Delhi District Court
Bharat Heavy Electricals Limited ... vs Sarr Freight Corporation on 17 May, 2025
DLND010014972023
IN THE COURT OF MRS VINEETA GOYAL,
DISTRICT JUDGE (COMMERCIAL-03),
PATIALA HOUSE, NEW DELHI
OMP (Comm) No.21 of 2023
CNR No. DLND01-001497-2023
In the matter of:
Bharat Heavy Electricals Ltd. (Trichy)
Represented by Deputy General Manager,
Works Contracts Management Department,
3rd Floor, 24 Building,
BHEL Tiruchirappalli Complex,
Tiruchirappalli, Tamil Nadu-620014. ........ Petitioner
Versus
1 Sarr Freight Corporation
(Through Sh. Subodh Kumar,
Managing Partner)
1E/12, Sewak House,
Link Road, Block E1,
Jhandewalan Extension,
New Delhi-110005.
2. Sh. Justice Dinesh Gupta
Ld. Sole Arbitrator
Delhi International Arbitration Center
Shershah Road, New Delhi-110001. ...... Respondents
Digitally
signed by
VINEETA
VINEETA GOYAL
GOYAL Date:
2025.05.17
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Date of institution of suit : 25.02.2023
Date of Judgment : 17.05.2025
Appearance : Sh. Abhay Singh and Sh. Suraj Kumar Singh,
Ld. counsels for petitioner.
Sh. Kshitiz Jain, Ld. Counsel for respondents.
JUDGMENT
1 The present petition under Section 34 of Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'The Act') has been filed by the petitioner for setting aside arbitral award dated 28.10.2022 passed by Ld Arbitrator in Arbitration in case reference no. DIAC/2491D/07-19 titled as "Sarr Freight Corporation Vs M/s Bharat Heavy Electricals Ltd."
2 Brief facts averred in the petition are that petitioner, a public sector undertaking, inter alia is a manufacturer of power boilers and its components. The petitioner engages the services of transport carriers in connection with its business activities and entered into contract with numerous transport carriers for transportation of boilers and boilers components across India. In pursuance of the same, the petitioner floated a tender bearing no. LOG/CCC/14-15/4017E dated 26.07.2014 comprising all terms and conditions of work, for handling and transportation of panels, headers and boiler components etc. by road from Sone Nagar (Bihar) Railway Siding to Nabinagar Power Generating Company Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:31:41 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 2 of 24 Limited (in short 'NPGCL') - Nabinagar site (approx. 30 km distance) by engaging suitable material handling equipment and suitable capacity vehicle as per Motor Vehicles Rules. The respondent participated in the bid and owing representation made by respondent regarding performance of contract, the respondent was awarded 'Letter of Intent' bearing no. LOG/CCC/14-15 4017L dated 11.09.2014.
2.1 According to petitioner in clause 7 of General Terms and Conditions of Contract (hereinafter referred as 'GCC'), the respondent was not allowed to delegate the contract without prior written approval of petitioner. The petitioner had paid Rs.18,30,220/- to the respondent as the delivery receipts received from site office was only to the extent of that amount. It is alleged by the petitioner that rest of the contract was performed by Sh.Anuj Kumar and same can be affirmed from the fact that delivery/acknowledgment receipt were issued to Sh. Anuj Kumar.
It was thus clear that the respondent sub contracted the work to Sh. Anuj Kumar without the written approval of the petitioner which was not permissible as per Clause 7 of GCC. Moreover, the petitioner also received a letter dated 15.12.2014 from Sh. Anuj Kumar who categorically stated work was sub-contracted to him by respondent. Sh. Anuj Kumar had also sent an e-mail dated 23.11.2014 along with first page of contract dated 22.09.2014 executed between respondent and Sh. Anuj Kumar for delegation of work which affirmed that contract was performed by Sh. Anuj Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:31:52 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 3 of 24 Kumar.
