Delhi High Court
R.C. Jain vs Samant Bhadra Coop. Group Housing ... on 20 January, 2010
Author: Manmohan
#F-5
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ O.M.P. 231/1998
R.C. JAIN ..... Petitioner
Through Mr. Sandeep Sharma with
Mr. Vikas Sharma,
Advocates
versus
SAMANT BHADRA COOP.
GROUP HOUSING SOCIETY
LTD. ..... Respondent
Through Mr. Raman Kapur with
Mrs. Francesca. Kapur,
Advocates
% Date of Decision : JANUARY 20th, 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. 1818/2006
1. By way of the present application, objections under Sections 30
and 33 of Arbitration Act, 1940 (hereinafter referred to as "Act, 1940")
have been filed by the respondent-cooperative society challenging the
Award dated 28th March, 2002 passed by Mr. C. Rama Rao, learned
Umpire.
2. Briefly stated the facts relevant for this case are that respondent-
objector, which is a group housing cooperative society having 210
members, awarded the contract to the petitioner-contractor vide
Agreement dated 31st May, 1989 for construction of 210 dwelling units
at Plot No. 37, Sector 13, Rohini, Delhi - 110 085.
3. Since disputes and differences arose between the petitioner-
contractor and the respondent-cooperative society and as the contract
contained an arbitration clause, petitioner-contractor appointed
Shri K.L. Sehgal, former Managing Director of NIDC as Co-Arbitrator
on 04th November, 1994 and respondent-cooperative society appointed
Shri R.S. Gupta, former Engineer Member of Delhi Development
Authority as Co-Arbitrator on 23rd December, 1994. Both the
Arbitrators appointed Shri C. Rama Rao, retired Director General of
Works, CPWD as the Umpire.
4. Petitioner-contractor preferred 14 claims and respondent-
cooperative society filed 12 counter claims before the Arbitrators.
After the Arbitrators had conducted 37 hearings, one of the Arbitrators,
Shri R.S. Gupta, unfortunately expired. In his place, respondent-
cooperative society appointed Shri Harish Chander, retired Director
General of Works, CPWD as Co-Arbitrator. These two Arbitrators
conducted 72 hearings. However, the two Arbitrators differed in their
findings and they could not arrive at a consensus. Accordingly,
Arbitrators referred the case to the Umpire vide their letter dated 20 th
March, 2001.
5. I find that the Umpire held 32 hearings and ultimately published
the impugned Award on 28th March, 2002. The Umpire filed the
aforesaid original Award and the proceedings in the present petition.
6. Learned counsel for the respondent-cooperative society
submitted that the Umpire mis-conducted himself and, therefore, the
Award was liable to be set aside under Sections 30 and 33 of the Act,
1940.
7. Upon perusal of the objection application, I find that all the
grounds raised are on merits and the present application proceeds on the
basis that this Court is an appellate authority against an award passed
by the Arbitrator.
8. I also find that the Umpire who is a retired Director General of
Works, CPWD, was well conversant with the kind of disputes he was
adjudicating. The Award dated 28th March, 2002 runs into 80 pages
and detailed reasoning has been given by the Umpire against each of
the claims and counter claims. I also find that the impugned Award is
in consonance with the contractual terms inasmuch as the contract
explicitly provides for payment of escalation to the contractor.
9. A Division Bench of this Court in D.D.A. vs. Bhagat
Construction Pvt. Ltd. reported in (2004) 3 ALR 548 has held that
Court will not substitute its opinion for that of the Arbitrator. The
Arbitrator in the aforesaid case was a retired Chief Engineer of CPWD
and this Court held that he was very well conversant with the kinds of
disputes he was adjudicating. It was also held that Court will not
substitute its own view even if the Court came to a different conclusion
until and unless the decision of the Arbitrator was manifestly perverse
or had been arrived at on the basis of wrong application of law. It was
also held that it was well settled principle of law that an Arbitrator need
not disclose with mathematical precision the breakup of the amount
awarded. If the award shows application of mind and a view which is
plausible, it should not be interfered with.
10. In the present case, the Umpire has given plausible reasons in
detail after dealing with all the claims and counter claims. I do not find
that the Umpire has mis-conducted himself in any manner. In fact, the
Award is a well reasoned one.
11. I find that the contract was awarded in the year 1989 and
sufficiently long time has been spent in litigation before the Arbitrators
as well as the Umpire and thereafter, in the present objections filed by
the respondent-cooperative society. As the respondent is a cooperative
society, in my view, ends of justice would be met if the rate of interest
awarded by the Umpire is reduced to 5%.
12. Accordingly, the objections under Sections 30 and 33 of Act,
1940 filed by the respondent-cooperative society are allowed only
insofar as the rate of interest is concerned which shall stand reduced
from 15% per annum as awarded by the Umpire to 5% per annum
simple interest throughout the period. The remaining objections are
dismissed and the Award dated 28th March, 2002, subject to above
modification, is made rule of the Court.
13. The respondent is given six months' time to make the payment in
terms of this order. However, if the entire payment is not made then the
respondent society shall be liable to pay simple interest @ 9 % per
annum on the amount of Rs.30,79,518/- w.e.f. 11th January, 1995 till
realisation. Registry is directed to prepare a decree-sheet in terms
thereof.
14. With the aforesaid observations, present petition and application
stand disposed of.
MANMOHAN, J.
JANUARY 20th, 2010
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