Delhi District Court
Delhi Development Authority vs M/S Narain Dass R. Israni on 18 April, 2011
IN THE COURT OF SHRI VIJAY KUMAR DAHIYA
ADDL. DISTRICT JUDGEII, ROHINI COURTS, DELHI
CS No. 2537/09
IN THE MATTER OF:
Delhi Development Authority
RPD2/DDA, DDA Office Complex,
Sector3, Rohini,
Delhi110085. .........Appellant
Versus
1. M/s Narain Dass R. Israni,
9, Asiad Village Complex
New Delhi110049.
2. Sh. Pramod Kumar, Arbitrator
5300, Chandrawal Road,
Old Subzi Mandi,
Delhi110007. ..........Respondents
Date of Institution the suit : 09.11.2009
Date on which the order was reserved : 30.03.2011
Date of decision : 18.04.2011
JUDGMENT
Vide this judgment I shall dispose off this petition filed against the above mentioned respondent by petitioner U/s 34 of CS no. 2537/09 Page no. 1 of 32 the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act). It is directed against the award passed by the Ld. Sole Arbitrator by reference made in terms of agreement/contract allegedly executed between the parties. The petitioner has assailed upon the award passed by the Ld. Sole Arbitrator in the ground that Ld. Arbitrator has passed the award by misrepresenting the evidence placed on record. Award passed by the Ld. Sole Arbitrator is pleaded to be set aside.
1. Brief facts, in nutshell, as alleged by the petitioner are that tender/contract was awarded to the respondent vide letter dated 12.09.1997 (Ex. C1/4), but the work could not be completed within stipulated period of time and the extension of time was granted upto 18.09.1999 vide letter dated 24.09.1999. The bill was finalized but it was alleged by respondent that petitioner withheld the amount on one pretext or the other. In the claim statement the petitioner is alleged to have withheld Rs. 350/ per flat for civil work and Rs. 225/ per flat of electrical CS no. 2537/09 Page no. 2 of 32 work for construction of flats. Petitioner is further alleged to have compelled the respondent to execute the supplementary agreement to the main agreement and the petitioner is stated to have not released the amount for the work in terms of the supplementary agreement. Dispute raised between the parties and the respondent/claimant invoked clause 29 of agreement and Sh. Ravindra, Superintendent Engineer, was appointed as Ld. Sole Arbitrator vide letter dated 30.11.2000 and out of 18 claims 6 were referred to the Ld. Sole Arbitrator. Thereafter, Sh. Ravindra, Ld. Sole Arbitrator was promoted as Chief Engineer and he resigned as Arbitrator. Thereafter, Sh. S.K. Sinha was appointed as Ld. Arbitrator, thereafter, Sh. S.K. Sinha was promoted as Chief Engineer and he had also submitted his resignation as Arbitrator. Therefore, Sh. Pramod Kumar was appointed as Ld. Arbitrator.
2. The petitioner/nonclaimant filed the counter claim/reply CS no. 2537/09 Page no. 3 of 32 and thereafter, claimant/respondent moved an application for amendment of claim statement U/s 23(3) of the Act. The petitioner filed reply and the said application for amendment was allowed by the Ld. Arbitrator and amended claim statement was placed on record and after conclusion of arbitral proceedings, the award has been passed, which has been challenged by the petitioner.
3. It has been submitted by the petitioner that the Ld. Arbitrator has awarded an amount of Rs. 5,10,089/ against the original claim of Rs. 90,515/ and without seeking any amendment of claim statement, grant of such enhanced claim is not sustainable in the eyes of law and the Ld. Arbitrator has misconducted the arbitral proceedings. It has been further contended that the Ld. Arbitrator has awarded an amount of Rs. 2,34,593/ under claim no. 3 i.e. construction of stageI BlockA13 whereas no such construction or demolition of CS no. 2537/09 Page no. 4 of 32 stageI of Block A13 was ever carried out by the claimant/respondent as stage I of Block A13 was already constructed by the earlier contractor but the work after stageI this Block A13 was to be left, as high tension wire was passing over this block; but this hindrance of high tension wire was removed in 1998 as disclosed in hindrance register maintained by the petitioner. So the further work of Block A13 has been executed by the respondent after stageI. So respondent is not entitled for any amount for construction of the stageI of Block A13 and Ld. Arbitrator has granted payment for reconstruction of stageI of block A13. So this award is patently illegality as well as against the public policy, as such is liable to be set aside.
