Delhi High Court
M/S. Brij Lal & Sons vs Union Of India on 26 March, 2014
Author: Valmiki J. Mehta
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ FAO No.12/2013
% 26th March, 2014
M/S. BRIJ LAL & SONS ....Appellant
Through: Mr. J.A. Chaudhary, Advocate.
VERSUS
UNION OF INDIA ...... Respondent
Through: Mr. Shalabh Gupta, Advocate.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA
To be referred to the Reporter or not?
VALMIKI J. MEHTA, J (ORAL)
1. This is a very peculiar appeal, peculiar because of the history of
this case. History of this case pertains to passing of three Awards till date by
the arbitrator, the details of which will be given hereafter. At the outset it
may be noted that this first appeal is filed under Section 37 of the Arbitration
& Conciliation Act, 1996 (hereinafter referred to as 'the Act') against the
order of the court below dated 17.10.2012 by which the court below while
allowing the objections under Section 34 of the Act and remanding the
matter to the arbitrator for a fresh decision directed that the
petitioner/appellant refund an amount of Rs.4,19,639/- which was received
FAO No.12/2013 Page 1 of 5
by the appellant/petitioner/claimant under the original Award dated
15.9.2004. The amount has been ordered to be refunded by the
appellant/petitioner alongwith interest @ 18% per annum simple, which rate
of interest is the only disputed aspect before this Court.
2. Appellant argues that since under the Award, appellant was
only entitled to interest @ 9% per annum simple, the court below should not
have directed refund of the amount pending the fresh decision by the
arbitrator alongwith interest only @ 9% per annum simple and not @ 18%
per annum simple.
3. The facts of the case are that the appellant was a claimant in the
arbitration proceedings. The same resulted in the Award dated 15.9.2004,
the first Award. By this first Award, the appellant/claimant was awarded a
sum of Rs.3,12,697/- alongwith interest @ 9% per annum simple. This
Award, on the objections which were filed by the appellant herein under
Section 34 of the Act, was set aside by the order of Sh. Rakesh Tewari, ADJ,
Delhi dated 9.12.2009 and the matter was remanded back to the arbitrator to
decide afresh because proper opportunity was not given to the petitioner for
proving his case. The arbitrator thereafter passed the Award dated 8.8.2011,
the second Award, whereby the arbitration proceedings were terminated and
Award was passed dismissing the claim petition on the ground that the
FAO No.12/2013 Page 2 of 5
appellant/petitioner had already received a sum of Rs.4,19,639/- in full and
final settlement of the first Award dated 15.9.2004 i.e during the pendency
of the first objections against the first Award dated 15.9.2004. The amount
of Rs.4,19,639/- was received by the appellant/petitioner by a cheque on
22.3.2006. The appellant/claimant challenged this second Award dated
8.8.2011 countering that the claim petition could not have been dismissed on
the ground of full and final satisfaction inasmuch as the amount was
received in the year 2006 whereas the judgment which was passed by Sh.
Rakesh Tewari was rendered later on 9.12.2009, and consequently the
direction of the court of Sh. Rakesh Tewari, ADJ becomes final whereby the
matter was to be considered on merits. It is against this second Award that
the impugned order dated 17.10.2012 has been passed by setting aside the
Award but simultaneously directing the appellant/petitioner to refund the
amount of Rs.4,19,639/- alongwith interest @ 18% per annum simple. The
appellant/petitioner accordingly contends that though there is no quarrel with
the order to return back the amount of Rs.4,19,639/-, interest has to be paid
on the amount of Rs.4,19,639/- not at 18% per annum simple, but only at 9%
per annum simple.
4. For the completion of narration, I may state that the counsel for
the appellant states that the arbitrator has now passed a third Award dated
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11.3.2014 (I may note that original arbitration record including the Award
dated 11.3.2014 is also before this Court) and by the third Award dated
11.3.2014, the appellant/claimant has been awarded an amount of
Rs.4,21,410/-. Since the appellant/claimant had already received a sum of
Rs.3,12,697/- out of the amount of Rs.4,19,639/- (received by the
appellant/claimant on 22.3.2006), balance amount of Rs.1,08,713/- has now
been awarded.
5. The only issue before this Court is that by the impugned order
the refund should have been made of the amount of Rs.4,19,639/- alongwith
interest @ 18% per annum simple or only at 9% per annum simple, and
which is the only aspect which is urged before this Court on behalf of the
appellant.
6. In my opinion, counsel for the appellant is justified in arguing
that refund of the amount of Rs.4,19,639/- should only be alongwith interest
@ 9% per annum simple inasmuch as the first Award dated 15.9.2004
pursuant to which the appellant received the total amount of Rs.4,19,639/-
including the principal amount of Rs.3,12,697/- was alongwith interest @
9% per annum simple. Therefore, since the appellant received the amount of
Rs.3,12,697/- alongwith interest @ 9% per annum simple, appellant will
have to refund the amount of Rs.4,19,639/- alongwith interest only @ 9%
FAO No.12/2013 Page 4 of 5
per annum simple, and not at 18% per annum as directed in the impugned
order dated 17.10.2012.
7. Appellant has deposited the amount of Rs.4,19,639/- in this
Court. This amount be paid to the appellant and which will be treated as an
appropriate/part satisfaction in terms of the Award dated 8.8.2011 read with
the Award dated 11.3.2014. If after the appellant has received the amount of
Rs.4,19,639/- as deposited in this Court, further balance is due in terms of
the Award dated 11.3.2014 to the appellant, the appellant can take such
appropriate steps for recovery of the balance amount, if pending, in
accordance with law.
8. Appeal is disposed of in terms of aforesaid observations,
leaving the parties to bear their own costs.
MARCH 26, 2014 VALMIKI J. MEHTA, J.
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