JUDGMENT
S.N. Kapoor, J.
1. The present petition has been filed under Sections 14 and 17 of the Arbitration Act, 1940 for filing and making the award rule of the Court.
2. Objections (IA No.11041/96) under Sections 30 and 33 of the Arbitration Act have been filed by the respondent.
3. In this case, the claimant, M/s. Gautam Enterprises, entered with an agreement with the respondent, Indian Tourism Development Corporation Limited (hereinafter called the “ITDC Ltd.” for short) for carrying out water proofing job at the terrace of Hotel Laxmi Villas Palace, Udaipur on 17th August, 1993. Some dispute arose and the matter was referred to the Sole Arbitrator Shri T.C. Garg to adjudicate upon the dispute vide letter No. LA/ARB/PROJ/LVPH/95/179 dated 21.4.1995.
4. The Arbitrator gave the award on 25th March, 1996. The claimant was awarded a sum of Rs. 6,50,886.43p. as against Rs. 6,91,329.13p. claimed. The counter claim was rejected. The claimant was also held entitled to interest at the rate of 12% per annum in case the payment was not released within two months from the date of the award i.e. 25th March, 996.
5. According to the respondent, notice of filing of the award was served on 25th September, 1996. The Court was closed on account of Dussehra vacations from 21st October, 1996 to 27th October, 1996. The objections were filed on 28th October, 1996 and thus, they are within time. It is claimed by the respondent that the learned Arbitrator has miss-conducted himself and the proceedings; it is based on no evidence; there is an error apparent on the face of the award; the award suffers from non-application of mind; and the Arbitrator has awarded those amounts which were not even claimed by the claimants. Apart from these general objection, some specific objections have been made with reference to particular claims. The learned Arbitrator has miss-conducted himself and the proceedings. The over payment had not been taken into consideration and thus, there is duplication in awarding the amount. Those objections, including the general objections shall be dealt with at appropriate place while considering specific claims. The Arbitrator has miss-conducted himself and proceedings in rejecting counter claim in respect of Rs. 30,000/- on account of polishing and painting of conference hall and other halls. The claim for a damage to the carpets though it was direct result of seepage due to poor workmanship of the claimant was rejected by just saying it was an afterthought. The Arbitrator also disallowed the claim of Rs. 5,50,000/- on account of direct loss of revenue to the respondent/objector caused due to failure of the claimant to
execute the work within time by mis-reading the provisions of the contract and for the same reason loss caused to the reputation of the respondent/objector concern has also been ignored.
6. On the other hand, the claimant asserts that notice in fact had been duly served on the respondent/objector on 12th June, 1996 while the objections have been filed on 28th October, 1996. As such, the objections are barred by time. Besides, the objections do not specifically disclose the manner in which Arbitrator has miss-conducted himself and proceedings. All the averments in regard to the specific claims have been denied.
7. Rejoinder was also filed reaffirming the claims and the objections.
8. Having heard learned Counsel for the parties and after going through the record, the following points arise for consideration:
1. Whether the objection petition has not been filed within time and is liable to be rejected summarily?
2. Whether the objections of the respondent can be accepted in respect of any claim for any of the reasons mentioned in the objection petition?
3. Relief
Point 1: Question of limitation in filing objection.
9. In so far as the question of limitation is concerned, learned Counsel for the claimant pointed out that notice of filing of the award was duly served on the respondent/objector on 12th June, 1996. It is very much apparent from the perusal of the notice and service report and affidavit of the Process Server that the respondent was served through General Manager, Laxmi Villas Palace Hotel, Udaipur on 12th June, 1996. But probably this service report was not placed before the learned Joint Registrar as a result of which he passed an order that notice of filing of the award be issued to the respondent without process fee, returnable on 26th November, 1996. The respondent do not disclose nor even deny that they were served on 12th June, 1996, except a bland denial that the objections are barred by time. However, it is not disputed that on 17th October, 1996 the respondent’s Counsel Mr. Y.K. Kapur inspected the record. The fact that
learned Counsel for the respondent inspected the record on 17th October, 1996 is not very material, for the respondent themselves claim that they had been served subsequently on 25th September, 1996 and that is also supported by the report of the Process Server dated 30th September, 1996 and a receipt thereon with the seal of the Laxmi Villas Palace Hotel, Udaipur dated 25th September, 1996, It may further be mentioned that the respondent relies on affidavit of Sh.C. Stephan, Company Secretary of ITDC Ltd., New Delhi. Obviously, he would not have any personal knowledge about service of notice at Udaipur and there is no affidavit of any other officer posted at the Laxmi Villas Palace Hotel, Udaipur, specially that of Sh. K.K. Chhabra and Mallika the receipt clerk to indicate that notice was not received. In such circumstances, I accept the report of the Process Server dated 13.6.1996. Seeing the report of the Process Server and the fact that it bears a seal of the Laxmi Villas Palace Hotel, notice had been received by the receipt clerk of respondent on 12.6.1996 and thereafter seal of the respondent was put below endorsement of receipt. I feel that the service was sufficient and the objections are patently barred by time in absence of any application for condensation of delay.