4. It has been further contended by the Ld. counsel for the petitioner that Ld. Arbitrator has wrongly allowed the claim of Rs. 1,21,173/ under claim no. 4. The claimant/respondent was CS no. 2537/09 Page no. 5 of 32 supposed to complete the construction in terms of drawing and specification which was the part of the agreement. As per general practice being followed in DDA housing projects also, the S.C.I. pipes/fittings connections of kitchen and bath room at Ground Floor flats are made in the house man hole through the Gali traps and for W.C. the connection is made directly to the House Manhole. The same system has been followed at site by the respondent no. 1, during the execution of the work, hence no additional payment is to be paid to the respondent, the Ld. Arbitrator had allowed the additional payment to the respondent no. 1, without appreciating these facts, hence the claim no. 4 allowed by the Arbitrator is liable to be dismissed. The original claim of the claimant for Rs. 8,20,600/ was enhanced to Rs. 13,20,600/ and by allowing the respondent to enhance the amount of the claim, the Ld. Arbitrator has travelled beyond his jurisdiction.
CS no. 2537/09 Page no. 6 of 32
5. It has been further contended by the petitioner that respondent/claimant has prayed for interest @ 18% p.a. with quarterly rest and the Ld. Arbitrator had granted interest @ 10% p.a. on claim no. 1, 3 & 4 which is not sustainable in the eyes of law. So there is no question for grant of any interest to the respondent/claimant. The delay in conclusion of arbitral proceedings is attributable to the respondent so there is no question of grant of any interest.
6. On the notice of petition appearance was caused by the respondent who has filed the detailed and apprehensive reply of the averments and facts of the above said petition U/s 34 of the Act. It is pleaded at the instance of respondent that petition filed by the petitioner merits dismissal as it does not conform to the section 34 of the Act. It has been submitted that no ground is made out by the petitioner as to how the award is illegal. The Ld. Arbitrator has passed the award after CS no. 2537/09 Page no. 7 of 32 appreciation of evidence and allowed the claim no. 1, 3 & 4 along with interest @ 10%. It has been further contended that delay in conclusion of arbitral proceedings is attributable to the petitioner as it was within the sole discretion of the petitioner to appoint the arbitrator for conduct of arbitral proceedings. It has been further contended that grant of claim under claim no. 3 is legal as the contract was granted for lump sum cost and stageI of Block A13 was disclosed in Annexure 'V' appended with agreement/contract. It has been further contended that at page no. 205 of the agreement/contract it has been mentioned that stageI of Block A13 has been wrongly constructed by the earlier contractor and further at page no. 133 of this agreement payment of Rs. 2,34,593/ for stageI of Block A13 was include in this lump sum contract. The respondent completed entire work regarding stage I Block A
13. So the Ld. Arbitrator has rightly allowed the claim no. 3. It CS no. 2537/09 Page no. 8 of 32 has been further contended that claimant/respondent had executed the work as per agreement and the Ld. Arbitrator had rightly allowed the additional payment under claim no. 4 as per the terms and conditions of agreement the whole of waste water was to be disposed off by single pipe stack system by making necessary connection for waste water in the flat and by connecting the same with the single vertical main piper/stack. It has been further contended that the contention of the petitioner is contrary to stipulations contained in the agreement/contract for providing double pipe stack system i.e. one stack of 100 mm dia. SCI pipe for soil waste disposal from WC and other stack of 75 mm dia. SCI pipe for disposal of waste from the toilets, wash basin and kitchen. It is submitted that the claimants/respondents executed the work as per the said directions and approval of the concerned authority of the petitioner herein and incurred as expense of Rs. 14,40,872/.
