Delhi District Court
Delhi Skills Mission Society Through ... vs Sameul Foundation Charitable India ... on 25 January, 2024
IN THE COURT OF SH.RAJ KUMAR TRIPATHI:
DISTRICT JUDGE (COMMERCIAL COURT)-08
SOUTH-EAST DISTRICT, SAKET COURTS, NEW DELHI
OMP (COMM.) No. 67/2022
Delhi Skills Mission Society vs. Samuel Foundation
Charitable India Trust
CNR No. DLSE01-011826-2022
Delhi Skills Mission Society
Through Deputy Director (Academic)
Directorate of Training & Technical Education
Government of NCT of Delhi
Muni Maya Ram Marg, Pitampura,
Delhi-110 034
......Petitioner
Through: Sh.Arun Kumar, advocate
Versus
Samuel Foundation Charitable India Trust
(Through its Authorised Representative)
C-5, 1st Floor, Om Vihar, Uttam Nagar,
New Delhi-110 059.
......Respondent
Through: Sh.Arjun Garg, advocate
Date of filing of petition: 13.12.2022
Arguments concluded on: 09.01.2024
Date of Judgment: 25.01.2024
JUDGMENT
1.1 This is a petition under Section 34 of The Arbitration & Conciliation Act, 1996 (hereinafter referred as 'The Act') filed by petitioner Delhi Skills Mission Society against respondent OMP (COMM.) No. 67/2022 Page No. 1 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) Samuel Foundation Charitable India Trust (hereinafter referred to as SFCIT) seeking setting aside of arbitral award dated 05.11.2021 passed by the sole Arbitrator.
2.1 Briefly stated the facts as stands emanated from the petition are as under: -
2.2 The petitioner is a state level society registered under the Societies Registration Act, 1860 as Delhi Skills Mission Society under Directorate of Training and Technical Education (in short 'DTTE') under the control of Government of NCT of Delhi.
Respondent is a Charitable Trust to whom contract was awarded by petitioner vide Agreement dated 18.01.2016. 2.3 The Ministry of Labour & Employment, Government of India launched a Skill Development Initiative Scheme (hereinafter referred as 'SDIS') in May, 2007. As part of the initiative, guidelines for implementation of the scheme were issued by the Director General of Employment & Training (hereinafter referred as "DGE&T"). The State Government and various regional institutions were entrusted with responsibilities to implement the SDIS in accordance with the guidelines issued by the DGE&T. The online implementation of SDIS through web- portal was launched on 01.01.2012.
2.4 The SDIS was launched by Government of India with the objective to provide vocational training to people by optimally utilizing the infrastructure available with the Government, private institutions and industries to test and certify the existing skills of the individuals to built capacity in the area of development of competency standards, course curricula, learning material and assessment standard in the country. In order to OMP (COMM.) No. 67/2022 Page No. 2 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) implement the SDIS, state government had setup societies (like petitioner) and rules were also framed that how societies will function. The effective part of the function of the state society set up under SDIS are reproduced hereunder for ready reference: -
"Access labour marked demand; give wide publicity to the scheme; invite applications from VTP's scrutinize the same; ensure implementation of prescribed training fee in the VTP's prepare annual training plan for the State and send the same to DGE&T at least three months before start of financial year; ensure implementation of reservation policy for SC/ST, women and other in respect of training places in VTP's provide support to the assessing bodies in conducting tests, monitor and evaluate the outcome of the scheme; prepare guidelines for inspecting VTP's and ensure proper utilization of funds released to the VTP's.
2.5 The training under the SDIS was being provided by various Vocational Training Partners (hereinafter referred as "VTPs") registered under Central Government, State Government, public and private Sectors and other institutions. The role of VTPs was to provide counseling and vocational guidance, training, post-training and support to the trainees in getting employment. The VTPs were registered with various States/Union Territories with regard to training infrastructure available with it.
2.6 On 16.07.2015, respondent made an application with its proposal to petitioner for registration as VTP. The said application of respondent was approved on SDIS portal on 14.12.2015. The proposal of respondent was approved to provide training for Module No. FAD801FAD901 and SS102 (for two batches) to impart training for fashion design and soft skills sectors. After awarding the contract to respondent, it was duty bound to comply with terms and conditions of contract in its letter and spirit as well as the order dated 28.12.2015, issued by OMP (COMM.) No. 67/2022 Page No. 3 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) petitioner (Department of training & Technical Education. Government of NCT of Delhi). The effective part of the order dated 28.12.2015 issued by the department is reproduced hereunder for ready reference:-
OFFICE ORDER DATED 28.12.2015 XXXXXXXXXXXXXXXX
(ii) Before uploading the batch on SDIS portal, approval of the candidates list & trainer with required documents like photo, age proof, caste certificate and form DTTE, Pitampura are necessary. Please ensure that the list is in the same order that will be uploaded on SDI Portal for TBN issue.
(iii) The minimum number of trainees for issue of TBN should be 10 per batch (reference clause 7.4.ll in SDI Manual)
(iv) The implementation of reservation policy for SC/ST, women and others is mandatory. (reference clause 7.4IV in SDI Manual)
(v) Before starting any batch biometric should be connected with SDIS portal.
(vi) Trainer's attendance would also be captured on the biometric device.
