Delhi District Court
Jagdamba Sales Corporation vs State Gnct Of Delhi And Others on 13 December, 2024
IN THE COURT OF DJ (COMMERCIAL COURT)-11 (CENTRAL): TIS
HAZARI COURTS, DELHI
PRESIDED BY: SH. SANJAY SHARMA-II, DHJS
OMP (Comm.) No. 116/2019
CNR No.: DLCT01-015231-2019
M/s. Jagdamba Sales Corporation
3809, Ram Nath Patwa Street
Paharganj, New Delhi-110005
..... Petitioner
VERSUS
1. State (GNCT of Delhi)
Through: Chief Secretary
Delhi Secretariat, Near Sachivalaya Road
I.G. Indore Stadium, I.P. Estate
Vikram Nagar, New Delhi-110002
2. Director General (Prison)
Prison Headquarter, Near Lajwanti Chowk
Janakpuri, New Delhi
3. The Superintendent (PHQ)
Central Jail, Tihar, New Delhi
..... Respondents
Date of Institution : 19.11.2019
Date of Arguments : 09.12.2024
Date of Judgment : 13.12.2024
JUDGMENT
THE PETITION:
1. The petitioner filed an application under Section 34 of 'The Arbitration and Conciliation Act, 1996 ' (Hereinafter referred to as 'the Act') for setting aside arbitral award dated 17.08.2019 (Hereinafter referred to as 'the impugned award') in Arbitration Petition No. 491/2017 titled as 'M/s. Jagdamba Sales Corporation vs. Director General (Prison) & Anr. ' whereby Ld. sole arbitrator rejected claim 'C' and 'D' of the petitioner.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 1 of 29 CLAIM 'C' AND 'D' OF THE PETITIONER:
2. In the statement of the claims filed by the petitioner, the claim 'C' and 'D' are, as under:
"3. Statement of Relief sought-
That in view of the facts and circumstances enumerated hereinabove, the Claimant humbly prays that this Hon'ble Sole Arbitrator may be pleased to adjudicate upon the matter and direct the respondents to-
(c) refund the Claimant amount Rs. 46,24,950/- (Loss suffered due to increase of price of Marandi Wood).
(d) refund the Claimant the amount of Rs. 4,63,680/-
towards the interest @ 18% per annum on the security of Rs. 10,08,000/- deposited for supply of cancelled order for 200 MT from the date of deposit the security till 17.03.2017 the date on which the security was refunded to the claimant." THE FACTS:
3. The respondent No. 2 issued e-tender dated 14.07.2014, vide Tender ID No. 2014_ CJT_61853_1,2,3,4,5, for supply of items comprised in Group 'A' to 'E' to Carpentry Unit, Central Jail Factory, Central Jail No. 02, Tihar for a period of one year from the date of award of contract ( extendable up to next three months), as under:
Group Goods
'A' M.S. Iron Round Pipe
'B' Marandi Wood
'C' Miscellaneous Items
'D' Refilling of Oxygen Gas Cylinder
'E' Transportation / Labour
4. The petitioner applied for tender for the items comprised in Group 'A' to 'C' and deposited the earnest money, as per terms of tender.
5. The respondents accepted offer of the petitioner, vide letter dated 15.09.2014, and requested him to submit an agreement and deposit security amount i.e. 10% of the total value of contract.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 2 of 29
6. Thereafter, the petitioner entered into an agreement dated 27.09.2014 and deposited the security amount, as under:
Group Goods Amount
'A' M.S. Iron Round Pipe Rs. 50,40,000/-
'B' Marandi Wood Rs. 58,23,000/-
'C' Miscellaneous Items Rs. 3,43,000/-
TOTAL Rs. 1,12,06,000/-
7. Thereafter, the respondents issued six purchase orders dated 21.10.2014, 18.11.2014, 21.01.2015, 12.02.2015, 27.03.2015 and 04.06.2015.
THE CASE OF THE PETITIONER QUA CLAIM 'C':
8. The case of the petitioner was that price of ' marandi wood' increased by Rs. 150 per Cft. w.e.f. July, 2015 and the petitioner supplied 15,000 Cft. + 15,833.10 Cft. (30,833.10 Cft.) 'marandi wood' during July and August, 2015. The petitioner requested the respondents to increase the price of ' marandi wood' from time to time and visited the office of the respondents. In that regard, the petitioner sent letter dated 12.10.2015. However, the respondents did not form the committee to increase price of 'marandi wood', in terms of Clause 12 of ' Terms and Conditions of e-Tender', as under:
"12. Price Escalation Clause :- In case of change in price of items, upwards or downwards, D.G. (Prisons) shall have the right to consider this after framing the committee."
9. Therefore, the petitioner claimed an amount of Rs.
(30,833.10 Cft. X 150) = Rs. 46,24,950/- towards loss suffered by it on account of increase of price of ' marandi wood' by Rs. 150 per Cft. and the respondents must compensate the said loss alongwith pendente-lite and future interest @ 18% per annum.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 3 of 29 THE CASE OF THE PETITIONER QUA CLAIM 'D':
10. The case of the petitioner was that the respondents awarded contract for supply of 10,00,000 Kg. ( 1,000 MT) 'Mild Steel Iron Round Pipe (ERW)' worth Rs. 5,04,00,000/- (without tax) and the petitioner deposited security amount in the sum of Rs. 50,40,000/- @ 10% of the total value of the said item. The petitioner supplied 800 MT 'MS Iron Round Pipe (ERW)'. The respondents extended period of contract for three months, vide letter dated 01.09.2015. However, the respondents did not place order for supply of balance quantity of 200 MT ' MS Iron Round Pipe (ERW)'. The petitioner written letters dated 12.10.2015, 26.10.2015, 27.11.2015, 31.12.2015 and 22.01.2016 to the respondents. The respondents cancelled order of 200 MT ' MS Iron Round Pipe (ERW)', vide letter dated 04.11.2015.
