Delhi District Court
Second Address vs Nbcc (India) Limited on 17 September, 2018
IN THE COURT OF SHRI GIRISH KATHPALIA,
DISTRICT & SESSIONS JUDGE
SOUTH EAST : SAKET COURT, NEW DELHI.
ARBITRATION No. 396/2016 (21366/2016)
M/s SUNNY SANITATIONS
through its PROPRIETOR
SHRI ASHOK KUMAR
G1/156, UTTAM NAGAR
NEW DELHI 110059
SECOND ADDRESS:
SHRI ASHOK KUMAR VASHISTA
S/o LATE SHRI RAMJAS VASHISTA
R/o FLAT No. 49, POCKET I,
SECTOR 9, DDA SFS
DWARKA, NEW DELHI110077 ....PETITIONER
VERSUS
1. NBCC (INDIA) LIMITED
(formerly known as NATIONAL BUILDING
CONSTRUCTION CORPORATION LTD.)
through its DIRECTOR
NBCC HOUSE, LODHI ROAD
NEW DELHI110003
2. SHRI C. M. GUPTA, SOLE ARBITRATOR
& GENERAL MANAGER
NBCC LIMITED
REAL ESTATE DIVISION
NBCC BHAWAN, 4TH FLOOR,
LODHI ROAD, NEW DELHI110003
...RESPONDENTS
Arbitration No. 396/2016 (21366/2016) Page 1 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
Date of filing : 26.07.2016 First date before this court : 18.05.2017 Arguments concluded on : 14.09.2018 Date of Decision : 17.09.2018 Appearance: Shri F. Hasan, counsel for petitioner Shri Dhruv Sharma, counsel for respondent J U D G M E N T
1. Petitioner has brought this objection petition under Section 34 of the Arbitration & Conciliation Act 1996 against arbitral award dated 23.06.2016 which was passed by the learned arbitrator (arrayed as respondent no. 2) in dispute between the petitioner and respondent no. 1. I have heard learned counsel for petitioner and respondent no. 1. On behalf of respondent no. 2 Arbitrator, the original arbitral records were filed and the same have been perused by me.
2. Petitioner was awarded work of providing and fixing Dholpur Stone Cladding Work at the construction of telephone exchange in Rohini by respondent no. 1 in the year 1997. The awarded work was to be completed within a period of two months, but it got delayed and completed only in the year 2001. During the said period, petitioner raised various bills which were cleared by respondent no. 1. Finally, by way of 12th and final bill dated 20.06.2001, petitioner claimed an amount of Rs. 4,98,838/, but that amount was reduced by respondent no. 1 to Rs. 1,41,192/ on account of certain deductions. Petitioner admitted and Arbitration No. 396/2016 (21366/2016) Page 2 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
accepted the final bill without any protest, thereby admitting that the total amount payable to him was Rs. 1,41,192/. Subsequently, by way of letter dated 18.06.2004, petitioner invoked arbitration which culminated into the impugned award.
3. By way of impugned award, the learned arbitrator awarded a total sum of Rs. 2,23,828/ with simple interest at a rate of 8% per annum in favour of petitioner. The learned arbitrator rejected the remaining amount claimed by the petitioner mainly on the ground that petitioner had accepted the 12th and final bill without any protest.
4. Hence, the present objection petition.
5. Learned counsel for petitioner argued that the learned arbitrator erred in opting not to place any reliance on the measurement book, which was signed by the petitioner under protest. It was also argued by learned counsel for petitioner that the learned arbitrator ought to have directed both sides to lead oral and forensic evidence if he suspected the genuineness of the endorsement of the protest on the measurement book.