CS no. 2537/09 Page no. 9 of 32 The claim which was initially filed for Rs. 8,20,600/ had been amended and claim for a sum of Rs. 13,20,600/ was sought. It is submitted that the Ld. Sole Arbitrator examined the said claim, perused the documents filed on record as well as the National Building Code of India 2005 and awarded a sum of Rs. 1,21,173/ as against the said claim for the extra work carried out by the respondent/claimant for the ground floor flats. So this claim has been allowed by the Ld. Arbitrator by appreciating the evidence and terms and condition of the agreement.
7. It has been further contended as per the provision of the Act the Ld. Arbitrator is empowered to grant @ 18% of interest but only 10 % interest has been granted by the Ld. Arbitrator. So there is no illegality in award passed by the Ld. Sole Arbitrator which may be granted U/s 34 of the Act.
8. Before considering merits of the petition, it would be CS no. 2537/09 Page no. 10 of 32 appropriate to analyze the scope of intervention of the courts, in the process of alternative dispute resolution mechanism coined and adopted by the parties. It is a settled proposition of law that the courts established by law are formal disputes resolution mechanism, should minimum interfere in the alternative disputes/resolution mechanism adopted by the parties. It had been observed by the Apex Court in catena of judgments that the courts cannot examine an awards passed by the Ld. Arbitrator, as a Court of Appeal and thus, cannot go into reappraise the documents, pleadings and evidence led before the Ld. Arbitrator. Since, the arbitration is a dispute resolution mechanism evolved by the parties at the time of entering into a contract, the sanctity has to be given to it. The perusal of scheme of the Act also endorses the aforesaid view being expressed by the Courts, reserving themselves with a mandate of minimum interference to the arbitral proceedings CS no. 2537/09 Page no. 11 of 32 and awards, as the Forum was elected by the parties. Section 5 of the Act specifically envisages the scope of judicial intervention during the process of arbitral proceedings, which reads as under: "5. Extent of judicial intervention Notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part."
9. Part 1 of the Act deals with arbitration and narrates scope in which the court could intervene. Section 8 envisages an eventuality, when a suit is brought before the judicial authority, which is a subject matter of arbitration agreement, on application by one of the parties before submitting his first statement on substance of dispute, the judicial authority may refer the parties for arbitration. Likewise, the court may pass interim orders/directions to save corpus which is a subject matter of arbitration agreement between the parties or may pass such interim directions as envisaged in Section 9 of the CS no. 2537/09 Page no. 12 of 32 Act. Likewise, in event, the parties fail to appoint arbitrator in terms of agreement, the Chief Justice or any person or institution designated by him to take necessary measures for securing appointment of arbitrator. Further perusal of scheme of the Act spells out the procedure seeking setting aside of awards under Section 34 of the Act, where the judicial authority/courts can interfere/intervene in awards passed by the Ld. Arbitrator, leaving aside the grounds arising under Section 13(5) and 16(6) which de hors Section 34 of the Act, the grounds for setting aside of awards set out in Section 34 of the Act are exhaustive. Careful perusal of SubClause 2 of Section 34 of the Act which opens with words "An arbitral awards may be set aside by the court only if (emphasis supplied). The phrase "only if" in Section 34 (2) of the Act manifests the legislative intent, which restricted the grounds for setting aside the awards passed by the Ld. Arbitrator only in circumstances CS no. 2537/09 Page no. 13 of 32 narrated therein. The aforesaid view is fortified in view of the view expressed by their Lordships in Government of NCT Vs. Khem Chand reported at 2003 (2) RAJ 437 (DEL), where it was observed that leaving aside the grounds arising under Section 13(5) and 16(6), which de hors Section 34, the ground for setting aside awards set out in Section 34 are exhaustive. It was observed by their Lordships in Union of India Vs. Bharat Builders 2002 (2) RAJ 576 (DEL) where their Lordships scribed the scope of the jurisdiction of the Court as under:
(a) unless party succeeds in establishing any ingredient of Section 34 does not entitle subvert of awards.
