Delhi High Court
Gurcharan Singh vs Union Of India (Uoi) on 10 January, 2006
Author: S K Kaul
Bench: S K Kaul
JUDGMENT
Sanjay Kishan Kaul, J.
IA No. 9045/1995 (Under Sections 30 and 33 of The Arbitration Act, 1940)
1. The petitioner contractor was assigned the work of construction of dwelling units in Sector 16, Rohini by the respondent in pursuance to Agreement No. 3/EE/CD-VIII/86-87. Disputes arose between the parties and in view of the arbitration clause No. 25, the Chief Engineer appointed Shri S.S. Juneja as the Sole Arbitrator in terms of the letter dated 11.01.1993. The Sole Arbitrator entered upon reference and made and published the Award dated 22.07.1994. The respondent aggrieved by the same has filed the present objections.
2. None has appeared for the respondent today and a perusal of the Order- sheets shows that after 25.08.2003, none has been appearing for the respondent. In such a situation, these objections could have been dismissed for non- prosecution, but in order to ensure that no injustice is done to the respondent, I have examined the award and the objections filed by the respondent.
3. The first claim relates to the work done by the petitioner for which no payment has been made by the respondent. The Arbitrator has examined the documents filed and the material placed on record to come to the conclusion that the stipulated dates for start of the work was 08.03.1989 and for the completion of work was 07.03.1991, while the work actually got completed on 10.06.1992. This is in terms of the Supplementary Agreement and it has been found that the occasion to enter into the Supplementary Agreement arose on account of delay in laying of peripheral services and not due to any delay on the part of the petitioner. The petitioner was, in fact, asked to complete the remaining items in April, 1992 after the stipulated date for completion as per the Supplementary Agreement had expired. The petitioner was held entitled for redoing the work for some of the items and out of the total claim of Rs.1,08,250/-, the Arbitrator has awarded Rs.68,000/-.
4. In the objections, all that has been stated is that the petitioner itself had agreed not to claim any compensation for extension granted to them. However, the plea itself is misconceived as what has been awarded to the petitioner is not compensation, but the value of the work actually done.
5. The Arbitrator has examined the claim of the petitioner under clause 10CC under claim No. 2. A claim of Rs.2,50,000/- was made. The said claim arises on account of increase in labour and material rates for the extended period of contract and only Rs.44,280/- has been found due and payable. Once the finding is arrived at that it was not the petitioner on whose account the delay occurred, the petitioner is entitled to the escalation in terms of clause 10CC. The objection of the respondent is that the delay was on account of the petitioner. This finding is not borne out in view of the documents placed on record.
6. It is necessary to note that this Court does not sit as a court of appeal over the findings of an arbitrator and unless the findings are perverse, interference would not call for in view of the observations of the Division Bench of this Court in DDA v. Bhagat Construction Co. (P) Ltd. and Anr. 2004 (3) Arb. LR 548. The Apex Court has even observed that merely because this Court may come to a different conclusion than one arrived at by the Arbitrator is no ground to interfere with the award. The Court is not to re-appreciate the evidence and in the absence of the award being absurd, reasonableness is not a matter to be considered. In this behalf, reference may be made to judgment of the Apex Court in Food Corporation of India v. Joginderpal Mohinderpal and Anr. . The Supreme Court observed in M/s Sudarsan Trading Co. v. Govt of Kerala that if the view taken by the arbitrator is plausible, though perhaps not the only correct view, the award cannot be examined by the court.
7. The third claim made by the petitioner is on account of overhead of watch and ward for the period from 09.12.1990 to 30.06.1992 amounting to Rs.2,06,161/-. The Arbitrator found that the stipulated dates for start and completion of work as per the original Agreement was 05.05.1986 and 04.05.1987 respectively. The date for completion of work as per the Supplementary Agreement has already been set out herein-above. In view of the finding that the delay was not on the part of the petitioner, the petitioner has been held entitled for payment and the amount has been quantified at Rs.43,000/-. In fact, the Arbitrator found that the petitioner was required to mitigate the losses and, thus, has allowed only part of the amount which does not call for any interference. The only objection taken is that expenses in this behalf are generally done by the contractor. The fact remains that once there is a delay resulting in prolongation in contract, and the contractor is not to blame for the same, the contractor is liable to be compensated for the same.
8. The claim of interest has been examined in claim No. 4. The claim has been awarded as simple interest @ 12% p.a. from 24.09.1992 till the date of the award. Further interest has been awarded at 14% p.a. from the date of award till the date of payment or decree, whichever is earlier. The payment has not been made.
9. Insofar as the past and pendente lite interest before the Arbitrator is concerned, the rate of interest of 12% p.a. does not call for any interference as it is the fair prevailing market rate of interest. Insofar as the future interest is concerned, the objection has been raised that the petitioner is not entitled to claim the same. No reasons have been set out for the same. Learned counsel for the petitioner himself confines the claim for interest to 12% p.a. up to the date of decree. This is a fair suggestion in view of the fact that the said interest rate is the prevailing rate of interest and has been so granted in numerous matters by this Court.
10. The last claim is in respect of the cost which hardly calls for any interference.
11. The objections are accordingly dismissed except to the extent that the petitioner shall be entitled to interest @ 12% p.a. instead of 14% p.a. from the date of award till the date of decree and the future interest is hereinafter fixed by this Court from the date of decree till the date of realisation.
CS (OS) No. 2796/1994
The objections having been disposed of, the award of the Sole Arbitrator, Shri S.S. Juneja dated 22.07.1994 is made Rule of the Court with the modification that the petitioner is held entitled to simple interest @ 12% p.a. instead of 14% p.a. from the date of award till the date of decree. The petitioner shall also be entitled to simple interest from the date of decree till the date of realisation @ 9% p.a. The petitioner shall be entitled to costs quantified at Rs.5,000/-. Decree-sheet be drawn up accordingly.
