Bombay High Court
Rashmi Housing Pvt. Ltd vs Pan India Infraprojects Private ... on 17 December, 2014
Bench: R.D. Dhanuka
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
ARBITRATION PETITION NO. 600 OF 2011
Rashmi Housing Private Limited )
st
B/215, 1 Floor, Shanti Shopping Centre, )
Opp.Mira Road Station, Mira Road (East)
Thane - 401 107 ) ..... Petitioner
VERSUS
Pan India Infraprojects Private Limited )
Continental Building, ig )
135 Dr.Annie Besant Road, Worli, )
Mumbai - 400 018 ) ..... Respondent
Mr.Piyush Raheja, a/w. Mr.G.R.Joshi, Mr.M.S.Delhvi, i/b. Bejai & Co. for the
Petitioner.
Dr.Birendra Saraf, a/w. Ms.Pooja Tidke, Ms.Kshama Loya, i/b. ALMT Legal for
the Respondent.
CORAM : R.D. DHANUKA, J.
RESERVED ON : 27th NOVEMBER, 2014
PRONOUNCED ON : 17TH DECEMBER,2014
JUDGMENT
By this petition filed under section 34 of the Arbitration and Conciliation
Act, 1996 (for short 'the said Act') the petitioner has impugned the arbitral award
dated 29th March, 2011 passed by the learned arbitrator allowing the claims of the
respondent in the sum of Rs.1,74,72,000/- with interest at the rate of 18% per
annum from the due date till the date of the award and thereafter at the rate of 12%
per annum till payment and rejecting the counter claim made by the petitioner with
cost quantified at Rs.9,25,000/-. For the sake of brevity the parties to this petition
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are described in this judgment as they were described before the learned arbitrator.
The petitioner herein was the original respondent before the learned arbitrator.
M/s.Essel Sports Private Limited were the original claimants. Name of the original
claimants were subsequently changed to Pan India Infraprojects Private Limited.
Some of the relevant facts for the purpose of deciding this petition are as under :-
2. The claimant had launched a cricket tournament called the Indian Cricket
League (ICL) wherein both domestic and international players were participating.
In the year 2007 the claimant hosted the Mumbai Champs (Cricket) Team during
the ICL tournament held at Panchkula from 30th November 2007 to 16th December
2007. On 26th November 2007 the claimant entered into a Deal Memo with the
respondent and appointed the respondent as the sponsor of the tournament for a
consideration of Rs.2 crores. Under the said Deal Memo the respondent had
agreed to pay 25% of the said consideration at the time of signing of the Deal
Memo. 35% of the balance amount was payable on or before 10 th December 2007
and balance 40% was payable on or before 16 th December 2007. The respondent
paid a sum of Rs. 50 lacs to the claimant being 25% of the fee payable under the
said Deal Memo upon execution of the said document by cheque. The term of the
said agreement was one year i.e. from 30th November 2007 to 29th November 2008.
3. Under the said Deal Memo the claimant had offered the brand logo marks on
the jersey of the team. The respondent was given a right to use the team logo in
any communication that brand may put out. The respondent was given a right to
hold press conference with full team in attendance. In addition to the above
referred rights, various other rights were given to the respondent under the said
Deal Memo. Clause 8 of the said Deal Memo provided for arbitration. Clause 8
provided that a Long Form Agreement of the said arrangement shall be executed
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between the parties within 90 days. Until a detailed and Long Form Agreement
was executed between the parties, the terms and conditions in the said arrangement
shall continue to be binding and subsisting.
4. There were five matches played i.e. on 1st December 2007, 3rd December
2007, 7th December 2007, 9th December 2007 and 12th December 2007. The
conclusion ceremony took place on 16th December 2007. By letter dated 4th
December 2007 the respondent made certain suggestions to the claimant regarding
their logo. It was suggested that their logo should be displayed on the chest and
back of the jersey/sweaters being worn by the team players. The respondent stated
that since their deal was signed at the last minute, they fully understood the
compulsion of the claimant in not getting the logo of the respondent printed on the
back in lieu of Mumbai Champs, there was need to implement the same for
forthcoming matches from 7th December 2007.
5. By their letter dated 12th December 2007 the respondent recorded their
sincere thanks for implementing suggestion contending letter dated 4 th December
2007 and also recorded their pleasure to learn that the claimant had displayed
hoardings about ICL Mumbai team at Bandra and Mahim and suggested for
display of some more hoardings at various places in Mumbai. The respondent
suggested the claimant to ensure that the name of the respondent as sponsor of
Mumbai Team of ICL was permanently displayed in those hoardings. This letter
was addressed by the respondent after all the five matches were over.
6. The claimant thereafter sent invoices to the respondent for various amounts.
On 23rd April 2008 the claimant informed the respondent that an outstanding
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balance of Rs.1,74,72,000/- was yet to be received from the respondent by the
claimant. The claimant by their advocate's letter dated 8 th September 2007 called
upon the respondent to pay Rs.1,74,72,000/- with interest at the rate of 18% per
annum. There was no response to the said notice of demand. On 1st April, 2009
the claimant once again sent a reminder for payment of the said outstanding
amount. There was no response to the said letter also. The claimant through their
advocate's letter dated 20th April 2009 once again called upon the respondent to pay
the outstanding amount with interest and conveyed that the claimant had decided to
invoke their rights under clause 8 of the Deal Memo and accordingly referred the
matter to the Essel Sports Private Limited Board to resolve the dispute.
7. On 17th June 2009 the claimants through their advocate issued a winding up
notice to the respondent. The respondent by their advocate's letter dated 27 th June
2009 for the first time alleged that the claimant had failed to perform their
obligations as per Deal Memo in respect of the last four of total five matches
covered by the said Deal Memo and thus there was no question of the respondent
having any liability to pay to the claimant any amount as claimed. Respondent
called upon the claimant to withdraw the said notice. The respondent by their
advocate's letter dated 14th July 2009 once again denied their liability and alleged
breaches on the part of the claimant.
8. By their advocate's letter dated 23rd July 2009 the claimant replied to the
letters dated 27th June 2009 and 14th July 2009 of the respondent and denied the
allegations made therein. On 7th August 2009 the claimant filed a company
petition (720 of 2009) against the respondent inter alia praying for winding up of
the respondent company. On 18th September 2009 the claimant initiated arbitration
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proceedings under clause 8 of the Deal Memo.
