Delhi District Court
M/S Haldiram Bhujia Wala vs M/S Bhawani Distributors on 12 December, 2025
IN THE COURT OF SH. AJAY PANDEY
DISTRICT JUDGE (COMMERCIAL COURT-10) CENTRAL,
TIS HAZARI COURTS, DELHI
OMP Comm 91/2024
M/s HALDIRAM BHUJIA WALA
Through it's Proprietor
Mr. Ashok Agarwal
Office at : AP-4/5,
Wazirpur Industrial Area,
New Delhi Objector
Vs
M/s Bhawani Distributors
Office at : Opp. Central Market,
Gola Road, Ramgarh Cantt.
District Ramgarh 829122
Jharkhand Respondent
Date of Institution : 07.10.2025
Date of Arguments : 15.11.2025
Date of Judgment : 12.12.2025
JUDGMENT:-
PETITION ON BEHALF OF PETITIONER UNDER SECTION 34 OF THE ARBITRATION AND CONCILIATION ACT, 1996 AGAINST THE ARBITRAL AWARD DATED 10.05.2024
1. The present objection under section 34 of The Arbitration and Conciliation Act 1996 (hereinafter referred as The Act), has been filed by petitioner M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 1 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:11 +0530 challenging the award dated 10.05.2024 passed by learned Arbitrator.
2. For the sake of convenience parties i.e. objector herein and respondent herein shall be referred to as per their original status in the arbitration proceedings i.e. as respondent and claimant respectively.
FACTUAL MATRIX
3. A claim petition was filed by the claimant M/s Bhawani Distributors against respondent Haldiram Bhujia Wala stating inter-alia that on 10.06.2010 respondent and claimant entered into an Consignment Sale Agency Agreement under which claimant was to act as Consignment Sale Agent of the respondent for sale of their patent and proprietory Namkeen, Sweets etc. in the State of Jharkhand. Claimant gave a security cheque of Rs.1.00 lakh and another cheque of Rs.2,51,000/- to the respondent as advance payment against the order for supply of goods to the claimant.
3.1 It was the case of claimant before the learned Arbitrator that it was agreed between the parties that claimant would be entitled for all expenses incurred by him for the acts done as per instructions of General Manager, Deputy General Manager or Area Sales Manager of respondent i.e. extra scheme for railway vendors, mistake in total, M.R.P. difference of the product, payment to sales team who were directly M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 2 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:18 +0530 appointed by the respondent from its Delhi office, expired and damaged stocks, freight transportation charges, service tax on commission and other over-head expenses. Claimant used to claim the reimbursement of aforementioned expenses in the subsequent month as per agreement.
3.2 It was further case of the claimant before the learned Arbitrator that parties carried on the business in this manner till September 2015, but due to disputes amongst respondent's family members/relatives, respondent stopped production of goods and also stopped payment to the sales personnels. For that reason sales personnels stopped to perform their duty and he available stocks were received unsold and got expired and damaged.
3.3 Pending claims of the claimant were not paid despite efforts. Hence, claimant sent legal notice dated 01.02.2017 to the respondent. In addition to that claimant also sent a personal notice to the respondent on 24.05.2017. Thereafter claimant invoked arbitration clause between the parties. Learned Arbitrator was appointed under section 11 of The Act. Claimant filed his statement of claim.
3.4 Respondent also filed its reply to the statement of claim denying the allegations therein. Claimants amended statement of claim and learned Arbitrator has tabulated the claims in the table running M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 3 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:26 +0530 from page no. 15 to 18 of the award as follows :-
S. No. Period Particulars Claim Amount
1. Upto 03.02.2014 Old pending claims & Rs.70,908.68 Balance claim
2. Between Damage and expired Rs.6,73,751.17 10.06.2010 to stock dues amount 10.10.2013 (damaged and expired stock returned to company = Rs.28,88,130.75, but got reimbursed by company only with an amount of Rs.22,14,379.58, hence balance due amount is Rs.6,73,751.17) Sub Total Rs.7,44,659.85
3. Between Damage stock sent, Rs.11,74,472.85 27.07.2013 to return to company 24.12.2014
4. Between Railway Fair Claims Rs.16,446.15 28.02.2013 to 31.01.2014
5. Between Rate difference in Rs.18,546.06 30.06.2013 to Billing 31.03.2015
6. Between Payment to Sales Rs.9,32,112.00 31.10.2013 to Personnels 31.12.2015
7. Between Commission Rs.63,888.49 31.03.2015 to 30.11.2015
8. Between Service Tax Rs.45,736.00 31.12.2015 to 31.07.2015
9. Between Secondary Freight Rs.63,888.49 31.03.2015 to charges 30.11.2015
10. Between Transpiration charges Rs.4,14,603.40 31.12.2013 to from Delhi to Ramgarh 30.09.2015 Cantt. And from M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 4 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:33 +0530 Ramgarh to Delhi
11. Between Office expenses Rs.51,250/-
31.10.2014 to 30.11.2014
12. 31.08.2016 Damage stock in the Rs.8,16,977.31 warehouse of the claimant
13. 10.06.2010 Security deposit money Rs.1,00,000/-
Grand total Rs.44,42,599.65 (Rupees Forty Four Lakhs Forty Two Thousand Five Hundred Ninety Nine and Sixty Five Paise only) Apart from the aforesaid claim, claimant also claimed that the claimant incurred legal expenses, fooding, lodging and travelling expenses as under:-
S. NO. PERIOD PARTICULARS AMOUNT 1. 2017 to 2023 Legal expenses Rs.2,00,000.00
2. 2017 to 2023 Fooding, lodging and Rs.2,00,000.00 traveling expenses
3. 2017 to 2023 Quarterly interest @ 18% Rs.72,56,098.00 per annum on the claim amount of Rs.44,42,599.65