11. The case of the petitioner was that it had deposited security amount of Rs. 50,40,000/- qua total contract value of 1,000 MT 'MS Iron Round Pipe (ERW)'. However, the respondents cancelled order for 200 MT ' MS Iron Round Pipe (ERW)'. Therefore, the petitioner is entitled to an amount of Rs. 4,63,680/- as interest @ 18% per annum on the security deposit of Rs. 10,08,000/- qua 200 MT 'MS Iron Round Pipe (ERW)'. THE IMPUGNED AWARD QUA CLAIM 'C' AND 'D':
12. Ld. arbitrator rejected claim 'C' of the petitioner, as under:
"The Claimant produced letters dated 12.10.2015 (Ex.PW1/13), 26.10.2015 and 01.02.2016 addressed to the Respondent, and the legal notice to support the plea that the rates of the Marandi wood had increased during the subsistence of the contract. No other documents like bills, Account statements etc. were either sent to the Respondent or filed before me with the Pleadings or the documents or produced during evidence to establish the alleged increase in price and the alleged amount on account of escalation of price.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 4 of 29 However, during the arguments, the Claimant produced, some of the bills of purchase of Marandi wood from different suppliers during the period from July, 2015 to December, 2015 along with the Statement of Accounts of different parties and also the VAT Returns confirming the payments of tax leviable against these purchases and total purchase made, the Bank Statements confirming the payments made to the respective sellers along with CA - Certificate.
3. It is pertinent to mention that the Claimant did not produce these documents either with the pleadings or during the evidence as contemplated under section 23 of the Arbitration and Conciliation Act, 1996, but have produced them during the arguments, only a little before the time for publication of award is expiring i.e. 19.08.2019. The documents have been denied by the Respondents. The application filed by the Claimant for production of additional documents and additional evidence during the arguments, did not disclose sufficient grounds for not producing these documents as contemplated under section 23 of the Arbitration and Conciliation Act, 1996. The application dated 23.07.2019 filed by the Claimant was dismissed by me on 29.07.2019. Considering these documents at this stage shall be denial of a reasonable opportunity to the opposite party and will be denial of principles of natural justice.
4. Further, had the DG (Prison) made a committee, the Claimant was required to support its claim with the supporting documents at that stage also. Since the documents cannot be looked into at this stage for the reasons given herein above, the Claim of the Claimant is bereft of any evidence to support the claim.
In view thereof the claim is rejected, and the Respondent is not liable to pay to the Claimant any amount on account of the alleged escalation."
13. Ld. arbitrator rejected claim 'D' of the petitioner, as under:
"1. A perusal of the Clause 14(b) of the Agreement dated 27.09.2014 between the parties shows that:
"Clause 14 (b) of tender document "the quantity prescribed in the tender is tentative & can be increased or decreased by the department, depending upon the necessity/ requirement...".
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 5 of 29
2. Further perusal of the tender document shows that it provides in Clause 21, 22 and 24 as under:
Clause 21: That the quantity prescribed in the tender is tentative & can be increased or decreased by the Department, depending upon the necessity/ requirement. The supply will have to be made strictly as per the schedule given in supply order by the department time to time.
Clause 22: The Jail Authorities reserve the right to requisition the material in part or in full or as per the schedule and no requisition of one or more items in case there is no demand/ budget/unforeseen security threat/law and other problems within Jail/any other extra ordinary situation. The transport cost will be borne by the supplier/contractor based on FOR at Central Jail No. 2 Tihar Delhi.
Clause 24: That the requirement and supply order will be made during the contract period from time to time depending upon the storage facilities, safety measures, movement of vehicles etc. Quantity to be supplied will also be intimated from time to time for all the contract period and also for the any other period agreed in the agreement.
3. It is evident from the terms of the Tender Document, that the intention of the parties to the agreement was that the quantities for supply will be at the discretion of the Respondent. Therefore, even though the tender was for 1000 MT of MS Pipe initially, which could be and was reduced to 800 MT of MS Pipe in the end, which would not have been known to the Respondent at the time of entering into agreement.
4. In these circumstances, the decrease in quantity of the MS pipe was in accordance with the terms of the Tender Document and the Claimant did not have a vested right to get the order of the entire quantity of 1000 MS pipe. In absence of any such right the Respondent had the right to order the desired quantity and the claim of the Claimant for payment of Rs. 4,63,680/- towards interest on security is not sustainable and is therefore rejected."
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 6 of 29 GROUNDS OF CHALLENGE TO IMPUGNED AWARD:
14. The petitioner impugned the arbitral award on the grounds, as under:
(a) The impugned award is against public policy of the State;
(b) Ld. arbitrator exercised judicial discretion with material illegality;
(c) Ld. arbitrator ignored that the petitioner filed bills Ex.PW1/13 and Ex.PW1/14 qua supply and increase of price of 'marandi wood';
(d) Ld. arbitrator failed to appreciate that the respondents never disputed increase of price of 'marandi wood' in their reply or affidavit filed in evidence. The respondents had taken sole defence that the petitioner did not request for formation of a committee to consider increase of price of 'marandi wood'. The respondents' witness also did not state the reason for non-formation of the said committee;
(e) Ld. arbitrator failed to appreciate that the petitioner stated, in his evidence, that price of 'marandi wood' had increased by Rs. 150 per Cft.
from July, 2015 and the petitioner supplied 15,000 + 15,833.10 Cft. 'marandi wood' from July, 2015 to December, 2015 and the petitioner requested the respondents to increase price of 'marandi wood', vide letter dated 12.10.2015. The respondents acknowledged letters dated 12.10.2015, 26.10.2015 and 01.02.2016 written by the petitioner to increase price of 'marandi wood';
(f) Ld. arbitrator failed to appreciate that the respondent No. 2 neither formed committee to consider request of the petitioner to increase price of 'marandi wood' nor sought any proof of increase of price of 'marandi wood' and therefore, there was no occasion for the petitioner to file proof of increase of price of 'marandi wood';
(g) Ld. arbitrator failed to appreciate evidence of the petitioner that it suffered loss of Rs. 46,24,950/- due to increase of price of 'marandi wood';
(h) Ld. arbitrator wrongly rejected application of the petitioner for taking additional documents on record and re-examination of the petitioner's witness;
(i) Ld. arbitrator wrongly rejected claim 'D' of the petitioner on the ground that issuance of purchase order was at the discretion of the respondents;
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 7 of 29
(j) Ld. arbitrator failed to appreciate that the respondents had requirement of the goods comprised in Group 'A' and for that purpose, they invited fresh tender and procured 'MS Iron Round Pipe (ERW)' from other vendor; and
(k) Ld. arbitrator failed to appreciate that the respondents had security deposit qua contract for 200 MT 'MS Iron Round Pipe (ERW)' and they were liable to pay interest on the security amount qua the said quantity.
