[Cites 8, Cited by 0]
Delhi High Court
M/S Synergy Consultants vs M/S T.D. Williamson India Pvt Ltd on 10 March, 2026
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on: 04.02.2026
Judgment pronounced on: 10.03.2026
Judgment uploaded on: 10.03.2026
+ FAO(OS)(COMM) 153/2024
M/S SYNERGY CONSULTANTS .....Appellant
Through: Mr. Sandeep Bisht, Mr. Sahil
Nindawat & Mr Prarabdh
Tiwari, Advs.
versus
M/S T.D. WILLIAMSON INDIA PVT. LTD. .....Respondent
Through: Ms. Fereshte D Sethna, Mr.
Mohit Tiwari & Mr. Devansh
Jain, Advs.
CORAM:
HON'BLE MR. JUSTICE ANIL KSHETARPAL
HON'BLE MR. JUSTICE AMIT MAHAJAN
JUDGMENT
ANIL KSHETARPAL, J.:
1. Through the present Appeal, the Appellant assails the
correctness of order dated 23.04.2024 [hereinafter referred to as
„Impugned Order‟] passed by the learned Single Judge of this Court in
OMP (COMM) 451/2019 whereby the objections preferred by the
Appellant under Section 34 of the Arbitration and Conciliation Act,
1996 [hereinafter referred to as „the Act‟] were dismissed and the
arbitral award dated 11.05.2019 was upheld.
2. The issue which arises for consideration in the present Appeal
is whether the learned Single Judge, while exercising jurisdiction
under Section 34 of the Act, committed any error warranting
interference under Section 37 of the Act in declining to set aside the
arbitral award dated 11.05.2019, particularly insofar as the learned
Sole Arbitrator rejected the Appellant‟s claim for commission in
respect of the ONGC Hazira 42 HTPCS (Hot Tapping Project) and
declined the claim for pre-suit interest.
FACTUAL MATRIX:
3. In order to appreciate the controversy involved in the present
Appeal, the relevant facts, shorn of unnecessary details, are required
to be noticed.
4. The Appellant is a proprietorship firm engaged in providing
consultancy services in the petroleum, gas and oil sector. Shri Anand
Mallick is stated to be its proprietor. The Appellant claims to be
engaged in liaisoning, business development, facilitating meetings,
assisting in drafting specifications for pre-tender meetings, follow-up
of tenders and rendering assistance in developing business relations
with public sector undertakings.
5. The Respondent is a company incorporated under the
Companies Act, 1956, and is stated to be a subsidiary of M/s TD
Williamson Inc., Tulsa, Oklahoma, USA. The dispute between the
parties arises out of a "Representative Agreement" dated 01.07.2012
executed between the Appellant and the Respondent.
6. In terms of the aforesaid Agreement dated 01.07.2012, the
Appellant was appointed as a Commission Representative of the
Respondent for the Market Area specified in Schedule I thereto.
Schedule I defined the geographic area as "India" and the industry as
"Oil & Gas Transmission and Distribution", limited to customers
specified therein, including Oil and Natural Gas Corporation Limited
[„ONGC‟] and public sector refining units. The Schedule I to the
Agreement reads as under:
"1. Market Area: The market area covered by this agreement is that
indicated by the box filled with specifics or limitation on filled in
lines:
X. Geographic-India
X. Industry(ies)-Oil & Gas Transmission and (Limited to Customers
Listed Below)
X. Customer(s)-ONGC, Oil & Natural Gas Corporation LTD. and
Public Sector Refining Units
2. This Agreement is Exclusive or Nonexclusive as indicated by the
box filled in (thus X)
X. This Agreement is Nonexclusive to Representative for the market
area:
TDW retains the right to quote, sell and invoice Products and Services
to any customers within the Market Area, either directly or through
their other representative without participation by or payment of a
Commission to Representative. TDW shall advise Representative in
writing before exercising this right.
For orders involving TDW or other organizations having TDW's
authorization to sell Products and services, Representative is not
subject to commission component credits or debits in accordance with
Schedule III except on an individual order as agreed in writing
between the parties prior to receipt of the order by TDW.
This agreement is Exclusive to Representative for the market area for
products and services listed in Schedule III.
TDW retains the right to quote, sell and invoice Products and Services
to any customers within the Market Area, without participation by
representative. TDW shall advise representative in writing before
exercising this right and only when the sale order value is over $500
USD shall pay representative a commission for these sales in
accordance with Schedule III.