9. On 2nd July 2010 this court passed an order disposing of the company
petition filed by the claimant thereby requiring the respondent to secure the claim
of the claimant by offering security. The respondent identified four flats and
undertook not to dispose of, alienate, transfer, encumber, part with possession of or
create any third party rights, title and/or interest in respect of the said four flats
except giving the same out on leave and licence basis for the period not exceeding
two years at a time. This court kept all the rights of the parties open and disposed
of the said company petition.
10. The claimant filed statement of claim before the learned arbitrator inter alia
praying for an order and direction against the respondent to pay a sum of
Rs.1,74,72,000/- together with interest at the rate of 18% per annum from the due
date till payment and cost. The respondent filed their statement of defence on 3 rd
November 2009 and denied the claim of the claimant. The respondent also filed a
counter claim against the claimant herein inter alia praying for refund of Rs.25 lacs
with interest, another Rs.25 lacs towards the amount alleged to have been spent by
the respondent for advertising their products and sum of Rs.1 crore by way of
damages for the loss alleged to have been caused for defaming the goodwill and
deputation of the respondent. The claimant opposed the said counter claim by
filing the written statement.
11. In the statement of claim the claimant relied upon 17 documents and
separately filed two copies thereof including a CD containing the pictures of the
tournaments. Both the parties led oral evidence before the learned arbitrator. The
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respondent also made various applications before the learned arbitrator during the
course of recording of oral evidence which was disposed of by the learned
arbitrator. The witnesses examined by the claimants were cross examined by the
respondent and vis-a-versa.
12. By the impugned award dated 29th March 2011 the learned arbitrator directed
the respondent to pay a sum of Rs.1,74,72,000/- with interest at the rate of 18% per
annum from the due date till the date of award and at the rate of 12% per annum
thereafter till payment or realization. The learned arbitrator rejected the counter
claim made by the respondent and directed the respondent also to pay sum of
Rs.9,25,000/- towards cost as against the claim of Rs.21,15,000/-.
13. Learned counsel for the respondent (petitioner herein) invited my attention
to various part of the pleadings, oral evidence, documents and various findings
rendered by the learned arbitrator. It is submitted by the learned counsel that the
learned arbitrator has failed to appreciate the evidence led by the parties and has
incorrectly drawn adverse inference against the respondent (petitioner herein) for
raising an objection from taking the DVDs on record which evidence ought to have
been produced by the claimant in support of their claim at the appropriate time and
not during the cross examination of one of the witness of the claimant.
14. It is submitted that the claimant has not produced any satisfactory evidence
to show that they had performed their obligation under the Deal Memo. It is
submitted that the said Deal Memo contemplated execution of a detailed Long
Form Agreement which was the obligation of the claimant which they had failed to
execute. It is submitted that unless the claimant would have performed their part
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of obligation, respondent could not have been called upon to pay any amount to the
claimant. It is submitted that the adverse inference can be drawn against a party
who has in his possession evidence however refuses to produce such evidence and
not against a party who raises objection from taking the disputed evidence on
record at the belated stage.
15. My attention is invited to the order passed by the learned arbitrator on 18 th
June 2010 on the objection raised by the respondent about the CD being marked as
exhibit. It is submitted that though the learned arbitrator ultimately rejected those
six CDs/DVDs from taking on record in evidence, the learned arbitrator has drawn
adverse inference against the respondent in respect of such DVDs which were not
marked as exhibits and proceeded to rely upon such DVDs indirectly in the
impugned award. Learned counsel submits that though such six CDs/DVDs were
available with the claimant since inception, the claimant chose to produce such
CD/DVD only in the cross examination of one of the witness. The respondent was
thus justified in opposing an attempt on the part of the claimant to produce such six
CDs/DVDs at the stage of cross examination.
16. Learned counsel submits that the learned arbitrator has thus violated the
principles of natural justice by relying upon a disputed piece of evidence which
was not proved and the award on that ground itself is vitiated. In support of this
submission the learned counsel placed reliance on the judgment of Supreme Court
in case of M/s.Bareilly Electricity Supply Co. Ltd. vs.The Workmen and others
AIR 1972 SC 330 and in particular paragraph 14 thereof.
17. Learned counsel also placed reliance on the following judgments :-
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(a) Judgment of this court in case of Municipal
Corporation of Greater Mumbai vs. Hindustan Construction
Company Ltd. decided on 3rd December 2010 in Arbitration
Petition No.65 of 2008 (paragraph 9.)
(b) Judgment of this court in case of Pradyuman Kumar
Sharma & Anr. vs. Shri Jaysagar M.Sancheti & Ors. 2013
BCI 49 (paragraphs 9 and 33)
(c) Judgment of this court in case of Bi-water Penstocks
Ltd. vs. Municipal Corporation of Greater Bombay & Anr.
2011(1) Bom.C.R. 622 (Paragraphs 13 to 15),
(d) Judgment of Delhi High Court in case of Wazir Chand
Karan Chand vs. Union of India and another AIR 1989
Delhi 175 (paragraphs 8 to 15).
18. It is submitted by the learned counsel that even if the learned arbitrator
wanted to draw any adverse influence against the respondent in view of the
respondent raising objection from the said CD/DVD being marked as exhibits, the
learned arbitrator could not have drawn an adverse inference without giving an
opportunity to the respondent. It is submitted that the award is liable to be set
aside also on this ground.
19. It is submitted by the learned counsel that though the learned arbitrator had
directed one of the witness of the claimant to produce the Long Form agreement
and the same was not produced by the witness, no adverse inference was drawn by
the learned arbitrator against the claimant. The learned arbitrator has thus not
treated both parties equally. The learned arbitrator ought to have drawn adverse
inference against the claimant for not producing the Long Form agreement by
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exercising powers under section 114(g) of the Indian Evidence Act.
20. It is submitted by the learned counsel that though the respondent had
produced certain photographs in evidence which were marked as exhibits W-3
collectively, the learned arbitrator did not consider the impact of those photographs
in the impugned award at all. The impugned award is thus passed by ignoring the
evidence produced by the respondent and though admitted in evidence.
21. Learned counsel for the respondent lastly submitted that the Deal Memo was
signed in great haste and thus no claim could have been allowed by the learned
arbitrator based on such Deal Memo which was signed in great haste by the
respondent.
22. Per contra, Dr.Saraf, learned counsel for the claimant invited my attention to
various pleadings, documents, evidence and also the findings rendered by the
learned arbitrator in the impugned award. My attention is also invited to the
provisions in Deal Memo which was admittedly executed by and between the
parties. It is submitted that when the letter dated 4th December 2007 was addressed
by the respondent to the claimant making few suggestions, two matches out of five
matches were already over. The next match was due on 7th December 2007. In the
subsequent letter addressed by the respondent on 12th December 2007 which was
addressed after all the five matches were over, the respondent themselves had
recorded their sincere thanks for implementing the suggestions contained in the
letter dated 4th December 2007. The respondent had also recorded their immense
pleasure by learning that the claimant had displayed hoardings about ICI Mumbai
Team at Bandra and Mahim.