APPEARANCE:
15. The Court has heard arguments of Mr. R.K. Goel, Ld. Counsel for the petitioner and Ms. Babli Kala, Ld. Counsel for the respondents and perused the arbitral record. CONTENTIONS OF THE PETITIONER:
16. Ld. Counsel for the petitioner contended that Clause 12 of 'Terms and Conditions of e-Tender' provides that 'In case of change in price of items, upwards or downwards, DG (Prisons) shall have the right to consider this after framing the committee '.
He contended that since July, 2015, price of ' marandi wood' increased by Rs. 150 per Cft. He contended that the petitioner supplied 15,000 Cft. + 15,833.10 Cft. (30,833.10 Cft.) 'marandi wood' during July, 2015 to December, 2015. He contended that the petitioner informed the respondent No. 2 regarding increase of price of 'marandi wood', vide letter dated 12.10.2015 Ex.PW1/12. He contended that the respondents acknowledged the said letter, vide letter dated 04.11.2015. He contended that in that regard, the petitioner had written letters dated 26.10.2015 and 01.02.2016. He contended that letter dated 26.10.2015 was also acknowledged, vide letter dated 04.11.2015 and letter dated 01.02.2016 was received by the respondent No. 2. He contended that the respondent No. 2 neither formed a committee to consider request of the petitioner to increase price of ' marandi wood' nor made payment of increased rate of 'marandi wood'.
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17. Ld. Counsel for the petitioner contended that the petitioner filed bills Ex.PW1/14 alongwith affidavit filed in evidence regarding increase of price of 'marandi wood'. However, Ld. arbitrator did not consider the said bills. He contended that Ld. arbitrator rejected an application of the petitioner seeking permission to file additional documents pertaining to deposit of tax against purchases, bank statements regarding payments made to suppliers and CA certificate and as such, the petitioner was deprived from bringing relevant evidence on record. He contended that the respondents have not disputed increase of price of 'marandi wood'. In that regard, he referred cross- examination of the respondents' witness. He contended that the respondents did not furnish any reason for rejecting request of the petitioner for forming a committee to consider increase of price of 'marandi wood'. He contended that the evidence led by the petitioner in respect of his claim regarding increase of price of 'marandi wood' remained unchallenged. He contended that the petitioner also issued a demand notice dated 06.01.2017. However, the respondents, vide reply-notice dated 24.04.2017, merely stated that the request to increase the rates was made for the supplies already made in the month of July and August, 2015. He contended that the petitioner had purchased ' marandi wood' at increased price @ Rs. 150 per Cft. and the petitioner is entitled to an amount in the sum of Rs. 46,24,950/- on account of increase of price of 'marandi wood'. He contended that the petitioner awarded contract for supply of 1,000 MT ' MS Iron Round Pipe (ERW)' and the petitioner deposited security amount of Rs. 50,40,000/- @ 10% of total value of the contract. However, the respondents placed order for supply of 800 MT 'MS Iron Round Pipe (ERW)'.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 9 of 29
18. Ld. Counsel for the petitioner contended that the petitioner did not place order for balance quantity of 200 MT ' MS Iron Round Pipe (ERW)'. He contended that the petitioner requested the respondents, vide letters dated 12.10.2015, 26.10.2015, 27.11.2015, 31.12.2015 and 22.01.2016, to issue purchase order for balance quantity of 200 MT ' MS Iron Round Pipe (ERW)'. However, the respondent No. 2, vide letter dated 04.11.2015, informed the petitioner that his representation for issuance of supply order for balance quantity of 200 MT ' MS Iron Round Pipe (ERW)' was not acceded by the competent authority. He contended that the respondent No. 2 had extended the contract w.e.f. 15.09.2015 to 14.12.2015 and therefore, there was sufficient time for placing an order for supply of balance quantity of 200 MT 'MS Iron Round Pipe (ERW)'. He contended that the petitioner is entitled to an amount of Rs. 4,63,680/- as interest @ 18% per annum on security amount of Rs. 10,08,000/- qua 200 MT 'MS Iron Round Pipe (ERW)' from the date of deposit of the security till 17.03.2017. He contended that the respondents had requirement of the said quantity of 200 MT ' MS Iron Round Pipe (ERW)' and the respondents invited fresh tender and procured 'MS Iron Round Pipe (ERW)'. He contended that the petitioner is entitled to an amount of Rs. 50,88,630/- alongwith pendente-lite and future interest 18% per annum. CONTENTIONS OF THE RESPONDENTS:
19. Ld. Counsel for the respondents contended that this Court has no territorial jurisdiction to hear the application under Section 34 of the Act. She contended that District Courts at West District of Delhi has jurisdiction to hear the said application as Tihar Jail is located within territorial jurisdiction of District Courts, West District, Delhi.
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20. Ld. Counsel for the respondents contended that Ld. arbitrator rejected claim 'C' and 'D' of the petitioner on the basis of valid reasons. She contended that ' the quantity prescribed in the tender' is tentative and it could be increased or decreased by the respondents, depending upon the necessity. She contended that the petitioner had no vested right to compel the respondents to place order for supply of entire quantity of 1,000 MT ' MS Iron Round Pipe (ERW)'. She contended that the petitioner never requested for formation of any committee for review of price of 'marandi wood'. She contended that the impugned award is a reasoned award and it must not be set-aside. STATUTORY PROVISION:
21. Relevant part of Section 34 of ' The Arbitration and Conciliation Act, 1996' is, as under:
"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:
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 11 of 29 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 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 1.-For the avoidance of any doubt, it is clarified that an award is in conflict with the public policy of India, only if,-
(i) the making of the award was induced or affected by fraud or corruption or was in violation of Section 75 or Section 81; or
(ii) it is in contravention with the fundamental policy of Indian law; or
(iii) it is in conflict with the most basic notions of morality or justice.] [Explanation 2.-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.] [(2A) 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.]"
