Bangladesh Telegraph and Telephone Board Vs. Lithi Enterprises Limited

Bangladesh Telegraph and Telephone Board (Defendant-Appellant)

Vs.

Lithi Enterprises Limited (Respondent)

 

Supreme Court

Appellate Division

(Civil)

JUSTICE

ATM Afzal CJ

Mustafa Kamal J

Latifur Rahman J

Md. Abdur Rouf J

Bimalendu Bikash Roy Choudhury J

Judgment dated : June 12, 1997.

The Arbitration Act, 1940 (X of 1940), Section 30

The appellant cannot raise any objection to arbitration while it self submitting to arbitration not only once but twice before the learned subordinate judge, in that context prayer for fresh arbitration is not tenable…………(13)

Misconduct on the part of the arbitrators may be a ground for setting aside the award but as because no such plea has been raised before the subordinate judge, any allegation of misconduct is not tenable at this stage……………………(14)

Lawyers Involved:

Akhtar Imam, Advocate instructed by Shamsul Haque Siddique, Advocate-on-Record — For the Appellant.

Md. Nawab Ali, Advocate-on-Record — For the Respondent.

Civil Appeal No. 66 of 1994.

(From the judgment and order dated 17th January, 1994 passed by the High Court Division in First Miscellaneous Appeal No. 140 of 1993.)

JUDGEMENT

                    ATM Afzal CJ.- This appeal by the defendant- appellant, Bangladesh Telegraph and Telephone Board (BTTB) following leave, is from judgment and order dated 17th January, 1994 passed by a Division Bench of the High Court Division dismissing First Miscellaneous Appeal No. 140 of 1993.

2. Facts of the case, briefly, are that, the appellant invited a tender for preparation of computerized telephone and telex bills for Dhaka, Chittagong and other areas of the country. The tender of the respondent company being the lowest was accepted and accordingly, an agreement was executed between the appellant and the respondent on 16-2-1988. Clause 1 of the agreement stipulates that on the basis of data to be submitted by the appellant, the respondent company would prepare 2,000 telephone and 1,000 telex bills on an experimental basis within a period of two months by using the computer of the Atomic Energy Commission and the contract between the parties would come into force for a period of 3 years subject to acceptance of the experimental bills. The respondent company prepared and submitted the experimental bills, but the appellant was not satisfied with the work and refused to accept the same. Ultimately, on 12-1-1989 the appellant cancelled the agreement.

3. The respondent invoked the arbitration clause of the agreement being aggrieved by the cancellation of the agreement and asked the appellant to appoint an arbitrator for settlement of the dispute but the appellant did not comply with the request for arbitration. The respondent company then filed an application under section 20 of the Arbitration Act in the First Court of Subordinate Judge. Dhaka being Miscellaneous Case No.78 of 1990. The appellant appeared and contested the Miscellaneous Case contending that the case was not maintainable as the respondent failed to prepare the experimental bills in terms of the agreement within the specified period and the bills having been found unacceptable the agreement stood ineffective as per Clause I and was accordingly cancelled.

4. The learned Subordinate Judge, however, allowed the miscellaneous case and by judgment and order dated 16-11-91 appointed two arbitrators from the lists submitted by the respective parties.

5. The appellant took a revision, Civil Revision No.63 of 1992 to the High Court Division against the said order of the Subordinate Judge and obtained Rule and an order of stay on 5-1-1992.

6. The Rule was ultimately discharged and a petition for leave to appeal from the order of the High Court Division proved unsuccessful.

7. The award was filed in the meantime on 15-1-1992 when the High Court Division was in seisin of the aforesaid revision case. The appellant raised objection to the award taking various grounds including that the provision for arbitration was not applicable because the agreement itself became ineffective and that the award filed on 15.1.1992 ignoring the stay order passed on 5-1-1992 in Civil Revision No.63 of 1992 was a nullity, the learned  Subordinate Judge upon rejecting the contentions of  the appellant made the award a Rule of the Court by judgment and decree dated 30-1-1993 whereupon the appellant filed aforesaid FMA No.140 of 1993 in the  High Court Division impugning the said judgment and decree.