(b) Court does not sit in Appeal nor required to re appreciate or reassess or revaluate the documents/material placed before Ld. Arbitrator.
(c) Even if erroneous view has been taken by the Arbitrator in respect of finding of fact of ingredient of term and clauses of Agreement, the Court should be reluctant to interfere until or unless perversity or nonapplicant of mind or error is writ large on the fact of awards.
The Hon'ble Supreme Court further analyzed in detail the scope of CS no. 2537/09 Page no. 14 of 32 powers of the Courts under Section 34 of the Act, in case title ONGC Vs,, Saw Pipes Limited reported at AIR 2003 (SC) 2629 as under: "(1) The court can set aside the arbitral awards under S.34(2) of the Act if 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, 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 awards deals with a dispute not contemplated by or not falling within the terms of the submissions to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration.
(2) The Court may set aside the awards :
(i) (a) if the composition of the arbitral Tribunal was not in accordance with the agreement of the parties,
(b) failing such agreement, the composition of the arbitral Tribunal was not in accordance with Part 1 of the Act.
(3) If the arbitral procedure was not in accordance with:
(a) The agreement of the parties, or
(b) failing such agreement, the arbitral procedure was not in accordance with Part 1 of the Act. However, CS no. 2537/09 Page no. 15 of 32 exception for setting aside the awards on the ground of composition of arbitral Tribunal or illegality of arbitral procedure is that the agreement should not be in conflict with the provisions of Part 1 of the Act from which parties can not derogate.
(c) If the awards passed by the arbitral Tribunal is in contravention of provisions of the Act or any other substantive law governing the parties or is against the terms of the contract.
(4) The awards could be set aside if it is against the public policy of India, that is to say, if it is contrary to
(a) Fundamental policy of India law;
(b) the interest of India; or
(c) justice or morality; or
(d) if it is patently illegal.
(4) It could be challenged:
(a)As provided under S. 13(5); and S. 16(6) of the Act.
10. From the aforesaid analysis of law made by the Hon'ble Courts, it is incumbent duty of the petitioner to bring his case within the four corners of Section 34 (2) of the Act so as to persuade the court to set aside the award. In the back drop of this discussion, let us examine the grounds taken by the petitioner to get the award set aside.
11. First and foremost ground to impugn the award on the CS no. 2537/09 Page no. 16 of 32 claim no. 1 is that the arbitrator has allowed escalation under clause 10 CC and the extra amount of Rs. 23,710/ has been wrongly awarded by the Ld. Arbitrator. In written submission filed by the respondent, the respondent in reply on merits in para no. 1 has admitted that on account of factual error the award against the claim no. 1 is awarded for a sum of Rs. 5,10,089/ whereas correct figure is Rs. 4,86, 339/. So in view of the admission of claimant/respondent that the Ld. Arbitrator has wrongly awarded an amount of Rs. 2,37,01/. Claim no. 1 is modified to the extent of Rs. 2,37,01/ . Therefore respondent is only entitled for Rs. 4,86,339/ under claim no. 1.