2.2 The petitioner has further averred that in pursuance to the letter issued by Sh. Anuj Kumar, the petitioner sent e-mails dated 22.12.2014, 20.03.2015, 26.07.2015 to the respondent requesting to settle the issues with Sh. Anuj Kumar. It is further averred that Sh. Anuj Kumar intimated the client of petitioner ('NPGCL') to pay the remaining of the outstanding and NPGCL informed the petitioner that local people are threatening to stop the work due to non-payment. It is claimed by the petitioner that NPGCL is a client of petitioner and owner of project which was being developed by the petitioner. NPGCL put the petitioner on notice and asked the petitioner to place charges of the services rendered by Sh. Anuj Kumar. NPGCL issued letters dated 15.01.2016, 16.02.2016 and 08.03.2016 wherein NPGCL instructed the petitioner to pay the charges for the services rendered by Sh. Anuj Kumar failing which, NPGCL would be directing paying Sh. Anuj Kumar and recovered the said amount from the petitioner.
2.3 The petitioner further averred that respondent did not settle issues with Sh. Anuj Kumar, NPGCL directly paid the balance amount to Sh. Anuj Kumar and adjusted the same from running business of petitioner and same can be affirmed from email dated 08.08.2019 sent by official of NPGCL confirming that an amount of Rs.19,80,849/- was paid by Sh. Anuj Kumar on Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:32:01 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 4 of 24 25.03.2016 and same was debited from running business of petitioner.
2.4 The petitioner further averred that petitioner was fully committed towards the performance of the contract, who had arrayed in lifting all the materials from wagons/sidings.
Consequently the Eastern Central Railways imposed demurrages charges upon the petitioner amounted to Rs 29,16,000/-.
2.5 The petitioner further averred that the Ld. Arbitrator passed award dated 28.10.2022 (herein referred as impugned award) wherein Ld. Arbitrator awarded an amount of Rs.13,73,260/- as claim, Rs.1,83,022/- as security deposit, Rs.1,50,000/- as earnest money and Rs 41,000/- along with interest @ 8% from the amount outstanding till date of actual payment in favor of respondents. Ld. Arbitrator disallowed the claim of petitioner.
2.6 Aggrieved by this, the petitioner challenged impugned award on various grounds including that Ld. Arbitrator did not consider all the evidence that too particularly in the respect of delegation of contract which was the main point of contention. Ld. Arbitrator ignored material evidence adduced by the petitioner. Ld. Arbitrator had acknowledged only an email (presumably e-mail dated 23.11.2014) and first page of order issued to Sh. Anuj Kumar. However, there was a letterDigitally dated signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:32:15 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 5 of 24 15.12.2014 wherein Sh. Anuj Kumar had stated that he was sub-
contacted the work by respondent. In fact Sh. Anuj Kumar mentioned the work order number also which is same as of the work order of first page submitted to Ld. Arbitrator. Ld. Arbitrator ignored e-mail dated 10.10.2014 which was submitted by respondent. The respondent never communicated anything to the petitioner about revised charges being reduced to Rs.950/- from Rs.1020/- per. However, the same was informed to Sh. Anuj Kumar through e-mail dated 1010.2014 and this e-mail would itself speak volume about the fact that work was sub-contracted by respondent to Sh. Anuj Kumar. It is settled position of law that no arbitral amount should be passed without appreciating all the evidence. The petitioner has relied judgments as follows i.e. PSA Sical Terminals Pvt Ltd Vs The Board of Trustees of VO Chidambranar Port Trust Tuticorin & Ors., Associate Builders Vs DDA and Excise and Taxation Officer-cum-Assessing Authority Vs Gopi Nath & Sons.
2.7 The next ground taken by petitioner is that Ld. Arbitrator did not allow the petitioner to cross examine the witness Sh. Subodh Kumar Singh of the respondent in respect to the relations with Sh. Anuj Kumar stating that petitioner has no right to ask the questions about the relations between respondent and Sh. Anuj Kumar but the Ld arbitrator himself observed the scope of work and full and final sum was paid to Sh. Anuj Kumar. It is emphasized that cross examination is important exercise to Digitally signed by VINEETA GOYAL VINEETA Date:
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extract the truth but respondent denied this fact. Pertinently, the respondent was allowed to give evidence disclosing Rs 10 lacs had been paid to Sh. Anuj Kumar for the work done, however, when petitioner tried to ask the question about the said transaction during cross examination, the petitioner was refused to ask the questions by the Ld Arbitrator. The said denial comes within the scope of section 34 of the Act.