XXXXXXXXXXXXX 2.7 On 19.01.2016, respondent had submitted list of fifty two candidates for the approved two batches. The details of training imparted by respondent in allocated batches are as follows:-
S.No. Module Name Training Batch No. Duration & Time
1. Fashion Design 07090043FAD116002 19/01/2016 to Technology 25/07/2016 (FAD 801) (08:30 AM to OMP (COMM.) No. 67/2022 Page No. 4 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) 05:30 PM)
2. Fashion Design 07090043FA80116003 19/01/2016 to Technology 25/07/2016 (FAD 801) (08:30 AM to 05:30 PM) 2.8 In terms of guidelines issued by DGE&T and as per clause 2.2.8 of the contract and in terms of the office order dated 28.12.2015 as well; it was mandatory to mark attendance through biometric before starting any batch. However, respondent did not comply the same, but violated the terms and conditions of the contract and guidelines issued by the DGE&T and office order dated 28.12.2015 during the execution of program. Further, in the year 2017, petitioner had also raised concerns with regard to duplicity of trainers in claims, as two batches of Fashion Design were trained by single trainer that too at the same time which is not possible at all as one person cannot be available at two different places at the same time. The said question remained unanswered by respondent which creates serious doubts and defense set up by the respondent comes under the dark cloud. 2.9 In terms of letter dated 26.03.2014, issued by Directorate General of Training, Government of India & clause 2.2.8 of the contract, it was categorically mentioned to maintain biometric attendance for all the candidates under training and their trainers. However, respondent failed to comply the said directions. Furthermore, petitioner had also purchased and installed the Biometric device (attendance) from the authorized vendor of DGT, Government of India. The same was/is under the control of DGT, Govt. of India. Thus, petitioner had no control OMP (COMM.) No. 67/2022 Page No. 5 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) over it and had very limited role to play i.e. just implementing the scheme.
2.10 Since Biometric was made mandatory by Government of India and as per the contract, therefore, on 18.01.2016, respondent had also installed biometric device bearing IMEI no. 911300155060645 in the premises and connected the machine with SDS portal. Accordingly, manual/physical attendance could not be accepted for the period of 2015-2016. However, respondent instead of submitting the biometric attendance of trainees and their trainers had submitted manual/physical attendance; which itself is in violation of guidelines issued by Government of India and violation of terms and conditions of the contract.
2.11 On 07.10.2016, respondent had submitted training cost claim no. 00857521 (TBN-07090043FAD80116003) and training cost claim no. 00858701 (TBN-
07090043FAD80116002). On scrutinizing the same by petitioner, several discrepancies were found. Further, the biometric attendance submitted by respondent wherein "Absent Status" was marked against name of most of trainees. The respondent was immediately informed by the petitioner with regard to above- mentioned discrepancies and requested to provide adequate explanation. However, respondent did not pay any heed despite several request of petitioner and did not reply willfully just to cover up its mistakes.
2.12 On 04.04.2017, respondent replied to the queries raised by petitioner in the year 2016, with regard to discrepancies and incomplete documents found in its training cost claim no.
OMP (COMM.) No. 67/2022 Page No. 6 of 33(Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) 00857521 (TBN-07090043FAD80116003) and training cost claim no. 00858701 (TBN-07090043FAD80116002) and submitted that biometric machine was not working properly or that it was having difficulty with electricity/internet software discrepancy etc., The said reply was/is an afterthought as the said explanation had not been given by respondent at the time of submission of its training cost claim no. 00857521 (TBN-07090043FAD80116003) and training cost claim no. 00858701 (TBN-
07090043FAD80116002). Further, the said reply was given by the respondent after a long period. Therefore, the said explanation of respondent comes under the dark cloud. Furthermore, the respondent had also tried to cover up its duplicitous claim with regard to same trainer of both necessary clarifications and documents. However, respondent did not pay any heed to respond to the said letters.
2.13 On 15.09.2017, a response was received from respondent wherein, respondent had tried to cover up its mistakes. Since, respondent had failed to provide any communications with regard to problems allegedly faced by it in recording the biometric attendance, therefore, claim of respondent could not be processed. Respondent had also failed to explain that how payment can be processed for the attendance status marked as 'Absent Status' and how, one trainer was present in both batches which were to run concurrently.
2.14 It is stated that during the execution of project, no concerns were received from respondent regarding biometric attendance, although, petitioner had received some concerns from some VTPs (excluding) respondent. The concerns were OMP (COMM.) No. 67/2022 Page No. 7 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) forwarded to The Ministry of Skill Development & Entrepreneurship on 05.10.2016, 15.06.2017, 23.08.2017 and 28.09.2017 to seek clarifications on the issues raised therein. The Ministry of Skill Development and Entrepreneurship, Government of India in its letter dated 10.10.2017 to Department of Training & Technical Education, Government of NCT of Delhi stated that "DGT formulates rules regulations and guidelines for smooth functioning of scheme, whereas its implementation depends on State Directorate. In this matter, if during verification/checking, it is justified beyond doubt that AB/VTP has not followed the stipulated guidelines/rules, you are competent to decide the final course of action by holding/suspending or blocking the payment of the said VTP". 2.15 On 20.12.2017, the competent authority i.e Principal Secretary, DTTE approved a proposal wherein, it was decided that "pro-rata payment for the period for which biometric attendance is available on the DGT web portal may only be made to the VTPs as full and final after taking an undertaking from the concerned VTPs that they will not claim any further payment, where biometric attendance could not be recorded. 2.16 Decision of the competent authority was communicated to all the VTPs including the respondent. Even though, respondent had not raised any issue regarding biometric machines and biometric attendance of the trainers during the training period. Therefore, respondent did not take advantage of the policy formulated by the petitioner/department. 2.17 On 07.09.2019, respondent invoked arbitration clause of work order dated 18.01.2016 and requested for OMP (COMM.) No. 67/2022 Page No. 8 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) appointment of sole arbitrator in terms of the said clause. Respondent approached to Hon'ble High Court of Delhi by way of Arbitration Petition bearing no. 862/2019 for appointment of Arbitrator which was allowed vide order dated 25.02.2020. Sh. Vibhor Garg, advocate was appointed as sole Arbitrator. Learned sole Arbitrator entered upon the reference and rendered the impugned award dated 05.11.2021. Pursuant to the impugned award, learned sole Arbitrator allowed the claims preferred by respondent.