4. Respondent's arbitration Rs.25,000/-
fee paid by claimant Total Amount Rs.76,81,098/-
3.5 Parties led their respective evidences before the learned Arbitrator.
3.6 After appreciation of evidence and consideration of arguments of parties the impugned award dated 10.05.2024 with following effective order in para no. 46 was passed :-
M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 5 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:39 +0530
46. That thus I hereby allow the claim of the claimant vide this Award to the tune of Rs.44,42,599.65 (Rupees Forty Four Lakhs Forty Two Thousand Five Hundred Ninety Nine & Sixty Five Paise only) alongwith interest @ 12% per annum from the date of filing of the claim i.e. 23.03.2018 till its actual realization. Though the claimant has claimed a sum of Rs.2,00,000/- towards legal expenses, Rs.2,00,000/-
towards fooding, lodging and traveling expenses which are exorbitant as the claimant has not filed any proof to this effect. The claimant is only entitled for Rs.50,000/- towards legal expenses and Rs. 10,000/- towards fooding, lodging and traveling expenses incurred by claimant while attending the proceedings.
OBJECTION PETITION
4. It is inter-alia stated in the objection petition under section 34 of The Act that award has been passed without considering the facts and law and learned Arbitrator wrongly allowed claim nos. 1 to 12. It is further stated that learned Arbitrator even granted Rs.10,000/- for fooding, lodging and travelling expenses without claiming the same by the respondent.
4.1 It is further stated that award is liable to challenge under section 34 of The Act. Claim wise objections have been raised in the petition stating inter- alia that claimant claimed the alleged due amount in M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 6 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:44 +0530 claim no.1 for the period 28.02.2011 to 31.12.2012 which is barred by limitation but the sole Arbitrator crossed all limits of biasness and allowed time barred claims in the claim petition filed in December 2017. It is further stated that there is no affidavit in respect of the claim raised by the respondent and the same was not properly verified.
4.2 It is further stated that learned Arbitrator tried his level best to place the matter within limitation and considered the mail of 03.02.2014 sent by the respondent to the petitioner to prove the claim. It is further stated that mere conversation by one party cannot extend limitation period.
4.3 It is further stated that claim no.2 pertain to the year 2013 and repeated communication of the claims cannot extend the limitation but the learned Arbitrator has allowed the claim. It is further stated that claimant in claim no.2 did not make any claim for the period December 2014 but learned Arbitrator recorded so while analyzing the said claim. It is further stated that from this fact it is clear that claimant's claim no.2 was not as per the claim no.2 mentioned by learned Arbitrator and he allowed the claim which was not part of the pleadings. It is further stated that learned Arbitrator cannot go beyond the pleadings. Total claimed amount by the claimant was a sum of Rs.16,466.15/- while learned Arbitrator allowed Rs.11,74,472/-.
M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 7 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:49 +0530 4.4 It is further stated that claim no.3 was pertaining to the invoice of period 2013-2014. It need not be mentioned that food items have expiry period of approximately six months or as mentioned upon their packings. If the claimant would return the expired goods they were not useable and the same must be returned within specified period, difference in billing/wrong billing can be raised within the shortest span of time after receiving the goods but the price/MRP cannot be disputed after receiving the goods. It is further stated that even this claim raised by the claimant was hopelessly barred by time as the limitation would start from each bill and there is no running account between the parties.
4.5 In respect of claim no.4 of the claimant it is stated that same pertains to the period October 2013 to August 2015 for the payment made by claimant on behalf of respondent to the sales team. It is stated that even this claim was barred by limitation. Furthermore, the claimant was silent about the quantum of payment made to the sales team and such vague averments could not have been allowed.
4.6 It is further stated that claim amount in claim no.5 pertains to the period 2011 and 2012 about service tax paid by claimant on the amount of commission received by him from respondent but learned Arbitrator without any specific demand considered the said claim amounting to Rs.9,32,112/- M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 8 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:04:55 +0530 though no such amount was claimed by the claimant. Further the claim pertaining to the period 2011-2012 were barred by limitation.
4.7 It is further stated that in claim no.6 quantum of transportation charges was not specified nor it was specified how the respondent was liable to make payment of the same to claimant. It is further stated that damaged and expired stock cannot be liability of the respondent. Thus claim no.6 was not maintainable being vague and barred by limitation.
4.8 In respect of claim no.7 towards payment of commission totaling to Rs.63,888.49/-, it is stated that claimant claimed that he was entitled to 2.5% commission on the sale of goods made in the State of Jharkhand and the respondent had only paid part commission. It is further stated that entitlement of the claimant towards the commission is not based on law and even the contract between the parties was silent for the same but learned Arbitrator allowed the said claim without examining the same.
4.9 In respect of claim no.8 it is stated that pleadings of the same were vague. It is further stated that there is no term of contract dated 10.06.2010 wherein the respondent was liable to pay transportation charges but learned Arbitrator ignored the said fact and passed the award on presumptions and beyond pleadings.
