Mahanagar Telephone Nigam Ltd. vs Shri M. Mukherjee And Anr.
2006 Latest Caselaw 1976 Del

JUDGMENT

Anil Kumar, J.

1. The petitioner has impugned the award dated 21st January, 2002 passed by respondent No. 2 and has sought directions to respondent No. 1 to pay the amounts of bills issued with effect from 1st December, 1991 to 1st October, 1992 without any rebate.

2. Brief facts to comprehend the disputes between the parties are that the petitioner is a Government of India undertaking and is registered under the Indian Companies Act, 1956 and is a licensee of Central Government in exercise of power of the Central Government under the Indian Telegraph Act, 1881. The petitioner is responsible for maintenance, control and supervision of telephone services in the city of Delhi.

3. Respondent No. 1 applied for a telephone connection on 12th August, 1975 for installation at his residence at I-17, Ground Floor, Lajpat Nagar III, New Delhi and pursuant to his request telephone connection bearing No. 617253 was installed vide OB NO.11709762 dated 23rd March, 1979. The telephone provided to the respondent No. 1 had STD/ISD facility since the date of installation.

4. The petitioner asserted that on account of cut over the telephone number was changed to 6837253. The respondent No. 1 on 11th November, 1991 requested for Dynamic STD facility on his phone and with effect from 15th November, 1991 vide OB No. 236837341, the dynamic STD facility was provided on the phone of the petitioner.

5. The respondent No. 1 was issued following bills amounting to Rs. 22,59,745/- which were not paid and the telephone was disconnected on 29th July, 1992.

  Sl. No.  Billing Cycle     Call charges               Amount (Rs.)
1        01/12/91          From 16.9.91 to 15.11.91   35,764
2        01/02/92          From 16.11.91 to 15.1.92   1,29,725
3        01/04/92          From 16.1.92 to 15.3.92    4,79,131
4        01/06/92          From 16.3.92 to 15.5       7,01,895
5        01/08/92          From 16.5.92 to 15.7.92    7,66,422
6        01/10/92          From 16.7.92 to 15.9.92    1,46,808
                                                      22,59,745

 

6. The petitioner therefore demanded a sum of Rs. 22,59,745/- and an amount of Rs. 1,320/- for the cost of instrument and directory and thus a total amount of Rs. 22,61,065/- along with interest and cost was demanded.
 

7. The respondent No. 1 refuted the allegation made by the petitioner and the liability of the respondent No. 1 to pay the amount demanded and asserted that no intimation was given to him about activation of dynamic STD/ISD facility. Respondent No. 1 asserted that during the period when the dynamic STD/ISD facility is alleged to have been provided to the respondent No. 1, he continued to book his national and international calls through the petitioner's channel. It was not admitted by the respondent No. 1 that STD control facility is foolproof mechanism. The respondent No. 1 categorically pleaded that information about the dynamic STD facility being provided to a particular subscriber is not a secret to the telephone exchange, as an official communication of such allocation is sent to the SDO Exchange (Phones) which is forwarded as a routine procedure and consequently, the unscrupulous operators from the exchange are always in a position to track a particular subscriber's number/line. It was contended that unscrupulous exchange operators can cut off the live connection to the subscriber's number with the facility remaining open for any amount of misuse. It was stated that even unscrupulous linesman in collusion with Exchange operators can transfer to another subscriber the line of a person having dynamic STD/ISD facility. The respondent No. 1 categorically asserted that during the period, the inflated bills have been raised from Okhla exchange, a clandestine arrangement was caught with the nexus operating from Batla Estate under Okhla Exchange and unscrupulous linesman and the exchange operators. In the circumstances, respondent No. 1 denied that the bills which have been raised on him are for the calls made by him. The respondent No. 1 had brought to the notice of the Accounts Department and corrections were demanded in his inflated bills. ? About the letter dated 8th February, 1993, it was stated that the letter was obtained by four employees of the petitioner who had visited him and had requested him to give a letter so that the investigation in his case may be facilitated and in these circumstances the letter dated 8th February, 1993 was given. Regarding the investigation carried out by the petitioner, it was stated that no one visited either to check up the faulty instrument or the faulty telephone line of the respondent No. 1 premises. This was also contended that the question of bill being inflated and the calls not made by him was never investigated and the liability of the respondent No. 1 to pay any interest on the alleged amount was categorically denied.