2.8 It is further contended that the petitioner delegated the work for handling and transportation of panels, headers and boiler components etc. by road from Sone Nagar (Bihar) railway siding to NTPC-Nabinagar site (approx 30km distance) to the respondent through tender no. LOG/CCC/14-15/4017E dated 26.07.2014 floated by the petitioner along with Letter of Intent bearing no. LOG/CCC/14-15/4017L dated 11.09.2014. The respondent further delegated the said work to Sh. Anuj Kumar after deducting its margin rate. The same can be affirmed from Annexure 7 of Tender no. LOG/CCC/14-15/4017E dated 26.07.2014 wherein the price bid for the work Rs 1190/- per metric ton by the respondent. Thereafter, respondent delegated the said work @ Rs 950/- per metric ton to Sh. Anuj Kumar which can be affirmed from e-mail dated 10.10.2014 wherein the information regarding the charges was communicated to Sh. Anuj Kumar. The respondent earned margin of Rs 240/- per metric ton only by delegating the entire work despite the fact that it was the respondent who was supposed to complete the entire work. The Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:32:31 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 7 of 24 Ld. Arbitrator ignored the said Annexure 7 and e-mail dated 10.10.2014, thus, making the award dated 28.10.2022 patently illegally.
2.9 The petitioner further contended that the Ld. Arbitrator has disallowed the counter claim of the respondent on the ground of limitation ignoring that the transaction between petitioner and respondent was that of current account with mutual demands. The limitation will start running from the last transaction between the parties. The account has been open and the payments under the contract between the parties were not completed/the contract was not concluded as there were disputes on the amount payable. The Ld. Arbitrator also went to the extent of seeking more evidence to show that the demerges claimed by the respondent was on account of the delay caused by the claimant whereas the contract between the parties does not require the respondent to prove the same. The contract merely says that beyond 8 hrs., demurrage rate is applicable as per the latest railway notification.... If demurrage happened, then the demurrage charges incurred/levied by railway should be borne by the subject default contractor. The contract further says that if any demurrage and warfage have to be paid to railway on account of the contractors default the same will be adjusted against running bills of the defaulted carrier and on EMD/security deposit submitted by the default carrier. The Ld. Arbitrator had gone beyond the scope of the contract in demanding more evidence in Digitally signed by VINEETA GOYAL VINEETA Date:
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connection with the demurrage charges paid by the respondent to Eastern Railways I the subject case.
2.10 The petitioner further contended that Ld. Arbitrator himself observed that the reason for holding payment was justifiable no interest would have been awarded. The petitioner further averred that the primary contention of the petitioner was that the respondent has delegated the entire work to Sh. Anuj Kumar, however, the Ld. Arbitrator rejected the claim. The Ld. Arbitrator made a contradictory and suggestive observation in the impugned award observing that Mr. Anuj Kumar if has any right to claim the remaining amount, he can do so from the claimant only and not with any other person either respondent or NPGCLL officials and if Mr. Anuj Kumar was intimidated or threatening to stop work at site, the only recourse available to NPGCLL officials to take legal action against Mr. Anuj Kumar including criminal action but the NPGCLL officials has no authority to make payment to Sh. Anuj Kumar. It is contended by the petitioner that in other words, the Ld. Arbitrator acknowledged that Sh.Anuj Kumar was working at the site but the Ld. Arbitrator did not make any effort to find out the business relations of the petitioner and Sh. Anuj Kumar. It is clear from the above that the Ld. Arbitrator has passed the impugned award on the basis of presumption and without application of mind.
2.11 On the aforesaid grounds, the petitioner has prayed Digitally signed by VINEETA GOYAL VINEETA Date:
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to set aside the impugned award.
3 Per contra, the respondent resisted the instant petition
and submitted that the Ld. Arbitrator considered all the documents and thereafter rendered the impugned award. The award as rendered has been passed by Ld. Arbitrator after due application of mind, and is binding on the parties. The court cannot sit in appeal over the impugned award and venture into re-assessing and re-appreciating evidence to find out whether a different decision could have been arrived at, as against the findings of Ld. Arbitrator in the impugned award. It is not open to challenge on the ground that the Arbitral Tribunal reached the wrong conclusion or failed to appreciate the facts or evidence that the petitioner contends ought to have been accorded more importance.