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23. It is submitted that except making payment of Rs. 50 lacs the respondent did
not make the payment of the balance amount. Most of the letters of demand issued
by the claimant were not replied by the respondent. Only for the first time on 27 th
June, 2009 after the claimant issued winding up notice, the respondent made false
and incorrect allegations alleging breaches on the part of the claimant of their part
of the obligation.
24. Dr.Saraf learned counsel for the claimant states that the respondent has not
denied that the brand logo marks of the respondent was there on the jersey. Even
the witness examined by the respondent admitted that the brand logo marks was
there on the jersey. The suggestions given by the respondent was admittedly
implemented by the claimant in so far as suggestions given on 4 th December 2007
were concerned. The other suggestions given by the respondent on 12 th December
2007 were given after all the five matches were over. The respondent themselves
have accepted the fact that the claimant had implemented all the suggestions of the
respondent in the said letter dated 12th December 2007 and had expressed pleasure
for such implementation and had thanked the claimant for the same. It is submitted
that the learned arbitrator had rendered findings of fact.
25. In so far as issue raised by the respondent that in absence of the Long Form
not having been executed by the claimant and thus no reliance could be placed on
the Deal Memo or that the same was not conclusive is concerned, it is submitted
that the Deal Memo itself was a concluded contract as is apparent from clause 8
thereof. It is submitted that the respondent also had partly implemented the said
Deal Memo. The learned arbitrator therefore rightly relied upon the obligations of
both parties under the Deal Memo and analyzed the same. The learned arbitrator
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rendered a finding that logo mark of the respondent was visible and proved. It is
submitted that the witness of the respondent in the cross examination admitted that
the logo mark of the respondent was visible on jersey. The respondent could not
exploit other rights as the respondent had no marketing plan. It is submitted that
the claimant did not obstruct the respondent from exploiting their rights.
26. It is submitted by the learned counsel that the claimant in the examination in
chief of the witness Mr.Yogesh P.Bosmiya (witness of the respondent), he had
relied upon the contents of six DVDs which were opposed by the respondent when
produced by the witness of the claimant. It was thus clear that the objection of the
respondent in taking those six DVDs on record in evidence was frivolous. It is
submitted that in any event the learned arbitrator had not allowed the claim of the
claimant only by drawing adverse inference against the respondent but has
considered several documents, oral evidence led by both parties and also the
contents of a CD containing photographs which was proved by the witness
examined by the claimant.
27. It is submitted that in any event under section 167 of the Indian Evidence
Act, even if there was any improper rejection of the evidence or the learned
arbitrator not having considered a piece of evidence, there can be no new trial if
there was otherwise sufficient evidence available on record.
28. In so far as submission of the learned counsel for the respondent that the
learned arbitrator could not have considered the photographs contained in the CD
is concerned, Dr.Saraf learned counsel invited my attention to the oral evidence led
by the witnesses examined by the claimant and in particular Mr.Dominic Savio
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D'souza (CW-5) who produced the said CD. In his cross examination, the said
witness deposed that he was the author of the said CD. The witness was asked how
did he compile the CD and what did the DVD contain. The witness deposed that he
was author of the CD and the DVD covered the entire matches. My attention is
invited to the order passed by the learned arbitrator on the objection of the
respondent raised in the application dated 26th July 2010. It is submitted that the
respondent had raised objection for the DVD being taken on record on the ground
that the respondent had already produced a CD through the said witness and could
not be allowed to produce any more CDs/DVDs.
29.
Learned counsel invited my attention to the evidence of Mr.Gaurav R.Behal
examined by the claimant who had initially tendered the said CD. In the
arbitration meeting held on 6th March 2010 when the evidence of the said witness
was recorded, the learned arbitrator had taken the said CD on record and had
marked as Ex.L. The learned counsel submits that the claimant thus rightly relied
upon the said CD and the same has been rightly considered by the learned
arbitrator in the impugned award.
30. Dr.Saraf, learned counsel for the claimant invited my attention to the
grounds raised by the respondent in the arbitration petition and submits that no
ground has been raised by the respondent that the learned arbitrator had wrongly
drawn adverse inference or that the CD was wrongly marked as exhibit by the
learned arbitrator. It is submitted that the respondent has also not raised any
ground that the photographs produced by the respondent though marked have not
been considered by the learned arbitrator. It is submitted that the respondent cannot
be allowed to urge any grounds across the bar which are not raised in the
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arbitration petition.
31. Dr.Saraf learned counsel distinguished the judgments relied upon by the
learned counsel for the respondent on the ground that the learned arbitrator has not
followed the principles of natural justice and has relied upon the evidence and the
documents which were duly proved by the respondent in evidence.
32. Dr.Saraf, placed reliance on the judgment of the Division Bench of this court
in case of Rashtriya Chemicals and Fertilizers Limited. vs. M/s.Mohinder Singh
& Co. AIR 1985 Bombay 381 and in particular paragraphs 28 and 29 in support of
the submission that the strict provisions of Evidence Act are not applicable to
arbitration proceedings. Paragraphs 28 and 29 of the said judgment read thus :-
28. The sixth ground urged by Mr. Thakkar was that the
arbitrator took on record documents which had not been
strictly proved as required by the Evidence Act. This must
surely be the weakest of all the contentions urged before us.
Technical rules of evidence do not apply to arbitration
proceedings. What is more, the arbitrator called upon both
parties to produce the documents on which they relied. They
did so. They were taken on record without demur from either
side. The appellant took inspection of the measurement books
and measurement registers tendered by the contractor. The
appellant was even allowed to take away those books and
registers for perusal. Parties based their arguments and
submissions on the measurement books, measurement registers
and other documents which were on record of the arbitrator.
No desire was expressed by either party for production of any
person for cross-examination or that any document be strictly
proved. A party cannot sit back on an objection during the
hearing before the arbitrator and raise it later after finding
himself faced with an adverse award; such conduct would
amount to acquiescence. (N.E.S. & T. Corporation v. State of
Punjab MANU/PH/0018/1963, K. N. Co-op. Society v. Union
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of India, MANU/SC/0002/1973 : AIR1973SC1338 and N.