2.18 Petitioner preferred petition under section 34 of the Act against the impugned award in Rohini District Court, Delhi by way of O.M.P. no. 09/2022, titled as Delhi Skill Mission Society vs. Samuel Foundation charitable India Trust. However, the same was withdrawn vide order dated 18.08.2022, due to territorial jurisdiction with liberty to file fresh before the competent Court. Accordingly, after withdrawal of petition from Rohini District Court, the present petition was filed. 2.19 Aggrieved by the impugned Award, petitioner has filed the present petition on the following grounds:-
(a) That learned Sole Arbitrator erroneously allowed claims preferred by respondent and has ignored the fact that respondent has not complied with the terms and conditions as mentioned in the work order dated 18.01.2016. Further, respondent itself is in violation of terms and conditions of said order and the guidelines issued by DGE&T. As per office order dated 28.12.2015, respondent was required to provide the list of trainers, who would be imparting the training. However, the same was not compiled by respondent while executing the project. It OMP (COMM.) No. 67/2022 Page No. 9 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) was mandatory for respondent to maintain biometric attendance for all the candidates under training.
It is contended that upon scrutiny of the claim, duplicity of trainer was found. Objections were raised with regard to duplicity of trainer, even two batches of Fashion Design were trained by only one/same trainer namely Ms. Sunita Chawla. Respondent had failed to explain as to how one trainer was present in both batches which were run concurrently. However, learned Arbitrator has ignored all these facts and passed the impugned award which is liable to be set aside on this ground itself.
(b) That learned sole Arbitrator has also ignored the clause 2.2.8 of the contract, wherein it has been categorically mentioned that it is mandatory to maintain the biometric attendance for all candidates under training. The respondent had to maintain biometric attendance for all candidates under training and this was also made mandatory by the Directorate General of Training, Government of India in its letter dated 26.03.2014. Since biometric was made mandatory by Government of India, therefore, there was no provision of accepting manual/physical attendance of training main/core module. Respondent during scrutiny of claim placed reliance on manual/physical attendance in place of biometric attendance. However, all these facts have been ignored by the learned Arbitrator while passing the impugned award.
(c) That learned sole Arbitrator overlooked the fact that as per clause 2.2.8 of the contract entered into between the parties and the guidelines issued by the DGE&T, it was mandatory to OMP (COMM.) No. 67/2022 Page No. 10 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) maintain/connect the biometric attendance of the trainees with the SDIS Portal. The biometric portal was installed by DGT for the purpose of attendance report with "Date & Profile-ID, in-time, out-time, time-spend, longitude, latitude and present status. If the candidate was not present for two third of total batch duration or longitude and latitude was not found, absent status was marked. However, learned Arbitrator ignored all these facts and passed the impugned award which is liable to be set aside as the same is in violation of clause 2.2.8 of the contract and guidelines issued by Government of India and various letters/office orders issued by the Government.
(d) That learned sole Arbitrator failed to appreciate that petitioner had written several letters i.e. letters dated 09.06.2017, 04.08.2017 and 12.09.2017 to respondent to provide necessary clarifications and documents. However, respondent did not pay any heed to respond the said letters. However, on 15.09.2017, a response was received from respondent wherein, respondent had tried to cover up its mistakes and stated that "unfortunately we have lost the written email correspondence as the concerned person working with us for the operation has left the organization. Since, the person left in negative frame hence is unwilling to share the details. However, we have the internal documents of the same in case if they are validated, we can provide the same to you."
(e) As respondent failed to provide any communications with regard to problems allegedly faced by it in recording the biometric attendance, the claim of respondent could not be processed. Further, respondent had also failed to explain that how OMP (COMM.) No. 67/2022 Page No. 11 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) payment can be processed for the attendance status marked as "Absent Status" and how one trainer was present in both batches which were to run concurrently. However, learned Arbitrator has overlooked these facts and passed the impugned award and allowed the claim of the respondent, which is liable to be set- aside.
(f) That learned sole Arbitrator has also ignored the fact that respondent in its letter dated 04.04.2017 has accepted that the biometric machine was not working properly or that it was having difficulty with electricity/internet software discrepancy etc. Further, respondent sought to cover up its duplicitous claim qua the same trainer, training both batches and manual/physical attendance of the trainees. However, these facts have never been brought to the notice of petitioner and DGT during the training period i.e. from 19.01.2016 to 25.07.2016 by the respondent, but the said facts have been completely overlooked and ignored by learned Arbitrator while passing the impugned award.
(g) That learned sole Arbitrator has failed to appreciate that upon scrutiny of claims, several discrepancies and lack of documents were found, which were communicated to respondent and requests were also made to provide clarifications/explanation, but the same was ignored by respondent.
(h) Learned sole Arbitrator has erred considering the fact that respondent has not submitted the names of trainers during the execution of project and tried to cover up its mistakes, by writing letter dated 23.01.2016 & 04.04.2017 and during the arbitral proceedings, respondent had filed its admission and denial dated 25.11.2020 wherein, respondent itself has denied its own letter OMP (COMM.) No. 67/2022 Page No. 12 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) dated 04.04.2017.
(i) That learned sole Arbitrator has failed to appreciate that on 20.12.2017, the competent authority i.e. Pr. Secretary DTTE approved a proposal, wherein it was decided that "pro-rata payment for the period for which biometric attendance is available on the DGT web portal may only be made to the VTPs as full and final after taking an undertaking from the concerned VTPs that they will not claim any further payment where biometric attendance could not be recorded." The said decision of the competent authority was communicated to all the VTPs including respondent. Even though, respondent had not raised any issues regarding biometric machines and biometric attendance of the trainers during the training period.
(j) That the impugned award is contrary to public policy, notions of justice and the laws of India.
(k) The the impugned award is perverse, untenable and lacking in proper reasons.
(l) That the impugned award fails to consider the evidence on record and is based on mere presumptions, assumptions and prejudicial inferences, and is therefore opposed to public policy and notions of justice.
(m) Because the impugned award is otherwise illegal and invalid.