It is further submitted that the Ld. Arbitrator has categorically dealt with allegations regarding Sh. Anuj Kumar in the impugned award, and held that there is no evidence that Sh. Anuj Kumar was sub-contracted by respondent herein. The Ld. Arbitrator went on to note that petitioner herein has no privity of contract with Sh. Anuj Kumar - and any payment by NPGCL and their adjustment of the same from the petitioner's bill would not absolve the petitioner from making payment to respondent no.1. In the impugned award, the Ld. Arbitrator has appreciated all the evidence properly and provided cogent reasoning for its conclusion. It is prayed that the petition preferred by the petitioner deserves dismissal.
Digitally signed by VINEETAVINEETA GOYAL Date: GOYAL 2025.05.17 17:32:51 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 10 of 24 4 I have heard arguments advanced by Ld. Counsels for parties and gone through the material available on record.
5 Before adverting to the contentions of the parties, it is essential to refer to the law laid down by Hon'ble Supreme Court, the jurisdiction conferred on the Courts under Section 34 of the Act. The petitioner before this Court has invoked Section 34 of the Act to challenge the impugned award. The relevant portion of the said provision is reproduced hereunder:
"34.Application for setting aside arbitral award-
(1)Recourse to a court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub- section (3). (2)An arbitral award may be set aside by the court only if-
(a) the party making the application furnishes proof that-
(i) a party was under some incapacity, or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law for the time being in force; or
(iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration;
Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a Digitally signed by VINEETA GOYAL VINEETA Date:
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provision of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part; or
(b) the court finds that-
(i) the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or
(ii) the arbitral award is in conflict with the public policy of India.
Explanation- I For the avoidance of any doubt, it is clarified that an award is in conflict with the public policy of India only.
i) if the making of the award was induced or affected by fraud or corruption or was in violation of Section 75 or Section 81."
ii) It is in contravention with the fundamental policy of Indian law;
iii) It is in conflict with the most basic notions of morality or justice.
Explanation-II- For the avoidance of doubt, the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.
[2 (A) An arbitral award arising out of arbitrations other than international commercial arbitrations, may also be set aside by the court, if the court finds that the award is vitiated by patent illegality appearing on the face of the award:
[Provided that an award shall not be set aside merely on the ground of an erroneous application of the law or by reappreciation of evidence].
6 The contents of the provision of Section 34 of the Act would clearly show that the intention of the legislature by enacting the Act as well as while carrying out amendment to the same was that there should be limited intervention of the Courts in Digitally signed by VINEETA GOYAL VINEETA Date:
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arbitral proceedings, especially after the proceedings have been concluded and award thereto have been made by the Tribunal.
Any claim brought forth a Court of law under Section 34 of the Act shall be in accordance with the principles of the provision laid down under the Act.
6.1 Normally, the general principles are that the decision of the Arbitrator unless there is an error apparent on the face of the award which makes it unsustainable, is not to be set aside even if the court as a court of law would come to a different conclusion on the same facts. The court cannot reappraise the evidence and it is not open to the court to sit in appeal over the conclusion of the arbitrator. It is not open to the court to set aside a finding of fact arrived at by the arbitrator and only grounds on which the award can be challenged are those mentioned in the Act. Where the arbitrator assigns cogent grounds and sufficient reasons and no error of law or misconduct is cited, the award will not call for interference by the court in the exercise of the power vested in it.
6.2 In the case of Associate Builders v/s Delhi Development Authority, (2015) 3 SCC 49, it was held that interference with an arbitral award is permissible only when the findings of the arbitrator are arbitrary, capricious or perverse or when conscience of the Court is shocked or when illegality is not trivial but goes to the root of the matter. The arbitrator is Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:33:12 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 13 of 24 ultimately a master of the quantity and quality of evidence while drawing the arbitral award. Patent illegality must go to the root of the matter and cannot be of trivial nature.
6.3 In Ssangyong Engineering & Construction Co. Ltd.
vs. National Highways Authority of India Ltd. 2019 SCC OnLine SC 677, the Hon'ble Supreme Court has held that under Section 34 of the Act, a decision which is perverse while no longer being a ground for challenge under public policy of India but would certainly amount to a patent illegality appearing on the face of the award. A finding based on the documents taken behind the back of the parties by the arbitrator would also qualify as a decision based on no evidence inasmuch as such decision is not based on evidence led by the parties and therefore would also have to be characterized as perverse.
