' was not to be then extracted and, as such, the Corporation could not be com pelled to grant or sanction extraction of remaining marked timber.
The learned Judge by his impugned judgment and order deprecated the conduct of the authorities concerned.
He proceeded on the basis that inasmuch as the remaining timber had to be extracted one day or the other, the entire work should have been given to the respondent.
In the present case, the learned Judge noted that the performance of the respondent contractor as 300%.
The respondent was entitled to the grant of this contract even if his performance had merely been 100%.
The learned Judge found that there were two different points to be examined.
He found that there existed a dispute between the parties touching the agreement executed between them.
The matter in dispute was referred to the named arbitrator, namely, the Managing Director of the State Forest Corporation, who was directed to adjudicate upon the same and submit his award within the statutory period of four months.
The learned Judge went further and as an interim measure directed that the petitioner before him, namely, the re spondent herein be allowed to do the remaining work of extraction of timber of standing marked trees in compartment No. 59 Marwah and the rates were to be determined by the arbitrator, after hearing both the parties.
This order is the subject matter of the appeal.
The main question involved in this appeal is whether there was any subsisting arbitration agreement in respect of the matters sought to be referred.
The second aspect in volved herein is whether the learned Judge was justified in making the impugned order by directing that the petitioner be allowed to do the remaining work of extraction of timber of standing marked trees in compartment No. 59 Marwah, and the rates be determined by the arbitrator after hearing both the sides.
It was contended on behalf of the appellant that the learned Judge travelled beyond the scope of his juris diction.
It was submitted that there was no subsisting arbitration agreement covering the entire area of 10,08,000 eft.
There were only two subsisting contracts one being a contract for felling trees of 4 lacs eft dated 6th March, 1986, and another for 2 lacs eft in addition, dated 28th October, 1986.
The agreement dated 6.3.86 provided that dispute in respect of these 396 should be referred to arbitration but there was, according to the appellant, no subsisting contract in respect of the remaining 4 lacs cft.
The respondent had only a right to be considered in respect of the rest and yet no contract had been granted to him.
Therefore, there being no subsisting contract there was no scope for reference to arbitration.
In my opinion, it is not the correct way to look at the facts of this case.
It appears from the first agreement, which is at page 142 onwards of the present paper book that it con tained, inter alia, the following clauses.
"The quantum of work under each activity/sub activity is estimated and as such cannot be guaranteed and can be increased or decreased upto 25% by the General Manager Ext.
East Jammu East on the contract rates subject to prior approval of the Managing Director.
Any subsequently marking carried out in a section/unit under work with the contractor shall be included in this increase of 25%.
" It also contained clause 15 which was to the following extent: "Extension for the additional volume available in the coupe will not be claimed as matter of right.
But may be considered by the Management where the achievement is 100%.
" Clause 17 of the said agreement which provided for reference to arbitration was the following: "Any dispute, difference, question which may at any time arise between the parties in respect of the works to be executed by the contractor(s) shall be referred for arbitra tion to the Managing Director J&K SFC whose decision shall be final and binding on both the parties.
" In respect of the second contract that similar terms were there, was not disputed before us.
Therefore, even though where the achievement of the contractor was 100% the contractor had a right only to be considered for grant of the additional work.
In this case it was contended on behalf of the appellant Corporation that the Corporation could not be compelled by the process of an application under Section 20 of the Arbitration Act to grant additional work to the contractor.
On the other hand, the contractor had pleaded that where the 397 achievement of the contractor in respect of the subsisting contract was 100% the contractor had a right to be consid ered for grant of the additional work, while in this case his performance was 300%.
Additional volume available in the coupe was liable to be granted to him or, at least, he was entitled to be considered in accordance with equity and justice.
The contractor has further alleged that while others in similar position had been granted this additional work, he had been wrongfully denied.
His claim was that he having fulfilled 300% performance, was entitled to the remaining work of the additional work.
It was contended on behalf of the appellant before us that there cannot be any application for filing of an arbi tration agreement for the arbitrator in respect of the contract which had not been entered into.
I am unable to accept this submission.
Clause 17 of the arbitration agree ment provided that any dispute, difference, question which might at any time arise between the parties in respect of the works to be executed by the contractor(s) should be referred to the arbitration of the Managing Director of the Jammu & Kashmir State Forest Corpn.
Therefore, it appears to me that dispute which had arisen between the parties in respect of the "works to be executed" by the contractor was a dispute which was referable in terms of the clause 17 and the dispute was, according to the pleadings, the custom, practice and procedure of granting additional volume of available coupe where the timber trees had been marked but not extracted to be considered by the Government for grant of the contract.
The contract alleged if such proper consid eration or lawful consideration in accordance with the principles of equity and justice had been made, the contract would have been granted to the contractor.
Therefore, the contractor claimed that he was entitled to the grant of additional volume of work.
In my opinion, there was a dis pute whether the contractor was entitled to the grant of additional volume of the work.
Such dispute was a dispute between the parties in respect of the "works to be executed by the contractor.
" I am clearly of the opinion that the dispute in this case was a dispute between the parties in respect of the "works to be executed by the. contractor".
In that view of the matter and in the light of clause 15 read with clause 17, the dispute in this case was clearly referable to arbi tration of the Managing Director, Jammu & Kashmir State Forest Corpn.
An arbitration agreement is one which is defined in Section 2(a) of the as a written agreement to submit present or future differences to arbi tration.
There was, in this case, an arbitra 398 tion agreement, that is to say, the parties had been ad idem.
The agreement was in writing.
It was not a contingent or a future contract.
It was a contract at present time to refer the dispute arising out of the present contract en tered into by the parties as a result of which the contrac tor got a right or a privilege to ask for consideration of grant of the further work.
It was not as sought to be argued a mere right to get the additional work.
Hence, in my opin ion, it could not be contended that there was no agreement.
Endeavour should always be to find out the intention of the parties, and that intention has to be found out by reading the terms broadly, clearly, without being circumscribed.
This contention of the appellant cannot, therefore, be accepted.
In the light in which I have read the facts, I am unable to accept the position that the claim raised by the plain tiff in this application before the High Court was not covered by the arbitration clause.
The amplitude of the arbitration clause, in my opinion, was wide enough and should be so read for the reasons mentioned hereinbefore.
If that is the position then the order of reference by the High Court was not bad and cannot be set aside.
I am unable to agree that the decision of this Court in Seth Thawardas Pherumal vs The Union of India, indicated that in the facts of this case, there could not be reference to the arbitration.
That was a case where the appellant, a contractor, entered into a contract with the Dominion of India as it then was for supply of bricks.
A clause in the contract required all disputes arising out of or relating to the contract to be referred to arbitration.
Disputes arose and the matter was duly referred.
The arbitrator gave an award in the contractor 's favour.
It was held that it was not enough for the contract to provide for arbitration but something more was necessary.
An arbitrator only got juris diction when either, both the parties specifically agreed to refer specified matters or, failing that, the court com pelled them to do so under the arbitration clause if the dispute was covered by it.