2.20 It is submitted that learned Sole Arbitrator has reached findings that are beyond the terms of the contract and learned Sole Arbitrator, as a creation of the contract, cannot contravene settled terms that are agreed between the parties. The impugned award is perverse, lacks proper, intelligible and OMP (COMM.) No. 67/2022 Page No. 13 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) adequate reasons, is opposed to public policy and notions of justice and is contrary to undisputed facts, the terms of the contract and the laws of India.
2.21 For all the aforesaid reasons/grounds the award is stated to be bad in law and has thus been prayed to be set aside.
3.1 Reply to the petition was filed by respondent, wherein it is contended that petition is a gross abuse of law and same is liable to be dismissed as petitioner has failed to establish that impugned arbitral award by any stretch of imagination suffers from any illegality and even any irregularity. 3.2 It is stated that consequent to the scheme and guidelines issued by Government of India, respondent made an application for registration as a Vocational Training Provider (VTP) before the petitioner, who was/is the implementing agency for the SDI Scheme of NCT of Delhi. Upon scrutiny/evaluation of its application, physical inspection of its training centre and registration of respondent as VTP, petitioner vide its order dated 28.12.2015 approved two modules namely Fashion Design Technology (FAD-801) and Soft & Entrepreneurship Skill (SES) for two batches to be trained by respondent and an Agreement dated 18.01.2016 was signed by the parties.
3.3 Accordingly, the classes for two batches bearing Training Batch No. (TBN) 07090043FAD80116002 and 07090043FAD80116003 commenced on 19.01.2016 for the aforesaid two modules consisting of 26 trainees each. The said batches were imparted training till 25.07.2016. On completion of training, they were assessed by independent assessing bodies OMP (COMM.) No. 67/2022 Page No. 14 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) empaneled with DGT, Government of India.
3.4 In regard to Training Batch No. (TBN) 07090043FAD80116002, out of 26 trainees 25 appeared before the assessing body (Inspire Youth Development Pvt. Ltd.) all of whom cleared the assessment. Similarly in training batch no.07090043FAD80116003, out of 26 trainees, 21 appeared and cleared the assessment conducted by assessing body, FICCI. The said successful 46 trainees were granted certificate under the SDI scheme during the graduation ceremony held on 12.11.2016 in the presence of Joint Director of petitioner.
3.5 In accordance with the process for reimbursement under the Scheme, respondent submitted training cost claims bearing nos. 00857521 (for Training Batch No.07090043FAD80116003) and 00858701 (for Training Batch No.07090043FAD80116002). The said claims were made on the basis of prescribed rates and prescribed duration of each module as specified under the SDI Scheme and were computed as follows:-
Training Name of No. of Prescribed Prescribed Amount for Total Claim Cost Module successful Rate (Rs. per duration of each Amount Claim No. Trainees student per Module (Hrs) Module (Rs.) hr) (Rs.) 00857521 FAD-801 25 30 1040 7,80,000 8,42,500 (Claim 1) SES 25 100 60,500 00858701 FAD-801 21 30 1040 6,55,200 7,07,700 (Claim 2) SES 25 100 52,500 3.6 Respondent contends that instead of reimbursing the costs claims, petitioner raised frivolous and non-existent issues in order to deny the legitimate dues. It is alleged that despite being provided with all the necessary documents and appropriately OMP (COMM.) No. 67/2022 Page No. 15 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) clarifying all the queries raised by it, petitioner failed to reimburse the Training Cost Claims of claimant. Furthermore, taking advantage of its dominant position, petitioner made a proposal of making partial payment on the condition that balance amount will not be claimed by respondent. Sine respondent had executed its obligations under the Agreement and the SDI scheme with full dedication, it rejected the said proposal and was compelled to invoke the arbitration clause of Agreement.
3.7 Respondent averred that petitioner in its statement of defence as well as in the present petition has neither disputed that training imparted to the trainees nor it was its case that said trainees were not assessed or passed by independent Assessing Bodies. The defences urged by petitioner are (i) issue of irregularities with the biometric attendance submitted before the petitioner and (ii) issue of duplicity of Ms. Sunita Chawla and non-submission of list of trainers. Respondent contends that the aforesaid defences were frivolous, untenable and had been raised in order to deny the legitimate dues payable to it. 3.8 According to respondent due procedure was followed in procurement and installation of biometric device. Issue with regard to biometric device is an afterthought as petitioner had admitted issues with biometric recording were being faced by other VTPs as well. The said statement is also contrary to petitioner's assertion that it had nothing to do with the process involving biometric device. Moreover, it is claimant's case that the issues being faced by it were duly conveyed to Customer Care/Technical staff of DGT.
3.9 On perusal of attendance report recorded through OMP (COMM.) No. 67/2022 Page No. 16 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) said biometric device, the following facts can be deduced:-
Dates Status of Attendance
19.01.2016 to 01.02.2016 (2 weeks) No attendance at all.
02.02.2016 to 26.02.2016 (3.5 weeks) No issues with the attendance.
27.02.2016 to 13.05.2016 (11 weeks) 'In-time' & 'Out-time' recorded,
however, because of unavailability of
Longitude & Latitude, marked absent.
14.05.2016 to 25.07.2016 (12 weeks) No issues with the attendance.
3.10 Respondent contends that the attendance of more
than 2.5 months had been wrongly marked 'absent'. It had no control over what was and what was not being recorded by biometric device. There is no issue with the attendance recorded during 55% duration of entire course. Further attendance recorded during almost 40% of the course has incorrectly been marked 'absent' because of unavailability of 'Longitude' and 'Latitude'. However, the 'in-time' and 'out-time' were duly recorded by the biometric device. The training cost claims are liable to be reimbursed, if these 40% of training days are counted as regular days.
3.11 The manual/physical attendance was maintained by respondent only as a backup to biometric attendance. Since the biometric system had lots of issues, the intent behind various clauses referred by petitioner could not have been fully fulfilled. It is not appropriate for petitioner to state that physical attendance cannot be considered for processing of Training Cost Claims when it itself was asking for the same.