For a sale of products and services valued for $500 USD, when more
than one organization having TDW's authorization to sell products
and services is involved in such a transaction, it shall be within
TDW's discretion to make a division of commission in accordance
with Schedule III.
Exclusively applies to all Products and Services listed in Schedule II,
except which are NONEXCLUSIVE"
7. Section I of the Agreement provided for appointment of the
Appellant as a TDW Commission Representative for the specified
Market Area, which is reproduced as under:
"SECTION I- APPOINTMENT
1.1 Representative had meeting with the TDW management and
the TDWIL has agreed that the Representative shall be appointed as
its authorised representative on 1st July 2012.
1.2 TDW hereby appoints the Representative to be a TDW
commission representative for the market specified in Schedule I
hereto (hereinafter referred to as the "Market Area"), under the terms
and conditions set forth herein, with respect to the fulfilment of the
activities specified herein, including those set forth in Schedule II
hereto and the sale of products and services as set forth on Schedule
III hereto (hereinafter referred to individually and collectively as
'Products and Services').
1.3 Representative is hereby granted the right to indicate its
status as "Authorized Representative of TDW" within the Market
Area in a manner which is in accordance with Section I.
1.4 In consideration of Representative fulfilling its obligations
and responsibilities under and in accordance with this Agreement, the
Representative shall receive a commission, based on the amounts
received by TDW from sales of Products and Services which is subject
to and paid in accordance with the terms of this Agreement, including
Schedules I and III hereto."
8. Section IV of the Agreement, titled "Prices, Commissions &
Expenses", inter alia provided that the Respondent may contract with
and invoice customers directly within the Market Area for sales of
products and services and would pay the representative a commission
based on the amounts received from such sales in accordance with
Schedule I and Schedule III. Relevant clauses of Section IV thereof
read as under:
"SECTION IV - PRICES, COMMISSIONS & EXPENSES
4.3 TDW may contract with and invoice customers directly within the
market area for sales of products & services & will pay representative a
commission (herein after referred to as 'Commission') based on the
amount received from those sales in accordance with Schedule I & III
4.5 Any commission, due under this agreement shall be paid within 30
days following the month in which claimant has received from the
customer."
The commission payable to the Appellant was in terms of Schedule III
(Representative Commission) read with Section IV (Prices,
Commissions & Expenses), which provided for commission primarily
at the rate of 6% in respect of tender-based sales and 8% in respect of
nomination-based sales.
9. The Agreement was stated to be non-exclusive. Schedule I
further provided that the Respondent retained the right to quote, sell
and invoice products and services to any customer within the Market
Area either directly or through other representatives without
participation by or payment of commission to the Appellant, subject to
advising the Appellant in writing before exercising such right.
10. Schedule II to the Agreement, titled "Services of
Representative", set out the routine services to be rendered by the
Appellant, including developing relations at all levels with customers
listed in the Market Area, assisting the Respondent in drafting
specifications, facilitating visits between customers and employees of
the Respondent, attending pre-tender meetings and following up on
tenders.
11. Disputes arose between the parties in relation to commission
allegedly payable to the Appellant in respect of certain projects of
ONGC, namely the ONGC Uran Project and the ONGC Hazira 42
HTPCS (Hot Tapping Project).
11A. It is the case of the Appellant that the officials of the
Respondent had taken the services of the Appellant for the ONGC
Projects at Uran and Hazira in terms of the Agreement dated
01.07.2012 and that the Appellant had worked on priority basis in
respect of both the ONGC Uran Project and the ONGC Hazira 42
Project. According to the Appellant, after securing the said projects
and receiving payment from ONGC, the Respondent refused to pay
the commission without justifiable reason.
11B. Vide letter dated 03.01.2017, the Respondent terminated the
Representative Agreement dated 01.07.2012 and offered to pay a sum
of Rs. 18,39,278/- as full and final settlement of all dues alleged or
otherwise under the Agreement, subject to execution of a settlement
agreement. The Appellant did not accept the said amount, claiming
that a sum of Rs. 3,06,00,000/- apart from GST was outstanding
towards commission.
11C. The Appellant filed Arbitration Petition No. 837/2017 under
Section 11 of the Act before this Court. By order dated 10.04.2018,
this Court referred the parties to the Delhi International Arbitration
Centre for appointment of a Sole Arbitrator.