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 12 of 29 SCOPE OF JURISDICTION UNDER SECTION 34 OF THE ACT:
22. While exercising jurisdiction under Section 34 of the Act, the Court does not sit in appeal over the arbitral award. The Court may interfere with an arbitral award in terms of Section 34 (2) (b)
(ii) of the Act. However, such interference does not entail a review of the merits of the dispute and is limited to situations where the findings of the Arbitrator are arbitrary, capricious or perverse, or when the conscience of the Court is shocked, or when the illegality is not trivial but it goes to the root of the matter.
However, an arbitral award cannot be interfered with if the view taken by the Arbitrator is a possible view based on facts.
23. The scope of intervention of the Court in arbitral matter is quite limited and it is confined to the extent envisaged under Section 34 of the Act. The proceedings under Section 34 of the Act are summary in nature and are not like a full-fledged regular civil suit.
24. The scope of jurisdiction under Section 34 of the Act is not like a normal appellate jurisdiction and the Courts should not interfere with the arbitral award lightly in a casual and a cavalier manner. The mere possibility of an alternative view on facts or interpretation of the contract does not empower the Courts to reverse findings of the arbitral tribunal. The Court, in exercise of jurisdiction under Section 34 of the Act, does not sit in appeal over the arbitral award. The appellate Court cannot consider the merits of the case so as to find out whether the decision of the arbitral tribunal was right or wrong upon reappreciation of evidence as if it is sitting in an ordinary Court of appeal. In case the decision of the arbitral tribunal is based on evidence and if reasonable, it cannot be set-aside on the ground that the other view is a better view according to the appellate Court.
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25. In OPG Power Generation Private Limited vs. Enexio Power Cooling Solutions India Private Limited & Anr. , 2024 SCC OnLine SC 2600, Hon'ble Apex Court held, as under:
"60. Sub-section (2-A) of Section 34 of the 1996 Act, which was inserted by 2015 Amendment, provides that an arbitral award not arising out of 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. The proviso to subsection (2-A) states that an award shall not be set aside merely on the ground of an erroneous application of the law or by reappreciation of evidence. In Saw Pipes (supra), while dealing with the phrase 'public policy of India' as used in Section 34, this court took the view that the concept of public policy connotes some matter which concerns public good and public interest. If the award, on the face of it, patently violates statutory provisions, it cannot be said to be in public interest. Thus, an award could also be set aside if it is patently illegal. It was, however, clarified that illegality must go to the root of the matter and if the illegality is of trivial nature, it cannot be held that award is against public policy.
61. In Associate Builders (supra), this Court held that an award would be patently illegal, if it is contrary to:
(a) substantive provisions of law of India;
(b) provisions of the 1996 Act; and
(c) terms of the contract.
The Court clarified that if an award is contrary to the substantive provisions of law of India, in effect, it is in contravention of Section 28(1)(a) of the 1996 Act. Similarly, violating terms of the contract, in effect, is in contravention of Section 28(3) of the 1996 Act.
62. In Ssangyong (supra) this Court specifically dealt with the 2015 Amendment which inserted sub- section (2-A) in Section 34 of the 1996 Act. It was held that "patent illegality appearing on the face of the award" refers to such illegality as goes to the root of matter, but which does not amount to mere erroneous application of law. It was also clarified that what is not subsumed within "the fundamental policy of Indian law", namely, the contravention of a statute not linked to public policy' or 'public interest', cannot be brought in by the backdoor when it comes to setting aside an award on the ground of patent illegality. Further, it was observed, reappreciation of evidence is not permissible under this category of challenge to an arbitral award.
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63. Perversity as a ground for setting aside an arbitral award was recognized in Western Geco (supra). Therein it was observed that an arbitral decision must not be perverse or so irrational that no reasonable person would have arrived at the same. It was observed that if an award is perverse, it would be against the public policy of India.
64. In Associate Builders (supra) certain tests were laid down to determine whether a decision of an arbitral tribunal could be considered perverse. In this context, it was observed that where: (i) a finding is based on no evidence; or (ii) an arbitral tribunal takes into account something irrelevant to the decision which it arrives at; or (iii) ignores vital evidence in arriving at its decision, such decision would necessarily be perverse. However, by way of a note of caution, it was observed that when a court applies these tests it does not act as a court of appeal and, consequently, errors of fact cannot be corrected. Though, a possible view by the arbitrator on facts has necessarily to pass muster as the arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon. It was also observed that an award based on little evidence or on evidence which does not measure up in quality to a trained legal mind would not be held to be invalid on that score.
65. In Ssangyong (supra), which dealt with the legal position post 2015 amendment in Section 34 of the 1996 Act, it was observed that a decision which is perverse, while no longer being a ground for challenge under "public policy of India", would certainly amount to a patent illegality appearing on the face of the award. It was pointed out that an award based on no evidence, or which ignores vital evidence, would be perverse and thus patently illegal. It was also observed that a finding based on documents taken behind the back of the parties by the arbitrator would also qualify as a decision based on no evidence in as much as such decision is not based on evidence led by the parties, and therefore, would also have to be characterized as perverse.
66. The tests laid down in Associate Builders (supra) to determine perversity were followed in Ssyanyong (supra) and later approved by a three-Judge Bench of this Court in Patel Engineering Limited v. North Eastern Electric Power Corporation Limited.