3.12 Furthermore, when petitioner had raised objection regarding irregularity with attendance report, respondent vide its letter dated 16.04.2018 brought this specific fact to the knowledge of DGT, Government of India which in turn forwarded the same OMP (COMM.) No. 67/2022 Page No. 17 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) to petitioner vide its letter dated 07.05.2016, therein stating that the object of biometric device was to capture daily attendance, so that trainees having attendance more than 80% are eligible to take assessment and as trainees have already been assessed and granted certificates, the petitioner may take decision accordingly at their end. Therefore, the defence of petitioner was rightly rejected by learned Arbitrator, who after appreciating the evidence adduced before him, gave detailed findings of fact and also the construction of agreement. Petitioner has failed to demonstrate any patent illegality in the reasoning and conclusions of the Sole Arbitrator.
3.13 The issue of duplicity of Ms. Sunita Chawla and non- submission of list of trainers was not existent and frivolous issue raised by petitioner to escape its liability. It is contended that Ms. Sunita Chawla was the Head Trainer of Garhi Centre and thus, her name appears on both the batches. Moreover, all ten trainers deployed by respondent taught their respective subjects to both the batches as per respective schedule/time table of batch. The time table/training calender was so designed that classes of one subject would not clash with other section's class for the same subject. The time tables of both the batches were uploaded on the SDI portal in May 2016 and duly conveyed to petitioner. 3.14 It is further contended that intricacies of respondent's operations were duly explained by its letter dated 23.01.2016 which also enclosed list of trainers deployed by respondent. However, petitioner conveniently and falsely alleged that same was not traceable in its record. Petitioner falsely denied the said document which bears an acknowledgment of receipt on OMP (COMM.) No. 67/2022 Page No. 18 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) 25.01.2016 by its official. The said documents and its contents, including the list of trainers have been referenced by respondent in its letter dated 31.10.2017. The said letter was an admitted document and petitioner never objected to receipt of document dated 23.01.2016.
3.15 As per respondent, petitioner never raised the issue of non-submission of list of trainers or training calender in the numerous correspondence exchanged between the parties before or after submission of training cost claims dated 06.10.2016 and the said issue was only raised in the statement of defence for the first time. This demonstrates that the said issue is only an afterthought, raised to mislead the Sole Arbitrator and deny legitimate dues of claimant. The aforesaid defence was rightly rejected by the arbitrator, who after appreciating the evidence adduced before him, gave detailed findings of facts and settled position of law. This court ought not to re-appreciate the evidence adduced, especially when petitioner failed to demonstrate any patent illegality in the reasoning and conclusions of the Arbitrator.
3.16 There was no dispute that the substantive objects of SDI Scheme and Agreement dated 18.01.2016 were duly fulfilled by respondent i.e. trainees after being trained, were assessed and passed by independent bodies and consequently the said qualified trainees were duly placed in their respective industry. However, defences urged by petitioner were only of procedural nature besides being unsubstantiated.
3.17 It is stated that petitioner had no legitimate reason to deny the reimbursement of Training Costs Claims of respondent OMP (COMM.) No. 67/2022 Page No. 19 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) and thus, the award passed by learned Sole Arbitrator does not warrant any interference from court. Denying all the other allegations, respondent prayed to dismiss the petition filed by petitioner.
4.1 I have heard the submissions advanced by learned counsel for parties.
4.2 Learned counsel for petitioner argued that learned Sole Arbitrator has overlooked the fact that as per clause 2.2.8 of the contract entered into between the parties and the guidelines issued by the DGE&T, it was mandatory to maintain/connect the biometric attendance of the trainees with the SDIS portal. The biometric portal was installed by the DGT for the purpose of attendance report with "Date and Profile ID, In-Time, Out-Time, Time Spend, Longitude, Latitude and present status". If the candidate was not present for 2/3rd of total batch duration or longitude and latitude was not found, absent status was marked. However, learned Arbitrator has ignored all these facts and passed the impugned order which is liable to be set aside as the same is in violation of clause 2.2.8 of the contract and guidelines issued by Government of India and various letters/office order issued by the Government. He further argued that learned Sole Arbitrator has failed to appreciate that petitioner had written several letters dated 09.06.2017, 04.08.2017 and 12.09.2017 to respondent to provide necessary clarifications and documents. However, respondent did not pay any heed to respond the said letters. However, on 15.09.2017, a response was received from respondent, wherein, respondent had tried to cover up its mistakes. He further submitted that learned Sole Arbitrator has OMP (COMM.) No. 67/2022 Page No. 20 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) also ignored the fact that respondent in its letter dated 04.04.2017 has accepted that the biometric machine was not working properly or that it was having difficulty with electricity/internet software, discrepancy etc. further, respondent sought to cover up its duplicitous claim qua the same trainer, training both batches and manual/physical attendance of the trainees. However, these facts have never been brought to the notice of petitioner and DGT during the training period i.e. from 19.01.2016 to 25.07.2016 by respondent. He prayed to set aside the award dated 05.11.2021 rendered by learned Sole Arbitrator in the facts and circumstances of the case and in the interest of justice.
4.3 Per contra, learned counsel for respondent submitted that now it is well settled law that scope of examination in proceedings u/s 34 of The Act is limited to ascertaining whether the impugned award is vitiated by any patent illegality or that the impugned award is in conflict with the public policy of India. It is not permissible for the court to re-appreciate the evidence recorded before an Arbitral Tribunal in section 34 proceedings. He submitted that the present petition does not qualify the requirement of law to set aside the impugned Arbitral Award as it has failed to disclose/point out any patent illegality or violation of public policy of India in the impugned award dated 05.11.2021. He prayed to dismiss the petition filed by petitioner. In support of his submissions, he relied upon "S.V. Samudram vs. State of Karnataka & Anr.", 2024 SCC OnLine SC 19; DDA vs. Eros Resorts & Hotels Ltd., 2022 SCC OnLine Del 978; Bharat Sanchar Nigam Ltd. vs. Vindhya Telelinks (P) Ltd., 2021 SCC OnLine Del 4813; Indian Highways Management Company OMP (COMM.) No. 67/2022 Page No. 21 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) Ltd. vs. Sowil Ltd., 2021 SCC OnLine Del 5523 and Glitter Overseas vs. MMTC Ltd. 2022 SCC OnLine Del 2058. 5.1 I have considered the rival submissions of both the parties and perused the material on record including the written submissions filed by learned counsel for parties. 5.2 Chapter VII of The Arbitration and Conciliation Act, 1996 (in short 'the Act') provides for recourse against Arbitral Award.