6. Per contra, learned counsel for respondent no. 1 argued that learned arbitrator specifically dealt with the aspect of measurement Arbitration No. 396/2016 (21366/2016) Page 3 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
book and gave explicit reasons for opting not to place reliance on the same. It was argued on behalf of respondent no. 1 that additionally speaking, the arbitration proceedings could not have even been commenced since petitioner having accepted final bill, there was no arbitrable dispute left and in this regard learned counsel for respondent no. 1 placed reliance on the judgment of Hon'ble Supreme Court of India in the case of Union of India vs Popular Builders, Calcutta, (2000) 8 SCC 1. It was further argued by learned counsel for respondent no. 1 that even petitioner was fully satisfied with the final bill prepared by respondent no. 1 and did not take any action for a period of almost three years after accepting the final bill.
7. At this stage, it would be apposite to traverse through the legal position relevant for the present case.
8. The scope of judicial review of an arbitral award is akin to review under Article 226 of the Constitution of India of the decision of bodies, where it is a settled principle of law that judicial review is of the decision making process and not of the decision itself on merits and the same cannot be converted into an appeal. Even Section 34 (2) (a) of the Arbitration & Conciliation Act, 1996 amply clarifies the grounds of challenge on the lines of violation of principles of natural justice in making of the award or invalidity of the arbitral agreement and non Arbitration No. 396/2016 (21366/2016) Page 4 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
arbitrability of disputes arbitrated and composition of the arbitral tribunal or arbitral procedure being not in accordance with the agreement between the parties. None of the legislated grounds permits to challenge an arbitral award on merits by way of fresh appreciation of evidence.
9. In the case of Associate Builders vs DDA, (2015) 3 SCC 49, the Hon'ble Supreme Court held thus :
"It must clearly be understood that when a court is applying his public policy test to an arbitration award, it does not act as a court of appeal and consequently errors of fact cannot be corrected. 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 when he delivers his arbitral award. Thus, 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 this score. Once it is found that arbitrator's approach is not arbitrary or capricious, then he is the last word on facts." (emphasis supplied)
10. In the case of Delhi Development Authority vs Bhardwaj Brothers, MANU/DE/1753/2014, a division bench of the Hon'ble Delhi High Court observed thus :
"It cannot also be lost sight of that nonconferring of finality on the arbitral awards not only affects the speed and expense of arbitration but also has a more subtle consequences of, extensive judicial review changing the nature of the arbitral process to an even greater extent.
Arbitration No. 396/2016 (21366/2016) Page 5 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
If arbitration becomes simply another level of decision making, subject to judicial review on merits, arbitrators may begin to decide cases and write opinions in such a way as to insulate their awards against judicial reversal producing opinions that parrot the appropriate statutory standards in conclusory terms, but suffer from a lack of reasoned analysis. Such a shift from the arbitral model in which decision makers are free to focus solely on the case before them rather than on the case as it might appear to an appellate court, to the administrative model, in which decision makers are often concerned primarily with building a record for review, in my opinion would substantially undercut the ability of arbitrators to successfully resolve disputes. The courts therefore have no business weighing the merits of the grievance, considering whether there is equity in a particular claim or determining whether there is particular language in the written instrument which will support the claim. The agreement is to submit all grievances to arbitration, not merely those which the court may deem meritorious. The courts if start undertaking to determine the merits of the grievance, would be usurping the function which under the Arbitration Act, 1996 is entrusted to the arbitration tribunal. This plenary review by the courts of the merits would make meaningless the provisions that the arbitral award is final, for in reality it would almost never be final".
11. Falling back to the present case, on the very first page of the impugned award, learned arbitrator held thus :
"It has been noticed that the claimant has duly signed the 12 th and final RA bill dated 20.06.2001 without any comment written on it, however on MB claimant has written "under protest", which seems that this is not written on the day of signing of the bill. Hence, I have not considered that claimant has signed the bill under protest".
Arbitration No. 396/2016 (21366/2016) Page 6 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
12. In order to establish that the endorsement of protest recorded in the measurement book is not genuine, respondent no. 1 placed on record a coloured photocopy of the relevant page. It is absolutely clear to even naked eye that on the relevant page of the measurement book, the endorsement "bill accepted" and signatures "Ashok Kumar" under the same are in one pen, while endorsement "under protest" is clearly added subsequently in a different pen. In that regard, during final arguments I also examined the original measurement book, which leaves no doubt that initially the measurement book was endorsed and signed by petitioner Ashok Kumar as a token of acceptance of the same but subsequently the acceptance endorsement was tampered by adding the words "under protest". Therefore, I find no infirmity in the view taken by learned arbitrator in that regard even on merits.