Chellapan v. Kerala S. E. Board, MANU/SC/0002/1974 :
[1975]2SCR811 ). In these circumstances, pray, where arises
the question of the documents necessitating strict proof as
required in a Court of law where the Evidence Act holds the
field? In any event, in these circumstances, it was open to the
arbitrator to dispense with strict proof.
29. Mr. Thakkar relied on Bareilly Electricity Supply Co.
Ltd. v. Workmen MANU/SC/0501/1971 : (1971)IILLJ407SC ,
where on the question of observance of the principles of
natural justice it was held that where issues are seriously
contested and have to be established and proved, the
requirements relating to proof cannot be dispensed with even
though the Evidence Act is not applicable to industrial
tribunals. This is yet another decision which can avail the
appellant nothing. Labour matters and decisions of tribunals
cannot be equated with arbitration proceedings and arbitrators
awards. In the former where depend issues like the correctness
of a balance sheet prepared by the employer from materials to
which the workers would have no access and on which their
fate is in balance, it is but right that the strict requirements of
proof should not and cannot be dispensed with. To do
otherwise would be contrary to the principles of natural
justice. Unlike arbitrators, industrial tribunals have statutory
rules as to how evidence is to be taken. No parallel can
conceivably be drawn between mode of proof before tribunals
and arbitrators. Moreover, in the present matter even Mr.
Thakkar does not say that the appellant challenges the
genuineness of the documents produced by the contractor. All
he says is that they have not been strictly proved. In these
circumstances, reliance on the Bareilly Electricity case
MANU/SC/0501/1971 : (1971)IILLJ407SC is utterly
misplaced.
33. Dr.Saraf also placed reliance on the judgment of this court in case of New
Consolidated Construction Co. Ltd. vs. Serum Bio Pharma Park on the same
issue. Paragraphs 62 and 63 of the said judgment read thus :-
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62. Mr. Chinoy relied upon the judgment in the case of
M/s.Bareilly Electricity Supply Co. Ltd. Vs. The Workmen &
Ors., AIR 1972 Supreme Court 330 which was a case before
the labour tribunal and in which it was held that evidence had
to be strictly proved when issues are seriously contested. It is
observed that applications of principles of natural justice
would not imply that what was not in evidence could be acted
upon whilst considering the evidence contained in the Balance
Sheet and Profit and Loss Account of the company. It was held
that mere production cannot amount to the proof of the truth of
the entries contained therein and the tribunal cannot pass an
award on the copies of documents when originals were not
proved either by affidavit or by direct evidence. Mr. Chinoy
would argue that this was shown to be standard of proof even
in industrial courts where direct proof of evidence was not
required.
63. Mr. Kadam on the other hand correctly drew my
attention to the same principle imported into arbitration as held
by the Division Bench of this Court in the case of Rashtriya
Chemicals & Fertilizers Ltd. Vs. M/s. Mohinder Singh & Co.,
1984, The Bombay Law Reporter (LXXXVI). The Division
Bench frowned upon the analogy in the case of Bareilly
Electricity (supra) sought to be applied to arbitrations under
the old Arbitration Act of 1940, the principles of which have
been further streamlined and smoothened in the new
Arbitration Act of 1996 giving the arbitrators the greater ambit
to follow the procedure not set out in the Indian Evidence Act.
34. It is submitted by the learned counsel that the learned arbitrator has rendered
various findings of fact which cannot be re-appreciated by this court under section
34 of the Act since the same are not perverse. In support of this submission, the
learned counsel placed reliance on the judgment of Supreme Court in case of
Ravindra Kumar Gupta and Company vs. Union of India (2010) 1 SCC 409 and
in particular paragraph 14 which reads thus :-
In this case, the Supreme Court notice the earlier judgment in
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the case of Ispat Engineering & Foundry Works, B.S. City,
Bokaro v. Steel Authority of India, B.S. City, Bokaro
MANU/SC/0389/2001 : (2001) 6 SCC 347 wherein it was held
as follows:
" 4. Needless to record that there exists a long catena of cases
through which the law seems to be rather well settled that the
reappraisal of evidence by the court is not permissible. This
Court in one of its latest decisions [Arosan Enterprises Ltd. v.
Union of India MANU/SC/0595/1999 : (1999) 9 SCC 449]
upon consideration of decisions in Champsey Bhara & Co. v.
Jivraj Balloo Spg. & Wvg. Co. Ltd. MANU/PR/0071/1923 :
Air 1923 PC 66, Union of India v. Bungo Steel Furniture (P)
Ltd. MANU/SC/0004/1966 : 1967 1 SCR 324, N. Chellappan
v. Secy., Kerala SEB MANU/SC/0002/1974 : (1975) 1 SCC
289, Sudarshan Trading Co. v. Govt. of Kerala
MANU/SC/0361/1989 : (1989) 2 SCC 38, State of Rajasthan
v. Puri Construction Co. Ltd. MANU/SC/0865/1994 : (1994) 6
SCC 485 as also in Olympus Superstructures (P) Ltd. v. Meena
Vijay Khetan MANU/SC/0359/1999 : (1999) 5 SCC 651 has
stated that reappraisal of evidence by the court is not
permissible and as a matter of fact, exercise of power to
reappraise the evidence is unknown to a proceeding under
Section 30 of the Arbitration Act, 1940. This Court in Arosan
Enterprises categorically stated that in the event of there being
no reason in the award, question of interference of the court
would not arise at all. In the event, however, there are reasons,
interference would still be not available unless of course, there
exist a total perversity in the award or the judgment is based
on a wrong proposition of law. This Court went on to record
that in the event, however, two views are possible on a
question of law, the court would not be justified in interfering
with the award of the arbitrator if the view taken recourse to is
a possible view. The observations of Lord Dunedin in
Champsey Bhara stand accepted and adopted by this Court in
Bungo Steel Furniture to the effect that the court had no
jurisdiction to investigate into the merits of the case or to
examine the documentary and oral evidence in the record for
the purposes of finding out whether or not the arbitrator has
committed an error of law. The court as a matter of fact, cannot
substitute its own evaluation and come to the conclusion that
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the arbitrator had acted contrary to the bargain between the
parties. "
35. Dr. Saraf placed reliance on the judgment of Supreme Court in case of
Arosan Enterprises Ltd. vs. Union of India and another (1999) 9 SCC 449 and in
particular paragraphs 36 and 37 on the issue that the court cannot re-appreciate the
evidence and cannot interfere with the findings of fact in the petition challenging
an arbitral award. Reliance is placed on paragraphs 36, 38 and 39 of the said
judgment which read thus:-
36. Be it noted that by reason of a long catena of cases, it is
now a well settled principle of law that reappraisal of evidence
by the court is not permissible and as a matter of fact exercise
of power by the Court to reappraise the evidence is unknown
to a proceeding under Section 30 of the Arbitration Act. In the
event of there being no reasons in the award, question of
interference of the court would not arise at all. In the event,
however, there are reasons, the interference would still be not
available within the jurisdiction of the Court unless of course,
there exist a total perversity in the award or the judgment is
based on a wrong proposition of law: In the event however two
views are possible on a question of law as well, the Court
would not be justified in interfering with the award.