5.3 Before proceeding to decide the case on merits, I deem it appropriate to reproduce the relevant portion of section 34 of The Arbitration and Conciliation Act, 1996 for ready reference, which is extracted herein below:-
"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-
...
(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 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.} [(2-A) An arbitral award arising out of arbitrations other than international commercial arbitrations, may also be OMP (COMM.) No. 67/2022 Page No. 22 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) 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.]"
5.4 It is well settled that the scope of judicial interference in deciding a petition u/s 34 of The Act is very narrow and the court must take the approach towards protecting the award rather than setting it aside and the courts must respect the finality of award and party autonomy. Reference may be have to "Dyna Technologies Pvt. Ltd. vs. Crompton Greaves Ltd." (2019) 20 SCC 1, wherein Hon'ble court held as under:-
"There is no dispute that Section 34 of the Arbitration Act limits a challenge to an award only on the grounds pro- vided therein or as interpreted by various Courts. We need to be cognizant of the fact that arbitral awards should not be interfered with a casual and cavalier manner, unless the Court comes to a conclusion that the perversity of the award goes to the root of the matter without there being a possibility of alternative interpretation which may sustain the arbitral award. Section 34 is different in its approach and cannot be equated with a normal appellate jurisdic- tion. The mandate under Section 34 is to respect the final- ity of the arbitral award and the party autonomy to get their dispute adjudicated by an alternative forum as pro- vided under the law. If the Courts were to interfere with the arbitral award in the usual course on factual aspects, then the commercial wisdom behind opting for alternate dispute resolution would stand frustrated. Moreover, umpteen number of judgments of this Court have categorically held that the Courts should not inter- fere with an award merely because an alternative view on facts and interpretation of contract exists. The Courts need to be cautious and should defer to the view taken by the Arbitral Tribunal even if the reasoning provided in the award is implied unless such award portrays perversity unpardonable under Section 34 of the Arbitration Act."
5.5 In the case of Bharat Sanchar Nigam Ltd. vs. Vindhya Telelinks (P) Ltd., 2021 SCC OnLine Del 4813, OMP (COMM.) No. 67/2022 Page No. 23 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) Hon'ble Delhi High Court held as under:-
"39. It is now far too well settled that this Court does not sit in appeal over the decision of an Arbitral Tribunal; it cannot re-evaluate and reappreciate the evidence and supplant its opinion over that of the Arbitral Tribunal [See: Venture Global Engg. LLC v. Tech Mahindra Ltd. [Venture Global Engg. LLC v. Tech Mahindra Ltd. (2018) 1 SCC 656]; Dyna Technologies (P) Ltd. v. Crompton Greaves Ltd. [Dyna Technologies (P) Ltd. v. Crompton Greaves Ltd., (2019) 20 SCC 1]; Associate Builders v. DDA [Associate Builders v. DDA, (2015) 3 SCC 49]. Thus, this court is not called upon to determine whether the view of the Arbitral Tribunal in Sterlite Technologies Ltd. v. BSNL [Sterlite Technologies Ltd. v. BSNL, IA No.11088 of 2003, Award dated 07-5-2018 (AT)] or the decision of the Arbitral Tribunal in this case is erroneous. An arbitral award cannot be set aside on the ground that it is erroneous. In order to interfere with an arbitral award, this Court must conclude that the award is vitiated by patent illegality apparent on the face of the award."
5.6 Hon'ble High Court of Delhi in Indian Highways Management Company Ltd. v. Sowil Ltd. 2021 SCC OnLine Del 5523 observed as under:-
"45. Before concluding, it would also relevant to reiterate that the scope of interference with an arbitral award is restricted. It is permissible only on the grounds as set out under section 34 of the A&C Act. The view of an Arbitral Tribunal is final and binding unless it is found that the impugned award is vitiated by patent illegality or falls foul of the public policy of India. Even in those cases, where it is found that the Arbitral Tribunal has erred in law, interference with the arbitral award would not be permissible unless it is found that the patent illegality goes to the root of the matter and which vitiates the award [See Delhi Airport Metro Express (P) Ltd. v. Delhi Metro Rail Corpn. Ltd. [Delhi Airport Metro Express (P) Ltd. v. Delhi Metro Rail Corpn. Ltd., (2022) 1 SCC 131: (2022) 1 SCC (Civ) 330] ]. Clearly, in this case, the impugned award cannot be stated to be vitiated by patent illegality or in conflict with the public policy of India."
5.7 In the present case, there are mainly two issues raised by petitioner, one is with respect to irregularities with the biometric attendance submitted by respondent and other is issue OMP (COMM.) No. 67/2022 Page No. 24 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) of duplicity of Ms.Sunita Chawla and non-submission of list of trainers. Both the issues have been examined in detail by learned Sole Arbitrator on the basis of evidence led by the parties and documents produced before him.
5.8 In respect of the issue of irregularities with the biometric attendance, learned Sole Arbitrator arrived at the following conclusion:-
(i) Biometric device was admittedly purchased from an approved vendor installed at the training centre and was also linked to the SDI portal. There were no allegations that there was any deliberate attempt on the part of the respondent to dislodge the said biometric device and more pertinently the period for which complete biometric attendance is alleged to be not available is only interregnum and the device has been recording the complete biometric attendance before and after the said period.