12. Apart from the Agreement dated 01.07.2012 relating to ONGC,
the parties had also entered into another Commission Representative
Agreement dated 05.04.2014 concerning Gas Authority of India
Limited [„GAIL‟]. Under the said agreement, the Respondent had paid
commission on quarterly basis till the quarter ending June 2016.
Thereafter, commission payments were stopped. The Agreement was
terminated vide letter dated 03.01.2017 w.e.f. 02.02.2017, with an
offer of Rs. 29,06,755/- as full and final settlement, which was not
accepted.
12A. Accordingly, Arbitration Petition No. 839/2017 was filed under
Section 11 of the Act. The learned Sole Arbitrator conducted
proceedings in Arbitration Claim No. DAC/2003/04-18 (relating to
ONGC) and DAC/2005/04-18 (relating to GAIL) and passed a joint
award dated 11.05.2019.
13. In DAC/2005/04-18 (GAIL), the Arbitrator awarded Rs.
29,06,755/- to the Appellant. No petition under Section 34 was filed in
respect thereof.
14. Insofar as Arbitration Claim No. DAC/2003/04-18 (ONGC) is
concerned, the learned Sole Arbitrator held that the Appellant was
entitled to commission at the rate of 6% on the sale price of Rs.
11,03,74,769/-, amounting to Rs. 66,22,486/-, which was rounded off
to Rs. 66,22,500/-, in respect of the ONGC Uran Project. However,
the learned Sole Arbitrator rejected the Appellant‟s claim for
commission in respect of the ONGC Hazira 42 HTPCS (Hot Tapping
Project), and also declined the claim of the Appellant for pre-suit
interest on the amount awarded.
15. Aggrieved thereby, the Appellant filed objections under Section
34 of the Act being OMP (COMM) 451/2019 before the learned
Single Judge of this Court, challenging the award dated 11.05.2019
insofar as it rejected the claim for commission in respect of the ONGC
Hazira 42 HTPCS (Hot Tapping Project) and declined the claim for
pre-suit interest. The learned Single Judge, by the Impugned Order
dated 23.04.2024, dismissed the petition under Section 34 of the Act
and upheld the arbitral award.
16. Aggrieved thereby, the present Appeal under Section 37 of the
Act has been preferred.
CONTENTIONS OF THE PARTIES:
17. Contentions of the Appellant:
17.1. Learned counsel for the Appellant submitted that the present
Appeal under Section 37 of the Act arises from the rejection of the
Appellant‟s claim for commission in respect of the ONGC Hazira 42
HTPCS (Hot Tapping Project) and the denial of pre-reference interest
on the commission awarded for the ONGC Uran Project. It was
contended that both the ONGC Uran Project and the ONGC Hazira
Project were secured by the Respondent as a consequence of the
services rendered by the Appellant under the Representative
Agreement dated 01.07.2012.
17.2. It was contended that although the learned Sole Arbitrator
awarded a sum of Rs. 66,22,500/- towards commission in respect of
the ONGC Uran Project, the Arbitrator declined the claim for pre-
institution interest for the period between July 2015 and May 2018. It
was submitted that such denial of pre-reference interest is
unsustainable. It was further contended that the denial of pre-
institution interest was without any reasoning and contrary to settled
principles governing award of interest.
17.3. Insofar as the ONGC Hazira 42 HTPCS (Hot Tapping Project)
is concerned, it was argued that the learned Sole Arbitrator acted
unreasonably in rejecting the claim for commission, particularly when
the claim regarding ONGC Uran and ONGC Hazira allegedly stood
on the same footing and were based on the same set of documents and
email correspondence. It was submitted that the learned Sole
Arbitrator drew an artificial distinction between the ONGC Uran and
ONGC Hazira projects despite both pertaining to hot tapping and
stoppling services and being founded on substantially similar
correspondence and material on record.
17.4. Learned counsel submitted that the learned Sole Arbitrator as
well as the learned Single Judge failed to correctly appreciate the
terms of the Representative Agreement dated 01.07.2012. It was
argued that under Clause 4.3 read with Schedules I, II and III, the
Respondent was liable to pay commission on amounts received from
customers within the Market Area, including ONGC. The Agreement
was non-exclusive; however, the Respondent was mandatorily
required to advise the Appellant in writing before directly quoting,
selling or invoicing any customer without payment of commission.