12. Second, contention of the petitioner is that the Block A13 was constructed upto stageI as detailed in page 205 of the agreement was carried out by the earlier agency and not by the respondent/claimant. The question regarding the payment of stageI, construction of block A13 was never raised by the CS no. 2537/09 Page no. 17 of 32 respondent/claimant during entire period of progress of work and even the respondent is not claiming any amount for dismentaling or demolishing stageI of block A13. This second contention raised by the claimant, seeking setting aside of the award is that the Ld. Arbitrator has executed its jurisdiction while making an award in respect of work which has not been executed by the respondent, but had been executed by some other contractor, whom the work had been awarded originally. To fortify his submissions in this regard, the Ld. counsel for the representing the petitioner drew attention of this court towards bill of quantities, where the scope of work to be executed by respondent to be indicated in the aforesaid bill of quantities. It has been stated that the brick work of stageI had been executed by the other agency, which was in existence on the site at the time of award of the contract work to the respondent. The contention of the petitioner has vehemently CS no. 2537/09 Page no. 18 of 32 opposed by the respondent stating that the petitioner misconceived while making aforesaid submissions. It is contended at the instance of respondent that work was awarded to the respondent agency on lump sum basis, narrating exhaustively the scope of work to be executed by the respondent. To facilitate the payment to the respondent stages has been fixed. It is contended that once the work is completed to the satisfaction of the petitioner in a lump sum contract, there is no plea available with the petitioner to seek discount on the pretext of nonexecution of any item of work awarded to the agency. The arguments are further extended by the respondent by making submission that it is not the clause of petitioner that respondent has not completed the work. Further, no notice of any deficiencies or defect was appointed to respondent by the petitioner. In such circumstances, there was no jurisdiction with the petitioner to CS no. 2537/09 Page no. 19 of 32 make deduction from the bills raised by the respondent.
13. It is submitted by the respondent that amount withheld by the petitioner are unjustified, in terms of contract, as such the Ld. Arbitrator was justified in making this award and this plea raised by the petitioner as to the exceeding jurisdiction by the Ld. Arbitrator is misconceived and unfounded. But this contention of the petitioner appears to be fallacious as contract was awarded to the claimant/respondent for Rs. 17,32,26,219/ in lump sum. The relevant para of agreement at page no. 13 is reproduced here under:
"The lump sum cost will cover the cost of constructions of houses including water supply, sanitary installation, electrifications and Internal Development work i.e. sewerage, water supply, roads and drainage, electrifications, development of parks.
The contractor shall quote the plinth area rate for the balance work to be executed at site. While tending the tenderer should take into account the cost of the work to be executed to bring the incomplete stage to the succeeding stage, (in tentative schedule of CS no. 2537/09 Page no. 20 of 32 quantities is enclosed as per Annexure IVA) and cost of Minor work already done above the stages by earlier agency. (Tentative schedule of quantities enclosed as per Annexure IVB) and, rectification of defects in the existing work excited by original agency, all the balance electrical civil work left out by the previous agency and the rectification of defects in Electrical and Civil Work. Detailed blockwise position of the civil work is given as per Annexure X and position of Electrical work executed is enclosed as per Annexure XI."
and the details of blocks for AnnexureV appended to this contract for which work is to be done is reproduced as under:
"TypeA: Block No. 12, 13, 18, 24, 28, 36, 54, 58, 64 = 9 Nos."
further the details of total payment and further as per AnnexureX appended to this contract block wise existing position at site qua stageI block A13 is as under:
"A13 StageI executed but withheld due to wrong construction. The block should not be taken up due to H.T. Line over it."
CS no. 2537/09 Page no. 21 of 32 On conjoint reading of above said terms and conditions with regard to the payment of lump sum cost which includes the payment of work to be done by the respondent/claimant, it is clear that respondent was granted the above said contract for lump sum amount which includes not only work to be done by the respondent/claimant but also the remaining work left by the earlier agency. The details as mentioned in Annexure X regarding blockA13, clearly depicts stageI of Block A13 was already completed and from that stage onwards was to be completed by the respondent/claimant. The Ld. Arbitrator has also taken into consideration all these terms and condition before allowing the claim no. 3 . Apart from this, these findings of fact are recorded by the Ld. Arbitrator by appreciating the evidence on record and can not be interfered.
I have thoughtfully considered the rival contention of the petitioner. I do not find in agreement myself with the petitioner.
CS no. 2537/09 Page no. 22 of 32 At the very outset, scope of Section 34 of the Act does not confers me qua jurisdiction to reappraise the evidence as led by the parties before the Ld. Arbitrator as the court of appeal. It confer me with limited jurisdiction in terms of Section 34 of the Act. If any of the ground set out in Section 34 of the Act is made out, this court may venture to set aside the award.