4.10 In respect of claim no.9 it is stated that same M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 9 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:00 +0530 was in respect of transportation of goods from Delhi to Ramgarh and Ramgarh to Delhi. As per terms and conditions of contract, claimant was to take local permissions/licenses like sales tax, registration under Shop and Establishment Act. The entire pleading is silent that which stock was purchased by the claimant from the respondent and that as per agreement dated 10.06.2010 the claimant was only consignment agent but he showed himself as purchaser of the products but learned Arbitrator was totally silent on this issue while passing the award.
4.11 In respect of claim no.10, it is stated that this claim was a vague plea taken by claimant beyond the facts and claimant failed to place any document in respect of the averments in support of this claim. Claimant did not mention any part of the agreement by which this claim was permissible.
4.12 In respect of claim no.11, wherein old stock was kept by the claimant in warehouse and stock got expired, it is stated that it happened due to the negligence on the part of claimant. Once the claimant received the article he was responsible for the same and if said stock got expired or damaged, claimant cannot take advantage of its own wrong because he was negligent in discharge of his responsibility.
4.13 In respect of claim of return of security deposit, it is stated that security was deposited vide M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 10 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:05 +0530 agreement dated 10.06.2010 which should have been claimed on their original initial stage of agreement. Thus this claim was also barred by limitation.
4.14 It is further stated that claimant's partnership firm was unregistered and claims by such unregistered firm were not maintainable in view of section 69 (1) of Partnership Act 1932. Reference to the judgment passed by Hon'ble Kolkata High Court in the matter of Md. Mofazzular Rahman & Ors. Vs. Md. Sarfaraz Alam & Ors. AIR 2021 CALCUTTA 148, AIRONLINE 2021 CAL 235, and by Hon'ble Supreme Court in the matter of Loonkaran Sethia & Ors. Vs. Ivan E. John, AIR 1969, is made to state that the claims were not maintainable in view of section 69 (1) of the Partnership Act because of non-registration of firm.
4.15 Terms and conditions of the Consignment Sale Agency dated 10.06.2010 are quoted and it is stated that learned Arbitrator ignored the fact that notice was issued under order XII rule 8 of CPC, wherein details of consignment goods/products along with other particulars sent by the respondent to the claimant were sought. Said documents were never provided by the claimant but learned Arbitrator slept over the notice and did not discuss the same in his award.
4.16 It is further stated that it was duty of the claimant to keep the consignments in safe custody and he could not have filed the claim in respect of perishable M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 11 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:09 +0530 goods after a period of 08 years.
4.17 It is further stated that under clause 7 of the consignment agreement a consolidated and lumpsum amount equal to 2.5% of the sale value of the stock was to be paid to the claimant but the claimant failed to provide details of account in respect of consignment sent by the respondent to claimant.
4.18 It is further stated that findings of learned Arbitrator are not on merits.
4.19 It is further stated that findings of learned Arbitrator that respondent did not approach with clean hands and allowing claim of claimant is against the judgment of Hon'ble Supreme Court in the matter S Shivraj Reddy (Died) Thr His Lrs and Another Vs S. Raghuraj Rerddy and others, SLP (Civil) No (s). 4237 of 2015, wherein Hon'ble Supreme Court was pleased to decide that the question of limitation shall be decided by the court even though the said part or issue is not raised by the parties.
4.20 Reliance on the judgment of Hon'ble Supreme Court in the case of V.M. Salgocar and Bros. Vs Board of Trustees of Port of Mormugao and Another (2005) 4 SCC 613, is placed to submit that limitation shall be first decided by the court even though the same is not raised by the parties.
4.21 It is further stated that statement of claim was not maintainable as per section 19(2) (a) of Indian M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 12 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:15 +0530 Partnership Act 1932 because the implied authority of partner does not empower him to submit a dispute relating to business of the firm to arbitration. Therefore, claim was not maintainable in accordance with law. It is stated that CW-1 in his cross-examination stated :-
"It is correct that I have not mentioned in my affidavit exhibit CW-1/A that he is partner of the firm and also claimant firm is not a registered partner". It is further admitted " It is correct that I have not placed on record any partnership firm deed".
4.22 Following part of cross-examination of CW-1 is also quoted "I do not remember the details of the last consignment sent by the respondent to me. I have placed on record the Builty of the transport. It is correct that I have not placed on record the consignment bill. It is correct that I have not appointed any salesman/ staff for selling the goods. Vol. all the staff was appointed by the respondent. I placed orders on the respondent for supply of the goods through emails. I have not placed any record for demand of supply of goods from respondent. I have not placed all bills of the company, but some of the copies are placed on record. It is wrong to suggest that I have not filed the complete copies of bills intentionally." to submit that claimant failed to prove his case before learned Arbitrator.
4.23 It is further stated that learned Arbitrator totally ignored the evidence of the respondent and M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 13 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:20 +0530 findings of learned Arbitrator are perverse.
4.24 In the grounds of objections same averments are made and it is prayed in the prayer clause that Arbitral Award dated 10.15.2024 be set-aside.
REPLY TO PETITION
5. Notice of the petition was served upon the claimant. Claimant filed its reply taking objections that :-
5.1 The petition is not maintainable and no ground mentioned under section 34 (2) of The Act is made out. It is further stated that the application is filed at belated stage without explanation of any cause for delay. It is further stated that the objections are attempt to delay execution of award. Any biased-ness by learned Arbitrator is denied and it stated that the learned Arbitrator was appointed by the respondent.
5.2 In reply on merits, it is denied that the claims of claimant were time barred and it is stated that the claims were arising out of the continuous breaches in the contractual relationship and it has been repeatedly held by Hon'ble Supreme Court and various Hon'ble High Courts that in case of continuing breaches the limitation period can begin from the date of last breach or payment in the ongoing contracts. It is further stated that the learned Arbitrator has passed the impugned award after due consideration of material and evidence.