17.5. It was contended that the ambit of the Agreement was not
confined to any specific project but pertained to the customer, namely
ONGC, and the services required to be rendered by the Appellant
included brand building, developing relations at all levels, assisting in
drafting specifications, facilitating meetings and promoting the
Respondent‟s services. According to the Appellant, it acted in terms of
the Agreement and continuously promoted the Respondent‟s hot
tapping and stoppling services before ONGC.
17.6. Learned counsel referred to email correspondence dated
26.03.2013 and other emails exchanged between the parties, as well as
minutes of meetings dated 06.03.2013 circulated vide email dated
08.03.2013, to contend that the Appellant had actively participated in
meetings with ONGC, GAIL and Engineers India Limited for brand
building of the Respondent. It was further submitted that the sole
witness of the Respondent had admitted that emails were exchanged
between the parties relating to both ONGC Uran and Hazira projects.
17.7. It was further submitted that the ONGC Hazira Project was
valued at approximately Rs. 22,47,20,000/- and was awarded in urgent
circumstances involving exposure of a subsea pipeline, and that
ONGC had directly approached the Respondent in July 2014 as a
consequence of continuous brand-building and promotional efforts
undertaken by the Appellant. According to the Appellant, such
approach was the result of continuous efforts made by it in promoting
the Respondent‟s expertise in hot tapping and stoppling technology
before ONGC.
17.8. Learned counsel argued that the learned Sole Arbitrator
erroneously rejected the claim for commission in respect of ONGC
Hazira on the ground that there was no specific written request or
authorization from the Respondent to work on the said project, which,
according to the Appellant, was contrary to the terms of the
Agreement.
17.9. It was further contended that the Award, to the extent it rejected
the claim for commission in respect of ONGC Hazira and denied pre-
institution interest, is contrary to the terms of the Agreement and is
vitiated by patent illegality and perversity, thereby warranting
interference.
18. Contentions of the Respondent:
18.1. Per contra, learned counsel for the Respondent submitted that
the present Appeal is devoid of merit and seeks reappreciation of
evidence examined by the learned Sole Arbitrator, which is
impermissible under Section 37 of the Act.
18.2. It was argued that the scope of interference under Section 34 of
the Act is narrow and that the jurisdiction under Section 37 is even
more circumscribed. Reliance was placed on the decisions of the
Supreme Court in UHL Power Co. Ltd. v. State of H.P.1; Renusagar
Power Company Limited v. General Electric Company2; and
Associate Builders v. DDA3, to contend that interference is
permissible only where the award is contrary to public policy, shocks
the conscience of the Court, or suffers from patent illegality
18.3. Learned counsel submitted that the learned Single Judge, in
paragraphs 29 and 30 of the Impugned Order, correctly held that the
Appellant failed to establish any ground for interference under Section
34 of the Act and that the Award did not violate basic notions of
morality or justice.
18.4. It was further contended that the learned Sole Arbitrator, after
(2022) 4 SCC 116
1994 Supp (1) SCC 644
(2015) 3 SCC 49
considering the documentary evidence and email correspondence on
record, returned findings of fact with regard to the Appellant‟s alleged
entitlement to commission in respect of the ONGC Hazira Project.
The Court, while exercising jurisdiction under the Act, does not sit as
a Court of Appeal to re-assess or re-appreciate the evidence.
18.5. It was also submitted that several grounds raised in the present
Appeal travel beyond the grounds urged in the Section 34 petition and
are therefore impermissible.
18.6. On merits, it was contended that in the Statement of Claim
dated 16.05.2018, the Appellant had claimed a total commission of
Rs. 3,06,00,000/- in respect of ONGC Uran Project and ONGC Hazira
42 Project, along with interest at 18% per annum. The Award granted
commission of Rs. 66,22,500/- in respect of ONGC Uran Project
along with pendente lite and future interest at 9% per annum and
proportionate costs, while rejecting the claim for commission in
respect of ONGC Hazira Project and the claim for pre-award interest.
18.7. It was submitted that the learned Single Judge rightly upheld
the interpretation placed by the learned Sole Arbitrator on the
Agreement, including Schedule II thereof, holding that the Appellant
was required to establish active participation in securing allotment of
the ONGC Hazira Project in order to qualify for commission. The
argument that email correspondence relied upon in respect of ONGC
Uran Project equally applied to ONGC Hazira Project was rejected as
an attempt to reinterpret correspondence already examined by the
Arbitrator.