(ii) The petitioner has failed to address the issue where in-time/out-time was recorded of the trainees but without latitude/longitude, which corroborated with the testimony of the trainees and manual attendance registers show that the training was imparted during the said period also.
(iii) The Agreement executed between the parties does not consider the eventuality where in-time/out-time was recorded but without latitude/longitude, as such in absence of the complete biometric attendance the manual registers should have also been considered by the petitioner to corroborate the aspect of attendance. In absence of any specific clause to deal with the said situation the only possible corollary that would flow from clause OMP (COMM.) No. 67/2022 Page No. 25 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) 2.2.8 is that manual registers can be taken into consideration to corroborate the attendance of the trainees where complete biometric attendance was unavailable.
(iv) It is not the case where there is absolutely no biometric attendance recorded and the only basis of claim is the manual register recorded by the respondent. Also, nothing had come on the record of the tribunal to dispute the veracity of the manual register vis-a-vis the period for which both biometric attendance and manual register attendance was duly recorded. In fact CW-I in its cross had also deposed as follows:-
(i) It was mandatory for the Claimant to record attendance of the trainees in the biometric device installed at the centre. I have personally reconciled the record of manual attendance and the attendance recorded in the biometric device."
(v) Merely because the respondent had failed to communicate to the DGT Govt. of India in writing about the non-recording of latitude and longitude in the biometric attendance prior to raising their claim with petitioner, the same alone cannot demolish the stand of the respondent in respect to the difficulties faced by it in recording of biometric attendance. Especially when, it is the admitted case of the petitioner that other VTPs were facing the similar issues evidenced by repeated letters Ex.RW-1/10 to 1/14 written by petitioner to the Ministry of Skill Development & Entrepreneurship, testimony of RW1 who authored these letters and mere perusal of biometric attendance report filed by the respondent demonstrate the issue pertaining to non-recording of latitude and longitude in the biometric attendance despite OMP (COMM.) No. 67/2022 Page No. 26 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) recording the in time and out time.
(vi) The veracity of classes being conducted and training being imparted stands duly proved not only by the trainees examined before the Tribunal but also by the very fact that the trainees or the said two batches were duly assessed and granted the certificate evidencing completion of the said training, thereafter it now does not remain open with the petitioner to reject the claim of the respondent by disputing attendance of the trainees. The Issuance of certificate demonstrates that the object of training has been achieved, as such, the petitioner now cannot reject the claim of the respondent on non-cogent reasons.
(vii) It is also the case of the respondent that the petitioner had the right to conduct surprise inspections and no evidence has been brought on record by the petitioner that such inspections were conducted or that the classes were found not to be conducted in the stipulated format.
(viii) That the respondent had filed screen shots of the SDIS Portal detailing in its claim with respect of detailing cost pertaining to two batches, filing of these claims is also not been disputed by the petitioner, is admitted.
5.9 With respect to the issue of issue of duplicity of Ms. Sunita Chawla and non-submission of list of trainers, the learned Sole Arbitrator held as under:-
(i) Ms.Sunita chawla had been examined as CW2 who has duly supported the case of the respondent. It is pertinent to note that during the cross examination, the said witness CW-2 has submitted that there were total 10 trainers, being permanent employees of the Claimant, further, she has not attended both the OMP (COMM.) No. 67/2022 Page No. 27 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) batches at the same time.
(ii) The time table and the training calender was so designed that the classes of one subject would not clash with the other class for the same subject, which is also evident from the monthly time tables of both the batches which are Ex.CW2/1.
That the said time tables were duly uploaded on the SDI portal and were also conveyed to the petitioner vide letters both dated 03.05.2016 which is Ex.CW-1/14 & Ex.CW-1/15. That the said letters have been duly admitted by the Respondent in its affidavit of admission and denial.
(iii) That vide letter dated 23.01.2016 (Ex.CW-1/11), the respondent had again submitted the list of its trainers with the petitioner. The said document is disputed/denied by the petitioner by stating that the same is not traceable of the record of the Department. The petitioner states that in absence of any evidence to show how and in what manner the said letter dated 23.01.2016 containing list of trainers was delivered to the petitioner, the same cannot be said to be proved. The respondent has countered the same by stating that the reference of the said letter dated 23.01.2016 was also made in the subsequent letter dated 31.10.2017 (Ex.CW-1/7) which was issued by the respondent to the petitioner. That the said letter dated 31.10.2017 is duly admitted by the petitioner in its affidavit of admission and denial and has not been disputed till date in respect of its contents including the reference to letter dated 23.01.2016. CW-1 in its deposition has specially clarified and stated that the said letter was hand delivered by Mr. Atrey. It is nowhere the case of the petitioner that no letters in its department are received in the OMP (COMM.) No. 67/2022 Page No. 28 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) manner the letter dated 23.01.2016 is stated to be delivered by the respondent and as such, he (the Sole Arbitrator) did not find any force in the argument of the petitioner that the respondent has not been able to prove the service of its letter dated 23.01.2016 to the Respondent.
(iv) It is also contended by the petitioner that though the letter dated 23.01.2016 states that the respondent has 8 full time 5 part time trainers, the same contradicts the statement of CW-2, where it says that there was a total 10 number of trainers deployed who were permanent employees of the respondent. The witness was not confronted with the same by providing her with an opportunity to explain the same which otherwise also cannot be said to be a material contradiction & especially on being asked during her cross examination, the CW-2 was able to sufficiently name her colleagues at the time.
(v) Moreover, merely because there exists a common trainer for both the batches is not a ground for rejection of the Claim unless it can be shown that in terms of the training schedule it was not possible for the same trainer to take 2 different classes at the same time pertaining to different batches.
(vi) The communication dt. 22.10.2018 (Ex.CW-1/33) sent by the petitioner to the respondent fails to give any reasons as to why the explanation as provided by the respondent in respect of duplicity of trainer is found unacceptable or unsatisfactory. Further nothing has been pointed out by the petitioner from the biometric attendance and manual register filed before the Tribunal that it was not possible to impart training to two different batches or that she has been shown to impart OMP (COMM.) No. 67/2022 Page No. 29 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) training to 2 different classes at the same point of time.