That case was mainly concerned with a specific question of law.
This Court referred to the decision of this Court in A.M. Mair & Co. vs Gordhandass Sagarmull, ; at 798 where this Court quoted a passage from Viscount Simon 's speech in Heyman vs Darwins Ltd., [1942] Appeal Cases 356 at 368.
Here in this case the clause as I read it gave the respondent a right to be con sidered.
The respondent 's grievance was, if properly consid ered his performance being 300% achievement he was entitled in the facts and circumstances set out hereinbefore to the grant of the contract and further similarly placed persons had been so given.
That right had not been duly considered.
That is the dispute in the present case and that dispute is clearly referable to the arbitration 399 clause as mentioned hereinbefore.
I am, therefore, unable to accept the position that the order of reference passed by the High Court is bad.
The second challenge to the order of the High Court was that the order so far as it directed under Section 20 of the that the petitioner be allowed to do the remaining work of extraction of timber of standing market trees in compartment No. 59 Marwah, was wholly without jurisdiction.
For this reference may be made to Section 41 of the which provides that for the purpose of and in relation to arbitration proceedings, the Court has such powers to pass interim orders for detention, preserva tion, interim custody and sale of any property the subject matter of the reference for preservation or inspection of any property or thing the subject matter of the reference or as to which any question may arise therein for taking of samples and making observations and experiments; for secur ing the amount in difference in the reference; for granting an interim injunction and appointing a receiver as the Court has in relation to any proceeding before it.
But though under Section 41(b) the Court has power to pass an interim order of injunction or appointment of receiver, in my opin ion, the Section does not empower the Court to direct execu tion of the contract, the extent of which is in dispute and is a matter referable to be adjudicated by the arbitrator.
If the Court does so then the decision of the dispute be comes academic because the contract is executed.
Where the question is whether the contract was to be executed by the respondent, if the contract is in fact executed by the respondent by virtue of the order of the Court, then nothing remains of the dispute.
There is nothing arbitrable any more and proceedings before the arbitrator cannot, in my opinion, be forestalled by interim order by ordering execution of the contract before it is decided whether it had any right to the contract for additional work in the garb of preservation of the property.
In that view of the matter, I am clearly of the opinion that the interim directions given by the High Court that the "contractor be allowed to do the remaining work of extrac tion of timber of standing marked trees in compartment No. 59, Marwah" was beyond the competence of the Court.
In this respect I agree with my learned brothers.
But so far as the Court directed that the rates be determined by the arbitrator after hearing both the parties, this direction, in my opinion, was clearly within the juris diction provided this dispute was referred to the arbitra tion.
In this case unfortunately after the order of the High Court was passed and before any order of stay could be 400 passed by this Court in a petition under Article 136 of the Constitution, the respondent had done the work of extraction of timer of standing marked trees in compartment No. 59 Marwah.
Therefore, it would be inappropriate to interfere with this order.
The events have overreached the decision of the Court.
It would be unjust to deprive any party of its dues simply because the work has been done in view of a wrong order or incorrect order of the Court of justice when there was no stay.
Would it be just to deprive a suitor of his dues in this manner under Article 136 of the Constitu tion? I have no doubt in my mind that it would be unjust.
The work indisputably has been done pursuant to an order of the Court of law and the party who has done the work must be paid its remuneration.
How would that remuneration be set tled, would it be by a decree in the suit or would it be by adjudication of an award? In the view I have taken that there was a valid reference on the contention of the re spondent, this question which was incidental thereto must be decided along with that contention.
In any view of the matter, however, for determining the work done pursuant to the liberty or right given by the Court which was not stayed by this Court arbitration undoubtedly is a better method of finding out the dues in respect of that work done.
I would not, therefore, in any event alter this direction of the High Court.
In the aforesaid view of the matter, in my opinion, it would be inappropriate to interfere with the interim direc tion of the High Court though the direction was beyond jurisdiction.
In the premises I would have disposed of the appeal by directing the arbitrator to determine the rates in respect of the extraction of the remaining timber of stand ing marked trees in compartment No. 59 Marwah.
In the aforesaid view of the matter, I would have made no order as to costs.
N.V.K. Appeal al lowed.

dataset_name: IN-Abs

summary/full:
The appellant, a Corporation was created under the Jammu functions was to undertake the removal and disposal of trees and exploitation of the forest resources entrusted to it by the Government.
The Corporation took a decision for the extraction of timber of a total volume of 10.08 lakh c. ft. which included the work of felling and removal of trees.
The respondent an approved contractor submitted his tender and was granted the works contract initially with reference to 4 lakh c. ft., and subsequently he was entrusted with an additional work for a further quantity of 2 lakh c. ft.
The respondent completed the entire work under the contract.
Thereafter, he claimed that he was entitled to the remaining volume of the work, namely, 4.08 lakh c.ft.
as per the procedure, prac tice, custom and usage extended to him.
The appellant denied any such practice, custom or assurance and said that a decision had been taken not to work the area further till the entire timber already extracted was removed to its destination.
There was, therefore, no question of entrusting the remaining work to anybody.
Paragraph 15 of the Tender Notice stipulated that: "Extension for the additional volume in the coupe will not be claimed as a matter of right but may be considered by the Management where the achievement 381 is 100 per cent.
" The agreement provided for arbitration which was contained in clause 42, and which stipulated: "that any dispute, differences or question that may arise was to be referred for arbitration to the Managing Director of the Jammu & Kashmir Forest Corporation.
" The respondent filed an application under sections 8, 11 and 20 of the Jammu and Kashmir Arbitration Act, 2002 (Smvt) in the High Court for a direction to the Corporation to file the agreement and to refer the dispute to an arbitrator.
The High Court deprecated the attitude of the Corpora tion in not awarding the remaining work to the respondent.
It held that the trees in question had already been marked and had, therefore, to be felled 'one day or the other ', and as the contractor 's achievement was 300 per cent he had all the right to claim the remaining work as provided in para graph 15 of the Tender Notice.
The High Court also found that as there existed a dispute touching the contracts executed between the parties, it referred the matter under clause 42 of the agreement to the named arbitrator, namely, the Managing Director of the State Forest Corporation.
The High Court went further and by an interim order directed that the contractor be permitted to do the remain ing work of extraction of timber of standing marked trees and the rates be determined by the arbitrator after hearing both the parties pursuant to the said interim order.
Aggrieved by the aforesaid orders of the High Court the appellant appealed to this Court by special leave.
On the questions: (i) whether there was any subsisting arbitration agreement in respect of the matters sought to be referred, and (ii) whether the interim order of the High Court directing the respondent to do the remaining work was without jurisdiction, and whether the respondent was enti tled to any compensation for the work done.
Allowing the appeal, the Court, HELD: [R.S. Pathak.
CJ and L.M. Sharma, J. Majority Per L.M. Sharma.
J.] 1.
