Mr. Sunil K Goel, Adv. v. SHRI UMESH KUMAR GUPTA & ANR .....

1. Respondent was enrolled as a contractor with the appellant. Appellant awarded work of improvement of Hall, Duty Room adjoining Labour Room in GLM Hospital in City Zone to the respondent. Work was completed by the respondent in time, inasmuch as, same was inspected by the Engineer-in-Chief who recorded the same in measurement book NO. 1018, after taking measurement. After completing the work respondent raised the final bill. Appellant did not pass the bill despite requests of the respondent for preparing and passing the final bill. Instead, appellant started disputing the factum of work done by the respondent. In these 2014:DHC:6156 circumstances, respondent invoked Arbitration Clause No. 25 of the General Terms and Conditions of Agreement and issued notice dated 17th April,

2008. Appellant sent a reply and requested the respondent to submit details of the work carried out including names of Junior Engineers and Assistant Engineers under whose supervision he had executed the work. Entire information was submitted by the respondent to appellant vide letter dated 2nd May, 2008. Despite this bill was not prepared and passed by the appellant.

2. Ultimately, respondent approached this Court for appointment of an Arbitrator wherein Arbitrator was appointed, vide order dated 15th May, 2009, passed in Arbitration Application No. 237/2008 titled Shri Umesh Kumar Gupta vs. Municipal Corporation of Delhi & Anr. Pursuant to the order passed by this Court, Arbitrator entered upon the reference and afforded opportunity to the parties file their respective pleadings, documents, inasmuch as, to lead oral evidence.

3. Following issues were framed by the Arbitrator:i) Whether the claims filed by the Claimant are not arbitrable as the Claimant has not raised the claims before the SE concerned/CE concerned in view of Clause 25 of the General Terms & Conditions? ii) Whether the Claims no.2,[3] and 4 of the Claim Petition are also not arbitrable being beyond the General Terms & Conditions of the Agreement and as such are out of the ambit of Section 28(3) of the Arbitration & Conciliation Act, 1996? iii) Whether the claims of the Claimant are barred by limitation? iv) Whether the Claimant is entitled to the claims as made out by him in the Claim Petition?

4. On the basis of evidence adduced by the parties, Arbitrator held that claim no.1 did not survive as the principal amount was paid during the pendency of arbitration proceedings. As regards claim no. 2 about earnest money, it was ordered to be refunded. Claim no. 3 regarding damages was declined. Claim no. 5 was in respect of interest on the delayed payment and withheld earnest money @ 18 % per annum from the date of completion of work/notice till the date of payment. This claim has been allowed and appellant has been directed to pay interest @ 9 % per annum on `1,31,460/with effect from 1st September, 2006, that is, 3 months after submission of the bill till the date of payment, that is, 31st March, 2011. Interest on the earnest money has also been allowed. Claim no. 4 was with regard to the cost of proceedings which has been partially allowed.

5. Aggrieved by the Award appellant preferred a petition under Section 34 of the Arbitration & Conciliation Act, 1996 (for short, hereinafter referred to as the ‘Act’) which has been dismissed by the trial court by the order impugned in this appeal. Trial court has held that full opportunity was given to appellant to contest the case by the Arbitrator, inasmuch as, Award was well reasoned Award. All the objections of appellant had been taken due care of. It has been further held that court could not have sifted and weighed the evidence on record so as to substitute its findings as against the findings returned by the Arbitrator, as if hearing the appeal. Trial court concluded that none of the grounds, as envisaged under Section 34 of the Act, could be made out.

6. I have heard learned counsel for the parties and perused the Award as well as impugned order and do not find any illegality or perversity therein. Learned counsel for the appellant submitted that awarded amounts have already been paid and appellant is challenging the Award only with regard to award of interest. It is contended that respondent had failed to pursue the matter, thus, appellant cannot be blamed for the delayed payment. Respondent did not follow up the matter with the officials of respondent and was himself guilty of contributory negligence. I do not find any force in this contention. First of all, no such ground was taken before the Arbitrator, therefore, appellant cannot rake up this issue at this stage. Findings of Arbitrator on merits cannot be sifted and weighed by scrutinizing the evidence adduced before the Arbitrator at threadbare as if this Court is hearing an appeal against the award. The grounds of challenge as envisaged under Section 34 of the Act have to be disclosed before an award can be interfered with. Award can also be interfered with if it is shown to be absurd that it shocks the conscience of the court. Arbitrator has given reasons for awarding interest. Admittedly, there was a long delay in processing the bill by the appellant for which no justification could be offered before the Arbitrator. Respondent had submitted the bill, therefore, it was obligatory on the part of the appellant to process the bill on the basis of records available with it. It was also obligatory on the part of appellant to clear the bill within a period of three months as envisaged in Clause 9 of the General Terms and Conditions of the Agreement. Arbitrator has taken note of all these facts and has awarded the interest.

7. In view of above discussions, appeal is dismissed. Dasti. A.K. PATHAK, J. NOVEMBER 18, 2014