6.4 The Hon'ble Apex Court in Union of India Vs. Varindera Construction Limited, (2018) 7 SCC 794, while discussing the object of arbitration observed as under:
12. The primary object of the arbitration is to reach a final disposition in a speedy, effective, inexpensive and expeditious manner. In order to regulate the law regarding arbitration, legislature came up with legislation which is known as Arbitration and Conciliation Act, 1996. In order to make arbitration process more effective, legislature restricted the role of courts in case where matter is subject to the arbitration. Section 5 of the Act specifically restricted the interference of the courts to some extent. In other words, it is only in exceptional circumstances, as provided by this Act, the court is entitled to intervene in the dispute which is subject matter of arbitration. Such Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:33:19 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 14 of 24 intervention may be before, at or after the arbitration proceeding, as the case may be. In short, court shall not intervene with the subject matter of arbitration unless injustice is caused to either of the parties.
6.5 In case of Jharkhand Vs. HSS Integrated DSN, (2019) 9 SCC 798, the Hon'ble Court observed that even when there are more than one plausible view and the Arbitrator, in his wisdom, adopt one of them, having given reasons for findings, the Courts shall interfere this such an award. It was observed as under:
6.2 In the case of Datar Switchgear Ltd. (supra), this Court has observed and held that the Arbitral Tribunal is the master of evidence and the findings of fact which are arrived at by the arbitrators on the basis of the evidence on record are not to be scrutinized as if the Court was sitting in appeal. In para 51 of the judgment, it is observed and held as under:
51. Categorical findings are arrived at by the Arbitral Tribunal to the effect that insofar as Respondent 2 is concerned, it was always ready and willing to perform its contractual obligations, but was prevented by the appellant from such performance.
6.6 In case of Dyna Technologies Pvt Ltd Vs. Compton Greaves Limited, (2019) 20 SCC 1, Hon'ble Apex Court in Para 24, thereof has been pleased to observe as under:
24. There is no dispute that Section 34 of the Arbitration Act limits a challenge to an award only on the grounds provided therein or as interpreted by various Courts. We need to be cognizant of the fact that arbitral awards should not be interfered with in a casual and cavalier manner, unless the Court comes to a conclusion that the perversity of the award goes to the root of the Digitally signed by VINEETA GOYAL VINEETA Date:
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matter without there being a possibility of alternative interpretation which may sustain the arbitral award. Section 34 is different in its approach and cannot be equated with a normal appellate jurisdiction. The mandate under Section 34 is to respect the finality of the arbitral award and the party autonomy to get their dispute adjudicated by an alternative forum as provided under the law. If the Courts were to interfere with the arbitral award in the usual course on factual aspects, then the commercial wisdom behind opting for alternate dispute resolution would stand frustrated.
6.7 In Dyna Technologies Pvt Ltd (supra), Hon'ble Apex Court has also observed that the Court should not interfere with an award merely because an alternate view on facts and interpretation of contract exists and the Courts need to be cautious and should defer to the view taken by the Arbitral Tribunal, even if, the reasoning provided in the award is implied unless such award portrayed perversity unpardonable under Section 34 of the Act.
6.8 In case of Parse Kente Collieries Ltd Vs. Rajasthan Rajya Vidut Utpadan Nigam Ltd, (2019) 7 SCC 236, Hon'ble Apex Court has reiterated that a possible view by the Arbitrator on facts has necessarily to pass muster as Arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon when he delivers his arbitral award. Hon'ble Court has also observed that an award based on little evidence or no evidence, which does not measure up the quality to the trained legal mind would be held to be invalid on this Court.
Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:33:32 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 16 of 24 6.9 In case of K Sugarmar & Anr v/s Hindustan Petroleum Corporation Limited & Anr (2020) 12 SCC 539 , Hon'ble Court observed that the contours of powers of the court under Section 34 of the Act are too well established to require any reiteration and even a bare reading of Section 34 of the Act indicates the highly constricted power of the Civil Court to interfere with an arbitral award. It is further held that reason for this is obvious as when parties have chosen to avail an alternative mechanism for dispute resolution, then they must be left to reconcile themselves to the wisdom of the decision of arbitrator and role of the court should be restricted to bare minimum.