It is further stated that even before the learned Arbitrator M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 14 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:26 +0530 the respondent attempted to delay the proceedings and did not even pay the Arbitrator's fee.
5.3 Dismissal of objections is prayed.
ARGUMENTS
6. Arguments on petition were heard from learned counsels for parties. I have also gone through the written submissions filed on behalf of parties. The court has carefully perused the award passed by Arbitral Tribunal.
7. It is argued by learned Sh. Vishwendra Verma, Advocate for respondent that the award passed by learned Arbitrator is against principals of natural justice. The learned Arbitrator was prejudiced against the respondent and made every attempt to bring the claims of the claimant within limitation though the claims filed by the claimant were time barred. He also extended the stand taken in the objection petition that even without any pleadings or arguments from any party, the learned Arbitrator was obliged to decide the issue of limitation. On the issue of limitation he has referred following judgments in his written submissions :-
1) Reliance infrastructure vs. State of Goa, 2023 SCC OnLine SC 604;
2) Thomas Cook (India) Ltd. vs. Red Apple Chandrarat Travel; 2023 SCC OnLine Born 97;
3) Oriental Insurance Co. vs. April USA Assistance, 2021 SCC OnLine Del 4843 M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 15 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:31 +0530
4) National Highways authority of India vs. Oriental Structural Engineers, OMP No. 1640/2014;
5) State Trading Corporation of India Ltd. vs. Toepfer International Asia Pte. Ltd. 2014 SCC Online Del 3426;
6) Ssangyong Engineering & Construction Co.
Ltd. vs. National Highways Authority of India, 2019 SCC OnLine SC 677;
7) Associate Builders vs. Delhi Development Authority, (2015) 3 SCC 49;
8) Sh. Purna Nand vs. Union of India & Anr. OMP 164/2007, Delhi High Court dated 19 January 2015;
9) P. R. Shah Shares and Stock Brokers Pvt. Ltd. vs. B.H.H. Securities Pvt. Ltd. & Ors. (2012) 1 SCC 594;
10) National Highway Authority of India vs. Gammon India Ltd. 2014 SCC Online Cal 17407;
11) K.M. Muhammed Sultan Rowther and Ors. vs. K.S.M. Muhamed Nurdin -(1963) 1MLJ300;
12) Mohammad Dalil Khan vs. State of Hyderabad - AIR 1963 AP 216;
13) Bindeshwari Prasad vs. District Board of Saran - AIR 1964 Pat 134;
14) State of Rajasthan vs. The Bundi Electric Supply Co.Ltd., Bundi- AIR 1971 Raj 24;
15) S.P. Moidu vs. The Kerala State Electricity M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 16 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:36 +0530 Board, ILR 1980 (2) Kerala 499;
16) Geo Miller & co. Pvt. Ltd. vs. Chairman Rajasthan Vidyut Utpadan Nigam Ltd. 2019 SCC Online 1137;
17) Allahabad Development Authority and Ors vs. Vidyawati Construction Co. (2002) (46) ALR 73;
18) State of Maharashtra vs. Hindustan Construction Co. Ltd. 2013 SCC Online Bom 181;
19) Sampuran Singh & Ors. vs. Niranjan Kaur and Ors. (1999) 2 SCC 679;
20) Vijayalakshmi Art Productions vs. Vijaya Productions Pvt Ltd. MANU/TN/0121/1995.
8. He further argued about the objections in respect of section 69 (1) of Partnership Act and 19 (2) (a) of The Indian Partnership Act as taken in his objection petition.
9. Learned Sh. Amresh Anand, Advocate for claimant also extended his arguments in the lines of the contents of reply to the objection petition.
10. Arguments considered. Record perused.
FINDINGS
11. It is settled law that the objections to the Arbitral Award are required to be strictly confined to the grounds under section 34 (2) and 2A of The Act.
12. Said provision is reproduced herein below:-
34.Application for setting aside M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 17 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:42 +0530 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--
2(a) the party making the application 1[establishes on the basis of the record of the arbitral tribunal 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, underthe 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 M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 18 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:49 +0530 matters beyond the scope of the submission to arbitration:Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate, or, failing such agreement, wasnot 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; M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 19 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:54 +0530 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.] ...........
13. There is only limited scope of interference by the court in the petitions under section 34 of the Arbitration and Conciliation Act 1996. In the case of Associate Builders Vs Delhi Development Authority (2015) 3 SCC 49, it was held by Hon'ble Supreme Court "the M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 20 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:05:59 +0530 interference with an arbitral award is permissible only when the findings of the arbitrator are arbitrary, capricious or perverse or when conscience of the Court is shocked or when illegality is not trivial but goes to the root of the matter. It is held that once it is found that the arbitrator's approach is neither arbitrary nor capricious, no interference is called for on facts. The arbitrator is ultimately a master of the quantity and quality of evidence while drawing the arbitral award. Patent illegality must go to the root of the matter and cannot be of trivial nature."