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67. In a recent three-Judge Bench decision of this Court in Delhi Metro Rail Corporation Ltd. v. Delhi Airport Metro Express Pvt. Ltd. 2024 INSC 292, the ground of patent illegality / perversity was delineated in the following terms:
"40. In essence, the ground of patent illegality is available for setting aside a domestic award, if the decision of the arbitrator is found to be perverse, or so irrational that no reasonable person would have arrived at it; or the construction of the contract is such that no fair or reasonable person would take; Or, that the view of the arbitrator is not even a possible view. A finding based on no evidence at all or an award which ignores vital evidence in arriving at its decision would be perverse and liable to be set aside under the head of patent illegality. An award without reasons would suffer from patent illegality. The arbitrator commits a patent illegality by deciding a matter not within its jurisdiction or violating a fundamental principle of natural justice."
68. The aforesaid judicial precedents make it clear that while exercising power under Section 34 of the 1996 Act the Court does not sit in appeal over the arbitral award. Interference with an arbitral award is only on limited grounds as set out in Section 34 of the 1996 Act. A possible view by the arbitrator on facts is to be respected as the arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon. It is only when an arbitral award could be categorized as perverse, that on an error of fact an arbitral award may be set aside. Further, a mere erroneous application of the law or wrong appreciation of evidence by itself is not a ground to set aside an award as is clear from the provisions of subsection (2-A) of Section 34 of the 1996 Act."
26. In Larsen Air Conditioning and Refrigration Company vs. Union of India and Ors., MANU/SCOR/98351/2023, Hon'ble High Court of Delhi held, as under:
"15. The limited and extremely circumscribed jurisdiction of the court under Section 34 of the Act, permits the court to interfere with an award, sans the grounds of patent illegality, i.e., that "illegality must go to the root of the matter and cannot be a trivial nature"; and that the tribunal "must decide in accordance with the terms of the contract, but if an arbitrator construes a term of the contract in a reasonable manner, it will not mean that the award can be set aside on this ground"....."
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 16 of 29 ANALYSIS AND CONCLUSION:
27. The petitioner invoked price escalation clause of ' Terms and Conditions of e-Tender' on the ground that price of ' marandi wood' had increased by Rs. 150 per Cft. from July, 2015 and the petitioner supplied 15,000 Cft. + 15,833.10 Cft. ( 30,833.10 Cft.) from July, 2015 to December, 2015. However, the respondent No. 2 neither paid increased price of ' marandi wood' nor formed a committee to consider request of the petitioner despite letter dated 12.10.2015. Therefore, the petitioner is seeking an amount of Rs. 46,24,950/- on account of increase of price of ' marandi wood' alongwith pendente-lite and future interest @ 18% per annum.
28. The arbitral tribunal rejected claim 'C' of the petitioner for an amount of Rs. 46,24,950/- on account of price escalation of 'marandi wood' on the grounds, as under:
"(a) The petitioner neither sent documents e.g. bills, account statements to the respondents nor filed the said documents alongwith pleadings or evidence to establish increase of price of 'marandi wood' and the said amount on account of escalation of price; and
(b) The bills of purchase of 'marandi wood' from suppliers during the period from July, 2015 to December, 2015 alongwith statement of account and VAT returns, and bank statement were neither filed with the pleadings or during evidence and produced just before publication of the award."
29. Price escalation clause i.e. Clause 12 of ' Terms and Conditions of e-Tender', as under:
"12. Price Escalation Clause:- In case of change in price of items, upwards or downwards, D.G. (Prisons) shall have the right to consider this after framing the committee."
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 17 of 29
30. The petitioner informed the respondent No. 2 about increase of price of 'marandi wood' @ Rs. 150 per Cft., vide letter dated 12.10.2015 Ex.PW1/12, relevant part of which is reproduced, as under:
"We have received the full qty. of order from time to time for Marandi wood silly as well as different sizes of planks alongwith other items when the rates of Marandi wood and Fevicol have gone up. For Marandi wood rates have gone up by Rs. 150/- per Cft. since July-August, 2015. The supply against order received is being made by us."
31. It is evident from the said letter that the petitioner had informed the respondent No. 2 regarding increase of price of 'marandi wood'.
32. The respondent No. 2 acknowledged receipt of letter dated 12.10.2015, vide letter dated 04.11.2015 Ex.PW1/16. However, the respondent No. 2 did not state anything regarding constitution of a price review committee regarding increase of price of 'marandi wood', as under:
"To, The Jagdamba Sales Corporation, 3809, Ramanath Patwa Street Paharganj, New Delhi-110055 Sub.: Supply of Carpentry Unit Items (Steel Pipes Round) to Central Jail Factory, CJ-2, New Delhi.
(Rate Contract No. F7/DS(Prov.-Factory)/Dual Desk Items / 2014-15/118/CD00015688/484-87 Dated 15.09.2014) Kindly refer to your representation dated 12.10.2015 and 26.10.2015 addressed to Addl. I.G. (P) and D.G. (P) on the subject cited above.
Your representation for issue of supply order for balance qty. of 200 Metric Ton of Mild Iron Round Pipe (ERW - Wall thickness 1.6 mm weight 27/28 kgs. Per 100 ft. - 16 Gauge OD 25 mm, equivalent IS 7138 - Length of each pipe should be 20 ft.) in terms of rate contract dated 15.09.2015 was examined and I am directed to convey you that the same could not be acceded by the Competent Authority.
(ARVIND JAIN) SUPERINTENDENT-I: (PHQ.) TIHAR, NEW DELHI"
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 18 of 29
33. The reason furnished for non-constitution of price review committee, as mentioned in the statement of defenec of the respondents, is that the petitioner never requested for formation of such committee, vide letter dated 12.10.2015, as under:
"(g) .....It is submitted that the Claimant have no vested right in the formation of a committee in case of upward or downward change of price and the said decision rests with Director General (Prisons). It is submitted that reliance in this regard is placed onto Clause 12 of the tender document. It is submitted that in the letter dated 12.10.2015 the Claimant never requested for formation of such committee."