6.10 Hon'ble Apex Court in case of UHM Power Company Limited v/s State of Himachal Pradesh 2022 (4) SCC 116 reiterates that under Section 34 of the Act, the court cannot re-
appreciate the findings returned by Ld. Arbitral Tribunal and take up different view in respect of interpretation of relevant clauses of the agreement between the parties. The Court cannot act as a Court of appeal and the power confers under Section 34 of the Act are fairly limited.
6.11 The law is well settled by Hon'ble Higher Courts that the scope of interference is limited and narrow. The Court cannot sit in appeal while adjudicating the challenges to an award, which is passed by an Arbitrator, who is master of evidence, after consideration of facts, circumstances, evidence and material Digitally signed by VINEETA GOYAL VINEETA Date:
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before him.
7 Reverting back to the case in hand, the first set of
grounds raised by the petitioner is that the Ld. Arbitrator has neither considered material evidences nor permitted the petitioner to effectively cross-examine the witness of the respondent. Needless to say, it may be noted that except this bald assertion made by the petitioner there is nothing on record to substantiate the same. On examination of impugned award, it is evident that the Ld. Arbitrator has examined the contentions raised by both the parties and has thoroughly examined the evidence relied upon by the parties. Furthermore, the Ld. Arbitrator has relied upon the examination and cross-examination of the statements of the witnesses presented during the course of the arbitral proceedings to establish the reasoning on which the impugned award is passed. The Ld. Arbitrator has demarked the impugned award in various segments encompassing the averments relied by the disputing parties in their Statement of Claim, Statement of Defence, counter-claim and allied pleadings therefore, it is to be noted that the Ld. Arbitrator has duly considered the pleadings of the parties.
8 The next ground as raised by the petitioner that the respondent has sub-contracted the work to Sh. Anuj Kumar, it is evident that Ld. Arbitrator dealt with this issue observing that Sh. Anuj Kumar was employed by the respondent in limited capacity which was permitted in the tender contract. The Ld. Arbitrator Digitally signed by VINEETA VINEETA GOYAL Date:
GOYAL 2025.05.17 17:34:46 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 18 of 24 further considered that the claim of the petitioner that alleged substantial monies were paid to this Sh. Anuj Kumar on the alleged threat of suspension of work at the site, in such a case the Ld. Arbitrator has held that the petitioner should have relied on other remedies and the grievance of non-payment to Sh. Anuj is the dispute between respondent and Sh. Anuj not the petitioner. Ld. Arbitrator has given justification in not holding that the work contract was sub-contracted and no infirmity is found on this issue. The findings recorded by Ld. Arbitrator therein or supported by cogent reasoning. The detailed justification given is as under:-
"21(xi)......The only dispute remained regarding the balance amount. The respondent has avoided to pay this amount and take a flimsy ground that the claimant has sub contracted the contract to Mr. Anuj. However, the true facts are that Mr. Anuj was hired by the claimant as transporter and his duties were to provide transpiration vehicles which was permissible under the tender floated by the respondent. The claimant drew my attention towards clause 17 of the special conditions of the contract. The contention of the respondent that the claimant has sublet the contract to Anuj is without any foundation or basis. The claimant's witness clearly stated that Mr. Anuj was hired only to provide transportation vehicles. He was not awarded the contract by the claimant and in case the respondents were aggrieved they should have cancelled the contract as per the provisions of the tender but at no point of time the contract was cancelled;
........
24........First of all, there is no evidence, documentary or otherwise to establish that Mr. Anuj was sub-contracted by the claimant. The respondent has only submitted an email from one Mr. Anuj and only was sublet to Mr. Anuj. The claimant has specifically denied that they sublet the contract to Mr. Anuj. On the contrary, they stated that Anuj was engaged as transporter and that was in consonance with the terms and conditions of the tender. Under this situation the burden was on the respondents to prove that the contract Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:34:53 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 19 of 24 was sublet to Mr. Anuj which they have failed to prove by any documentary or oral evidence. Hence, it cannot be accepted that the contract was sublet to Mr. Anuj. Mr. Anuj if has any right to claim the remaining amount, he can do so from the claimant only and not with the any other person either respondent or NPGCL officials and if Mr. Anuj was intimidating or threatening to stop work at site, the only recourse available to NPGCL officials to take legal action against Mr. Anuj including the criminal action but the NPGCL officials has no authority to make payment to Mr. Anuj. They have no privity of contract with Mr. Anuj. Even the respondent's has also no privity of contract with Mr. Anuj and any payment by the NPGCL officials and adjustment of the same from respondent's bill will not absolve the respondents from making payment to the claimant. Respondents cannot withhold payment of the claimant on the above said ground."