(vii) It is difficult to comprehend that if details of trainers or training schedule were not available with the petitioner, then how the assessment could have been conducted for the trainees in question.
5.10 After going through the above findings on the issues involved in case in hand, I am of the view that learned Arbitrator has passed the award on detailed scrutiny of facts and proper appreciation of evidence which is not obnoxious to the settled position of law or the principles of interpretation of appreciation of evidence. It is noticed that learned Sole Arbitrator has properly appreciated the facts of the case and has done a detailed analysis of evidence led by the parties and thereafter rendered his findings after due consideration and application of mind. 5.11 On consideration of the appreciation of arguments advanced by learned counsel for parties, I find that challenge to the impugned award is purely founded on the merits of the award. Same is not permissible within the limited powers of challenge available u/s 34 of The Act. Otherwise also, I do not find any infirmity in the reasoning given by learned Arbitrator. The impugned award is not found to be patently illegal or against the public policy.
5.12 In the case of Konkan Railway Corporation Ltd. v. Chenab Bridge Project (2023) 9 SCC 85, it was held by Hon'ble Supreme Court, if the view taken by Arbitrator is a plausible view, no interference on the specified grounds is warranted. 5.13 Similar observations were made by Hon'ble Apex Court in the case of S.V. Samudram vs. State of Karnataka & OMP (COMM.) No. 67/2022 Page No. 30 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) Anr. 2024 SCC OnLine SC 19, in which it was held as under:-
"49. We have carefully perused the award passed by the Arbitrator in which he has not only referred to and considered the materials on record in their entirety but also, after due application of mind, assigned reasons for arriving at this conclusion, either rejecting, accepting or reducing the claim set out by the Claimant-Appellant. Noticeably, during the arbitral proceedings none of the parties raised any objection to the Arbitrator adjudicating the dispute, be it on any ground, including bias. Each one of the claims stands separately considered and dealt with.
50. We find that the view taken by the Arbitrator is a plausible view and could not have been substituted for its own by the Court."
5.14 In the case in hand, consequent upon evaluation of its application and physical inspection of its training centre, registration of respondent as a VTP was confirmed by petitioner vide order dated 28.12.2015. Petitioner approved two modules namely Fashion Design Technology (FAD-801) and Soft and Entrepreneurship Skill (SES) for two batches to be trained by respondent. Accordingly, an agreement date 18.01.2016 was signed by both the parties.
5.15 The classes for two batches for the aforesaid two modules consisting of 26 trainees each commenced on 19.01.2016. The batches were imparted training till 25.07.2016. On completion of training, the trainees were assessed by independent Assessing Bodies empanelled DGT, Government of India. In one training batch, out of 26 trainees, 25 appeared before the Assessing Body i.e. Inspire Youth Development Pvt. Ltd. and they all cleared the assessment. In another batch, out of 26 trainees, 21 appeared, who cleared the assessment conducted by Assessing Body (FICCI). All the successful trainees 46 (25 +
21) trainees were granted certificates under SDI Scheme during OMP (COMM.) No. 67/2022 Page No. 31 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) the graduation ceremony held on 12.11.2016 in the presence of Joint Director of petitioner.
5.16 There is no dispute regarding the Attendance Report through biometric device for the period 02.02.2016 to 26.02.2016 (3.5 weeks) and 14.05.2016 to 25.07.2016 (12 weeks). The dispute is for the period 19.01.2016 to 01.02.2016 (two weeks) for which no attendance has been marked and 27.02.2016 to 13.05.2016 (11 weeks), where in the attendance report 'in-time' and 'out-time' is recorded but due to non-availability of longitude and latitude, the status of trainees have been marked 'absent'. 5.17 Petitioner has also raised issue with respect to duplicity of Ms.Sunita Chawla and non-submission of list of trainers. The contention of respondent is that Ms.Sunita Chawla was the Head Trainer of Garhi Centre and thus, her name appears on both the batches. Moreover, all ten trainers deployed by respondent taught their respective subjects to both the batches as per respective schedule/time table of batch. The time table/training calender was so designed that classes of one subject would not clash with other section's class for the same subject. The time tables of both the batches were uploaded on the SDI portal in May 2016 and duly conveyed to petitioner. 5.18 On examination of witnesses and the documents produced and proved on record by the parties, learned Sole Arbitrator has found the claimant/respondent to be entitled for the amount claimed by it. The impugned award passed by Arbitral Tribunal is well reasoned and based on appreciation of correct facts and evidence on record. The view taken by Arbitrator is not in conflict with the settled legal position. Petitioner has failed to OMP (COMM.) No. 67/2022 Page No. 32 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust) bring anything on record that the findings and conclusions rendered by learned Arbitrator are per se perverse, illegal or not sustainable. On the basis of material available on record, I find that the view taken by the learned Arbitrator is a plausible one and same cannot be substituted for its own by this court. 5.19 For the foregoing reasons and discussion made above, no ground for setting aside or interference in the impugned award dated 05.11.2021 is made out. Accordingly, the petition filed by petitioner is dismissed.
6.1 Parties are left to bear their own cost.
7.1 In compliance of the provisions of the Order XX Rule 1 of the Code of Civil Procedure (as amended upto date by The Commercial Courts Act, 2015) a copy of this judgment be sent to both the parties to the dispute through electronic mail, if the particulars of the same have been furnished, or otherwise. 8.1 File be consigned to Record Room.
Announced in the open court (RAJ KUMAR TRIPATHI) Dated: 25.01.2024 District Judge (Commercial Court)-08, South-East District, Saket Courts, New Delhi OMP (COMM.) No. 67/2022 Page No. 33 of 33 (Delhi Skills Mission Society vs. Samuel Foundation Charitable India Trust)