38. It is on the basis of this well settled proposition that the
learned Single Judge came to a conclusion that the findings of
the Arbitrators in regard to the extension of delivery period and
failure to fix the fresh date has resulted in breach of the
contract on the part of the Government and the same being
purely based on appreciation of material on record by no
stretch it can be termed to be an error apparent on the face of
the record entitling the court to interfere. The Arbitrators have,
in fact, come to a conclusion on a closer scrutiny of the
evidence in the matter and re-appraisal of evidence by the
Court is unknown to a proceeding under Section 30 of the
Arbitration Act. Re-appreciation of evidence is not permissible
and as such we are not inclined to appraise the evidence
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ourselves save and except what is noticed herein before
pertaining to the issue as the time being the essence of the
contract. In this context, reference may be made to a decision
of this Court in the case of M. Chellappan v. Secretary, Kerala
State Electricity Board and Anr. MANU/SC/0002/1974 :
[1975]2SCR811 . Mathew, J. speaking for the Three Judge
Bench in paragraph 12 and 13 observed as below:
" 12. The High Court did not make any pronouncement
upon this question in view of the fact that it remitted the
whole case to the arbitrators for passing a fresh award by its
order. We do not think that there is any substance in the
contention of the Board. In the award, the umpire has
referred to the claims under this head and the arguments of
the Board for disallowing the claim and then awarded the
amount without expressly adverting to or deciding the
question of limitation. From the findings of the umpire
under this head it is not seen that these claims were barred
by limitation. No mistake of law appears on the face of the
award. The umpire as sole arbitrator was not bound to give
a reasoned award and if in passing the award he makes a
mistake of law or of fact, that is no ground for challenging
the validity of the award. It is only when a proposition of
law is stated in the award and which is the basis of the
award, and that is erroneous, can the award be set aside or
remitted on the ground of error of law apparent on the face
of the record:
Where an arbitrator makes a mistake either in law or in fact
in determining the matters referred, but such mistake does
not appear on the face of the award, the award is good
notwithstanding the mistake, and will not be remitted or set
aside.
The general rule is that, as the parties choose their own
arbitrator to be the judge in the disputes between them, they
cannot, when the award is good on its face, object to his
decision, either upon the law or the facts, (see Russell on
Arbitration, 17th ed., p.322).
13. An error of law on the face of the award means that you
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can find in the award or a document actually incorporated
thereto, as for instance, a note appended by the arbitrator
stating the reasons for his judgment, some legal proposition
which is the basis of the award and which you can then say
is erroneous (see Lord Dunedin in Champsey Ehara & Co,
v. Jivraj Baloo Co.). In Union of India v. Bungo Steel
Furniture Pvt. Ltd., this Court adopted the proposition laid
down by the Privy Council and applied it. The Court has no
jurisdiction to investigate into the merits of the case and to
examine the documentary and oral evidence on the record
for the purpose of finding out, whether or not the arbitrator
has committed an error of law."
39. In any event, the issues raised in the matter on merits
relate to default, time being the essence, quantum of
damages--These are all issues of fact, and the Arbitrators
are within their jurisdiction to decide the issue as they deem
it fit--The Courts have no right or authority to interdict an
award on a factual issue and it is on this score the Appellate
Court has gone totally wrong and thus exercised jurisdiction
which it did not have. The exercise of jurisdiction is thus
wholly unwarranted and the High Court has thus exceeded
its jurisdiction warranting interference by this Court. As
regards issues of fact as noticed above and the observations
made herein above obtains support from a judgment of this
Court in the case of Olympus Superstructures Pvt. Ltd. v.
Meena Vijay Khetan and Ors. MANU/SC/0359/1999 :
[1999]3SCR490.
36. Learned counsel for the respondent in rejoinder submits that the learned
arbitrator did not consider the evidence led by the witnesses examined by the
respondent properly and has not treated both parties equally. It is submitted that
the effect of drawing adverse inference by the learned arbitrator for opposing the
DVDs being taken on record was so much on the mind of the learned arbitrator that
it disclosed a prejudice in the mind of the learned arbitrator thereby rendering an
illegal and erroneous award.
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REASONS AND CONCLUSION :
37. I shall first deal with the issue raised by the respondent that the respondent
was kept in dark since the claimant had not signed the Long Form agreement.
Perusal of clause 8 of the Deal Memo clearly indicates that though it was
provided that the Long Form Agreement of the said arrangement shall be
executed between the parties within ninety days, it was also provided that until
detailed and Long Form Agreement was executed between the parties, the terms
and conditions of the arrangement shall continue to be binding and subsisting.
Perusal of the record indicates that the respondent never called upon the claimant
to execute any such Long Form Agreement before the expiry of ninety days from
the date of execution of the Deal Memo or even thereafter. Respondent has also
not raised any such ground in the arbitration petition and has raised this issue
across the bar.
38. Perusal of the award on this issue indicates that even before the learned
arbitrator it was not the case of the respondent that they were not bound by the
Deal Memo but only defence was that for want of Long Form Agreement, they
were kept in dark regarding the procedure and other obligations between the
parties. Learned arbitrator has rendered a finding that the Deal Memo itself made
it clear that the terms stipulated in the Deal Memo shall be valid and binding
upon the parties and both the parties will have to act upon the same. No terms
and conditions were left to be observed until Long Form Agreement was executed
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and nothing was subject to the Long Form Agreement. Learned Arbitrator has
also rendered a finding that the respondent was not able to point out as to how
and in what manner and at what point the respondent was handicapped or
prejudiced in the absence of the Long Form Agreement. It is held that there was
no dispute that the claimants were bound to implement the Deal Memo as was
executed and nothing was left to the Long Form Agreement.
39. Learned arbitrator has rendered a finding that the Deal Memo was itself
sufficient wherein all the terms and conditions between the parties were
stipulated. It was also an admitted position that on 16 th December, 2007, there
was no Long Form Agreement signed between the parties. Learned Arbitrator also
considered the fact that even in their correspondence addressed by the
respondent, there was no whisper that absence of Long Form Agreement was
handicap for them in any manner. I am therefore, of the view that the terms and
conditions recorded between the parties in the Deal Memo were binding on both
the parties and the said Deal Memo itself was a concluded contract. Both the
parties acted upon the said agreement. The respondent never called upon the
claimant to execute any such Deal Memo at any point of time. No such ground
has been raised in the petition.