9 After considering the sound reasoning given by the Ld. Arbitrator as above, there are no apparent merits in this ground.
10 Further, it has been contended by the petitioner that the Ld. Arbitrator has dismissed the counter-claim of the petitioner. This issue has been thoroughly dealt by Ld. Arbitrator in the impugned award, an inference has been drawn to the documents relied by the petitioner showing two payments for two rakes to East-Railway but this was not corroborated by any evidence that reveals that these payments are related to the work of the respondent and this issue was barred by limitation. The Ld. Arbitrator further intricately dealt the issue of alleged monies paid to Sh. Anuj Kumar. The relevant part of the impugned award is as under:- Digitally signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:35:00 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 20 of 24 "31. I am unable to accept the contention raised by the Ld. Counsel for the respondent. So far as the demurrage charges are concerned, the respondent has claimed demurrage charges for two rakes from whom the claimant lifted the material. The respondent has only filed a document showing payment of Rs.5,39,023/- for one rake and 23,76,988/- for second rake to East railway but the respondent has not filed any documentary evidence to show that these demurrage charges were paid to the railway in respect to the rakes carrying the equipment of respondents which were to be lifted by the claimant from the railway siding. Mere payment of some amount to railway will not establish the liability of the claimant. The respondent should have filed detailed documentary evidence available with them in respect to the demurrage charges and that such charges are related with the work contract done by the claimant. The respondent has miserably failed to establish these payments of demurrage charges with the work done by the claimant. Further, if such was the position and the respondent paid demurrage charges then why they were not claimed immediately after the said payment. By this time, the total amount of work done of Rs. 32,03,480/- was lying with the respondent and the respondent could have easily adjusted the said amount from the claimant's bill but on the contrary, part payment of Rs. 18,33,220/- was made 21.03.2015 long after the payment of demurrage charges by the respondent to the railway authorities which clearly shows that the demurrage charges were not related to the work done by the claimant. The respondent further alleged that NPGCLL made payment to Mr. Anuj for an amount of Rs. 19,80,849/-. The respondent never asked the NPGCLL authorities to adjust demurrage charges from the amount alleged to be paid to Mr. Anuj. Thus, the respondent has miserably failed to establish that these demurrage charges were related to the work done by the claimant and respondents are not entitled to claim this amount from the claimant. So far as the right of the respondent to recover this amount from the claimant is concerned, admittedly the amount was paid by the respondent to the railway authorities in 2014 itself and raising of this amount by way of counter claim during the arbitral proceedings for the first time clearly takes away the right from them as their right to claim is hopelessly barred by the limitation. In order to save the limitation, the respondent should have claimed the amount from the claimant within three years from the date Digitally signed by VINEETA GOYAL VINEETA Date:
GOYAL 2025.05.17
17:35:19
+0530
OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 21 of 24
of payment which they have failed to claim. Neither this amount was ever acknowledged by the claimant any point of time. Hence, the claim of the respondent in respect of demurrage charges is disallowed.
32. So far as the surplus amount to Mr. Anuj is concerned, as I have discussed this issue while deciding the issue No.1 that the respondent of NPGCLL have no privity of contract with Mr. Anuj and this fact is fully admitted by the respondent's witness also and any payment to Mr. Anuj will not absolve the respondent from their liability of remaining transportation charges to claimant. Thus, when the payment of any amount by NPGCLL to Anuj will not help the respondent in avoiding the payment to claimant any surplus amount paid by the NPGCLL to Mr. Anuj will not give any right to respondent to claim such amount from the claimant.