14. In the case of Navodaya Mass Entertainment Ltd VS J.M. Combines MANU/SC/0735/2014, it was held :-
"scope of interference of the Court is very limited. Court would not be justified in reappraising the material on record and substituting its own view in place of the Arbitrator's view. Where there is an error apparent on the face of the record or the Arbitrator has not followed the statutory legal position, then and then only it would be justified in interfering with the award published by the Arbitrator. Once the Arbitrator has applied his mind to the matter before him, the Court cannot reappraise the matter as if it were an appeal and even if two views are possible, the view taken by the Arbitrator would prevail. (See: Bharat Coking Coal Ltd. Vs. L.K. Ahuja, (2004) 5 SCC 109; Ravindra & Associates Vs. Union of India, M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 21 of 44 OMP Comm 91/24 Digitally signed by AJAY AJAY PANDEY PANDEY Date:
2025.12.12 15:06:04 +0530 (2010) 1 SCC 80; Madnani Construction Corporation Private Limited Vs. Union of India & Ors., (2010) 1 SCC 549; Associated Construction Vs. Pawanhans Helicopters Limited, (2008) 16 SCC 128; and Satna Stone & Lime Company Ltd. Vs. Union of India & Anr., (2008) 14 SCC".
15. In the case of M/s Arosan Enterprises Ltd Vs Union of India & Anr MANU/SC/0595/1999, it was held:-
"that reappraisal of evidence by the court is not permissible and as a matter of fact exercise of power by the Court to reappraise the evidence is unknown to a proceeding under Section 30 of the Arbitration Act. In the event of there being no reasons in the award, question of interference of the court would not arise at all. In the event, however, there are reasons, the interference would still be not available within the jurisdiction of the Court unless of course, there exist a total perversity in the award or the judgment is based on a wrong proposition of law: In the event however two views are possible on a question of law as well, the Court would not be justified in interfering with the award. The common phraseology `error apparent on the face of the record' does not itself, however, mean and imply closer scrutiny of the merits of documents and materials on record: The court as a matter of fact, cannot substitute its evaluation and come to the conclusion that the arbitrator had acted contrary to the bargain between the parties. If the view of M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 22 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:09 +0530 the arbitrator is a possible view the award or the reasoning contained therein cannot be examined. In this context, reference may be made to one of the recent decision of this Court in the case of State of Rajasthan v. Puri Construction Co. Ltd. (1994 (6) SCC
485) wherein this court relying upon the decision of Sudarsan Trading Co.'s case case (Sudarsan Trading Co. v. Government of Kerala and Anr. (1989 (2) SCC 38) observed in paragraph 31 of the Report as below:- "A court of competent jurisdiction has both right and duty to decide the lis presented before it for adjudication according to the best understanding of law and facts involved in the lis by the judge presiding over the court.
Such decision even if erroneous either in factual determination or application of law correctly, is a valid one and binding inter parties. It does not, therefore, stand to reason that the arbitrator's award will be per se invalid and inoperative for the simple reason that the arbitrator has failed to appreciate the facts and has committed error in appreciating correct legal principle in basing the award. An erroneous decision of a court of law is open to judicial review by way of appeal or revision in accordance with the provisions of law. Similarly, an award rendered by an arbitrator is open to challenge within the parameters of several provisions of the Arbitration Act. Since the arbitrator is a judge by choice of the parties and more often than not a person with little or no legal background, the adjudication of disputes by an arbitration by way of an award can be challenged only within the limited scope of several provisions of the Arbitration Act and the legislature in its wisdom has limited the scope and ambit of challenge to an award in M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 23 of 44 OMP Comm 91/24 Digitally signed by AJAY AJAY PANDEY PANDEY Date: 2025.12.12 15:06:14 +0530 the Arbitration Act. Over the decades, judicial decisions have indicated the parameters of such challenge consistent with the provisions of the Arbitration Act. By and large the courts have disfavoured interference with arbitration award on account of error of law and fact on the score of misappreciation and misreading of the materials on record and have shown definite inclination to preserve the award as far as possible. As reference to arbitration of disputes in commercial and other transactions involving substantial amount has increased in recent times, the courts were impelled to have fresh look on the ambit of challenge to an award by the arbitrator so that the award does not get undesirable immunity. In recent times, error in law and fact in basing an award has not been given the wide immunity as enjoyed earlier, by expanding the import and implication of "legal misconduct" of an arbitrator so that award by the arbitrator does not perpetrate gross miscarriage of justice and the same is not reduced to mockery of a fair decision of the lis between the parties to arbitration. Precisely for the aforesaid reasons, the erroneous application of law constituting the very basis of the award and improper and incorrect findings of fact, which without closer and intrinsic scrutiny, are demonstrable on the face of the materials on record, have been held, very rightly, as legal misconduct rendering the award as invalid. It is necessary, however, to put a note of caution that in the anxiety to render justice to the party to arbitration, the court should not reappraise the evidences intrinsically with a close scrutiny for finding out that the conclusion drawn from some facts, by the M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 24 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:19 +0530 arbitrator is, according to the understanding of the court, erroneous. Such exercise of power which can be exercised by an appellate court with power to reverse the finding of fact, is alien to the scope and ambit of challenge of an award under the Arbitration Act. Where the error of finding of facts having a bearing on the award is patent and is easily demonstrable without the necessity of carefully weighing the various possible viewpoints, the interference with award based on erroneous finding of fact is permissible. Similarly, if an award is based by applying a principle of law which is patently erroneous, and but for such erroneous application of legal principle, the award could not have been made, such award is liable to be set aise by holding that there has been a legal misconduct on the part of the arbitrator. In ultimate analysis it is a question of delicate balancing between the permissible limit of error of law and fact and patently erroneous finding easily demonstrable from the materials on record and application of principle of law forming the basis of the award which is patently erroneous. It may be indicated here that however objectively the problem may be viewed, the subjective element inherent in the judge deciding the problem, is bound to creep in and influence the decision. By long training in the art of dispassionate analysis, such subjective element is, however, reduced to minimum. Keeping the aforesaid principle in mind, the challenge to the validity of the impugned award is to be considered with reference to judicial decisions on the subject."