40. In my view merely, because the claimant did not produce the said Long
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Form Agreement, though agreed to be produced in the oral evidence, no adverse
inference could be drawn against the claimant for not producing the Long Form
Agreement as urged by the respondent. Even if the learned arbitrator would have
proceeded on the basis that there was no Long Form Agreement executed, the
Deal Memo itself being the concluded agreement and having been acted upon
partially even by the respondent, the execution of the Long Form Agreement
would not be a condition precedent for the agreement already entered into
between the parties to come in force. Learned arbitrator in my view has thus
rightly not drawn any adverse inference against the claimant in not producing the
said Long Form Agreement and has rightly rendered a finding that the Deal Memo
itself was a concluded contract between the parties. There is thus no merit in the
submission of the learned counsel for the respondent that the respondent was
kept in dark about the subsequent agreement agreed to be entered into between
the parties.
41. The next question that arises for consideration of this court is whether the
claimant had committed any breach of the agreement or not or whether the
respondent had wrongfully withheld the balance payment due and payable to the
claimant by the respondent. It was the case of the respondent before the
learned arbitrator that though in the Deal Memo, the brand logo marks of the
respondent on the jersey of player was to be absolutely clear and visible, the
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same was not clear and visible. The respondent was thus not liable to make any
payment to the claimant. To controvert these allegations of the respondent, the
claimant had examined witnesses. The respondent also had examined witnesses.
In the oral evidence of the claimant, the claimant had produced the CD
containing the compilation of still pictures taken from the live matches where
the Mumbai Champs played at Chandigarh from 4 th December, 2007 to 15th
December, 2007. The claimant had also relied upon 5 DVDs in support of their
plea that the claimant had not committed any breach and that the logo marks of
the respondent was on the jersey of the team and also the respondent had
exercised their right under the terms of the said agreement.
42. It is not in dispute that one of the said CD was marked as exhibit in the
arbitration proceedings as the same was produced by the author of the said CD.
When the said CD was marked as exhibit, the respondent did not raise any
objection at that point of time. The claimant however, when produced 5 DVDs,
the respondent raised strong objection against the claimant producing said 5
DVDs on the ground that the same was produced by the claimant at the stage of
cross examination of the witness and not at the threshold though the claimant
had possessed the said DVDs before commencing the oral evidence. Learned
arbitrator accepted the submission of the respondent and refused to take the said
DVDs on record in the evidence.
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43. A perusal of the oral evidence led by the respondent themselves clearly
indicate that in the examination in chief of Mr. Yogesh Bosmiya, a witness
examined by the respondent had himself relied upon the contents of those 6
DVDs which were opposed by them when the same were tendered by the witness
examined by the claimant. In my view, the respondent themselves relying upon
these DVDs could not have raised such objection before the learned arbitrator for
taking those DVDs on record in the evidence when the same was tendered by the
claimant. Be that as it may, the perusal of the entire award clearly indicates that
the learned arbitrator has not allowed the claim of the claimant only by drawing
an adverse inference against the respondent in opposing the said DVDs being
taken on record in evidence but has considered entire documentary evidence and
oral evidence relied by both the parties.
44. It was strenuously urged by the learned counsel for the respondent that
the drawing of adverse inference against the respondent for opposing the DVDs
being taken on record in the evidence and which according to respondent was a
valid objection has affected the merits of the case. In my view, since the
respondent themselves were relying upon the said DVDs, learned arbitrator was
right in holding that if the said DVDs would have been produced, it would have
assisted the case of the respondent also to prove that brand logo of the
respondent was not properly visible and/or was not clear on the jersey of the
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players. In my view, thus there is no substance in this submission of the learned
counsel for the respondent that the mind of the learned arbitrator was
prejudiced or that the claim awarded in favour of the claimant was on the basis
of such adverse inference drawn by the learned arbitrator against the
respondent. Perusal of the record also indicates that no such ground has been
raised by the respondent in the arbitration petition but has been urged only
across the bar which is even otherwise not permissible in law.
45.
A perusal of the record also indicates that when the CD which was a
compilation of still pictures was tendered by the witness examined by the
claimant, the respondent did not raise any such objection. The said CD was
already marked as Exhibit "L" by the learned arbitrator. In para 27 of the
impugned award, the learned arbitrator has placed reliance upon the said CD
and has recorded that the learned arbitrator has seen the CD which was produced
by the claimant which was legally proved by the author of the CD. The said CD
was taken on record and was served upon the respondent along with 16 other
documents on 19th September, 2009. It is held by the learned arbitrator that the
respondent must have seen the said DVDs and thereafter had decided to oppose
very strongly the production of these DVDs.
46. The learned arbitrator had seen the said CD and has rendered a finding that
the boundaries clearly and distinctly shown the logo with the name of the
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respondent in Hindi and English on the front and back of the jerseys of the
players. The name and the logo were also displayed on the runner board and on
the boundary line. It was an advertisement showing drawing of a small house
with logo and the name of the respondent clearly appeared. It is held that every
picture was reasonably visible and clear. Learned arbitrator also took cognizance
of the letter dated 12th December, 2007 which was addressed by the respondent to
the claimant expressing their thanks for implementing their suggestions. Even in
the said letter, there was no whisper of any grievance about the quality or
visibility of the pictures or display on the screen or on the hoardings etc.
Considering these material, the learned arbitrator held that the grievance of the
respondent on this issue was afterthought and baseless and wholly contrary to
the record or material on record. It is held that all these allegations were made
only with an ulterior motive to dodge to make outstanding payment to the
claimant.
47. A perusal of the record also indicates that after considering the entire
evidence, the learned arbitrator has rendered a finding that it was not the case of
the respondent that the claimant had in any manner prevented the respondent
from exercising any rights provided under clause V of the Deal Memo. There was
neither whisper in the pleadings nor was there an iota of evidence to support
the said claim against the claimant. The learned arbitrator has held that it was for
the respondent to use the team logo and the brand in its communication with
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the world. The claimant could do nothing in the matter. The claimant could not
have advised the respondent how to prepare the team logo brand and how to
communicate the same in its correspondence. There was failure on the part of the
respondent and not on the claimant.
