M/S. Hans Construction Company vs Delhi Development Authority & ...
2001 Latest Caselaw 324 Del

ORDER

J.D. Kapoor, J.

1. The only dispute in these proceedings is in respect of claim No. 8 awarded vide award dated 28th December, 1992, which is through this suit sought to be made rule of the Court.

2. Claim No.8 pertains to damages on account of 'establishment and overhead expenses' incurred by the petitioner during the extended period of contract and hire charges for the tools and plants for the same period.

3. The learned counsel for the respondent has drawn my attention to the observations of the Arbitrator in respect of 'establishment and overhead expenses' to the effect that the claimant has not submitted any authenticated documentary proof of expenditure on salary of staff and their continuous employment etc. yet on practical consideration the claim appears to be on the higher side. However the Arbitrator has also observed that there is n denying the fact that the claimant's minimum establishment continued for the entire period till 15th April, 1989 when the claimant intimated the respondent regarding the physical completion of the work. While referring to clause (10) of the Agreement which provides a bar on compensation if the delay in supply of stipulated material is up to six months and the coset of work also exceeds by 15%, the Arbitrator considered the expenditure incurred by the claimant on practical considerations to the tune of Rs.1,22,250/- as just and reasonable. The expenses are split up as under:-

    1. Graduate Engineer one number for
    21 months @ Rs.1500/- per month                Rs.31,500/- 

 2. Supervisor one number for 21
    months @ Rs.750/ per month                     Rs.15,1750/-

 3. Chowkidar three numbers for
    50 months @ Rs.500/- per month                 Rs.75,000/-
                                                ..............
                                           Total Rs.1,22,250/-
                                                .............. 

 

4. The learned counsel contends that the above award is based upon surmises and conjectures and there is no evidence whatsoever even with regard to the retention of one Engineer, one Supervisor and three Chowkidars or as to their salary or the rate or the period for which they were paid by the contractor.

5. The learned counsel has relied upon K.P. Poulose Vs. State of Kerala & Anr. wherein two material documents were referred before the Arbitrator that tended to help in arriving at a just and fair decision to resolve the controversy between the Department and the Contractor but the Department did not produce these documents before the Arbitrator. It was held that it was incumbent upon the Arbitrator to get hold of all the relevant documents including referred documents to show that the contractor had carried out the work and claimed for the additional expenditure incurred by him on the ground that he assumed the site condition to be as represented in the schedule to the notification inviting tenders and submitted his original design on that basis and since the site condition was found to be different and on the advice of the Research Institute jetting had to be resorted to involving extra expenditure he was entitled to claim additional amount for the work of jetting. However the Department refused the claim which led to the arbitration. It was contended that the Arbitrator was guilty of legal misconduct in conducting the proceedings which resulted in miscarriage of justice by not procuring the relevant documents by way of insistence.

6. However for the aforesaid reasons the award was set aside and the Arbitrator was directed to complete all the proceedings after procuring all the relevant documents.

7. Another case relied upon by the counsel is M/s Mehta Teja Singh & Co. Vs. Union of India & Anr. . In the said case the Department had set up a counter claim in the form of recovery on the basis of the Technical Examiner's Report. However this repot was not produced before the Arbitrator but still the Arbitrator without directing the production of the said repot proceeded with the matter and gave the award. It was held that the procedure to be adopted by the Arbitrator should not be opposed to natural justice. He should perform his function in a quasi-judicial manner and should not make a farce of the enquiry before him. However it was held to be a technical misconduct. It was held that the principles of natural justice require that a party must know the case he has to meet. That duty is laid upon everyone who is called upon to decide a dispute impartially.

8. The next authority relied upon by the learned counsel is M/s Bombay Ammonia Pvt. Ltd. Vs. Union of India AIR 1987 Delhi 148. In this case the respondent had invited tenders for air-conditioning plant for telephone exchange building at Manglore. The disputes arose between the parties and the Joint Secretary and Legal Advisor was appointed as sole Arbitrator. The Arbitrator directed the Union of India to produce the documents sought to be produced by the petitioner but he did not pursue the matter further. The documents sought to be produced by the petitioner before the Arbitrator were not available on record of the proceedings of the Arbitrator. It was held that the Arbitrator had failed to do his duty and his failure or negligence has resulted in substantial miscarriage of justice. On this ground alone the award was set aside.

9. As is apparent the facts of the cases referred by the learned counsel for the respondent are conspicuously distinct. In the instant case the Arbitrator did not give any direction to any of the parties much less the petitioner to produce the documents as to the employment of Graduate Engineer or Supervisor or Chowkidars and the salary paid by him. Rather the Arbitrator found that the claim of the petitioner was on higher side and, therefore, awarded the claim for the skeleton staff that was expected to be employed by the Contractor. IT is not the case where the Arbitrator had not taken into consideration the documents produced by either of the parties. The finding as to the factual matrix is not to be interfered with as the Court does not sit in Appeal nor should the Court examine or scan the mind of the Arbitrator in arriving at a conclusion as to a particular fact. Thus the objection of the respondent in his regard is highly tenuous and groundless.

10. As regards the award on account of hire charges of machinery, tools and plants the objection in nutshell is that the Arbitrator inspite of observing that the Class I contractor owns the full requirement of tools, plants and machinery and, therefore, the question of hiring of these plants and machinery does not arise still awarded the compensation of Rs.20,000/- on that account. I am afraid this is not the correct perception of the award as the Arbitrator has observed that the claimant has suffered loss due to under utilisation and depreciation without optimum profitable use and, therefore, on practical considerations it held that Rs.20.000/- was justified and reasonable compensation. It was on account of the failure of the respondent in providing the full and complete awarded contract that the petitioner suffered the losses on account of under utilisation and depreciation without optimum profitable use.

11. In view of the foregoing reasons objections of not hold water and are dismissed. Accordingly the award is mad ea rule of the Court. The suit is decreed in terms of the award with pendente lite and future interest @ Rs. 18% till realisation.

The suit & the application stand disposed of.