18.8. Insofar as pre-institution interest is concerned, it was submitted
that the learned Single Judge correctly upheld the decision of the
learned Sole Arbitrator to grant only pendente lite and future interest,
observing that in the absence of any admission of liability for pre-
reference interest, no interference was warranted.
ISSUES FOR DETERMINATION:
19. In view of the rival submissions advanced on behalf of the
parties and having regard to the limited scope of interference under
Section 37 of the Act, the following issues arise for consideration in
the present Appeal:
I. Whether the learned Single Judge, while exercising jurisdiction
under Section 34 of the Act, committed any jurisdictional error or
applied an incorrect legal standard in declining to interfere with the
arbitral award dated 11.05.2019 insofar as it rejected the Appellant‟s
claim for commission in respect of the ONGC Hazira 42 HTPCS (Hot
Tapping Project)?
II. Whether the refusal of the learned Sole Arbitrator to grant pre-
institution interest on the amount awarded, as affirmed by the learned
Single Judge, suffers from patent illegality, perversity, or violation of
the terms of the Agreement so as to warrant interference under Section
37 of the Act?
III. Whether any of the grounds urged by the Appellant fall within
the limited parameters of interference available in an appeal under
Section 37 of the Act?
ANALYSIS & FINDINGS:
20. This Court has considered the submissions advanced on behalf
of learned counsel for the parties and perused the material on record.
At the outset, it is apposite to note that this Court, while exercising
jurisdiction under Section 37 of the Act, does not sit in appeal over the
findings of fact recorded by the learned Sole Arbitrator. Interference is
permissible only where the order passed under Section 34 itself suffers
from a manifest error in the application of the settled principles
governing challenge to arbitral awards.
21. In UHL Power Co. Ltd. (supra), the Supreme Court has held
that the scope of interference under Section 37 of the Act is even
narrower than under Section 34 of the Act. The appellate court is
required to bear in mind the limited grounds available under Section
34 of the Act and must be slow to interfere unless the view taken by
the Arbitral Tribunal is patently illegal or perverse. Similarly, in
Renusagar Power Co. Ltd. (supra), the Supreme Court explained that
interference on the ground of public policy is warranted only when the
award is contrary to the fundamental policy of Indian law, the interests
of India, justice or morality. The concept of "public policy" is not to
be expanded so as to convert the proceedings into an appellate review
on merits. In Associate Builders (supra), the Supreme Court further
clarified that patent illegality must go to the root of the matter. A mere
erroneous application of law or reappreciation of evidence does not
justify interference. Where the Arbitral Tribunal has adopted a
plausible interpretation of the contract, the Court cannot substitute its
own view merely because another interpretation is possible.
22. The issues framed above shall therefore be examined within the
aforesaid limited contours.
ISSUE I- Rejection of Commission in respect of ONGC Hazira 42
HTPCS (Hot Tapping Project)
23. The principal grievance of the Appellant pertains to the
rejection of its claim for commission in respect of the ONGC Hazira
42 HTPCS (Hot Tapping Project). At the outset, it must be
emphasised that the present Appeal is not directed against the arbitral
award simpliciter, but against the order of the learned Single Judge
refusing to set aside the award under Section 34 of the Act. The
Appellate Court is not required to examine whether a different view
on facts or interpretation of the Agreement was possible, but whether
the learned Single Judge committed any jurisdictional error or ignored
the settled parameters governing interference with arbitral awards.
24. A perusal of the award reveals that the learned Sole Arbitrator
examined the terms of the Representative Agreement, including the
clauses relating to entitlement to commission, the nature of the
Appellant‟s obligations, and the requirement of participation in
securing orders within the designated Market Area. The Arbitrator
analysed the documentary material, including the email
correspondence relied upon by the Appellant, and returned a
categorical finding of fact that, insofar as the ONGC Hazira Project
was concerned, the Appellant failed to establish a nexus between its
alleged promotional activities and the award of the said contract to the
Respondent.
25. The Arbitrator recorded that mere existence of a representative
arrangement or general brand-building efforts would not ipso facto
entitle the Appellant to commission on every project awarded by
ONGC. The Arbitrator held that entitlement to commission was not
automatic but dependent upon the Appellant establishing performance
of its contractual obligations in relation to the specific project. On
appreciation of the evidence, the Arbitrator concluded that such
involvement, in respect of the ONGC Hazira Project, had not been
established.
