Delhi High Court
M/S. Hans Raj Construction ... vs Delhi Development Authority & ... on 22 April, 2010
Author: Manmohan
#F-2B
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) 2265A/1996
M/S. HANS RAJ CONSTRUCTION
COMPANY AND ANR. ..... Petitioners-Claimants
Through Mr. Sandeep Sharma, Advocate
versus
DELHI DEVELOPMENT
AUTHORITY & ANR. ..... Respondent-Objector
Through Ms. Sangeeta Chandra, Advocate
with Mr. J.P. Singh, Executive
Engineer.
% DATE OF DECISION : APRIL 22, 2010
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
1. Whether the Reporters of local papers may be allowed to see the judgment? No.
2. To be referred to the Reporter or not? No.
3. Whether the judgment should be reported in the Digest? No.
JUDGMENT
MANMOHAN, J (ORAL)
I.A. No. 10219/1997
1. By way of the present application, objections have been filed by
respondent-DDA under Sections 30 and 33 of Arbitration Act, 1940
(hereinafter referred to as "Act, 1940") challenging the arbitral Award
dated 12th August, 1996 passed by the Sole Arbitrator, Mr. M.S.
Telang.
2. Ms. Sangeeta Chandra, learned counsel for respondent-objector
challenges the impugned Award on merits insofar as it awards Claims
No. 1, 2 and 3 to petitioners-claimants. She further states that the
Arbitrator has erroneously awarded Claim No.7. In this connection,
she has drawn my attention to the objection application wherein it has
been stated that Clause 10C had been deleted from the contract
executed between the parties.
3. Ms. Chandra also submits that Arbitrator has not dealt with the
respondent-objector's Counter Claims No. 12 and 14. She lastly
submits that interest awarded by the Arbitrator is excessive and
usurious.
4. On the other hand, Mr. Sandeep Sharma, learned counsel for
petitioners has drawn my attention to the original contract executed
between the parties, which clearly incorporates Clause 10C. He has
also drawn my attention to the counter statement of facts filed by
respondent-objector wherein no counter claims have been raised.
5. Having heard the parties I am of the view that scope of
interference by this Court with an arbitral award rendered under Act,
1940 is limited. The Supreme Court in Arosan Enterprises Ltd. Vs.
Union of India & Another reported in (1999) 9 SCC 449 has clearly
outlined the scope of interference by this Court in objections filed under
Sections 30 and 33 of the Act, 1940. The relevant observations of the
Supreme Court in the said judgment are reproduced hereinbelow :-
"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 proceedings 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.
37. The common phraseology "error apparent on the face of
the record" does not itself, however, mean and imply closer
scrutiny of the merits of documents and materials on record.
The court as a matter of fact, cannot substitute its evaluation
and come to the conclusion that the arbitrator had acted
contrary to the bargain between the parties. If the view of the
arbitrator is a possible view the award or the reasoning
contained therein cannot be examined. .........
(emphasis supplied)
6. Keeping in view the aforesaid parameters, I am of the opinion
that I cannot reappraise the evidence and consequently, I reject the
challenge with regard to Claims No. 1, 2 and 3. Further as I find that
Clause 10 C was a part of the contract executed between the parties, I
am of the view that the Award with regard to Claim No. 7 requires no
interference.
7. Since, no counter-claims have been agitated by respondent-
objector in its counter statement of facts, there is no question of
impugned Award being set aside on that account.
8. However, as far as the award of interest is concerned, I deem it
appropriate to reduce the rate of interest. The Supreme Court in
Rajendra Construction Co. Vs. Maharashtra Housing & Area
Development Authority and Ors. reported in (2005) 6 SCC 678;
McDermott International Inc. Vs. Burn Standard Co. Ltd. & Ors.
reported in (2007) 8 SCC 466 and Rajasthan State Road Transport
Corporation Vs. Indag Rubber Ltd. reported in (2006) 7 SCC 700 has
reduced the rate of interest. In fact, in Krishna Bhagya Jala Nigam
Ltd. vs. G. Harischandra Reddy & Anr. reported in (2007) 2 SCC 720
the Supreme Court has held as under :-
"11. ...... here also we may add that we do not wish to
interfere with the award except to say that after economic
reforms in our country the interest regime has changed and
the rates have substantially reduced and, therefore, we are of
the view that the interest awarded by the arbitrator at 18%
for the pre-arbitration period, for the pendente lite period
and future interest be reduced to 9%."
9. Consequently, keeping in view the aforesaid judgments and the
current rate of interest, I reduce the rate of interest for pendent lite as
well as post award period, that is, from 12% per annum and 16.5% per
annum respectively to 9% per annum simple interest. However, it is
made clear that in case the awarded sum is not paid within a period of
twelve weeks from today, respondent-objector will be liable to pay
simple interest at the rate of 12% per annum from the date of Award till
its realisation. With the aforesaid modifications in the rate of interest,
the impugned Award dated 12th August, 1996 is made rule of the Court
and Registry is directed to prepare a decree in terms thereof.
Accordingly, petition and application stand disposed of.
MANMOHAN, J.
MARCH 16, 2010
rn