16. It is thus clearly established by catena of M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 25 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:24 +0530 judgments of Hon'ble Supreme Court and Hon'ble High Courts that the interference with an arbitral award is permissible only when the findings of the Arbitrator are arbitrary, capricious or perverse or when conscience of the court is shocked or when illegality is not trivial but goes to the root of the matter. The Arbitrator is master of the quality and quantity of the evidence. The court would not be justified in re-appraising the material on arbitral record and substitute its own view in place of the view of learned Arbitrator. Once the Arbitrator has applied his mind to the matter before him, the court cannot re- appraise the matter as if it was an appeal and even if two views are possible, the view taken by Arbitrator would prevail. No interference in the award is required unless there is existence of total perversity in the award or the judgment is passed on wrong proposition of law. Even when the Arbitrator makes a mistake either in law or in fact but such mistake does not appear on the face of award, the award is good not withstanding the mistake and would not be remitted or set-aside.
17. It is further rightly submitted by learned counsel for claimant that court would not construe the nature of claim by adopting too technical an approach or by indulging into hair-splitting, otherwise the whole purpose behind holding the arbitration proceedings as an alternative to Civil Courts forum would stand defeated as was held by Apex Court in the case of Sangamner Bhag M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 26 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:28 +0530 Sahakari Karkhana Ltd Vs Krupp Industries Ltd, AIR 2002 SC 2221. Further in the case of P.R. Shah, Shares & Stock Brokers Pvt Ltd Vs B.H.H. Securities Pvt Ltd & Ors, (2012) 1 SCC 594, it was held by Hon'ble Supreme Court that in order to provide the balance and to avoid excessive intervention, the arbitration award is not to be set-aside merely on the ground of erroneous application of law or by re-appreciating evidence.
18. In the case of NTPC Ltd Vs Maratho Electric Motors India Ltd, 2012 SCC Online Del 3995, it was held that appreciation of evidence by the Arbitrator is never a matter which the court considers in the proceedings under section 34 of The Act as the court is not sitting in appeal over the adjudication of the Arbitrator and the court do not act as court of appeal. An error relatable to interpretation of the contract by an Arbitrator is an error within his jurisdiction and such error is not amenable to the correction by courts as such error is not an error on the face of the award.
19. In the recent judgment of Delhi Airport Metro Express Pvt. Ltd Vs Delhi Metro Rail Corporation Ltd., Civil Appeal No. 5627 of 2021, AIR ONLINE 2021 SC 708, Hon'ble Apex Court, keeping in view the amendment of the Arbitration and Conciliation laws by the Arbitration & Conciliation Act 1996 decided the M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 27 of 44 OMP Comm 91/24 Digitally signed by AJAY AJAY PANDEY PANDEY Date: 2025.12.12 15:06:33 +0530 Contours of the court's power to review arbitral awards. Relevant principles can be summarized amongst others, as follows:-
- One of the principal objectives of the 1996 Act is to minimize the supervisory role of courts in the arbitral process.
- An application for setting aside an arbitral award can only be made in accordance with provisions of Section 34 of the 1996 Act.
- While deciding applications filed under Section 34 of The Act, courts are mandated to strictly act in accordance with and within the confines of Section 34, refraining from appreciation or re-appreciation of matters of fact as well as law.
- As it is only such arbitral awards that shock the conscience of the court that can be set aside on grounds under section 34.
- There must be patent illegality appearing on the face of the award, which refers to such illegality as goes to the root of the matter but which does not amount to mere erroneous application of the law.
- Reappreciation of evidence, which is what an appellate court is permitted to do, cannot be permitted under the ground of patent illegality appearing on the face of the award.
- The construction of the terms of a contract is primarily for an arbitrator to decide, unless the M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 28 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:37 +0530 arbitrator construes the contract in a manner that no fair- minded or reasonable person would; in short, that the arbitrator's view is not even a possible view to take.
- 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 on the ground of patent illegality.
- There is a disturbing tendency of courts setting aside arbitral awards, after dissecting and reassessing factual aspects of the cases. This approach would lead to corrosion of the object of the 1996 Act and the endeavours made to preserve this object, which is minimal judicial interference with arbitral awards. Several judicial pronouncements of the Court would become a dead letter if arbitral awards are set aside by categorising them as perverse or patently illegal without appreciating the contours of the said expressions.
- Every error of law committed by the Arbitral Tribunal would not fall within the expression 'patent illegality'. In addition, contravention of law not linked to public policy or public interest is beyond the scope of the expression 'patent illegality'.
- Courts do not sit in appeal against the arbitral award. The permissible grounds for interference with a domestic award under Section 34(2-A) on the ground of patent illegality is when the arbitrator takes a view which is not even a possible one.
M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 29 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:43 +0530 20. In Indian Oil Corporation Vs Shree Ganesh
Petroleum Rajgurunagar, MANU/SC/0127/2022, it was held by Hon'ble Supreme Court :-
44. An Arbitral Tribunal being a creature of contract, is bound to act in terms of the contract under which it is constituted. An award can be said to be patently illegal where the Arbitral Tribunal has failed to act in terms of the contract or has ignored the specific terms of a contract.