The claim raised by the respondent in his application before the High Court is not covered by the arbitration clause and cannot be 382 referred for a decision of the arbitrator.
The order of reference passed by the High Court has therefore to be set aside.
[390F] 2.
If the foundation of the claim of the respondent be any alleged assurance or custom or practice, it cannot be said that such claim arises out of the written agreement between the parties; and so the prayer for reference has to be rejected.
If the case pleaded is true, the appropriate forum for the respondent will be a Court of Law directly granting the relief in an appropriate legal proceeding [388A B] 3.
The language of the term contained in para 15 of the tender notice is explicit in declaring that the contractor would not be allowed to claim as a matter of right the additional volume of work.
His right extends only to a consideration of his case by the management when the ques tion of allotment of additional work is taken up.
But by the application filed before the High Court the respondent did not ask for reference of a dispute as to whether he is entitled to consideration or not; the prayer is for refer ence of a higher claim of immediately getting the additional work, and this prayer has been allowed.
This issue cannot be said to have any connection with the 15th term of the tender notice or any other provision thereof or of the agreement.
[388D E] 4.
In the absence of a repudiation by the Corporation of the respondent 's right to be considered, if and when occa sion arises, no dispute can be said to have arisen which may be referred for arbitration.
[390B] 5.
In order that there may be a reference to arbitra tion, existence of a dispute is essential, and the dispute to be referred must arise under the arbitration agreement.
[390C] Seth Thawardas Pherumal vs The Union of India, relied on.
There was no justification for the High Court in deprecating the Corporation for not awarding the remaining work 10 the contractor when it was leaving the matter to be decided by the arbitrator. [387G] 7.
A Court, while considering the question whether an alleged dispute between the parties has to be referred for arbitration or not, should refrain from expressing its opinion on the merits of the dispute which may embarrass the arbitrator.
[387G H] 383 8.
Section 18 deals with the power of the Court to pass interim orders after award is actually filed in Court.
So far as clause (a) of Section 41 is concerned, it makes only the procedural rules of the Civil Procedure Code applicable.
The source of power to grant interim relief cannot be traced to clause (a), otherwise clause (b) would become otiose.
So far as clause (b) is concerned, it circumscribes the Court 's power within the limits indicating in the second Schedule, and further qualifies it by declaring in the Proviso that it cannot be used to the prejudice of any of the powers of the arbitrator.
[391 D E] H.M. Kamaluddin vs Union of India, relied on.
Interim directions can be issued only 'for the pur pose of ' arbitration proceedings and not to frustrate the same.
[391E] 10.
The High Court in the instant case, by granting the interim relief, not in the shape of an injunction in the negative form, but by a mandatory direction clothing the respondent plaintiff with the right to do something which he could have been entitled to only after a final decision on the merits of the case in his favour committed a serious error.
[391G H] [Per Sabyasachi Mukharji, J partly dissenting] 1.
There was a dispute in the instant case, whether the contractor was entitled to the grant of the additional volume of work.
Such dispute was a dispute between the parties in respect of the 'works to be executed by the contractor '.
In that view of the matter and in the light of clause 15 read with clause 17 of the Agreement the dispute was clearly referable to the arbitration of the Managing Director, Jammu & Kashmir State Forest Corporation.
[397F G] 2.
Endeavour should always be to find out the intention of the parties, and that intention has to be found out by read ing the terms broadly, clearly, without being circumscribed.
[398B C] 3.
An arbitration agreement is one which is defined in section 2(a) of the as a written agreement to submit present or future differences to arbi tration.
There was, in the instant case, an arbitration agreement that is to say, the parties had been ad idem.
The agreement was in writing.
It was not a contingent or a future contract.
It was a contract at present time to refer the dispute arising out of the present contract entered into by the parties as a result of which the 384 contractor got a right or privilege to ask for consideration of grant of the further work.
It was not a mere right to get the additional work.
The amplitude of the arbitration clause was wide enough and should be so read.
[397H; 398A B, C D] Seth Thawardas Pherumal vs The Union of India, distinguished.
A.M. Mair & Co. vs Gordhandass Sagarmull ; at 798 and Heyman vs Darwins Ltd., [1942] Appeal Cases 356 at 368 referred to.
Though under section 41(b) the Court has power to pass an interim order or injunction or appointment of re ceiver, the Section does not empower the Court to direct execution of the contract, the extent of which is in dispute and is a matter referable to be adjudicated by the arbitra tor.
If the Court does so, then the decision of the dispute becomes academic because the contract is executed.
[399D E] 5.
Where the question is whether the contract was to be executed by the respondent, if the contract is in fact executed by the respondent by virtue of the order of the Court, then nothing remains of the dispute.
There is nothing arbitrable any more land proceedings before the arbitrator cannot be forestalled by interim order by ordering execution of the contract before it is decided whether the contractor had any right to the contract for additional work in the grab of preservation of the property.
[399E F] 6.
The interim directions given by the High Court that the contractor be allowed to do the remaining work of ex traction of timber of standing marked trees was beyond the competence of the Court.
[399F G] 7.
It would be unjust to deprive any party of its dues simply because the work has been done in view of a wrong order or incorrect order of the Court of justice when there was no stay. ]400B]


judgement:
ivil Appeal No. 3561 of 1986.
From the Judgment and Order dated 28.2.1986 of the Gujarat High Court in SCA No. 1176 of 1974.
Mehta, Shishir Sharma and P.H. Parekh for the Appel lants.
Respondent in person.
(N.P.) The Judgment of the Court was delivered by SINGH, J.
This appeal is directed against the judgment and order of the High Court of Gujarat dated 28.2.1986 allowing the respondent 's writ petition and quashing order of discharge from service and directing his reinstatement in service.
The respondent joined service as technical assistant with the Gujarat State Electricity Board (hereinafter re fened to as the Board).
He was promoted to the post of Deputy Engineer.
While he was posted at Surat as Deputy Engineer he was transferred to Ukai subdivision under the order of the Superintending Engineer dated 29th March, 1974.
Pursuant to the order of transfer he was relieved from his duties at Surat on 30th March, 1974 to enable him to join at Ukai.
He made representation to the Additional Chief Engi neer for cancelling his transfer order on the ground that his mother aged 70 years was ailing and it would cause great inconvenience to him if he was required to join at Ukai.
His representation was rejected and he was directed to 361 join at Ukai but he did not do so instead he filed a civil suit at Baroda challenging validity of the order of trans fer.
Meanwhile, the Chief Engineer by his order dated 27th May, 1974 discharged the respondent from service with effect from 31st March, 1974 in accordance with service Regulation No. 113.
The respondent challenged the validity of the order of his discharge from service by means of a writ petition under Article 226 of the Constitution before the High Court of Gujarat.
A learned Single Judge of the High Court quashed the order of termination on the findings that the order of discharge was issued m violation of the basic principles of natural justice as no opportunity was afforded to the re spondent before discharging him from services under Regula tion No. 113.
