ORDER
Ashim Kumar Banerjee, J.
1. The claimant/ respondent made a claim of Rs. 23,38,257/-. Initially, the matter was referred to arbitration and the authority of the erstwhile Arbitrator was revoked by this Court under the old Arbitration Act, 1940. This Court thereafter appointed Mr. N.C. Roy Choudhury, a senior Advocate of this Court as Arbitrator. The parties participated in the proceeding. There had been 100 and odd sittings. At the 106th sitting when the arbitration was nearing its completion, Counsel for the petitioner before me took certain technical objections including challenging the authority of the Arbitrator relying on a decision of mine reported in (2003) 4 Cal HN 163 in the case of Union of India v. Pioneer Construction. In Paragraph 11 of the said decision I held that as the letter of acceptance was a conditional one and unless and until that pre-condition was fulfilled it could not be said that there had been concluded contract. Since there had been no concluded contract, the arbitration Clause embodied therein could not be invoked. Citing this decision, it was contended that no formal agreement for arbitration was entered into by and between the parties and, as such, the Arbitrator had no authority. The Arbitrator in his award considered such issue and came to a finding that such submission in the facts of this case was not tenable and the ratio decided by me in the case of Union of India (supra) was not applicable. The Arbitrator also rejected the other technical objections raised by the petitioner.
2. On merits, the Arbitrator published an award only to the extent of Rs. 1,28,0007- on account of principal claim and a sum of Rs. 75,000/- on account of interest in favour of the claimant/ respondent. The balance part of the claim was rejected by the Arbitrator. The Arbitrator, however, in the concluding paragraph awarded costs for Rs. 1.2 lacs in favour of the claimant/respondent. The observations of the Arbitrator are as follows :-
“The only point remaining is the question of cost in the present case. In view of the said contumacious and improper conduct as aforementioned and in the facts and circumstances of the case I think it is just and proper that the respondent should pay the cost assessed for Rs. 1,20,000/- and I award the same in favour of the claimant.”
3. The claimant/respondent accepted the award although about 90% of their claim stood rejected by the Arbitrator. The petitioner has approached this Court by way of presentation of this application under Sections 30 and 33 of the said Act, 1940.
4. Mr. Debal Banerjee, learned Counsel appearing in support of this application, submits that the award for Rs. 1.28 lacs as and by way of detention charges should not have been allowed without having claim proved by the claimant/respondent. His further contention has been that since the substantial part of claim was rejected, there was no question of awarding any interest.
5. In the issue of costs, Mr. Banerjee has drawn my attention to the award. According to him, the decision of mine was reported in 2003. As soon as the learned Counsel came to know of the said decision he cited the said authority before the Arbitrator. Such decision was, however, not available for the petitioner to be cited before the Arbitrator at an early date. Mr. Banerjee further submitts that the contention of the petitioner was to be dealt with by the Arbitrator. Such contention did not find favour with the Arbitrator and the Arbitrator decided as against the petitioner on that score, awarding of costs to the extent of Rs. 1.2 lacs cannot be sustained.
6. Mr. Ashis Chakraborty, while opposing this application on behalf of the claimant/respondent, submits that the Arbitrator on factual score decided the issue and awarded the principal sum of Rs. 1.28 lacs in his favour. The Arbitrator also came to a finding on perusal of the facts that there had been delay in making payment of the bills which prompted him to award lumpsum interest to the extent of Rs. 75,000/-. Hence, such factual findings of the learned Arbitrator cannot be assailed in this application unless it is shown that those findings are perverse.
7. In the issue of costs, Mr. Chakraborty has relied upon a decision of the Apex Court in the case of State of Orissa v. Dandasi Sahu.
8. Paragraph 10 of the judgment has been relied upon by Mr. Chakraborty, wherein the Apex Court observed that the contention to the effect that the amount was shockingly high per se cannot vitiate the award warranting setting aside of the same.
9. Relying on the decision Mr. Chakraborty, submits that the Arbitrator in his reasoned award considered all aspects and ultimately came to a finding that the claimant/respondent was entitled to cost in the facts and circumstances of the case considered by him. According to Mr. Chakraborty, his client had to incur a substantial sum to participate at the Arbitration proceedings. In instruction, Mr. Chakraborty submits on account of the Arbitrator’s fees his client: had to incur a sum of Rs. 2 lacs and odd. Considering all these aspects the Arbitrator, according to Mr. Chakraborty, thought it fit to award a sum of Rs. 1.2 lacs as cost and such mental process cannot be assailed herein in this application for setting aside.
10. In the first two issues, i.e. the principal sum of Rs. 1.28 lacs and interest of Rs. 75,000/-, I am in agreement with Mr. Chakraborty to the extent that this factual findings cannot be gone into by this Court in an application for setting aside. The Arbitrator was the master of his own procedure. He considered pleadings as well as findings and the documents placed before him. He came to an ultimate finding to such extent on factual score. Hence, it would not be proper for me to re-examine the issue upon fresh appraisal on merits of the case as the same is not permissible in law. Hence, the contention of the petitioner on the first two counts are rejected.
11. In the issue of costs, I am, however, unable to appreciate the contention of Mr. Chakraborty. In an adversary proceeding when a party comes and invites the Forum to adjudicate upon the disputes between the parties and if the adjudicator ultimately finds that substantial part of the claim of that party is liable to be rejected, as a logical conclusion such party is not entitled to any costs. In the instant case, the claimant made a claim of Rs. 23.38 lacs which was ultimately lowered down to Rs. 1.28 lacs on principal sum and 75,000/- on account of interest. Hence, the decision of the Arbitrator to award costs, considering such facts and circumstances of the case, cannot: be conceived of.
12. Now comes the question of unnecessary delay caused by the petitioner from 106th sitting. The decision relied upon by the petitioner before the Arbitrator was on the Act of 1996. In the instant case, the authority of the erstwhile Arbitrator was revoked. The said Arbitrator was appointed by the petitioner themselves. This Court thereafter appointed Arbitrator at the invitation of the parties. The parties participated at the arbitration proceeding and the Arbitrator conducted as many as 105 sittings. When the arbitration proceeding was nearing its completion, the petitioner should not have raised those technical objections at the 106th sitting. Assuming the petitioner was entitled to raise that issue, they should have raised at the earliest opportunity. Having participated in the Arbitration proceeding substantially the rights, if any, of the petitioner stood waived by them.
13. Hence, there was sufficient reason for the Arbitrator to make comments on the conduct of the petitioner on that score.
14. I, however, feel that once the claimant/respondent; was not entitled to cost otherwise awarding costs as against the petitioning in favour of the respondent for such wrongful conduct on the part of the petitioner that too to the extent of Rs. 1.2 lacs, in my view, was not the correct approach. Although the Arbitrator described the same as costs, in my view, that should not have been the penalty imposed upon the petitioner because of their wrongful conduct.
15. In the result, I modify the award by imposing a token cost as against the petitioner as and by way of penalty for the reasons as discussed hereinbefore to the extent of Rs. 20,000/-. The award is modified accordingly.
16. Mr. Chakraborty, on being instructed from Mr. Ranjan Lal Mitra Advocate-on-Record for the claimant/respondent, prays for stay of operation of this order. Such prayer is considered and rejected.
17. The application being GA No. 3529 of 2004 is disposed of accordingly without any order as to costs.
18. Xerox certified copy of this order be made available to the parties, if applied for, upon compliance of all formalities.