26. It is also necessary to note that the learned Sole Arbitrator
undertook a construction of the Representative Agreement dated
01.07.2012 and interpreted the nature of the Appellant‟s entitlement to
commission in the context of the obligations cast upon it. The
Agreement, inter alia, required the Appellant to provide consultancy
services, to use its reasonable best efforts to promote the sale of
products and services within the market area, to assist the
Respondent‟s personnel, and to keep the Respondent informed of
customer activities and market developments. The Arbitrator
construed these stipulations to mean that commission was not
envisaged as an automatic or blanket entitlement for every sale
secured within the market area during the subsistence of the
Agreement. Rather, the entitlement was held to be co-related to the
discharge of contractual obligations, namely, the rendering of
services, assistance, participation, or demonstrable efforts in
promoting or facilitating the specific project in question.
27. Such a construction cannot be said to be either implausible or
contrary to the language of the Agreement. A commercial
arrangement of this nature, whereby a representative is appointed to
promote products and assist in securing projects, reasonably admits of
an interpretation that commission is linked to the services rendered
and the extent of participation in the concerned transaction. The view
adopted by the Arbitrator, that the representative would be entitled to
commission commensurate with the work performed or assistance
actually rendered, is a possible and commercially sensible
interpretation of the Agreement. Once such interpretation is found to
be a plausible view emerging from the contractual text, this Court, in
exercise of jurisdiction under Section 37 of the Act, would not
substitute its own interpretation merely because another view is
conceivable.
28. The learned Single Judge, while exercising jurisdiction under
Section 34, examined the reasoning of the Arbitrator and held that the
interpretation placed on the Agreement was a plausible one. The
learned Single Judge further observed that the conclusions drawn were
based on appreciation of evidence and did not suffer from perversity,
patent illegality, or contravention of fundamental policy of Indian law.
29. The submission of the Appellant before this Court is essentially
that the material relied upon for grant of commission in respect of the
ONGC Uran Project ought to have led to a similar conclusion in
respect of ONGC Hazira, since both projects involved the same
customer and similar services. This argument, however, proceeds on
the assumption that similarity of customer or nature of services
automatically translates into entitlement to commission. Such an
inference does not arise as a matter of law and was expressly rejected
by the Arbitrator on appreciation of the evidence.
30. In so far as the ONGC Hazira 42 HTPCS (Hot Tapping) Project
is concerned, the award records a categorical finding that the
Appellant failed to discharge the burden of proof cast upon it. The
learned Arbitrator noted that except for a solitary email
communication dated 29.03.2012, no material was produced to
demonstrate that the Appellant had, in fact, rendered consultancy
services, participated in negotiations, assisted the Respondent‟s
personnel, or otherwise performed any obligation relatable to the said
project.
31. The said email, addressed to the Chairman-cum-Managing
Director of ONGC, merely contained a reference to the project and
was not shown to establish any substantive effort undertaken by the
Appellant in furtherance of the sale. The Arbitrator expressly observed
that the mere mention of the project in an email would not ipso facto
lead to the conclusion that the Appellant was instrumental in securing
the project or had fulfilled its contractual duties in relation thereto. No
contemporaneous correspondence, meeting records, technical
assistance documents, market intelligence reports, or other cogent
material were produced to evidence active involvement.
32. The finding that the Appellant neither provided consultancy
services nor participated in any manner in relation to the Hazira
project is thus founded squarely upon appreciation of the evidentiary
record. It is trite that an arbitral finding based on evaluation of
evidence, particularly where the burden of proof lay upon the
claimant, cannot be interfered with unless it is demonstrated to be
perverse, i.e., based on no evidence or by ignoring vital material. In
the present case, the Arbitrator has not ignored evidence; rather, he
has recorded that no cogent evidence was forthcoming beyond the
solitary email. Such a conclusion, emerging from the record itself,
does not warrant interference under Section 37 of the Act.
33. It is well settled that where the Arbitrator has interpreted the
terms of a contract and such interpretation is a possible and reasonable
one, the Court cannot substitute its own construction merely because
another view may also be possible. Re-appreciation of evidence,
reassessment of correspondence, or drawing of alternate factual
inferences falls outside the permissible scope of interference under
Sections 34 and 37 of the Act.