The learned Single Judge granted a declaration in respondent 's favour holding the order void and illegal but having regard to recalcitrant attitude of the appellant and his continued conduct of disobedience of the orders of his superior authorities, he refused to grant consequential reliefs regarding reinstatement or payment of back wages.
The respondent as well as the appellant board, both pre ferred Letters Patent appeals against the order of learned Single Judge.
A Division Bench of the High Court dismissed the appeal preferred by the Appellants but it allowed the respondent 's appeal.
The Division Bench upheld the order of the learned Single Judge holding the order of discharge illegal and void but it set aside the order of the learned Single Judge refusing to grant consequential relief instead it directed the appellants to reinstate the respondent, and to treat him in service without any break in service and to grant him benefits of increments, seniority, and promotion to which he may be entitled under the rules.
The Bench, however, did not grant full back wages to the respondent instead it directed the Board to pay him 50 per cent of back wages.
Aggrieved, the appellant has preferred the instant appeal after obtaining special leave of this Court.
This appeal came up for hearing before us on 28th Janu ary, 1988 and on that day Sh.
B.K. Mehta, Advocate appearing for the appellants and Sh.
Vimal Dave, Advocate, appearing for the respondent were fully heard.
After hearing learned counsel for the parties we were satisfied that the learned Single Judge as well as the Division Bench both had commit ted error in allowing the writ petition and granting relief to the respondent.
We expressed our view in the Court and suggested to Mr. Vimal Dave, counsel for the respondent, that if he agreed the original writ petition of the respond ent could be dismissed without directing him to refund the amount which he had already been paid by the appellants in pursuance to the orders of the High Court and of this Court as during the pendency of the appeal, the appellants 362 were directed by means of interim order of this Court to continue to pay salary to the respondent which was being paid to him regularly.
The hearing was adjourned to enable Sh.
Vimal Dave, to obtain instructions from the respondent.
The appeal came up for hearing before us on 16.2.1988 when another counsel appeared to argue the appeal on behalf of the respondent on merits.
We refused to hear the counsel as we had already completed hearing.
Thereupon, the respondent himself appeared in person and sought permission to make his submissions personally.
We refused to accede to his request as oral heating had already been completed and the matter had been adjourned only to enable the respondent 's counsel to obtain instructions.
However, in the interest of justice we permitted the respondent to file written submissions.
if any, in support of his case.
Thereafter, the case was listed several times but no written submissions were filed instead the respondent adopted an unusual course by sending an application by post expressing his no confidence in us with a prayer to transfer the case to some other Bench.
Since this was unusual, uncalled for and unjustified request we ignored the same and reserved the order.
We are constrained to note that instead of utilising the opportunity granted to him for filing written submissions the respondent has mis used adjournments for the purposes of raising frivolous objections for getting the case transferred to some other Bench.
No party is entitled to get a case transferred from one Bench to the other, unless the Bench is biased or there are some reasonable grounds for the same, but no right to get a case transferred to any other Bench, can legitimately be claimed merely because the judges express opinion on the merits of the case on the conclusion of hearing.
In the instant case on the conclusion of the oral hearing we had expressed our opinion on 28.1.1988 in the open court, that we were inclined to allow the appeal and set aside the order of the High Court and dismiss the writ petition but taking a sympathetic view we requested Sh.
Vimal Dave, learned coun sel appearing for the respondent to obtain instructions as aforesaid.
The opportunity granted to the respondent has, however, been misused by raising mischievous and frivolous objections instead of filing written submissions.
The re spondent 's prayer is accordingly rejected and since oral hearing has already been completed, and in spite of several adjournments respondent failed to appear before the Court or to file the written submissions we proceed to decide the case on merits.
Transfer of a Government servant appointed to a particu lar cadre of transferable posts from one place to the other is an incident of service.
No Government servant or employee of Public Undertaking has legal tight for being posted at any particular place.
Transfer from 363 one place to other is generally a condition of service and the employee has no choice in the matter.
Transfer from one place to other is necessary in public interest and efficien cy in the Public administration.
Whenever, a public servant is transferred he must comply with the order but if there be any genuine difficulty in proceeding on transfer it is open to him to make representation to the competent authority for stay, modification or cancellation of the transfer order.
If the order of transfer is not stayed, modified or cancelled the concerned public servant must carry out the order of transfer.
In the absence of any stay of the transfer order a public servant has no justification to avoid or evade the transfer order merely on the ground of having made a repre sentation, or on the ground of his difficulty in moving from one place to the other.
If he fails to proceed on transfer in compliance to the transfer order, he would expose himself to disciplinary action under the relevant Rules, as has happened in the instant case.
The respondent lost his serv ice as he refused to comply with the order of his transfer from one place to the other.
There is no dispute that the respondent was holding a transferable post and under the conditions of service ap plicable to him he was liable to be transferred and posted at any place within the State of Gujarat.
The respondent had no legal or statutory right to insist for being posted at one particular place.
In fact, during the tenure of his service in the Board the respondent had been transferred from one place to an other place several times.
In March, 1974 he was transferred .
from Surat to Ukai.
The distance between the two places as was stated before us during the hearing of the case is less than 50 kms.
He was relieved from his duties at Surat on 30th March, 1974 but he did not join at Ukai till the impugned order of discharge was issued on May 27, 1974.
The Chief Engineer who discharged the respondent 's services exercised his power under Service Regulation No. 113, which runs as under: "113.
The continued absence from duty or overstay, m spite of warning, to return to duty shall render the employee liable to summarily discharge from service without the necessity of proceedings under the Gujarat Electricity Board, Conduct, Discipline and Appeal Procedure.
" The above Rule provides that if an employee of the Gujarat Electricity Board continues to remain absent from duty or overstays the period of sanctioned leave and in spite of warning, he fails to return to duty, he renders himself liable to be discharged summarily from service without 364 complying with the procedure prescribed for taking discipli nary action, under the Gujarat Electricity Board, Conduct, Discipline and Appeal Procedure.
Regulation 113 confers wide powers on the authorities to summarily discharge an employee from service, if he continues to be absent from duty in an unauthorised manner and refuses to join his duty even after warning.
Under the disciplinary rules detailed procedure is required to be followed for removing an employee from serv ice but Regulation 113 provides for summary discharge from service.
Before this power is exercised, two conditions must be satisfied; Firstly, the employee must be found to be absent from duty without leave or overstaying the period of sanctioned leave, and secondly, he failed to join his duty even after a warning.
The object and purpose of giving warning is to remind the delinquent employee that if he continues to be absent from duty he would be liable to action under Regulation 113 and to afford him an opportunity to make amends by joining his duty.
If even thereafter he fails to join duty, his services are liable to be terminated by an order of discharge.
It is noteworthy that the validity of Regulation 113 was not challenged before the High Court and the parties proceeded on the assumption that Regulation 113 was valid and applicable to the respondent 's service.
The Chief Engineer discharged the respondent from service as he had continued to remain absent from duty w.e.f. March 30, 1974 to May 27, 1974.