34. The petitioner, vide legal notice dated 06.01.2017 Ex.PW1/18, demanded the difference in the price of ' marandi wood' supplied by him to the respondents on account of increase of price of 'marandi wood', as under:
"7. That as clause 12 of the tender conditions, In case of change of price of items, upwards and downwards, DG (Prisons) shall consider the price escalation after framing the committee. The price of Marandi wood had increased by Rs. 150 Cft. from July, 2015. My client requested you noticees to increase the rates of Marandi wood time and again by visiting the office of you noticees and vide letter dated 12.10.2015, but you noticees did not pay heed to the legitimate request of my client. Even, you noticees did not form the committee to consider the request of my client as per clause 12 of the tender. My client supplied 15000 + 15833.10 Cft during July & August, 2015 and as such, he suffered loss of Rs. 46,24,950/- due to increase of price. Thus, you noticees are liable to pay Rs. 46,24,950/- alongwith interest @ 18% from the date of supply of material and till the date of payment."
35. The reason furnished for non-formation of the committee, as stated in the reply notice dated 24.07.2017, is as under:
"Para - (vii) That in reply to the contents of para under, rate contract was issued to the firm for one year from the date of award of rate contract. The letter was written by the firm on 12.10.2015 for the already supplies made in the month of July and August, 2015. This makes no sense that to consider the request for increase the rates for the already supplied material and thus, question of payment of Rs. 46,24,950/- and interest @ 18% does not arise."
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 19 of 29
36. It is relevant to note that the respondents neither disputed the quantity of 'marandi wood' supplied by the petitioner since July, 2015 nor escalation of the price of 'marandi wood'.
37. The case of the petitioner is that the arbitral tribunal ignored bills pertaining to supply of goods and increase of price of 'marandi wood' Ex.PW1/13 and Ex.PW1/14 which were filed alongwith evidence by way of affidavit.
38. Ex.PW1/13 are the bills of the supply made by the petitioner to the respondent No. 2, as under:
Sl. No. Invoice No. Date Description Qty. Rate Amt. (inc. VAT)
1. 2802 14.08.2015 Marandi 3119 45 each Rs. 1,47,372.75 Wood Planks 38"x1"x4"
2. 2804 24.08.2015 Marandi 5807 45 each Rs. 2,74,380.75 Wood Planks 38"x1"x4"
3. 2805 24.08.2015 Marandi Wood Planks Rs. 2,55,413.55 10"x1"x38" 860 186 each 8"x1"x38" 559 149 each
4. 2806 24.08.2015 Marandi Wood Planks Rs. 3,82,208.40 8"x1"x38" 1320 149 each 9"x1"x38" 996 168 each
5. 2807 24.08.2015 Marandi 152 186 each Rs. 29,685.60 Wood Planks 10"x1"x38"
6. 2808 24.08.2015 Marandi Wood Planks Rs. 6,42,280.80 10"x1"x38" 3052 186 each 9"x1"x38" 184 168 each 8"x1"x38" 88 149 each
7. 2810 24.08.2015 Marandi Wood Planks Rs. 6,27,071.55 8"x1"x38" 1295 149 each 9"x1"x38" 533 168 each 10"x1"x38" 1692 186 each OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 20 of 29
8. 2811 25.08.2015 Marandi 1108. 824/ Cft. Rs. 9,58,718.60 Wood Silly 089
9. 2814 25.08.2015 Marandi 21.80 824/ Cft. Rs. 18,864.82 Wood Silly 4
10. 2815 25.08.2015 Marandi 54.48 824/ Cft.
Wood Silly 0 Marandi Wood Rs. 4,38,509.40 Planks 8"x1"x38" 1333 149 each 9"x1"x38" 753 168 each 10"x1"x38" 256 186 each
11. 2816 26.08.2015 Marandi Wood Planks 38"x1"x9" 455 168 each 38"x1"x8" 964 149 each Rs. 5,04,046.07 Marandi 315.4 824/ Cft.
Wood Silly 95
12. 2817 26.08.2015 Marandi 630.0 824/ Cft. Rs. 5,45,161.64 Wood Silly 99
13. 2824 09.09.2015 Marandi 270.8 824/ Cft. Rs. 2,34,304.81 Wood Silly 10
14. 2825 09.09.2015 Marandi 640 168 each Rs. 1,12,896 Wood Planks 38"x1"x9"
15. 2826 09.09.2015 Marandi 234.7 824/ Cft. Rs. 2,03,079.74 Wood Silly 20
16. 2828 09.09.2015 Marandi Wood Planks Rs. 1,74,900.60 38"x1"x13" 462 242 each 38"x1"x9" 326 168 each
17. 2831 09.09.2015 Marandi Wood Planks Rs. 3,21,350.40 38"x1"x13" 996 242 each 38"x1"x9" 387 168 each
18. 2836 15.09.2015 Marandi 320 242 each Rs. 81,312 Wood Planks 38"x1"x13"
19. 2839 15.09.2015 Marandi 297.8 824/ Cft. Rs. 2,57,735.28 Wood Silly 91 10"x13"x10"
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 21 of 29
21. 2844 28.09.2015 Marandi 1005 242 each Rs. 2,55,370.50 Wood Planks 13"x1"x38"
22. 2846 28.09.2015 Marandi Wood Planks 10"x1"x38" 990 186 each Rs. 3,17,214.45 9"x1"x38" 204 168 each 8"x1"x38" 225 149 each 4"x1"x38" 1105 45 each
23. 2847 28.09.2015 Marandi Wood Planks 13"x1"x38" 309 242 each Rs. 5,56,063.20 10"x1"x38" 800 186 each 9"x1"x38" 688 168 each 8"x1"x38" 1278 149 each
24. 2848 28.09.2015 Marandi 1085. 824/ Cft. Rs. 9,39,197.09 Wood Silly 526 10"x13"x10"
25. 2849 28.09.2015 Marandi 3012 45 each Rs. 1,42,317 Wood Planks 38"x1"x4"
26. 2850 28.09.2015 Marandi 383.6 824/ Cft. Rs. 3,31,960.80 Wood Silly 81
27. 2852 28.09.2015 Marandi Wood Planks 13"x1"x38" 206 242 each Rs. 1,74,106 10"x1"x38" 352 186 each 9"x1"x38" 145 168 each 8"x1"x38" 172 149 each
29. 2857 15.10.2015 Marandi 369.2 824/ Cft. Rs. 3,19,495 Wood Silly 74
30. 2858 15.10.2015 Marandi 688.7 824/ Cft. Rs. 5,95,873.62 Wood Silly 12
31. 2866 28.10.2015 Marandi Wood Silly 10"x13"x10" 162.4 824/ Cft.