8. Since the dispute arose about the payment of outstanding bills and the interest and cost claimed by the petitioner, the matter was referred to arbitration under the provision of Section 7(b) of Indian Telegraph Act. The first Arbitrator, who was appointed, superannuated and consequently respondent No. 2 was appointed as the sole Arbitrator and claims and reply to the claims were filed before the Arbitrator. The Arbitrator, respondent No. 2, after considering the pleas, contentions and documents filed by the parties gave an award dated 21st January, 2002 directing the petitioner that the pending bill dated 1st December, 1991 be checked for call of duration 60 minutes dated 2nd November, 1991 to USA and if the call is found to be genuine, it may be charged for maximum permissible duration but not more than 60 minutes and for the amounts of bills dated 1st February, 1992, 1st April, 1992, 1st June, 1992, 1st August, 1992 and 1st October, 1992, the Arbitrator awarded the amounts equivalent to the bill of 1st December, 1991 plus 10% extra.

9. The petitioner impugned the award on the ground that the award is a non-speaking award and there was no justification for giving rebate by respondent No. 2 to respondent No. 1. Relying on the case of A.N. Pandey v. MTNL, it was contended that dynamic STD/ISD control facility is foolproof and, therefore, the award of rebate is not justifiable. The finding of facts arrived at by the learned Arbitrator, respondent No. 2, were also challenged by the petitioner.?Comparison of bill dated 1st December, 1999 with the other bills was also challenged and it was contended that the Arbitrator had been provided details of the call numbers during the disputed period.

10. The petitioner also placed reliance on 1996 I AD S.C. 454, Shri M.L. Jaggi v. Mahanagar Telephones Nigam?Ltd. and Ors. to contend that when an Arbitrator decides the disputes under Section 7(b), he is required to give reasons in support of his decision since it is final and cannot be questioned in a Court of law and the only remedy available to the aggrieved person against the award is judicial review under Article 226 of the Constitution.

11 I have heard learned Counsel for the petitioner and have perused the record. Perusal of the award reflects that the learned Arbitrator, respondent No. 2, have considered the claims, counter claims and documents in detail. It was noticed by the respondent No. 2 that the telephone was disconnected after a long period of 9? months and telephone was allowed to be used during the period these seven bills were raised without investigation or disconnection. Despite the complaint by respondent No. 1 an unrealistic amounts reflected in the bills which was brought to the notice of the Accounts Department. Respondent No. 2 noticed the billings based on the of pre 15th November, 1991 charges. The Arbitrator also noticed that bills were allowed to be increased and not investigated and the telephone was not disconnected in time and ultimately the line was disconnected on 27th July, 1992. ? The Arbitrator emphasized about the fact that line was not disconnected two months after the intimation of erratic bills and for the balance five cycles were allowed to go unchecked. ?The Arbitrator also relied on the fact that point 9(b) raised in the fresh submissions by respondent No. 1 remained un-replied by the petitioner which was a vital point.

12. In these circumstances, the Arbitrator directed the petitioner to check the trunk calls booked by the respondent for duration of 60 minutes dated 2nd November, 1991 and if it is found to be genuine then charge the maximum permissible duration but not for more than 60 minutes and to recover the amounts of other bills proportionate to the bill dated 1st December, 1991 with 10% extra.

13. The main contention of the petitioner is that the award does not disclose any reasons besides the factual disputes raised by the petitioner. It is no more res integra that when the Arbitrator is required to give reasons, it is not for the courts to see reasonableness of the reasons given by the Arbitrator or sufficiency of the reasons. What reasons are required depends upon the facts of each case. The court is bound by the Arbitrator?s finding of fact and cannot review unless they are not supported by evidence and unless it appears from the award itself that there was no evidence to support the finding. It will not be open to the court to examine adequacy of evidence which led the Arbitrator to his finding of facts as his findings are final.

14. The decision of the Arbitrator is normally final both on facts and law and is not lightly set aside. The Arbitrator is selected by the parties to fight their disputes according to law and it is not appropriate for the courts to substitute their own inferences with the inference drawn by the Arbitrator as based on evidence or on admission. The sufficiency and quality of evidence is a matter for the Arbitrator to decide and court is not permitted to re-appreciate the evidence and sit as a court of appeal over the Arbitrator's award.

15. The judgment relied on by the petitioner, Shri M.L. Jaggi (supra) is apparently distinguishable as in that case the Arbitrator had given rebate on one bill only and had confirmed the rest of the demand and consequently the award when it was challenged was set aside as there was no justification for not giving the rebate on other bills.