The Division Bench of the High Court held that no warning as contemplated by service Regulation No. 113 had been issued to the respondent nor he had been afforded any opportunity of showing cause before the im pugned order of discharge was passed and consequently, the order of discharge was null and void being contrary to service Regulation No. 113 itself.
On perusal of the materi al on record we are of the opinion that the view taken by the High Court is not sustainable as there is sufficient material on record which shows that warning had been issued to the respondent before the order of discharge was issued.
In determining the question whether any warning was given to the respondent it is necessary to refer to the sequence of events and the correspondence which ensued between the appellants and the respondent.
On March 29, 1974 the Superintending Engineer of the Board issued the order, transferring the respondent from Surat to Ukai, on 30.3.1974 the respondent was relieved from Surat and directed to join his duty at Ukai, but the respondent did not join his duty at the new place of posting.
Instead he made a representa tion to the Additional Chief Engineer on 8.4.1974 after the transfer order.
The Transfer order was not stayed and as the respondent did not join 365 his duties, he continued to be absent without sanction of any leave.
In this situation the Superintending Engineer by his letter dated 18th April, 1974 directed the respondent to show cause as to why action should not be taken against him for disobeying the order of transfer and also for unautho rised absence from duty in breach of service Regulation No. 113.
The letter is as under: "GUJARAT ELECTRICITY BOARD O & M DIVISION Nana Varchha Road Surat.
Dated 18th April, 1974 To Shri A.S. Pohani Junior Engineer, Ukai 37, Gurunagar Society Near Jakat Naka, Surat 3.
Sub: Transfer from Surat to Ukai.
You have been relieved on 30.3.1974 A.N. on account of your transfer from Surat to Ukai, but you have not reported to Ukai till today and remained on unauthorised absence on re lief, which is breach of S.R. No. 112 and 113.
Please submit your explanation as to why action should not be taken against you for disobeying order of superior and breach of S.R. No. 112 and 113 within 7 days from re ceipt of this letter.
Sd/ Execut ive Engineer (O & M) Surat Copy f.w.c.s.
to Superintending Engineer, GEB, Utran.
" There is no dispute that the respondent received the afore said letter as he sent a reply to the Superintending Engi neer on April 20, 1974, a copy of which was annexed as Annexure 'J ' by the petitioner, to his 366 petition before the High Court.
By that letter respondent stated that he was waiting for the decision of his represen tation made for reconsideration of his transfer from Surat to Ukai and therefore, the question of his remaining on unauthorised leave was misconceived.
Since the respondent had not obtained any sanctioned leave for his absence his absence from duty was unauthorised.
No Government servant or employee of any public undertaking has a right to be absent from duty without sanction of leave, merely on account of pendency of representation against the order of transfer.
Since the respondent continued to be absent from duty the Superintending Engineer by a registered post acknowledgment due letter dated April 24, 1974 informed the respondent that his request to postpone his transfer was rejected and he was directed to join his duty at Ukai and on his failure to do so disciplinary action would be taken against him.
The Establishment Officer (P) of the Board, also informed the respondent by his letter dated May 6, 1974 that his repre sentation against the order of transfer was not accepted and he was directed to obey the order of transfer.
A copy of the letter filed by the petitioner himself as Annexure 'K ' to the writ petition in the High Court.
But even thereafter, the respondent did not join his duties.
Ultimately, the Chief Engineer of the Board took action against the respond ent and discharged him from service with effect from 31.3.1974 by his letter dated May 27, 1974.
The sequence of events and the correspondence which ensued between the officers of the Board and the respondent clearly show that the respondent disobeyed the order of transfer and he re mained absent from duty in an unauthorised manner without obtaining sanction of leave.
The aforesaid documents leave no room for any doubt that the respondent was reminded of his failure to join his duties at Ukai and he was further reminded that his unauthorised absence had exposed him to disciplinary action.
In fact, the Superintending Engineer had by his letter dated 18th April, 1974 clearly reminded the respondent that his unauthorised absence was in breach of Service Regulation No. 113 and called upon to show cause why action should not be taken against him but in spite of these letters the respondent failed to join his duties.
The Division Bench of the High Court has held that since no warning was issued to the respondent action taken under Service Regulation No. 113 was not in accordance with law.
This finding is wholly misconceived.
A warning need not be in any particular form.
The object and purpose of the warn ing as contemplated by the Regulation,.
is to remind the delinquent employee that his continued unauthorised absence from duties was liable to result in discharge of his serv ice.
The substance of the Superintending Engineer 's letter dated 18th April, 1974 which was admittedly served on the respondent, contained 367 warning to the respondent, which fully met the requirement of Regulation No. 113.
Before the High Court a controversy was raised as to whether the registered letter dated 24.4.1974 addressed by the Superintending Engineer to the respondent was received by him or not.
The registered cover, containing the letter dated 24.4.1974 was returned back by the postal authorities with an endorsement that the addressee refused to accept the same.
The respondent 's case was that no such registered letter was tendered to him by the postman nor he ever re fused to accept the same.
The Division Bench held that letter dated 24.4.1974 which contained a warning had not been served on the respondent and since the Board had failed to raise the question before the learned Single Judge it could not do so in the letters patent appeal.
The Division Bench further held that since the letter dated 24.4.1974 was not served on the respondent, there was no material to show that any warning had been issued to the respondent before he was discharged from service.
We do not agree with the view taken by the Division Bench.
Firstly, even if the letter dated 24.4.1974 was not served on the respondent there is no dispute that the Superintending Engineer 's letter dated 18th April, 1974 had been served on him.
By that letter warning as contemplated by Regulation No. 113 had been issued to the respondent.
Therefore even if the letter dated 24.4.1974 was not served on the respondent the order of discharge as contemplated by Regulation No. 113 is sustainable in law.
But even otherwise, the Division Bench committed error in holding that the Board had raised the question of service of the letter dated 24.4.1974 for the first time before the Division Bench in the letters patent appeal.
Perusal of the averments made in paragraphs 17, 18, 23 and 25 (2)(ii) of the counter affidavit filed in reply to the petitioner 's writ petition before the learned Single Judge shows that the Board had categorically pleaded that the respondent was informed by letter dated 24.4.1974 that his representation to postpone his transfer was rejected and he should obey the order of transfer.
It was further pleaded that the respond ent had refused to accept the registered letter and the same had been returned back by the postal authorities with an endorsement that the addressee refused to accept the same.
In his rejoinder affidavit the respondent denied the afore said allegations and asserted that the letter was not ten dered to him and he never refused to accept the registered cover and the postal endorsement was wrong and incorrect.
Apart from denying the postal endorsement, the respondent placed no material before the Court in support of his plead ing.
In this view, we are of the opinion that the Division Bench was totally wrong in holding that 368 no opportunity was afforded to the respondent to meet the case set up by the Board that the letter dated 24.4.1974 was served on the respondent.
No new plea had been raised by the Board before the Division Bench instead the plea relating to service of the aforesaid letter had already been before the learned Single Judge.