13. Then comes the argument of petitioner that the learned arbitrator ought to have recorded evidence as regards the above mentioned endorsement on the measurement book. The argument, to say the least is fallacious. For, the evidence is already on record by way of document. Analysis of the documentary evidence, which is the measurement book, by the learned arbitrator cannot be a subject matter of these proceedings since it is trite that this court cannot sit in appeal over the view taken by the learned arbitrator. Once the learned arbitrator Arbitration No. 396/2016 (21366/2016) Page 7 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
took a view that by naked eye itself, it is found that words "under protest" were added subsequently, this court under section 34 of the Arbitration and Conciliation Act cannot hold that the arbitrator should have referred the document to forensic analysis before forming an opinion in that regard.
14. Besides, I also find placed on the original arbitral record an application dated 19.01.2015 submitted on behalf of the present petitioner, whereby the present petitioner requested that the arbitration proceedings be closed on the basis of documents already submitted. In the light of application dated 19.01.2015, now the petitioner cannot claim that oral or forensic evidence as regards measurement book interpolation was not recorded. Admittedly, no specific procedure was agreed between the parties which could preclude analysis of documentary evidence in the absence of oral testimony.
15. Further, in the case of Popular Builders (supra) relied upon by learned counsel for respondent, it was observed that where final bill prepared by the appropriate authority was accepted by the builder without any protest as regards one of the claims and question had been raised before the arbitrator in respect of that claim, the same could not have been a matter of reference of an arbitrable dispute and to that extent the award must be set aside. In the present case, as mentioned above Arbitration No. 396/2016 (21366/2016) Page 8 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
admittedly the final bill was accepted by the present petitioner without any protest, as such going by the aforesaid legal proposition, there was not even an arbitrable dispute. But the present respondent has opted not to challenge the impugned award in that regard, to the benefit of the petitioner.
16. No other challenge was raised against the impugned award during arguments on behalf of petitioner.
17. There is no allegation in the present case that the learned arbitrator did not adopt a judicial approach or acted in violation of jus naturale. It is also nobody's case that the learned arbitrator has not acted bonafide or has not dealt with the subject in a fair, reasonable and objective manner or that the decision of the learned arbitrator was actuated by any extraneous consideration. No perversity or irrationality in the award has been made out nor it is contended to be a case of non application of mind by the learned arbitrator.
18. Therefore, I am unable to find any ground on which the impugned arbitral award dated 23.06.2016 could be set aside under the provisions of Section 34 of the Arbitration & Conciliation Act 1996, so the same is upheld. Rather, as mentioned above, having accepted the final bill dated 20.06.2001, the present petitioner remained silent for a Arbitration No. 396/2016 (21366/2016) Page 9 of 10 pages M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.
period of almost three years, as petitioner was conscious of correctness and legality of the final bill. But just before expiry of three years, petitioner invoked arbitration vide letter dated 18.06.2004, that too on the basis of fudged measurement book, which in itself reflects frivolity of the present petition. The objection petition is held meritless and frivolous, so the same is dismissed with cost of Rs.10,000/ to be paid by petitioner to respondent no. 1 within ten days.
19. File be consigned to records.
Announced in the open court on
this 17th day of September 2018 (GIRISH KATHPALIA)
District & Sessions Judge
Digitally signed
by GIRISH South East, Saket Courts
GIRISH New Delhi 17.09.2018 (ar)
KATHPALIA
Date:
KATHPALIA 2018.09.18
15:10:31
+0530
Arbitration No. 396/2016 (21366/2016) Page 10 of 10 pages
M/s Sunny Sanitations Vs. NBCC (India) Ltd. & Anr.