Point 2: Objections relating to specific claim:
10. Now, objections relating to specified claims are proposed to be considered:
Claim No. 1 : In regard to awarding a sum of Rs. 3,27,422.70p., the main objection is that out of total original claim of Rs. 3,65,981/-, 2,55,602/- had already been admittedly paid. As such, awarding a sum of Rs. 2,24,422/- was unjustified. It appears from the award that claimant confined it to Rs. 3,29,637/-. It also appears that while taking this objection respondent has not taken into consideration the note (1) appended to award which is as
follows:
“The amount included shall be payable within two months from the date of this award or decree whichever is earlier after deducting payments already made. In case the money is released, the claimant shall be paid simple interest at the rate of 12% per annum.
As such there is no duplication in awarding any payment. In so far as the question of rate of awarding Rs. 330/ – per sq. metre for waterproofing is concerned, that rate has not been challenged. Payment has been ordered in respect of an area of 1,495.96 sq. metres as against 1,507.53 sq. metres claimed, on the basis of agreed measurements. There does not appear any reason, therefore, to say that the award is unreasonable in any manner so far as the Claim No l. is concerned. However, it is clarified that out of Rs. 3,27,422/- a sum of Rs. 2,55,602/- had already been received by the titioner/claimant from the respondent/objector. Thus, only Rs. 71,820/- is payable under this head.
11. As regards claim relating to extra items of expansion of joints and the bills relating thereto amounting to Rs. 36,344/- it is submitted that this had already been paid in the first running bill since extra items of expansion of joints were included in Rs.2,55,602/- and accordingly, no amount could have been awarded on this head. According to claimant this extra item was not included in Rs. 2,55,602/- paid under first running bill. Further this amount was awarded subject to deductions of the amounts already paid, including Rs. 2,55,602/- already paid. After adjustment of
this amount, the claimant cannot claim duplication in award of the payment of Rs. 34,507.64p. as against Rs. 36,344/- claimed.
12. In so far as the objection relating to awarding of a sum of Rs. 28,169/- relating to newly built kitchen, it is claimed by the objector that it was done without there being any evidence. All rates of extra items were to be agreed or derived from the work of same nature in the contract and if this is not possible then from the rates fixed by CPWD for an identical type of work. There was no agreement of rates nor CPWD rates applied. This extra work was undisputedly done. So far as rate is concerned, seeing the rate of waterproofing of other portions of the building, the rate awarded in this regard cannot be said to be unjust nor it is open for scrutiny. Nothing has been pointed out to indicate any prohibition about non-applicability of CPWD rates on the one hand and on the other hand to show that CPWD rates have been accepted. Therefore, no interference is called for in this respect.
13. In so far as the question of awarding a sum of Rs. 3,150/- towards cost of transportation is concerned, according to the objector, this amount was supposed to be spent by the contractor himself. In reply to this, nothing was pointed out to show that it was contractual obligation of the contractor to spend any money on this account. Seeing the award it is apparent that this Court cannot take any other view for it cannot be said to be a case of no evidence.
14. Award of a sum of Rs. 34,630.54 relating to plastering of conference hall, it is claimed by the objector that no work order was placed. There was no evidence of work done. Moreover, basis of claim for Rs. 95/- per sq. metre had not been disclosed. So far as the factum of doing the work of plastering is concerned, it is not disputed. It is further submitted that the rate of plastering of thickness from 12 mm to 15 mm was at the rate of Rs. 45 /- per mm. considering the submissions and factual position, this is such a matter where this Court is not supposed to interfere, for one cannot say there is no reason and reasonableness of the reason cannot be looked into by this Court. As such, I would accept the finding of the learned Arbitrator in this regard.
