Delhi High Court High Court

Prem Chand Sharma & Co. vs Delhi Development Authority on 21 September, 2001

Delhi High Court
Prem Chand Sharma & Co. vs Delhi Development Authority on 21 September, 2001
Equivalent citations: 2003 (1) ARBLR 417 Delhi, 2002 (63) DRJ 229
Author: V Jain
Bench: V Jain


JUDGMENT

Vijender Jain, J.

1. Aggrieved by the award dated 25.3.1995 passed by Mr. K.K. Reddy, the retired Chief Engineer of CPWD, who was appointed as an arbitrator, the respondent/DDA has filed the objection under Sections 30 & 33 of the Arbitration Act. Ms. Salwan, learned counsel for the respondent has vehemently contended that the finding of the arbitrator with respect to claim nos. 1 and 2 are erroneous on the face of it and errors of judgment are apparent. It was contended that the arbitrator has disallowed the rebate availed by the respondent on monthly bills and the final bill without considering that the petitioner was to submit his bills under clause 7 & 8 of the agreement. Similarly the objector have challenged the finding of the arbitrator in respect of claim no. 3. According to Ms. Salwan the arbitrator has not given any reason or basis for making an award of Rs. 23,920/- under the said claim and, therefore, committed misconduct. The objector has found fault with the award of claim no. 5 in awarding a sum of Rs. 22,700/- under the said claim.

2. Ms. Salwan, learned counsel for the objector has vehemently contended that the learned arbitrator has erred in awarding the amount under claim no. 12 as the award of the same was contrary to the conditions of the contract entered into between the parties. It was contended by learned counsel for the respondent that the arbitrator has completely ignored the conditions of the agreement and particularly additional condition no. 1 at page 42 of the agreement. From the bare reading of the said condition, it would be seen that the petitioner was not entitled to any extra compensation for delay in handing over part of site or material, although it was admitted by learned counsel for the respondent that there was delay in handing over the part of the site. However, the contractor could not have claimed compensation under the terms of the agreement as there was a bar under the terms of the contract. On these grounds the objector has challenged the award of the arbitrator.

3. On the other hand, Mr. Girish Aggarwal, learned counsel for the petitioner has contended that the award is supported by documentary evidence on record. It was contended that Mr. Reddy was a former Chief Engineer of CPWD with vast experience having dealt with number of arbitration cases during his tenure of service in the Government. It was contended by Mr. Aggarwal that this Court will not sit as a Court of appeal over the award made by the arbitrator both on questions of facts and law. It was also contended by Mr. Aggarwal that this Court will not re-appreciate the evidence or go into the sufficiency or insufficiency of the award which was in the final domain of the arbitrator. It was contended that the arbitrator has rightly awarded the claim under claim nos. 1 and 2 as the respondent was bound to prepare bills and make the payment to the petitioner within the stipulated period and if the same had not been paid within the stipulated period, the respondent was not entitled to claim any rebate beyond the said period.

4. It was also contended that the award under claim no. 3 was reasoned whereby the arbitrator was awarded Rs.23,920/- for 6037 kgs. of steel in favor of the petitioner against the claim of Rs. 68,595/-. The said sum of Rs. 23,920/- for 6037 kgs. of steel reinforcement which was shown as overweight in the recovery statement prepared by the respondent and the same was not deleted and, therefore, the arbitrator was right in awarding the said amount of Rs. 23,920/-. Mr. Aggarwal has defended the award of Rs. 22,700/- in respect of claim no. 5. It was contended that the claim under claim no. 5 was for Rs. 45,120/-. However, the arbitrator has given a cogent and detailed reasoning in awarding the sum of Rs. 22,700/-, respondent has made a payment of Rs. 5,742/- already on this account. It was contended that the arbitrator took into account that the time was the essence of the contract and the arbitrator has awarded this amount on the basis of Ex.C-51. Similarly, the learned counsel for the petitioner has contended that the award of the sum under claim nos. 9 & 12 was rightly awarded by the arbitrator in favor of the petitioner.