There is presumption of service of a letter sent under registered cover, if the same is returned back with a postal endorsement that the addressee refused to accept the same.
No doubt the presumption is rebuttable and it is open to the party concerned to place evidence before the Court to rebut the presumption by showing that the address mentioned on the cover was incorrect or that the postal authorities never tendered the registered letter to him or that there was no occasion for him to refuse the same.
The burden to rebut the presumption lies on the party, challenging the factum of service.
In the instant case the respondent failed to dis charge this burden as he failed to place material before the Court to show that the endorsement made by the postal au thorities was wrong and incorrect.
Mere denial made by ,the respondent in the circumstances of the case was not suffi cient to rebut the presumption relating to service of the registered cover.
We are, therefore, of the opinion that the letter dated 24.4.1974 was served on the respondent and he refused to accept the same.
Consequently,the service was complete and the view taken by the High Court is incorrect.
In view of the above discussion, we therefore hold that the respondent 's failure to join his duties at Ukai resulted in unauthorised absence and his failure to join his duties in spite of the repeated reminders and letters issued to him constituted sufficient valid ground for taking action under Regulation No. 113.
We further hold that before issuing the order of discharge the respondent was not only warned but he was also afforded an opportunity to explain as to why disci plinary action should not be taken against him.
The respond ent acted in an irresponsible manner in not complying with the order of transfer which led to his discharge from serv ice in accordance with the Service Regulation No. 113.
The learned Single Judge as well as the Division Bench both erred in law in setting aside the order of discharge.
We, accordingly, allow the appeal, set aside the order of the Single Judge as well as Division Bench and dismiss the respondent 's petition.
There would be no order as to costs.
The respondent has been paid a sum of Rs. 1,04,170 towards salary under the interim orders of this Court.
Now, since the order of 369 discharge is held to be valid the amount paid to the re spondent is liable to be recovered from him, but having regard to the facts and circumstances of the case and the hardship which could be caused to the respondent, we direct the appellant not to recover the amount already paid to the respondent.
S.K.A. Appeal al lowed.

summary/full:
The respondent joined service as technical assistant with the Gujarat State Electricity Board and was later promoted to the post of Deputy Engineer.
While he was posted at Surat he was transferred to Ukai Sub division under the order of the Superintending Engineer dated 29th March, 1974 and he was relieved from his duties at Surat on 30th March, 1974.
He made representation to the Addl.
Chief Engineer for cancelling his transfer order which was rejected and he was directed to join at Ukai but he did not do so and continued to be absent without sanction of any leave and instead he filed a civil suit challenging validity of the order of transfer.
The Superintending Engineer by his letter dated 18th April, 1974 directed the respondent to show cause as to why action should not be taken against him for disobeying the order of transfer and also for unauthorised absence from duty in breach of service Regulation No. 113.
The respondent failed to join his duty even after a warning.
Thereafter the Superintending Engineer sent a letter dated 24th April, 1974 by registered cover which contained a warning but the same was returned back by the postal authorities with an endorse ment that the addressee refused to accept the same.
Meanwhile, the Chief Engineer by his order dated 27th May, 358 1974 discharged the respondent from service in accordance with service Regulation No. 113 as he had continued to remain absent from duty since 30th March, 1974.
The respondent filed a writ petition before the High Court challenging the validity of the order of his discharge from service.
A learned Single Judge of the High Court quashed the order of discharge but looking to the attitude of the respondent and continued conduct of disobedience of the orders of his superior he was not granted consequential reliefs.
The respondent as well as the appellant Board preferred Letter Patent Appeals.
A Division Bench of the High Court dismissed the appeal of the appellant Board and allowed the respondent 's appeal upholding the order of discharge as illegal and void and directed the appellants to reinstate the respondent, to treat him in service, and to grant him benefits of incre ments, seniority, and promotion.
The Division Bench, howev er, did not grant full back wages but directed the Board to pay the respondent 50 per cent of back wages.
Against the order of the Division Bench of the High Court the appellants preferred an appeal to this Court by special leave.
The appeal came up for hearing and advocates for both the parties were fully heard.
Being satisfied that the Single Judge as well as Division Bench of the High Court committed error in allowing the writ petition of the re spondent, this Court suggested to the counsel for the re spondent that if he agreed the original writ petition of the respondent could be dismissed without directing him to refund the amount which he had already been paid by the appellants in pursuance to the orders of the High Court and of this Court.
The bearing was adjourned to enable counsel to obtain instructions from the respondent.
On the next hearing another counsel appeared on behalf of the respondent to argue on merits.
The Court refused to hear fresh argu ments as the hearing had already been completed.
Thereupon, the respondent appeared in person to make his submissions which the Court refused as oral.
hearing has already been completed.
However, in the interest of justice the respond ent was permitted to file written submissions.
No written submissions were filed, instead the respondent adopted an unusual course by sending an application by post expressing his no confidence in the Bench of this Court with a prayer to transfer the case to some other Bench.
The Court ignored the request of the respondent as it was unusual, uncalled for, and unjustified.
359 Allowing the appeal by special leave, this Court, HELD: No party is entitled to get a case transferred from one Bench to the other, unless the Bench is biased or there are some reasonable grounds for the same.
but no right to get a case transferred to any other Bench, can legiti mately be claimed merely because the Judges express opinion on the merits of the case on the conclusion of hearing.
[362E] Transfer of a Government servant appointed to a particu lar cadre of transferable posts from one place to other is an incident of service.
No Government servant or employee of public undertaking has legal right for being posted at any particular place.
Transfer from one place to other is gener ally a condition of service and the employee has no choice in the matter.
Transfer from one place to other is necessary in public interest and efficiency in the Public Administra tion.
[362H; 363A] Whenever, a public servant is transferred he must comply with the order but if there be any genuine difficulty in proceeding on transfer it is open to him to make representa tion to the competent authority for stay, modification, or cancellation of the transfer order.
If the order of transfer is not stayed, modified, or cancelled the concerned public servant must carry out the order of transfer.
[363B] If he fails to proceed on transfer in compliance to the transfer order, he would expose himself to disciplinary action under the relevant Rules, as has happened in the instant case.
The respondent lost his service as he refused to comply with the order of his transfer from one place to the other.
[363C] No Government servant or employee of any public under taking has a right to be absent from duty without sanction of leave, merely on account of pendency of representation against the order of transfer.
[366B] There is presumption of service of a letter sent under registered cover, if the same is returned back with a postal endorsement that the addressee refused to accept the same.
No doubt the presumption is rebuttable and it is open to the party concerned to place evidence before the Court to rebut the presumption by showing that the address mentioned on the cover was incorrect or that the postal authorities never tendered the registered letter to him or that there was no occasion for him to refuse the same.
The burden to rebut the presumption lies on 360 the party, challenging the factum of service.
[368B C] In the instant case, the respondent 's failure to join his duties at Ukai resulted in unauthorised absence and his failure to join his duties in spite of repeated reminders and letters issued to him constituted sufficient valid ground for taking action under Regulation No 113.