45. However, a distinction has to be drawn between failure to act in terms of a contract and an erroneous interpretation of the terms of a contract. An Arbitral Tribunal is entitled to interpret the terms and conditions of a contract, while adjudicating a dispute. An error in interpretation of a contract in a case where there is valid and lawful submission of arbitral disputes to an Arbitral Tribunal is an error within jurisdiction.
46. The Court does not sit in appeal over the award made by an Arbitral Tribunal. The Court does not ordinarily interfere with interpretation made by the Arbitral Tribunal of a contractual provision, unless such interpretation is patently unreasonable or perverse.
Where a contractual provision is ambiguous or is capable of being interpreted in more ways than one, the Court cannot interfere with the arbitral award, only because the Court is of the opinion that another possible M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 30 of 44 OMP Comm 91/24 Digitally signed by AJAY AJAY PANDEY PANDEY Date: 2025.12.12 15:06:48 +0530 interpretation would have been a better one.
47. In Associate Builders (supra), this Court held that an award ignoring the terms of a contract would not be in public interest. In the instant case, the award in respect of the lease rent and the lease term is in patent disregard of the terms and conditions of the lease agreement and thus against public policy. Furthermore, in Associate Builders (supra) the jurisdiction of the Arbitral Tribunal to adjudicate a dispute itself was not in issue. The Court was dealing with the circumstances in which a Court could look into the merits of an award.
48. In this case, as observed above, the impugned award insofar as it pertains to lease rent and lease period is patently beyond the scope of the competence of the Arbitrator appointed in terms of the dealership agreement by the Director (Marketing) of the Appellant. agreement and thus against public policy. Furthermore, in Associate Builders (supra) the jurisdiction of the Arbitral Tribunal to adjudicate a dispute itself was not in issue. The Court was dealing with the circumstances in which a Court could look into the merits of an award.
48. In this case, as observed above, the impugned award insofar as it pertains to lease rent and lease period is patently beyond the scope of the competence of the Arbitrator appointed in terms of the dealership agreement by the Director (Marketing) of the Appellant.
49. The lease agreement which was in force for a M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 31 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:53 +0530 period of 29 years with effect from 15th April, 2005 specifically provided for monthly lease rent of Rs.1750 per month for the said plot of land on which the retail outlet had been set up. It is well settled that an Arbitral Tribunal, or for that matter, the Court cannot alter the terms and conditions of a valid contract executed between the parties with their eyes open.
21. In Civil Appeal No. 369-3700 of 2018 decided on 28.07.2021, it was held :-
"85. It has been held that the role of the Arbitrator is to arbitrate within the terms of the contract. He has no power apart from what the parties have given him under the contract. If he has travelled beyond the contract, he would be acting without jurisdiction.
86. It will also be apposite to refer to the following observations of this Court in the case of Md. Army Welfare Housing Organization v. Sumangal Services (P) Ltd. MANU/SC/0797/2003 "43. An Arbitral Tribunal is not a court of law. Its orders are not judicial orders. Its functions are not judicial functions. It cannot exercise its power ex debito justitiae. The jurisdiction of the arbitrator being confined to the four corners of the agreement, he can only pass such an order which may be the subject-matter of reference."
87. It has been held that an Arbitral Tribunal is not a Court of law. Its orders are not judicial orders. Its functions are not judicial functions. It cannot exercise its M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 32 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:06:59 +0530 powers ex debito justitiae. It has been held that the jurisdiction of the arbitrator being confined to the four corners of the agreement, he can only pass such an order which may be the subject-matter of reference.
88. In that view of the matter, we are of the considered view, that the impugned Award would come under the realm of 'patent illegality' and therefore, has been rightly set aside by the High Court."
22. Now coming back to the facts of the present case, this court is not inclined to dismiss the objections on the point of limitation as it is borne out from the record that previously the objection petition was filed before District Judge, Commercial Court-01, North-West District, Rohini on or before 06.08.2024 and the same was returned under order VII rule 10 CPC vide order dated 07.09.2024 of the learned District Judge, CC-01, North- West, Rohini giving liberty to the objector to present the same before the court of competent jurisdiction. This court is therefore inclined to grant benefit of section 14 of The Limitation Act to exclude time spent in proceedings in court without jurisdiction. Hence, this court is inclined to deal the objections on merits.
23. The most emphatic argument of learned Sh.
Vishwendra Verma is on the point of limitation. The court is in agreement with the submissions of learned Sh. Vishwendra that it is the duty of the court or tribunal to M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 33 of 44 OMP Comm 91/24 Digitally signed by AJAY AJAY PANDEY PANDEY Date: 2025.12.12 15:07:05 +0530 satisfy itself that the cause of action or claims before it is within the limitation period. There is however no mandatory requirement to spell such satisfaction in the judgment or award in a particular manner. It is however seen that this objection of limitation was not taken in the reply to the claim petition. Court do not find that any impressive arguments were led before the learned Arbitrator to object that the claims before the tribunal were barred by limitation.
24. This court is of the humble opinion that on the basis of evidence and material before the learned Arbitrator, it could not have been straightway concluded that the claims were barred by limitation.
25. It appears to be rightly submitted by learned counsel for claimant that the Consignment Sale Agency Agreement between the parties was subsisting. Court finds some substance in the submissions of learned counsel for claimant that there were continuous breaches of the contractual terms by non-payment of earlier dues by the respondent and therefore a fresh period of limitation would begin to run at every moment of time during which such breaches continued. Reference in this respect is made to section 22 of The Limitation Act, 1963 which provides as under :-
22. Continuing breaches and torts In the case of a continuing breach of contract or in the case of a continuing tort, a fresh period of limitation M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 34 of 44 OMP Comm 91/24 Digitally signed by AJAY AJAY PANDEY PANDEY Date: 2025.12.12 15:07:10 +0530 begins to run at every moment of the time during which the breach or the tort, as the case may be, continues.