8. The High Court Division also in appeal, rejected the contention of the appellant that the provision for arbitration was not applicable because as per Clause 1 of the agreement dated 16-2-1988 the agreement itself became ineffective that the arbitrator had filed the award ignoring the stay order passed in Civil Revision No.63 of 1992 and thus the award was invalid and that the agreement was unenforceable being hit by section 21 of the Specific Relief Act. It was not also found that the arbitrator had not misconducted himself and that the award had not been improperly procured nor was it otherwise invalid. The appeal was accordingly dismissed by the impugned judgment and order.

9. Leave was granted to consider whether the aforesaid findings of the High Court Division were contrary to facts and law applicable in the matter and further whether the award was otherwise vague and unenforceable and thus illegally made a Rule of the Court.

10. Mr. Akhtar Imam, learned Counsel for the appellant, repeated the same arguments as were made in the High Court Division and rejected by it as noted above. The main contention of the Appellant all through has been that the provision for arbitration could not be invoked by the respondent inasmuch as the appellant having not accepted the experimental bills submitted by the respondent which was a condition precedent for the agreement (dated 16-2-88) to take effect, the agreement never became effective and remained in a stupor, The High Court Division gave elaborate and cogent reasons to repeal the said argument and the learned Counsel except repeating his submission before us could not make any dent in the solid findings made by the High Court Division upon appreciation of the evidence on record. Further, we find that the argument assailing the invocation of the arbitration clause was futile because admittedly the appellant submitted to the arbitration by giving its own list of arbitrators from among whom the learned Subordinate Judge selected one arbitrator and another from the list of the respondent.

11. The appellant, however, moved the High Court Division in revision against the order (dated 16.11.91) appointing arbitrators and obtained a Rule and stay of the order on 5-1-92 in Civil Revision No.62 of 1992. But curiously enough it never cared to inform even its own nominee about the stay order thinned by it and the result was that the arbitrators made an ex parte award and filed the same in Court on 15-1-92. The appellant argued in the High Court Division and later on in this Division by way of leave to appeal from judgment of the High Court Division against filing of the award during the pendency of the stay order in the revision case and further as to the arbitration clause being not available on the ground of the agreement being not effective. This Division while dismissing its CPLA No. 368 of 1992 on 3 November 1992 observed: ‘These questions may better be raised before the learned Subordinate Judge” where the award was pending for being made a Rule of the Court.

12. The appellant filed an application on 4-1-93 before the Subordinate Judge in Arbitration Misc. Case No.78 of 1990 praying for setting aside of the  ex parte award and a direction to make a new award either by the same or new arbitrators.

13. The learned Subordinate Judge observed in his judgment and order dated 30-1-93 that by making a prayer for fresh arbitration, the appellant had given up us its objection to arbitration on the alleged ground of the agreement having not become effective. The leaned Subordinate Judge was quite right and we also do not see how the appellant can raise any objection to arbitration while itself submitting to arbitration not only once but twice. Therefore, we do not find any justification whatsoever for the main contention of the appellant apart from the fact that the High Court Division negatived the Contention on merit with which we find no reason to differ. Indeed, we find no reason to differ from the High Court Division, no convincing argument having been advanced, on any of the points decided against the appellant.

14. Although leave was taken alleging that the award was vague and unenforceable, no argument was advanced by the learned Counsel in support thereof, perhaps advisedly as it is found that the point was never raised at any stage before. The High Court Division observed that misconduct on the part of the arbitrators may be a ground for setting aside the award but the appellant did not take any such plea before the Subordinate Judge, nor did the Subordinate Judge find any such misconduct.

Thus it appears that the appeal is not well founded and liable to be dismissed.

In the result, the appeal is dismissed without any order as to cost.

Ed.

 

Source : 50 DLR (AD) (1998) 63

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