Shalimar Furnishers vs Delhi Development Authority
1996 Latest Caselaw 73 Del

JUDGMENT

S.D. Pandit, J.

(1) This suit has been registered on account of filing of the Award by Arbitrator Mr. 0.P. Mittal on 15.5.1990. Thereafter, notices were issued under Section 15 of the Arbitration Act to both the parties and petitioner has filed IA.6331/90 raising certain objections whereas respondent has filed IA.6332/90 raising certain objections to the said Award.

(2) Petitioner, M/s.Shalimar Furnishers had taken Contract No.11/PE/AGDX/AGVC/DDA/82-83 for supply of wooden furniture and curtains in 48 numbers of type 'A' House of Group Vi at Asian Games village Complex, Siri Fort, New Delhi in the year 1982. The agreement between, the parties was executed on 27.4.198.2. As regards the said contract the disputes between the parties had arisen. As per the terms of the contract between the parties the Engineer Member of Dda was to appoint an arbitrator. Accordingly, Shri O.P. Mittal was appointed as Arbitrator by the Engineer Member of Dda on 5.1.1987. After giving both the parties opportunity to lead evidence in support of their rival claims and after hearing both the parties the Arbitrator was pleased to pass his Award on 30.8.1989.

(3) Petitioner has filed IA.6331/90 and by the said application he wants me to remit back the claim NOS.I, 3, 4 & 6 to the Arbitrator. According to him, the arbitrator was quite competent to give the Award on Claim No.l but he wrongly interpreted clause No.14 & 14A of the agreement between the parties and held that the decision of the Executive Engineer of the Dda was final. Similarly, the arbitrator was not justified in refusing the claim of interest. Similarly, the arbitrator was not also justified in rejecting the Claim No.6 which was on account of the replacing of the missing and totally damages parts.

(4) As against this, in IA.6332/90 it is contended by the Dda that the arbitrator was not at all justified in allowing the claims in favour of the petitioner though he has allowed them in part and that there was no justification for awarding those claims in favour of the petitioner. Thus, they want to reject the Award passed by the arbitrator.

(5) In view of the rival pleadings between the parties my learned predecessor had settled issues on 29.1.1992. Those issues and my findings thereon for the reasons hereinafter stated are as follows:- S.No. Issues Finding 1. Whether the award is liable to be set aside for the reasons stated in the objections filed by the respondent? Yes. 2. Whether clause 14(a) of the agreement did not preclude the arbitrator from adjudicating upon the claim No.1 of the petitioner as alleged in para A of the grounds of the objections filed by the petitioner? No. 3. Whether the award is liable to be remitted to the arbitrator for reconsideration as alleged in paras B to E of the grounds of the objections filed by the petitioner? No. 4. Relief, if any As per final order.

(6) Matter was fixed for arguments. The recording of evidence in this case was completed in the year 1992 and, thereafter the matter was being listed for final arguments from time to time. Even notices were sent to the petitioner as well. as counsel for the petitioner but neither petitioner nor petitioner's counsel is appearing since September 1994. But on some dates even the counsel for the defendants was not appearing. Today the matter has been passed over twice and called out the third time but neither the parties nor their advocates have turned up.

(7) As the pleadings in the case are complete, issues are settled and evidence is also recorded, it is incumbent on this Court to decide the matter on merits. Therefore, I proceed to decide both IAs.6331 & 6332/90 on merits instead of rejecting them in default as I am of the view that once the pleadings are complete and the evidence is recorded the Court must decide the matter on merits.

(8) It must be borne in mind that I am consider this proceeding under Section 15 of the Arbitration Act, 1940. It is settled law that it is not possible for a Court which is considering an Award under Section 15 read with Sections 30 and 33 of the Arbitration Act to sit as an appellate court. The Court cannot have the reappreciation of evidence which Is led before the arbitrator. The Court can set aside the Award only if it is found that the arbitrator has committed any mistake which is apparent on the face of the record and if he has committed any misconduct. The misconduct contemplated under the Act is not a moral misconduct but it is a legal misconduct. Such a misconduct could be on account of passing of an Award without jurisdiction or on the same set of facts recording of inconsistent or contradictory findings in the Award or on account of misapplication of law or on account of not at all referring and consulting the documents produced before the Arbitrator. Therefore, bearing these aspects in mind I proceed further in the matter.

(9) It is also necessary to mention here that it is settled law that the Court cannot go into the question of sufficiency of the reasons recorded for the finding of the Arbitrator. The conclusions arrived at by the arbitrator are binding on the Court. The Court cannot weigh the evidence

(10) The Award in this case is a speaking Award and if the Award passed by the arbitrator is read then it would be quite clear that the arbitrator has considered the documents produced before him alongwith the provisions of the agreement between the parties as well as the submissions made before him. If the objections filed by both the petitioner and the respondent are taken into consideration then it would be quite clear that neither the petitioner nor the respondent has raised a contention that the arbitrator has not considered a particular document though produced and proved before the arbitrator.

(11) As regards Claim No.1 it is the contention of the petitioner that the arbitrator was not at all justified in rejecting his claim of getting back Rs.30,000.00 . The Executive Engineer of Dda in view of the report of the Chief Project Engineer had deducted an amount of Rs.31,775.00 from the final bill payable to the petitioner because (a) Vat die was not used for the cloth used for sofa sets and curtains and (b) 60% 1st class and 40% IInd class Teak wood was used in the furniture items. Clause No.14A of the contract between the parties reads as under:- "THE decision of the Chief Project Engineer regarding the quantum of reduction as well as justification thereof in respect of the sub-standard work which may be decided to be accepted will be final and would not be open for arbitration".

(12) In view of the said Clause No.l4A the arbitrator has found that the deductions made in the final bill were justified and it was not open for him to consider the question of the rates of sub-standard work carried out by the petitioner. That reasoning of the arbitrator could not be said to be either perverse or manifestly erroneous and, therefore, it is not possible for this Court to set aside the same.

(13) As regards the other claims the arbitrator has considered the material before him and the petitioner wants me to reappreciate and reconsider the material before the arbitrator and to come to a contrary conclusion but that is not possible to do in view of the settled legal position.

(14) The arbitrator had also found that the claim of interest was not tenable as per the law existing at the time the Award was passed. If the arbitrator has applied the law as it was existing on the date the Award was passed, merely because there is change in the law subsequently because of the decisions of the Supreme Court under Article 141 of the Constitution of India, the decisions of the Supreme Court become the law of the land. But merely because of the subsequent change in the law the Award passed by the arbitrator could not be said to be illegal or on account of any misconduct. Therefore, in these circumstances, IA.6331/90, filed by the petitioner, deserves to be rejected.

(15) As regards IA.6332/90 the contentions raised by.the respondent are similar to the contentions raised by the petitioner as regards Claim Nos.3 & 4. The respondent wants this Court to reappreciate the evidence which was led before the arbitrator. But that is not possible for this Court in view of the nature of the proceeding. Therefore, in these circumstances, IA.6332/90 filed by the respondent also deserves to be rejected.

(16) Thus, I hold that both IAs.6331 & 6332/90 are rejected with no order as to costs. The Award passed by the arbitrator on 30.8.1989 is made Rule of the Court. Decree in terms of the Award be drawn. Petitioner is entitled to get future interest @10% from the date of this decree till realisation.