The respondent has also failed to prove by any documentary or oral evidence that the payment by NPGCLL authorities to Mr. Anuj was related to work contract of claimant. The NPGCLL authorities informed the respondent that Mr. Anuj has submitted documents to claim the amount of the work done by him in respect of the work allotted to claimant and it was the duty of respondent to procure such documents from the NPGCLL authorities and to file them in the arbitral proceedings to establish that the payment to Mr. Anuj was done only in respect of the work contract allotted to claimant. The failure of respondent to file such evidence clearly proves that either the amount to Mr. Anuj was in respect of any other work done by Mr. Anuj or such amount was ever debited from the running bills of the respondent and the respondent has miserably failed to establish that the payment to Anuj was in respect of the work contract related to the claimant. The respondent also failed to show why surplus amount was paid to Mr. Anuj. Admittedly, respondents have already paid an amount of Rs. 18,30,220/- and only an amount of Rs. 13,73,260/- remained unpaid towards transportation charges then without confirming the amount from the respondent the payment of amount by NPGCLL authorities which was admittedly surplus the amount of work done by the claimant. The respondent cannot claim this amount from the claimant. On the contrary, they should have asked the NGCL authorities not to debit this amount from their running bills and if any such amount debited from their bill amount they should have taken appropriate action against the NPGCLL authorises for recovery of such amountDigitally but in signed by VINEETA VINEETA GOYAL GOYAL Date:
2025.05.17 17:35:26 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 22 of 24 no case they can claim from the claimant. Thus, from the above discussion it is clear that the respondents have failed to establish that the demurrage charges were paid to the railway authority were in respect of work contract executed with the claimant and the said claim is also barred by limitation and so far as the surplus amount as alleged to have been paid by NPGCLL to Mr. Anuj is concerned the respondent cannot claim the same from the respondent. Both the issues are decided against the respondent."
11 It is no more res-integra that the findings of Ld. Arbitrator based on appreciation of facts warrants no interference until unless these are shown to be based on non-existing facts. In the present case, Ld. Arbitrator has carefully examined the evidence adduced by the parties.
12 The next ground raised by the petitioner pertaining to the contradiction in reasoning in the impugned award and suggestive remarks of the Ld. Arbitrator. This impugned award on this ground warrants no interference since on the holistic reading of the impugned award, the Ld. Arbitrator while dealing with the facts and the scenarios as averred by the parties in an attempt to judiciously adjudicate on merit examined all the probability including taking the averment as relied by the parties to be completely true while discussing each scenario and disposing them accordingly. This grievance of the petitioner stems from the issue concerning Sh. Anuj and the claims as raised by the petitioner, thereafter to dispose this claim the Ld. Arbitrator entertained the claim of the petitioner if true and observed that in such a case the petitioner should have relied on other efficacious Digitally signed by VINEETA VINEETA GOYAL Date:
GOYAL 2025.05.17 17:35:33 +0530 OMP (COMM) 21/23 Bharat Heavy Electricals Ltd. vs. Sarr Freight Corporation Page 23 of 24 remedy rather than succumbing to the alleged threats. This reasoning of the Ld. Arbitrator is neither in contravention to the arbitral award nor suggestive in nature, therefore, the impugned award warrants no interference based on this ground.
13 It is well settled that re-appreciation of evidence is not within the forte of this Court under Section 34 of the Act and the Court cannot substitute own evaluation of law and fact to come to conclusion other than that of Ld. Arbitrator, as per law made on in the precedent illustrated hereinabove. Appropriately guided by the judgments (supra), this Court again reiterate that the Ld. Arbitrator is the ultimate master of the quantity and quality of evidence being relied upon by the parties. That being the case, this Court cannot re-appreciate the the evidence on record and then applying its mind and returned the findings as to whether the conclusions, which have been arrived at by the Ld. Arbitrator are correct or not. Accordingly, in view of above discussion, this Court is of considered view that there are no merits in the petition and hence the same is dismissed. Parties are left to bear their own costs.
14 File be consigned to Record Room.
Digitally signed by VINEETA VINEETA GOYAL
GOYAL Date:
2025.05.17
17:35:41 +0530
Pronounced in the open Court (VINEETA GOYAL)
on 17th May, 2025 District Judge (Commercial-03)
Patiala House, New Delhi
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