16. In , Naraindas R. Israni v. Union of India, it was held that an Arbitrator is not required to give a detailed judgment like a civil court. What is expected of the arbitrator is simply this much that he must give out the trend of his thought process. Consequently, if there is no detailed break-up justifying the amounts allowed by the Arbitrator, it will not amount to misconduct and it is not an adequate ground for the award given by the Arbitrator to be set aside. In the present case, the arbitrator has held that specific point of para 9(b) of the submissions of respondent No. 1 was not replied by the petitioner despite reminder to the claim vide letter dated 21st November, 2001 and the line was not disconnected two months after the non- payment of the bill and for the balance five cycles the erratic bills and use of telephone was allowed to be continued unchecked. The Arbitrator has checked the pattern of the calls and considering the facts and circumstances, held that the call made on 2nd November, 1991 to USA be checked and it if it found genuine then duration for 60 minutes be charged and consequently the pending bills were directed to be paid equivalent to the amount of bill of 1st December, 1991 with 10% extra for the bills dated 1st February, 1992, 1st April, 1992, 1st June, 1992, 1st August, 1992 and 1st October, 1992. ?The award gives the trend of his thought process. It can not be inferred in the facts and circumstances that the reasons have not been disclosed.

17. In , Municipal Corporation of Delhi v. Jaganath Ashok Kumar and Anr., it was held that the reasonableness of the reasons given by an Arbitrator in making his award cannot be challenged in a special leave petition. It was held that on the same evidence, the court may arrive at a different conclusion than the one arrived at by the Arbitrator but that by itself is not a ground for setting aside the award of an Arbitrator. The Supreme Court was of the view that Section 1 of the Evidence Act, 1872 in its rigor is not intended to be applied to proceedings before an Arbitrator. Apex Court observed as under:

A man in the trade who is selected for his experience would be likely to know and indeed to be expected to know the fluctuations of the market and would have plenty of means of informing himself or refreshing his memory on any point on which he might find it necessary so to do. In this case, according to the affidavit of sellers they did take the point before the Arbitrator that the Southern African market has slumped. Whether the buyers contested that statement does not appear but an experienced Arbitrator would know or have the means of knowing whether that was so or not and to what extent and I see no reason why in principle he should be required to have evidence on this point any more than on any other question relating to a particular trade. It must be taken I think that in fixing the amount that he has, he has acted on his own knowledge and experience. The day has long gone by when the Courts looked with jealousy on the jurisdiction of the Arbitrators. The modern tendency is in my opinion more especially in commercial arbitrations, to endeavor to uphold awards of the skilled persons that the parties themselves have selected to decide the questions at issue between them. If an arbitrator has acted within the terms of his submission and has not violated any rules of what is so often called natural justice the Courts should be slow indeed to set aside his award.

18. In Delhi Development Authority v. Bhagat Construction Company Pvt. Ltd. it was held that the Arbitrators are not Judges and they have not to write judgments as Judges do. From the award, if it can be inferred that the Arbitrator has applied his mind taking into consideration the relevant material for arriving at the finding than the award cannot be interfered with.

19. Reliance can also be placed on on , Food Corporation of India v. Joginderpal Mohinderpal and Anr.; , Puri Construction Pvt. Ltd v. Union of India; Gujrat Water Supply and Sewerage Board v. Unique Erectors (Gujrat) P. Ltd and Anr. and Hind Builders v. Union of India holding that when the parties have chosen a forum to refer their disputes to be adjudicated not under a common law forum or under a statute by filing a suit, the court while exercising appellate power will not substitute its opinion with than that of the arbitrator. If the clause in the contract is open to two plausible interpretations, it is legitimate for the arbitrator to accept one or the other available interpretation and even if the Court may think that the other view is preferable, the Court will not or should not interfere with interpretation of the Arbitrator. The award cannot be said to be perverse. It cannot be stated that the arbitrator has not taken the material before him into consideration before coming to a probable conclusion in allowing claims.

20. The respondent No. 2 has considered the pattern of calls made prior of December, 1991, has taken into consideration the effect of the petitioner not disconnecting the phone despite complaints being made about the telephone, the effect of no reply given by the petitioner to a vital ground raised by the respondent No. 1 and for these reasons, has given his finding. The respondent No. 2 considered the past pattern of calls made by the respondent No. 1 and on the basis of record produced by the petitioner has awarded the amount equivalent to the amount of December, 1991 bill and 10% more over that bill. It can not be said in the facts and circumstances that the Arbitrator has not given any reason for the findings given by him. Though it may be possible to infer differently as has been contended by the counsel for the petitioner, however, this Court will not be entitled to substitute its own findings with the findings of the respondent No. 2. Appraisement of evidence by the arbitrator is never a matter which the court questions and considers. If the parties have selected their own forum, the deciding forum must be conceded the power of appraisement of the evidence. The arbitrator is the sole Judge of the quality as well as the quantity of evidence and it will not be for the court to take upon itself the task of being a judge on the evidence before the arbitrator. The petitioner has failed to point out any express term of agreement between the parties which had been ignored by the respondent No. 2. Consequently the petitioner has not been able to make out a case which will require interference by this Court. There is no error apparent on the face of the award.

21. In the circumstances, there are no grounds to interfere with the award passed by the Arbitrator under Article 226 of Constitution of India and the writ petition is without any merit and it is dismissed.