86 Rs. 1,57,829.13
Marandi
Wood
Planks
38"x1"x4" 365 45 each
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 22 of 29
32. 2867 28.10.2015 Marandi
Wood Silly
10"x13"x10" 370.1 824/ Cft.
07
Marandi
Wood Rs. 5,61,367
Planks
38"x1"x13" 534 242 each
38"x1"x10" 540 186 each
33. 2868 28.10.2015 Marandi 604.8 824/ Cft. Rs. 5,23,280.74
Wood Silly 09
10"x13"x10"
34. 2869 28.10.2015 Marandi
Wood Silly
10"x13"x10" 305.7 824/ Cft.
08 Rs. 3,51,574.00
Marandi
Wood Silly
10"x13"x10" 100.6 824/ Cft.
42
35. 2871 04.11.2015 Marandi 1200. 824/ Cft. Rs.
Wood Silly 591 10,38,751.32
10"x13"x10"
36. 2872 04.11.2015 Marandi
Wood
Planks
38"x1"x13" 323 242 each
38"x1"x10" 104 186 each
38"x1"x9" 388 168 each
38"x1"x8" 156 149 each
Rs. 6,63,844
Marandi
Wood Silly
10"x13"x10" 541.6 824/ Cft.
20
37. 2880 30.11.2015 Marandi 622.8 824/ Cft. Rs. 5,38,901.06
Wood Silly 63
38. 2881 30.11.2015 Marandi 942 242 each Rs. 2,39,362.20
Wood
Planks
38"x1"x13"
39. 2882 30.11.2015 Marandi 406.2 824/ Cft. Rs. 3,51,457.21
Wood Silly 15
40. 2885 03.12.2015 Marandi
Wood
Planks
38"x1"x13" 682 242 each
Rs. 5,04,850.35
Marandi
Wood Silly
10"x13"x10" 383.2 824/ Cft.
11
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 23 of 29
41. 2888 28.12.2015 Marandi
Wood
Planks
38"x1"x13" 586 242 each Rs. 2,36,397
38"x1"x9" 496 168 each
42. 2889 14.12.2015 Marandi 345.7 824/ Cft. Rs. 2,99,137.70
Wood Silly 44
10"x13"x10"
43. 2890 28.12.2015 Marandi 222.9 824/ Cft. Rs. 1,92,925.75
Wood Silly 84
10"x13"x10"
39. Therefore, the contention of the respondents, as raised in reply notice dated 24.04.2017 Ex.PW1/18, that the petitioner was seeking formation of price review committee, vide letter dated 12.10.2015 Ex.PW1/12, regarding supplies made in July and August, 2015 is incorrect. As noted above, the petitioner supplied 'marandi wood' to the respondent No. 2 since 14.08.2015 to 28.12.2015. The reason furnished for non- formation of committee, in the statement of defence, that the petitioner never requested for formation of committee cannot be accepted as it was incumbent upon the respondent No. 2 to constitute a price review committee immediately on receipt of letter dated 12.10.2015 Ex.PW1/12.
40. It is relevant to mention that RW-1, in his cross- examination, merely stated that 'I do not know what is the reason for rejecting the request of the claimant for increase in price in the market'.
41. PW-1 Suresh Goyal deposed about quantity of supply and increase of price of 'marandi wood' and filed invoices pertaining to supplies made to the respondent No. 2 and the purchases made by him from the market, in his evidence affidavit, as under:
"8. That clause 12 of the tender conditions, in case of change of price of items, upwards or downwards, DG shall have the right to consider this after framing the committee. The price of the Marandi wood had increased by Rs. 150 Cft. from July, 2015 and the claimant supplied 15000 + 15833.10 Cft during July to December, 2015.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 24 of 29 The claimant, from time to time, requested the respondent to increase the price of the Marandi wood and again by visiting the office of the respondent and vide letter dated 12.10.2015, but the respondent did not pay heed to the request of the claimant. The respondent did not even form the committee to consider the request of the claimant as per clause 12 of the tender. As such, the claimant has suffered loss of Rs. 4624950/- due to increase of price and the respondents are liable to compensate the said loss alongwith interest @ 18% per annum. However, the claimant is not claiming interest till the filing of statement of claim and is claiming only pendentelite and future interest only. Letter dated 12.10.2015 is Exhibit PW-1/12. Bills showing supply of goods from July to December, 2015 are Exhibit PW-1/13 Colly. Bills showing increase in the rates are Exhibit PW-1/14 Colly."
42. Besides a suggestion to PW-1 Suresh Goyal that he had not requested for increase of price of ' marandi wood' or formation of price review committee, his evidence remained unchallenged on the aspect of quantity of 'marandi wood' supplied and increase of price of 'marandi wood'. The relevant part of his cross- examination is, as under:
".....I had supplied to the Respondent 2 items, namely, Silly (Logs), Planks of wood and MS pipes.....It is wrong to suggest that I had never requested for the increase of the rate of the material already supplied to the Respondent. It is wrong to suggest that I never requested for any increase in price or formation of Price Review Committee. (Volunteer: The Price Review Committee was to be formed by the Respondents themselves and we had no role to play in that regard)....."
43. Therefore, the respondent No. 2 should have formed a price review committee in terms of Clause 12 of ' The Terms and Conditions of e-Tender' to consider change in price of ' marandi wood', on receipt of letter dated 12.10.2015 Ex.PW1/12. However, the respondent No. 2 did not form the committee and continued to receive the supply of 'marandi wood' till 28.12.2015. The respondent No. 2 did not ask the petitioner to submit the invoices of its supplier regarding increase in price.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 25 of 29
44. The arbitral tribunal did not consider the bills of supply and the bills filed by the petitioner regarding the purchases made by him from the suppliers at increased rates despite the fact that the said bills were submitted alongwith statement of claim and affidavit as Ex.PW1/13 and Ex.PW1/14 respectively.