Before issuing the order of discharge the respondent was not only warned but he was also afforded an opportunity to explain as to why disciplinary action should not be taken against him.
The respondent acted in an irresponsible manner in.
not complying with the order of transfer which led to his dis charge from service in accordance with the Service Regula tion No. 113.
The Single Judge as well as the Division Bench both therefore erred.
in law in setting aside the order of discharge.
[368E G]


judgement:
ivil Appeal No. 2647 of 1980.
From the Judgment and Order dated 24.4.1980 of the Patna High Court in Original Decree No. 289 of 1979(R).
Shankar Ghosh, S .P. Lal and H.K. Puri for the Appellant.
L.N. Sinha, R.N. Sachthey and A. Sachthey for the Respond ents.
The Judgment of the Court was delivered by K. JAGANNATHA SHETTY, J.
This appeal by certificate under article 133(1) of the Constitution is from a decision of the Patna High Court which reversed the decree in the suit filed by the appellant for declaration of title and confir mation of possession.
In the court of the Subordinate Judge, the First Court at Dhanbad, the plaintiff/appellants instituted a suit in respect of Schedule B of the plaint for a declaration of their homestead right thereto and for confirmation of pos session or in the alternative recovery of possession.
The suit property consists of 30 bighas, 18 kattar and 11 chha taks being part of plot nos.
59 and 70 in village Dhansar.
The plaintiff 's claim was based on a registered indenture of lease dated December 9, 1949 by which it is said that the possession in the Zamindari right of Kali Prasad was settled to Ruplal Aggarwal, father of plaintiff No. 1 and grand father of plaintiff Nos. 2 and 3.
The plaintiffs ' claim that they have become the owners of the lease hold land and are in possession of the same by exercising diverse acts of possession, mutating their name and by payments of stipulat ed rents to the State of Bihar, who recognised the said lease.
The defendant is a Government company called Messrs. Bharat Coking Coal Limited (The Company).
The Company re sisted the suit on three main grounds: firstly, that the disputed land formed part of North Bhuggatdih Colliery which had vested in the Central Government and thereafter in the company under the provisions of the Coal Mines (Nationalisa tion) Act, 1973, secondly, that the interest claimed by the plaintiffs automatically stood extinguished with the vesting of the estate of the plaintiffs ' lessor, by reason of the vesting notification 286 issued under sec.
3 of the Bihar Land Reforms Act, 1950.
Lastly, that actual lease of the land was taken much earlier expressly for the purposes of the mines and that the instru ment of 1949 is contaminated with flaw and obtained with a view to certifying the vesting of the estates in the State of Bihar and even that on a misapprehension that the so called homestead land would.
not vest.
The trial court negatived all the defences and decreed the suit.
Upon appeal by the company, the Patna High Court re versed the decree of the trial court and dismissed the suit.
There are two main findings recorded by the High Court to allow the appeal.
As to the scope and effect of the provi sions of the Bihar Land Reforms Act, 1950 in respect of the suit property, the High Court held: "For the reasons indicated above, I am of the view that a lease granted to the plaintiffs in the instant case was an encum brance and it was annihilated with the issu ance of the notification under sec.
3 of the Act.
The submission urged on behalf of the appellants, therefore, in this behalf must be accepted.
The lease of the plaintiffs having come to an end consequent upon the issuance of notification under sec.
3 of the Act, the plaintiffs have no title to be declared and the decree of the trial court is liable to be set aside.
" As to the nature of the suit property and the scope and effect of the Coal Mines (Na tionalisation) Act, 1973, the High Court on an appraisal of the oral and documentary evidence led by both the parties said: "I would, therefore, prefer their positive evidence (referring to the defend ants/respondents evidence) than to the nega tive evidence adduced on behalf of the plain tiffs.
It will, however, be seen that the suit lands are adjacent to a coal mine, namely, North Bhuggatdih Colliery and were being used for the purposes of the said mine, namely, stacking of coal and effecting local sales thereof.
The conclusion is, therefore, ines capable that the suit lands are more within the meaning of the Nationalisation Act.
What vests under the Nationalisation Act is the mine and not merely the interest of the owner of the mine.
" 287 Having regard to these findings, the High Court did not find it necessary to examine whether the instrument of 1949 was a genuine transaction.
In this appeal, on the submission of counsel for both sides, two questions arise for our consideration: (i) wheth er the suit lands had vested, free from encumbrance in the.
State consequent upon the issuance of Notification under sec.
3 of the Bihar Land Reforms Act; and (ii) whether the suit land is "mines" within the meaning of the ? In our opinion, it is unnecessary to consider the first question and indeed it is not proper also to consider the question in the absence of the State which is a necessary party for adjudication of that dispute.
The State of Bihar is not impleaded as a party to the suit and we, therefore, refrain from expressing any opinion on the first question.
On the second question, the relevant provisions of the (The Act) may now be noted.
"Section 2(h) defines "mines" to mean any excavation where any operation for the purpose of searching for or obtaining minerals has been or is being carried on, and includes XXX XXX XXX XXX XXX (iv) all open cast workings; XXX XXX XXX XXX XXX (vi) all lands, buildings, works, adits, levels, planes, machinery and equip ments, instruments stores, vehicles, railways, tramways and sidings in, or adjacent to, a mine and used for the purposes of the mine; XXX XXX XXX XXX XXX (x) all lands, buildings and equip ments belonging to the owners of the mine, and in, adjacent to or situated on the surface of, the mine where the washing of coal obtained from the mine or manufacture, therefrom, of coke is carried on.
XXX XXX XXX XXX XXX XXX 288 Section 3, so far it is relevant, reads.
"(1) On the appointed day, the right, title and interest of the owners in relation to the coal mines specified in the Schedule shall stand transferred to, and shall vest absolutely in, the Central Government free from all incumbrances . . " Section 5(1) reads as under: "(1) Notwithstanding anything con tained in secs.
3 and 4, the Central Govern ment may, if it is satisfied that a Government company is willing to comply, or has complied, with such terms and conditions as that Govern ment may think fit to impose, direct, by an order in writing, that the right, title and interest of an owner in relation to a coal mine referred to in sec.
3, shall, instead of continuing to vest in the Central Government, vest in the Government Company either on the date of publication of the direction or on such earlier or later date (not being a date earlier than the appointed day), as may be specified in the direction.
" Section 6(1) provides as under: "(1) All property which vests in the Central Government or in a Government company under this Chapter shall, by force of such vesting be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it and any attachment, injunction or decree or order of any court restricting the use of such property in any manner shall be deemed to have been withdrawn.
" Sections 8 to 10 in chapter III provide for payment of compensation to owners of coal mines.
Provisions under Chapter IV of the Act deal with claims to be .made for compensation and for disbursing the amounts payable to the Owners of coal mines by Commissioner of Payments.
On behalf of the plaintiffs, 11 witnesses were examined including plaintiff No. 1 himself.