Further more, I find favour with the contention raised by the counsel for the respondent that in lump sum contract, if the petitioner has accepted the completion of work, in that circumstances, it does not lie in the mount of the petitioner to say that the respondent is not entitled for the payment on account of nonexecution of work which the respondent was obliged to do under the contract.
14. The another objection of the petitioner qua claim no. 4 is that as per Sr. No. 1 of the "General Conditions" at page no. 9 of the agreement it was stipulated that this agreement shall CS no. 2537/09 Page no. 23 of 32 cover the balance building work including internal water supply, sanitary installations, drains, internal electrification, internal development work of pocket up to the periphery including development parks of pocket. It has been further provided that in case, the drawing and description of scope of work are silent on any item necessary to complete the houses and make them functional, the scope of work/specifications adopted in respect of C/o MIG houses, Scheme R38, Secotr 18, Rohini, Shall be adopted for which nothing extra shall be paid. So the claimants/respondents have completed the work as per drawings and descriptions of scope of work and even if, in case, the said description/drawing are silent on any item the petitioner shall not pay any extra amount to the claimant/respondent. Therefore, claimants are not entitled for any payment on account of connection of pipes of bathroom of the flats at ground floor.
CS no. 2537/09 Page no. 24 of 32
15. Per contra, it has been contended by the Ld. counsel for the respondent/claimant that as per drawing issued by the petitioner double pipe system was provided at site for upper floor houses and in the contract under the head "specifications" a condition no. 5.0/5.1 is provided which clearly specify that if specifications for any item is not available, C.P.W.D specification shall be followed and as per C.P.W.D specification the waste water from ground floor bathroom is to be directly connected with two pipe system provided at site for upper floor houses. But on the direction of the petitioner, the respondent has made special arrangement for disposal of waste water for ground floor flats, so this claim has rightly been allowed by the Ld. Arbitrator.
16. But the contention raised by the petitioner pertains to the purely finding of facts which was recorded by the Ld. Arbitrator after going through the terms and conditions of the contract CS no. 2537/09 Page no. 25 of 32 including drawings/specifications and appreciation of evidence. The Ld. Arbitrator has observed that the special arrangement for disposal of waste water from ground floor flat was same in sample flats as provided for floors above ground floor in terms of the approved drawings/specification. But the representative of the petitioner directed the respondent/claimant to provide the special arrangement for waste water of ground floor flats. The Ld. Arbitrator has further observed that the petitioner has not controverted the amount of Rs. 1,30,494/ for extra pipes and fittings for disposal of waste water for ground floor flats except the numbers of flats which was respondent/claimant was claiming as 196 whereas petitioner had calculated the number of flats as 182. Therefore, findings recorded on the above said claim no. 4 is purely based on the findings of facts recorded by the Ld. Arbitrator and it is settled law that this court is not to sit as a court of appeal and go for reappraisal of evidence.
CS no. 2537/09 Page no. 26 of 32 Therefore, this objection of the petitioner qua claim no. 4 is not tenable under the provision of 34 of the Act and same is also hereby rejected.
17. Now coming to the last objection of the petitioner that respondent is not entitled for any interest in this regard. Section 31(7) of Arbitration and Conciliation Act, 1996 itself provides for grant of interest. It will be in fitness of things to reproduce the relevant provisions of law in this regard: "(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 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 eighteen per cent per annum from the date of the award to the date of payment."
CS no. 2537/09 Page no. 27 of 32
18. A perusal of this Subclause goes to show that the Act itself empower's the arbitrator to award interest to the extent of 18% per annum. In Indian Tourism Development Corporation Ltd. Vs. Buddiraja Electrical 2003(2) RAJ 216 (Delhi) also, the interest was awarded @ 18% per annum and the same was upheld by Hon'ble High Court. In Bhagwati Oxygen Ltd. Vs. Hindustan Copper Ltd. AIR 2005 SC 2071 the awarding of interest @ 18% per annum was upheld.