48. In so far as the right of the respondent to do press conference with full
team in attendance is concerned, it is held by the learned arbitrator that it was
for the respondent to have organized press conference by conveying the
attendance of the full team and the claimant could not have conveyed such press
conferences on behalf of the respondent. It was not the case of the respondent
that they had contacted the team and that the team had refused to attend the
press conferences or that the respondent had approached the claimant to help
them organize press conference with the attendance of the full team and that the
claimant had not cooperated with the respondent in that respect.
49. Learned arbitrator has considered the oral evidence of one Mr. Ramesh
Bhandari who in his evidence admitted that the respondent had no marketing
place. The learned arbitrator recorded a finding that it was for the respondent to
have taken benefits of those rights provided in the Deal Memo which were
specifically conferred upon the respondent. It is held that it was failure of the
respondent to exercise the rights conferred on them in the Deal Memo and it was
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not failure of the claimant to allow the respondent to avail of such rights. The
respondent is thus liable to face consequences of its own failure and had pushed
the blame on the claimant. The fact remains that the logo was admittedly
displayed. It is held that the sense of visibility is an individual perception.
Learned arbitrator has rendered a finding that there was no deficiency in the
service rendered by the claimant. The witness examined by the respondent in his
cross examination admitted that the brand logo of respondent was displayed on
the jersey of the team players but it was his case that it was not prominently
printed. In my view the learned arbitrator had considered the entire material on
record and has rightly rendered a finding that the respondent had committed
breaches of their obligations under the Deal Memo and not the claimant and the
respondent had wrongfully withheld the payment due and payable to the
claimant.
50. Learned arbitrator also considered the letters on record addressed by the
respondent themselves by which the respondent had acknowledged the
implementation of the suggestions given by the respondent and had expressed
pleasure and had thanked the claimants for such implementation. Learned
arbitrator has rightly observed that the submissions of the respondent were
contrary to the contents of the letter addressed by the respondent themselves.
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51. I am therefore, of the view that the findings rendered by the learned
arbitrator are not perverse and cannot be interfered with under section 34 of
the Arbitration and Conciliation Act, 1996. This court cannot re-appreciate the
findings of fact recorded by the learned arbitrator unless the same are perverse.
52. Learned counsel appearing for both the parties have relied upon number
of judgments on the issue whether the strict provisions of Evidence Act applies to
the arbitration proceedings or not.
ig I will now deal with the issue whether
strict provisions of the Evidence Act applies to arbitration proceedings or not?
Supreme Court in the case of M/s. Bareilly Electricity Supply Co. while dealing
with the provisions of the Industrial Disputes Act has held that application of
principle of natural justice does not imply that what is not evidence can be acted
upon. If a letter or any other document is produced to establish some fact which
is relevant to the enquiry, the writer must be produced or his affidavit in respect
thereof be filed and opportunity afforded to the opposite party who challenges
this fact. This is both in accord with principles of natural justice as also according
to the procedure under Order III of Civil Procedure Code and the Evidence Act
both of which incorporate these general principles.
53. Learned Single Judge of this court in the case of Municipal Corporation of
Greater Mumbai Vs. Hindustan Construction Company Ltd. in Arbitration
Petition No. 65 of 2008 while dealing with the petition under section 34 of the
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Arbitration and Conciliation Act, 1996 has followed the principles led down by
the Supreme Court in the case of Bareilly Electricity (supra) and has held that the
judgment of the Supreme Court would also buttress the contention of the
respondent that the minutes of the meeting of 15 September, 2004 could not have
been relied upon when neither the original was produced nor was any
justification put fourth for the absence of the signed copy of the original.
54. The Division Bench of this court in case of Bi-water Penstocks Ltd. Versus
Municipal Corporation of Greater Bombay and anr. (supra) after adverting to the
judgment of the Supreme Court in the case of M/s. Bareilly Electricity Supply Co.
(supra), judgment of Delhi High Court in the case of Wazirchand Karan Chand
Versus Union of India and another and various other judgments has adopted
the principles therein and has held that in blatant breach of the principles of
natural justice, the arbitrator had permitted the documents to be admitted in
evidence, inspite of repeated objections raised by the respondent, by receiving
such documents, therefore, amounts to a procedural error which can also be said
to be in breach of principles of natural justice.
55. Learned Single Judge of this Court in the case of Pradyuman Kumar Sharma
and anr. Vs. Shri Jaysagar M. Sancheti and Ors (supra) while deciding the
petition under section 34 of the Arbitration and Conciliation Act, 1996 and after
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considering the section 19 of the Arbitration and Conciliation Act, has held that
though the arbitrator is not bound by the provisions of the Code of Civil
Procedures or Evidence Act, the principles of Evidence Act and Code of Civil
Procedure are applicable even to the arbitration proceedings. The document
which is disputed by the party and if not proved, cannot be considered even by
the arbitrator to be on record or as piece of evidence. It is held that by taking
into consideration the unproved document by the arbitrator on the contrary
would be in violation of the principles of natural justice. The learned arbitrator
is not bound to refer to an unproved document.
56. In so far as judgment of the Division Bench of this court in the case of
Rashtriya Chemicals and Fertilizers Limited Vs. M/s. Mohinder Singh & Co.
relied upon by Dr. Saraf is concerned, a perusal of the said judgment indicates
that in that matter, learned arbitrator had called upon both the parties to produce
documents on which they relied upon which they did. The documents were
taken on record by the learned arbitrator without demur from either side.
Parties took inspection of the documents. None of the parties had shown their
desire for production of any person for cross examination or to prove strictly
any of such documents produced by either party. The appellant in that case had
not challenged the genuineness of the documents produced by the contractor.
With such facts in hand, the Division Bench of this court while hearing the appeal
arising out of the order passed by the learned Single Judge under section 30 of
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the Arbitration Act, 1940 distinguished the judgment of the Supreme Court in the
case of Bareilly Electricity (supra) and held that reliance thereof was misplaced.
In this case, the respondent in the arbitration proceedings did not dispute the
existence and contents of the CD produced by the claimant and the same was
already marked as Exh. "L". Learned arbitrator has not considered any document
which was not proved by the claimant. In my view, the principles laid down by the
Supreme Court in the case of Bareilly Electricity (supra) that the principles of
natural justice applied to the industrial tribunal also applies to the arbitral
tribunal.
