DR. JUSTICE S.K. PANIGRAHI

Lalatendu Mishra & Ors v. State of Odisha and Ors.

Case Number: W.P.(C) Nos. 12636 and batch

Date of Decision: 21st July, 2022

In this case, a batch of writ petitions challenged the advertisement dated 23rd December, 2021 issued by the Directorate of Secondary Education, Odisha on the grounds that it did not conform to the provisions of the Odisha Reservation of Vacancies in Posts and Services (For Scheduled Castes and Scheduled Tribes) Act, 1975 (“the ORV Act”) and the law laid down by the Supreme Court of India. It was further alleged that the advertisement for recruitment of Initial Appointee Teachers in Government Secondary Schools of Odisha on contractual basis is arbitrary as it does not prescribe a minimum pass mark for the Computer Based Test.

The Petitioners argued that it is illegal for the State Government to reserve its right to decide the cut-off mark of the Computer Based Test for shortlisting at a later stage. They also challenged the impugned advertisement on the ground that it violated the provisions of the ORV Act and the law laid down by the Hon’ble Supreme Court in Indra Sawhney v, Union of India as the reservations exceed the ceiling limit of 50% of the vacancies that are advertised for.

On the other hand, the Opposite Party stated that the increased number of vacancies in reserved categories is attributable to low participation of candidates belonging to the social categories in the previous years of selection which have led to more vacancies for the particular social category. Moreover, the Petitioners are estopped from challenging the advertisement and method of selection at the final stage of the selection process in view of the decision of the Apex Court in Dhananjay Malik v. State of Uttaranchal ((2008) 4 SCC 171), Ranjan Kumar v. State of Bihar ((2014) 16 SCC 187), and Anupal Singh v. State of U.P ((2020) 2 SCC 1731).

This Court observed that the impugned advertisement was a fresh recruitment drive aimed to fill up vacancies arising in posts in the current year as well as unfilled vacancies carried forward in various social categories from previous years. Therefore, the State had not committed any illegality, nor is it contrary to the statutory provisions, the constitution and the present position of law. Further, the Court while iterating “reservations have to be calculated in a post-based manner and not vacancy based”, observed that if the ORV Act is made inapplicable, then six years later when these initial appointees would be regularized, the absence of any provision for reservation would result in lack of representation from various social categories. The court after perusing the submissions of the parties held that the persons who participated in the selection process after having accepted the terms and conditions of the selection, cannot challenge the said process subsequently. In light of the above, the Court found the writ petitions to be devoid of any merits and accordingly disposed of the same.

New India Assurance Co. Ltd. v. Orissa State Warehousing Corporation

Case Number: ARBA No. 24 of 2019

Date of decision: 22nd December, 2022

In this case, the Appellant challenged the judgment dated 5th July, 2019 passed by the learned District Judge, Cuttack in ARBP No.05 of 2018 confirming the award dated 15th December, 2017 passed by the Arbitrator in Arbitration Proceeding No.55 of 2016.The matter pertaining to this case was that a claim intimation was lodged by Respondent No.1 for the alleged loss of Rs.23,51,560/- for misappropriation of stock by one employee namely M.R.K. Rao. A special audit ascertained that there was a loss of Rs.23,18,000/- marking a shortage of rice and Rs.33,250/- towards the value of empty gunny bags. Since the parties entered into disagreement over the reports of various Chartered Accountant-cum-Surveyor, this Court vide order dated 27th October, 2016 appointed the sole Arbitrator to adjudicate the dispute between the parties. The learned Arbitrator, after appreciating the oral and documentary evidence, awarded a sum of Rs.63,31,099/- inclusive of interest besides future interest @ 6% per annum, to be paid by the Appellant.

The Appellant contended that the learned Arbitrator was professionally associated with the entity which was a party to the arbitration proceeding and therefore, the arbitral award was liable to be set aside. It was further submitted that since the Respondent No.1 initiated the Arbitration proceeding after three years, and the alleged defalcation happened in the year 1998-1999, the claim is barred by limitation and ergo, not arbitrable.

On the other hand, the Respondent No.1 submitted that the Arbitrator passed a reasoned arbitral award after due appreciation of evidence and the awarded amount is as per the terms of the policy and the investigation made in determining the loss. Moreover, the question of limitation was raised by the Appellant before this Court in the petition for appointment of the Arbitrator, and those points were considered by this Court in ARBP No.16 of 2012. While appointing the learned Arbitrator, this Court held that, as per Clause 15 of the agreement, the claim is within the period of limitation and also held that since the matter involves the question of quantum of compensation only and liability has been admitted, it comes within the purview of the arbitration clause as per terms of policy.

This Court upheld the finding of the District Court and observed that District Judge, Cuttack has not committed any error in rejecting the challenge to the award, filed under Section 34 of the Arbitration and Conciliation Act, 1996. It was held that as per the Contract (policy), the petitioner was to indemnify the Respondent No.1 against direct pecuniary loss. The Court opined that the term “direct pecuniary loss” in a literal sense cannot be construed to be confined to only the cost of the shortage of goods or the goods involved in the fraud/misappropriation and not the other pecuniary loss incurred in connection with the same incident of infidelity or criminality. In a detailed analysis, the Court further remarked- “As it appears, the penalty was directly linked with the incident of defalcation and, hence, the amount paid on that count cannot be excluded from the “direct pecuniary loss” sustained by the Respondent No.1. Hence, in awarding the amount towards penalty, the learned Arbitrator cannot be said to have travelled beyond the contract or to have committed any illegality.” It was further observed that the breaking-point of the present commercial relationship was when the Appellant company declared the claim of the Respondent No.1 as “no-claim” thus giving rise to the “cause of action” in this transaction and hence, the claim is well within three years i.e. within the period of limitation. The Court concluded that the Arbitrator had acted well within his jurisdiction in awarding the appropriate relief and the appeal, being devoid of merits was dismissed without costs.