19. The judgment titled Secretary Irrigation Department, Govt. of Orissa and Others etc. Vs. G.C. Roy 1992(1) Arbitration Law Reporter, 145 it has been held after discussing the law in detail as follows:
" an arbitrator has jurisdiction to award pendente lite interest where the arbitration agreement so provides but no pendente lite interest can be allowed by the arbitrator if the agreement expressly provides that no pendente lite interest should be allowed. Where there is no express prohibition, such CS no. 2537/09 Page no. 28 of 32 power must be inferred."
20. Para 44 of this judgment titled Secretary Irrigation Department, Govt. of Orissa and Others etc Vs. G.C. Roy (Supra) it has been held that: "Where the agreement between the parties does not prohibit grant of interest and where a party claims interest and that dispute (alongwith the claim for principal amount or independently) is referred to the arbitrator, he shall have the power to award interest pendente lite. This is for the reason that in such a case it must be presumed that interest was an implied term of the agreement between the parties and therefore when the parties refer all their disputes or refer the dispute as to interest as suchto the arbitrator he shall have the power to award interest.
This does not mean that it in every case the arbitrator should necessarily award interest pendente lite. It is a matter within his discretion to be exercised in the light of the case. Keeping the ends of justice in view."
21. Bhagwati Oxygen Ltd. Vs. Hindustan Copper Ltd. (Supra) has discussed with regard to grant of interest at three CS no. 2537/09 Page no. 29 of 32 different stages i.e. prereference, pendente lite and post award interest. The law laid down in Secretary Irrigation Department Govt. of Orissa & Others Vs. G.C. Roy (Supra) has been discussed in para36 of the judgment titled Bhagwati Oxygen Ltd. Vs. Hindustan Copper Ltd. (Supra). It has been discussed regarding non applicability of Section 34 of the Code of Civil Procedure in the following lines: "Now Section 34 of the Code of Civil Procedure has no application to arbitration proceedings since Arbitration can not be said to be a 'court' within the meaning of the Code. But an Arbitration has power and jurisdiction to grant interest for all the three stages provided the rate of interest is reasonable."
22. So far grant of pendente lite interest is concerned, in para38 of this judgment titiled Bhagwati Oxygen Ltd. Vs. Hindustan Copper Ltd. (supra) the grant of pendente lite interest has been upheld.
CS no. 2537/09 Page no. 30 of 32
23. In judgment titled Delhi Development Authority Vs. S.S. Jetley 2001 (1) Arbitration Law Reporter 289 (Delhi) (DB) the award of pre suit and pendete lite interest has been upheld.
24. In view of the various authoritative pronouncements discussed above it is clear that pre reference interest and pendente lite interest can be awarded by the arbitrator.
25. Otherwise, all the objections raised by the petitioner relates to the assessment of award on the basis of reappraisal of the evidence, their quality and evidentiary value of the evidence adduced by the parties during the course of arbitral proceedings which does not fall in domain of this Court while considering objections under Section 34 of the Act as this Court is not vested with powers to assess the awards as a Court of First Appeal.
26. From the above discussions, I am of the conclusion that the objections raised by the petitioner against the award CS no. 2537/09 Page no. 31 of 32 passed in the above said case by the Ld. Arbitrator are devoid of merits. Therefore, this petition is partly allowed qua issue no. 1 to the extent discussed above and all the remaining issues/claims/objections of this petition is hereby dismissed. No order as to cost. File be consigned to Record Room. Announced in the Open Court (VIJAY KUMAR DAHIYA) On this 18.04.2011. ADJII : ROHINI : DELHI CS no. 2537/09 Page no. 32 of 32 CS No. 2537/09 18.04.2011 Present: Ld. counsel for the parties.
Vide separate order this petition is partly allowed qua objection/claim no. 1 and all the remaining issues/claims/objections of this petition is hereby dismissed. No order as to cost. File be consigned to Record Room.
(VIJAY KUMAR DAHIYA) ADJII(NW):ROHINI:DELHI.
18.04.2011.
CS no. 2537/09 Page no. 33 of 32