57. In so far as judgment of the learned single Judge of this court in the case of
New Consolidated Construction Co. Ltd. (supra) relied upon by Dr. Saraf is
concerned, perusal of the said judgment clearly indicates that the judgment of this
court in the case of Municipal Corporation of Greater Mumbai Vs. Hindustan
Construction Co Ltd. (supra), judgment of Division Bench in the case of Bi-water
Penstock and judgment of this court in the case of Pradyuman Sharma (supra)
were not brought to the notice of the learned Single Judge. The facts in the case
of Rashtriya Chemicals were different. Learned Single Judge in the case of New
Consolidated Construction Co Ltd. therefore, held that the reliance placed upon
the judgment in the case of Bareilly Electricity (supra) was misconceived and the
extent of the reliance upon the Evidence Act in that judgment cannot be made
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applicable to arbitral proceedings in commercial contracts where the contract and
correspondence following thereafter would alone be material along with the
proof of expenses incurred. In my view this judgment of the learned Single Judge
is delivered without noticing several other judgments of this court and a contrary
view came to be taken by the learned Single Judge, I am bound by the judgment
of the Supreme Court and judgment of Division Bench of this court rendered
earlier and also the judgment of the learned Single Judge delivered prior to the
delivery of this judgment which hold the field.
58. I am therefore, of the view that even in arbitration proceedings though
strict provisions of Evidence Act and Code of Civil Procedure, 1908 are not
applicable and though the arbitral tribunal is not bound by the provisions of the
Indian Evidence Act and Code of Civil Procedure, 1908, the arbitral tribunal is
bound to consider the principles of Evidence Act and the Code of Civil Procedure
and has to follow the principles of natural justice.
59. The question however, that arises in this case is whether the learned
arbitrator has violated the principles of natural justice as urged by the learned
counsel for the respondent or not. A perusal of the record clearly indicates that
the learned arbitrator has while rendering the findings against the respondent on
the issue whether logo mark appeared on the jersey or not has relied upon the
CD which was a compilation of photographs which was proved best of evidence.
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Learned arbitrator has not relied upon the DVDs which were objected to by the
respondent before the learned arbitrator and did not take the same on record in
evidence. In my view there is thus no substance in the submission of the learned
counsel for the respondent that the learned arbitrator relied upon any unproved
documents or that the impugned award is in violation of principles of natural
justice.
60. In my view, there is also no merit in the submission of the learned counsel
for the respondent that the learned arbitrator has decided the entire matter
against the respondent only on the basis of adverse inference drawn against the
respondent. A perusal of the record clearly indicates that though the respondent
themselves had relied upon the DVDs in their evidence, opposed the claimant in
producing such evidence. Learned arbitrator however, has not considered those
DVDs since the same were not taken on record in the evidence. A perusal of the
entire award does not indicate that the learned arbitrator has directly or indirectly
considered the said disputed DVDs any manner whatsoever. Learned arbitrator on
the contrary has taken into consideration the CD which was marked as Exh. L and
after going through the said CD has rendered a finding of fact which in my view
cannot be interfered with.
61. In so far as submission of the learned counsel for the respondent that the
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learned arbitrator ought to have considered the photographs produced by the
respondent is concerned, no such ground is raised in the petition. The respondent
cannot be allowed to urge any grounds not raised in this petition filed under
section 34 of the Arbitration & Conciliation Act, 1996.
62. In so far as submission of the learned counsel for the respondent that the
learned arbitrator ought to have granted liberty to the respondent before drawing
any adverse inference is concerned, in my view since the respondent themselves
had relied upon the DVDs and inspite thereof had raised objection against the
claimants from tendering the said DVDs, learned arbitrator was justified in
drawing adverse inference. Be that as it may, the claim awarded is not based on
any such adverse inference drawn by the learned arbitrator. The respondent
cannot be allowed to urge that the learned arbitrator should not have drawn
adverse inference in view of the respondent opposing the DVDs being taken on
record in evidence, since the respondents themselves had relied upon those DVDs.
There is thus no merit in the submission of the learned counsel for the respondent
on this issue.
63. In so far as submission of the learned counsel for the respondent that the
learned arbitrator did not draw any adverse inference against the claimant in not
producing the Long Form agreement by exercising powers under section 114(g)
of the Indian Evidence Act is concerned, I am of the view that since the learned
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arbitrator has rightly interpreted clause 8 of the Deal Memo and has rendered
finding that the terms and conditions of the said Deal Memo itself was recording a
concluded agreement and execution of the separate Long Form Agreement was
not mandatory, learned arbitrator has rightly not drawn any adverse inference
against the claimant in not producing the said Long Form Agreement. There is no
merit in this submission of the learned counsel for the respondent.
64. In so far as submission of the learned counsel for the respondent that the
Deal Memo was signed in great haste and thus no claim could have been
allowed by the learned arbitrator based on this Deal Memo, in my view, there is
no merit in this submission of the learned counsel for the respondent. The
respondent has acted upon by the said agreement partly and did not terminate
the said agreement on the ground that the said agreement was not valid since the
same was allegedly signed in great haste.
65. Supreme Court in the case of Ravindra Kumar (supra) has after adverting to
various earlier judgments of the Supreme Court has held that re-appraisal of the
evidence of the court is not permissible and as a matter of fact exercise of power
to reappraise the evidence is unknown to the proceedings under section 30 of the
Arbitration Act. This court has extended such principles even in the proceedings
filed under section 34 of the Arbitration & Conciliation Act, 1996. Similar is the
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view taken by the Supreme Court in in the case of Arosan Enterprises Ltd. Versus
Union of India and another (supra). In my view the learned arbitrator has
rendered finding of fact after considering all the evidence and pleadings on
record and has interpreted the terms of the Deal Memo which interpretation is not
only possible interpretation but is correct interpretation of the terms of the
contract. Supreme Court has held that even if the interpretation of the contract
by the arbitral tribunal is possible interpretation, the court cannot substitute such
possible interpretation by another interpretation which according to the court
shall be another possible interpretation. I am of the view that no case is thus
made out by the respondent for warranting interference with the impugned
award. Learned arbitrator has considered all the aspects of the matter and have
rendered the reasoned award on all the issues. No infirmity can be found with
the impugned award rendered by the learned arbitrator.
66. In so far as submission of the learned counsel for the respondent that the
learned arbitrator has not treated both the parties equally is concerned, perusal
of the record does not indicate that the learned arbitrator has not treated both
the parties equally. Learned arbitrator has granted liberty to both the parties to
present their case and to lead appropriate evidence. No such grievance was ever
made by the respondent before the learned arbitrator. There is thus no merit in
the submission of the learned counsel for the respondent. The petition is devoid
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of merits. I, therefore, pass the following order :
(a) Arbitration Petition is dismissed.
(b) There shall be no order as to costs.
(R.D. DHANUKA,J.)