Most of the witnesses have not made any relevant statement on the question of location or user of the suit land.
289 However, Kanhaiya Lal Agarwal, witness No. 6 for the plain tiff stated, "The land is full of collieries on all the four sides." Likewise Ram Briksha Viswakarma, witness No. 8 for the plaintiffs has stated that the suit land is a fallow land and no crop is grown on it and there is nothing except the road in between the suit land and the North Bhagatdih Colliery.
The 9th witness of the plaintiffs B.K. Mukherjee, who surveyed the locality and submitted a report stated: "At the time of my inspection, the defendants were removing the over burdened surface and then taking out coal and this is called open cast working . .
I do not see the quarry by Southern side of the leased coal land but do not remember whose quarry was there.
There were coal all over the land but it was after the burden of earth was removed . .
The coal was being ,cut at the depth of 25 from the surface.
Adjoining the quarry, the land was not for homestead pur poses.
" The witnesses for the defendant company have specifical ly stated that the land in dispute constitutes the upper layer of the coal lying beneath and above the surface.
The working of the mines is by open cast working system.
When the mining operations are carried on in the other parts of the Seam, the land is being used for the various purposes connected with the mining operations.
In the light of this evidence, the location of the suit land and the uses to which it is put to are beyond doubt.
The land is being used for carrying on the mining operations and it is adjacent to a mine.
It is used for the purposes of the mine for carrying on the mining operations in respect of the part of the Seam lying immediately below the surface.
Apparently, there cannot be any working mine without the surface being included in that concept.
If the surface does not form part of the concept of mine, it is not possible to have any excavation.
Section 2(h)(iv) includes open cast working within the definition of "mine".
Secondly, the suit land is also adjacent to a coal mine, namely, North Bhagatdih Colliery and is being used for the purposes of the said mine, namely, stacking of the coal and effecting local sale thereof.
It is, therefore, a mine as defined under sec.
2(h)(vi) of the Act.
Under sec.
3 of the Act, the right, title and interest of the owners in relation to the coal mines stand trans ferred to and shall vest abso 290 lutely in the Central Government free from encumbrances.
For the purpose of acquisition and vesting, it is immaterial whether the mine belongs to the State or to the plaintiffs.
In either case, the Act extinguishes the title.
A Constitu tion Bench of this Court in State of West Bengal vs Union of India, [1964] 1 SCR 371 has held that under Entry 44 of List 3 of the Seventh Schedule to the Constitution, Parliament is competent to make a law for acquisition of property owned by the State.
It was, however, urged for the appellants that there is no proper pleading or issue for determination of the afore said question and the evidence let in should not be looked into.
It is too late to raise this contention.
The parties went to trial knowing fully well what they were required to prove.
They have adduced evidence of theft choice in support of the respective claims.
That evidence has been considered by both courts below.
They cannot now turn round and say that the evidence should not be looked into.
This is a well accepted principle.
In Kunju Kesavan vs M.M. Philip & Others, ; , this Court has stated (as summarised in the headnote at p. 637): "The parties went to trial, fully understanding the central fact whether the succession as laid down in the Ezhava Act applied to Bhagavathi Valli or not.
The ab sence of an issue, therefore, did not lead to a material sufficient to vitiate the decision.
The plea was hardly needed in view of the fact that the plaintiff stated in his replication that the "suit property was obtained as makka thayam property, by Bhagavathi Valli under the Ezhava Act".
The subject of exemption from Part IV of the Ezhava Act, was properly raised in the trial court and was rightly considered by the High Court.
" On the facts and circumstances of the case we cannot, therefore, accept the contention urged for the appellant in this regard.
In the result and for the reasons stated above, the appeal fails and is dismissed.
In the circumstances, howev er.
we make no order as to costs.
P.S.S. Appeal dis missed.

summary/full:
Section 3 of the Bihar Land Reforms Act, 1950 provided for vesting an estate or tenure in the State.
Section 2(h) of the defines a 'mine, to mean any excavation where any operation for the purpose of searching for or obtaining minerals has been or is being carried on.
Sub clause (iv) thereto includes there in all open cast workings and sub clause (vi) takes in all lands, buildings etc., in or adjacent to a mine and used for the purposes of the mine.
Section 3(1) provides for acquisi tion of rights of owners in respect of coal mines by the Central Government.
Section 5(1)empowers the Central Govern ment to direct vesting of the said rights in a Government company.
Section 6(1) refers properties vested in the Cen tral Government free from mortgages etc.
The appellants instituted a suit in respect of a large expanse of land for declaration of their homestead right thereto.
The possession in the zamindari right was settled to their ancestor in 1949.
They, therefore, claimed owner ship of leasehold land.
The respondent Government company resisted the suit on the grounds, firstly, that the disputed land formed part of a colliery which had vested in the Central Government and thereafter in the company under the provisions of the and secondly, that the interest claimed by the plaintiffs, automatically stood extinguished with the vesting of the estate of the plaintiffs ' lessor by reason of the notification issued under section 3 of the Land Reforms Act.
The trial court negatived all the defences anti decreed the suit.
284 Reversing the said decree, the High Court held that the lease granted to the plaintiffs was an encumbrance which was annihilated with the issuance of the notification under section 3 of the Land Reforms Act, and that the lease having thus come to an end the plaintiffs had no title to be declared.
It further found that the salt lands were adjacent to a coal mine and were being used for the purpose of the said mine.
Therefore, it held that the suit lands were more within the meaning of the Nationalisation Act, and that what vests under that Act is the mine and not .merely the interest of the owner of the mine.
Dismissing the appeal, HELD: 1.1 The evidence on record both for the plaintif fappellants and the defendant respondents makes it evident that the land was being used for the purpose of the mine for carrying on the mining operations in respect of the part of the seam lying immediately below the surface.
There cannot be any working mine without the surface being included in that concept.
If the surface does not form part of the concept of mine, it is not possible to have any excavation.
Section 2(h)(iv) of the includes open cast working within the definition of 'mine. ' [289E F] 1.2 The suit land was also adjacent to a coal mine and was being used for the purposes of the said mine, namely, stacking of the coal and effecting local sale thereof.
It was therefore, a mine as defined under section 2(h)(vi) of the Act.
[289G] 2.
Under section 3 of the said Act, the right, title and interest of the owners in relation to the coal mines stood transferred to and vested absolutely in the Central Govern ment free from encumbrances.
It was immaterial whether the mine belonged to the State or to a private party.
The appel lant 's title to the said land, if any, thus stood extin guished.
[289H; 290A] State of West Bengal vs Union of India, [1964] 1 SCR 371, referred to.
The parties went to trial knowing fully well what they were required to prove.
They have adduced evidence of their choice in support of the respective claims.
That evidence has been considered by both courts below.
The appellants cannot now turn round and say that the evidence should not be looked into.
This is a well accepted princi ple.
[290C D] 285 Kunju Kesavan vs
M.M. Philip & Ors., ; , referred to.