34. In the present case, the findings relating to absence of proven
participation or causative linkage in respect of the ONGC Hazira
Project are findings of fact based on appreciation of evidence. The
Appellant has not demonstrated that such findings are perverse in the
sense of being based on no evidence, ignoring vital evidence, or being
such that no reasonable person could have arrived at them. It is also
noteworthy that the learned Sole Arbitrator awarded commission in
respect of the ONGC Uran Project while rejecting the claim in respect
of the ONGC Hazira Project. This itself indicates that the Arbitrator
did not adopt a blanket or mechanical approach but examined each
project on its own evidentiary footing.
35. This Court finds no material to conclude that the learned Single
Judge applied an incorrect legal standard or failed to exercise
jurisdiction vested in it under Section 34. The impugned order reflects
due consideration of the grounds raised and a conscious adherence to
the limited scope of interference.
36. Accordingly, Issue I is answered in the negative.
ISSUE II- Refusal to Grant Pre-Institution Interest:
37. The second limb of challenge relates to the refusal of the
learned Sole Arbitrator to award pre-institution (pre-reference) interest
for the period prior to commencement of arbitral proceedings, despite
awarding commission in respect of the ONGC Uran Project along
with pendente lite and future interest.
38. The power of an arbitral tribunal to award interest is traceable
to Section 31(7) of the Act, subject to the terms of the contract and the
discretion of the Tribunal. In the absence of a contractual prohibition
or stipulation governing such interest, the award of pre-reference
interest lies within the discretion of the Arbitral Tribunal. Section
31(7) of the Act reads as under:
"(7) (a) Unless otherwise agreed by the parties, where and in so far
as an arbitral award is for the payment of money, the arbitral tribunal
may include in the sum for which the award is made interest, at such
rate as it deems reasonable, on the whole or any part of the money,
for the whole or any part of the period between the date on which the
cause of action arose and the date on which the award is made.
(b) A sum directed to be paid by an arbitral award shall, unless the
award otherwise directs, carry interest at the rate of two per cent
higher than the current rate of interest prevalent on the date of award,
from the date of award to the date of payment."
39. In the present case, the Arbitrator, after considering the claim
for interest at 18% per annum, awarded pendente lite and future
interest at a reduced rate but declined pre-institution interest. The
learned Single Judge upheld this determination, noting that no ground
under Section 34 was made out warranting interference.
40. The Appellant has not been able to demonstrate that the refusal
to grant pre-institution interest was in the teeth of an express
contractual stipulation or that the Arbitrator ignored any mandatory
provision of law. At best, the contention relates to the manner in
which discretion was exercised.
41. Exercise of discretion by the Arbitrator, particularly in matters
relating to rate and period of interest, does not warrant interference
under Section 34 or Section 37 unless it is shown to be arbitrary,
capricious, or contrary to the contract. No such infirmity has been
established in the present case.
42. The learned Single Judge, therefore, cannot be faulted for
declining to interfere with the Arbitrator‟s determination on pre-
institution interest.
43. Issue II is accordingly answered in the negative.
ISSUE III- Whether the Grounds Urged Fall Within Section 37
Parameters
44. Having examined the submissions of the Appellant, it is evident
that the gravamen of the Appeal is an invitation to this Court to
undertake a re-evaluation of the evidence and to adopt an alternate
interpretation of the Representative Agreement.
45. The statutory framework of Sections 34 and 37 of the Act does
not contemplate such an exercise. The appellate jurisdiction under
Section 37 is confined to examining whether the Court under Section
34 has acted within the bounds of law. It is not a forum for rehearing
on facts.
46. None of the grounds urged by the Appellant demonstrate that
the award is vitiated by patent illegality apparent on the face of the
award, contravention of fundamental policy of Indian law, or
perversity in the legal sense recognised in arbitration jurisprudence.
47. The Impugned Order reflects a correct appreciation of the
limited scope of interference and does not suffer from jurisdictional
infirmity.
CONCLUSION:
48. For the foregoing reasons, this Court finds no merit in the
present Appeal. The learned Single Judge was justified in declining
interference with the arbitral award dated 11.05.2019.
49. The present Appeal is accordingly dismissed.
ANIL KSHETARPAL, J.
AMIT MAHAJAN, J.
MARCH 10, 2026
jai/pal