45. The petitioner furnished bills regarding purchase of 'marandi wood' @ 681 Per Cft. made by him w.e.f. 01.04.2015 to 08.04.2015 and the bills pertaining to purchases made by him w.e.f. 10.08.2015 to 06.11.2015 @ 825 Per Cft. to 875 Per Cft.
46. Therefore, the arbitral tribunal committed patent illegality as it ignored vital evidence placed by the petitioner pertaining to the supply of 'marandi wood' and increase in price of marandi wood' and it goes to the root of the matter.
47. Therefore, the impugned award qua claim 'C' deserves to be set-aside. The petitioner is entitled to an amount of Rs. 46,24,950/- on account of increase in price of ' marandi wood' @ Rs. 150 per Cft. alongwith pendente-lite and future interest @ 9% per annum.
48. As regards contention of the petitioner qua claim 'D' that the respondents did not place order for balance quantity of 200 MT 'MS Iron Round Pipe (ERW)' and therefore, the petitioner should be granted interest @ 18% per annum on the proportionate security amount of Rs. 10,08,000/- from the date of deposit of security till 17.03.2017, it can be stated that the arbitral tribunal rightly rejected the said claim of the petitioner. Clause 14 (b) of 'Terms and Conditions of e-Tender' is, as under:
"(b) The quantity prescribed in the tender is tentative & can be increased or decreased by the Department, depending upon the necessity / requirement. The supply will have to be made strictly as per the schedule given in supply order by the Prison Deptt.
time to time."
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 26 of 29
49. Therefore, the quantity of 100 MT 'MS Iron Round Pipe (ERW)' prescribed in tender and rate of contract is tentative and it can be increased or decreased by the respondent No. 2. Further, this clause is reaffirmed in Clause 21 of the Agreement dated 27.09.2014, as under:
"Clause 21: That the quantity prescribed in the tender is tentative & can be increased or decreased by the Department, depending upon the necessity/ requirement. The supply will have to be made strictly as per the schedule given in supply order by the department time to time."
50. Moreover, the respondent No. 2 rejected the request of the petitioner for issuance of supply order for balance quantity of 200 MT 'MS Iron Round Pipe (ERW)', vide letter dated 04.11.2015 Ex.PW1/16. The fact that the respondent No. 2 invited fresh tender and awarded contract for fresh supply cannot be invoke to compel the respondent No. 2 to issue order for supply of balance quantity of 200 MT ' MS Iron Round Pipe (ERW)'. The reasoning of the arbitral tribunal that issuance of supply order was at the discretion of the respondent No. 2 and the petitioner did not have a vested right to get the order of the entire quantity of 1,000 MT ' MS Iron Round Pipe (ERW)' is just and reasonable and it does not require any interference. The claim of the petitioner for an amount of Rs. 4,63,680/- as interest @ 18% per annum on proportionate security amount is rejected.
51. As regards contention that the District Courts of Central District, Tis Hazari Courts, Delhi do not have territorial jurisdiction to hear the application under Section 34 of the Act against the impugned award and the District Courts at West District, Tis Hazari Courts, Delhi have jurisdiction as Tihar Jail is located within territorial jurisdiction of West District is without merit.
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 27 of 29
52. According to the arbitration agreement, all disputes are subject to the jurisdiction of Delhi Courts only. Govt. of NCT of Delhi / the respondent No. 1 has its office within territorial jurisdiction of this Court. The respondent No. 2 is functioning under the administrative control of Govt. of NCT of Delhi. Therefore, this Court has territorial jurisdiction to hear the application under Section 34 of the Act against the impugned award.
CONCLUSION:
53. The application under Section 34 of ' The Arbitration and Conciliation Act, 1996' is partly allowed and the impugned award qua rejection of claim 'C' is set-aside and claim 'C' of the petitioner qua payment of increased price of ' marandi wood' is allowed and claim 'D' of the petitioner qua interest on security deposit on account of non-issuance of supply order for balance quantity of 200 MT 'MS Iron Round Pipe (ERW)' is rejected.
54. Consequently, the petitioner is entitled to an amount of Rs. 46,24,950/- on account of increase in price of ' marandi wood' @ Rs. 150 per Cft. alongwith pendente-lite and future interest @ 9% per annum. In the facts and circumstances of the case, there is no order as to cost. Arbitral record be sent back to Arbitrator.
Digitally signed
File be consigned to record room. by SANJAY
SANJAY SHARMA
SHARMA Date:
2024.12.16
12:20:10 +0530
Announced in the open Court SANJAY SHARMA-II
on this 13th December, 2024 DJ (Commercial Court)-03 (Shahdara) KKD Courts, Delhi OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 28 of 29 M/s. Jagdamba Sales Corporation vs. State & Ors. CNR No.: DLCT01-015231-2019 OMP (Comm.) No. 116/2019 13.12.2024 Proceedings convened through Video Conferencing. Present : Mr. R.K. Goel, Ld. Counsel for the petitioner.
Ms. Babli Kala, Ld. Counsel for the respondents.
Vide separate judgment, the application under Section 34 of 'The Arbitration and Conciliation Act, 1996' is partly allowed and the impugned award qua rejection of claim 'C' is set-aside and claim 'C' of the petitioner qua payment of increased price of 'marandi wood' is allowed and claim 'D' of the petitioner qua interest on security deposit on account of non-issuance of supply order for balance quantity of 200 MT 'MS Iron Round Pipe (ERW)' is rejected. Consequently, the petitioner is entitled to an amount of Rs. 46,24,950/- on account of increase in price of 'marandi wood' @ Rs. 150 per Cft. alongwith pendente-lite and future interest @ 9% per annum. In the facts and circumstances of the case, there is no order as to cost. Arbitral record be sent back to Arbitrator. File be consigned to record Digitally signed room. by SANJAY SHARMA SANJAY Date:
SHARMA 2024.12.16
12:20:18
+0530
Sanjay Sharma-II
DJ (Commercial Court)-03
Shahdara, KKD, Delhi
13.12.2024
OMP (Comm.) No. 116/2019 M/s. Jagdamba Sales Corporation vs. State & Ors. Page No. 29 of 29