15. In so far as the Arbitrator allowed a sum of Rs. 56,761.65p. on account of re-doing of waterproofing at the conference hall, _ this is objected to by the respondent on the ground that the claimant had done waterproofing but there was seepage in the same on inspection by the senior officer. The claimant was asked to remove the defect and in the process had to make some additional effort being part of the contract, the claimant was not entitled to receive anything extra since seepage was there and it was the claimant’s job to remove the same. Thus the learned Arbitrator wrongly awarded a sum of Rs. 56,761.65p. In the absence of an evidence on record. The respondent support the following finding given by the Arbitrator “Roof structure of conference hall is a Hyperbolic Paraboloid like an inverted umbrella. As a result of unusual overloading of the structure with water for a number of days and also blockage of low in the drainage pipe, there
was heaving effect and see page of water in the surface of concrete with lime mortar. This kind of testing in such inaccessible structure was perhaps not necessary and has overstressed the structure and, therefore, DGM(EHQ)ITDC and to direct for rehabilitation of damaged structure and the waterproofing work, which resulted in extra work for no fault on the part of the claimants who have to be paid for this extra work done at the instance of respondents. Total treated area claimed = 3638.40 sq.m. but base area i.e. 229.34 sq.m. only could be paid as removal of foam concrete was not required for parapet walls and central beams. Amount allowed is 229.34 X 0.75 X 330 = Rs. 56761.65p.”
16. It is evident that it was the job of the claimant to remove the seepage but it is also clear that he was asked to do additional work. It is evident from the reasons given that the roof structure of conference hall was a hyperbolic like an inverted umbrella. As a result of unusual overloading of the structure with water for a number of days and also blockage of flow in the drainage pipe, there was heaving effect and seepage of water in the surface of concrete with lime mortar. This kind of testing in such structure was perhaps not necessary and over struck the structure and therefore ITDC had to direct for rehabilitation of damaged structure and waterproofing work which resulted in extra work for no fault f the claimants. The Arbitrator has mentioned that “having considered the matter in dispute, having perused all the documents filed before me by the parties including all counterclaims having inspected the site and having heard the
parties award and direct as follows.” Since it is admitted that some additional work was done at the instance of the respondent including the unnecessary experiment was ensuring passage of water, it may be mentioned that the inspection of the site was requested by the Manager of ITDC. The letter at p.80 dated 16th April, 1994 supports the finding of the learned Arbitrator. There is a lot of correspondence in this regard. Consequently, it cannot be said that the award was without any basis and there was no evidence at all apart from the admission of the respondent about giving additional work. As such, I find it difficult to accept the contention of the objector in regard to redoing waterproofing work at the terrace of conference hall at the rate of 75% of Rs. 330/- per sq. mtr. So objection in this regard is, therefore, rejected.
17. In so far as the rejection of counter claim of the objector for Rs,30,000/- on account of polishing and painting of conference hall claim for damages to the carpets, direct revenue loss by blocking renting out of the rooms and loss of reputation is concerned, the Arbitrator rejected all these claims by mentioning that no provision existed in agreement of work order and the objections relating to direct loss of revenue and the cost of polishing and painting of the conference hall. In far as loss of carpets and claim of Rs. 7,000/- is concerned, that was rejected as this counterclaim of the respondent was not found justified for repair work relating to seepage, the claim was an after thought. In so far as counter claim of Rs. 25,000/- due to loss of reputation is concerned, it was held to be against the provision in the work order agreement and as such the loss was disallowed. In so far as loss of reputation is concerned, it is far-fetched and
appears to be on the face of it an afterthought and taken by way of counterblast to the claim of the respondent. The reasons are appropriate and Arbitrator has rejected it for appropriate reasons.
18. I do not find any force in the objections and reject the same accordingly. The award given by Mr. T.C. Garg dated 25th March, 1998 is hereby made rule of the Court. The claimant/decree holder shall be entitled to get a simple interest at the rate of 12% per annum on the unpaid awarded amount. Parties are left to bear their own cost.
19. Decree sheet be prepared accordingly.
Award made Rule of the Court.