5. I have given my careful consideration to the arguments advanced by learned counsel for both the parties. There is substance in the argument of learned counsel for the petitioner that this Court is not a court of appeal. More so, in view of the fact that the arbitrator was a retired Chief Engineer of CPWD and was well acquainted with the agreement which was referred for adjudication before him. There is no force in the argument of the objectors in relation to claims. 1, 2, 3, 4 & 9. The objections are merely for the sake of objections without any substance. The award of the arbitrator is well reasoned. He has considered the material on record and gave his findings on each of these claims. The law is well settled. This court will not re-appreciate or re-evaluate the evidence which was placed before the arbitrator until and unless it is shown that the arbitrator has left some vital evidence from his consideration while arriving at the award.

6. Ms. Salwan has vehemently contended that the award of Rs. 1,47,600/- under claim no. 12 was erroneous. Let me deal with her submission with regard to said claim. The claimant had claimed a sum of Rs. 3,70,000/- for the work done beyond the stipulated date of completion. The contractor has claimed that part of the site could not be handed over till 278 days as SCI and GI pipes could not be supplied by the respondent in time, electrical conducts were not laid in time, sanitary designs and colour scheme were not available in time, as a result the petitioner has to purchase the same at higher prices. It was contended before the arbitrator that the tender was accepted at 47% above DSR 77. Adjacent to the site of construction, another work was awarded on 21.2.1981 at 58% above DSR 77. It was contended that there was no provision in the contract by which the respondent can withheld any money from the final bill. For the aforesaid reasons a demand was made on 2.12.1981 (Ex. C-10) for enhancing rates by 16% over all the work done beyond stipulated date of completion and working out on the said basis a claim for Rs. 3,60,158/- was made by the petitioner. It was contended before the arbitrator by the respondent that as per the additional condition no. 1 which is at page 42 of the agreement, the contractor had not claimed extra amount or compensation on the said account. It was contended that it was the petitioner who failed to execute the work with due diligence and was reminded to employ sufficient labour, which he did not do and as a result the delay has taken place.

7. Arbitrator after considering the arguments, perusing through the evidence of the parties gave a finding on fact that the delay was attributable to the respondent, but he reduced the delay which was claimed to be 278 days by the claimant and, therefore, consequently reduced the amount of compensation from Rs. 3,60,000/- to Rs. 1,47,600/-. The arbitrator has given a finding on fact on the basis of the record that respondent instead of giving required quantity of cement was issuing part quantity by resorting to quota system and at times claimant had to purchase the cement from far off factories of Madhya Pradesh, although under the contract, the respondent was supposed to issue cement from DDA stores at Delhi. The arbitrator has also fixed responsibility on the respondent in issuing belatedly SCI, GI pipes, door shutters, structural designs etc. Arbitrator also held that there was delay on the part of the electrical contractor who was not laying the conduits in time though the shuttering was ready. The arbitrator took into consideration the award made in claim no. 5 on account of statutorily increase on the rates of labour, but held that it was only partial relief but that would not compensate in terms of increase in pricing of material. The arbitrator held that any clause in the contract, does not neutralise value increase in prices of material.

8. In view of specific finding of fact by the arbitrator this Court is precluded entering in controversy with the said finding as the law is well settled with regard to arbitral proceedings. Even if the Court comes to a different opinion, the award is not to be set aside on this ground alone until and unless it is shown that the reasoning adopted by the arbitrator was perverse, unreasonable or could not have been arrived at on the basis of material placed before the arbitrator.

9. I find none of these conditions in existence in the matter before me. There is no merit in the objections of the DDA. The same are dismissed.

10. Application is dismissed.

Suit No. 1056/95

11. As the objections are dismissed, award is made rule of the Court. A decree in terms thereof is passed. The petitioner shall be entitled to interest at the rate of 12% per annum from the date of decree till its realisation.

12. Petition stand disposed of.