26. By not taking the objections about limitation, the respondent had deprived the learned Arbitrator to examine the evidence to give his opinion on rival contentions.
27. Apart from this in para no.23 of the award learned Arbitrator has referred to two emails dated 15.05.2013 Ex.PW1/17 having attachment of the statement of account for the period 01.04.2012 to 31.03.2013 and the email dated 02.06.2016 having attachment of the statement of account for the period 01.04.2013 to 31.03.2014. These emails were sent by the respondent to claimant. The attachments were the account statement of the claimant maintained by respondent M/s Haldiram Bhujia Wala which are available on the record of learned Arbitrator. In para no. 31 of the award learned Arbitrator observed as under :-
31. That all the transactions were made by the claimant as per the directions of the respondent and incurred expenses for the promotion of the business and the money which he incurred for the promotion of business, were duly intimated by the claimant through email to the respondent which were reimbursed by the respondent after making the payment except the present claim which is clear from the statement of account M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 35 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:14 +0530 submitted by the claimant Ex. CW-1/17 (colly) which was sent by the respondent.
28. Witness of the respondent also admitted sending of emails to the claimant. In para 32 and 33, learned Arbitrator further observed :-
32. That the abovesaid fact has been admitted by the respondent in the cross examination dated 08.02.2024 as at that stage, the emails/documents at pages no.325 to 327 were shown to the RW-1 to confirm the emails sent by the respondent company of S.R. Payment, to which the witness admitted the emails at page no.325 to 326 only.
33. That the respondent further admitted in his cross examination that "It is correct that Sales Team were appointed by the company and the payment/salary all the sales team were paid by the claimant at the instance of respondent and the respondent thereafter reimburse the amount in this regard to the claimant. All the instructions regarding the business dealings and payments of Sales Teams/SR/ASM were sent through email of the respondent [email protected] only."
RW-1 further admitted that "It is correct that as per the agreement dated 10.06.2010, the transport/freight charges will be paid by the company and company paid the charges."
RW-1 further stated that "The respondent has M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 36 of 44 OMP Comm 91/24 AJAY Digitally signed by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:18 +0530 cleared the previous dues as raised by the claimant from to time except the dues under the present claim."
29. In the case of Asset Reconstruction Company (India) Ltd. Vs Bishal Jaiswal decided on 15.04.2021 reported in 2021 (6) SCC 366, Hon'ble Supreme Court held that entries in the balance sheet or statement of accounts of the defendant debtor can amount to acknowledgment under section 18 of The Limitation Act. Hon'ble Supreme Court referred to its previous judgments as well as judgments passed by various Hon'ble High Courts including Hon'ble High Court of Delhi.
30. It is admitted before the learned Arbitrator that parties were communicating through emails. The email from respondent dated 15.05.2013 with the subject 'account statement' with two attachments of statement of account of the claimant and the email dated 02.06.2016 from the respondent with subject 'Requirement of Account Statement for the Financial Year 2013-2014' with attachment of statement of account, amounts to a clear admission of liability by the respondent bringing the claims of the claimant within limitation even if it is considered that the claimant was not entitled to the benefit of section 22 of The Limitation Act or a running account was not maintained by the parties. The award cannot be said to be in violation of fundamental policy of M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 37 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:24 +0530 Indian Law of limitation or in conflict with basic notions of morality and justice, just because learned Arbitrator was not given an opportunity to deal the objections of limitation taken by the respondent in the present petition.
31. Even from the evidence and material discussed in the award, the claims were prima facie within limitation period and award cannot be interfered on this ground.
32. Nextly heavy emphasis is placed by learned Sh.
Vishwendra Verma on section 69 of the Partnership Act to submit that the claimant was an un-registered partnership firm and that no claim by such firm could have been allowed in view of the bar created under section 69 of the Partnership Act. For the purpose of convenience section 69 of the Partnership Act is quoted herein below :-
69. Effect of non-registration.--(1) No suit to enforce a right arising from a contract or conferred by this Act shall be institutes in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
(2) No suit to enforce a tight arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 38 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:28 +0530 in the Register of Firms as partners in the firm.
(3) The provisions of sub-sections (1) and (2) shall apply also to a claim of set-off or other proceeding to enforce a right arising from a contract, but shall not affect--
(a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or
(b) the powers of an official assignee, receiver or Court under the Presidency-towns Insolvency Act, 1909 (2 of 1909), or the Provincial Insolvency Act, 1920 (5 of 1920), to realise the property of an insolvent partner.
(4) This section shall not apply--
(a) to firms or to partners in firms which have no place of business in 1 [the territories to which this Act extends], or whose places of business in 2 [the said territories] are situated in areas to which, by notification under 3 [section 56], this Chapter does not apply, or
(b) to any suit or claim of set-off not exceeding one hundred rupees in value which, in the Presidency- towns, is not of a kind specified in section 19 of the Presidency Small Cause Courts Act, 1882 (15 of 1882), or, outside the Presidency-towns, is not of a kind specified in the Second Schedule to the Provincial Small Cause Courts Act, 1887 (9 of 1887), or to any proceeding in execution or other proceeding incidental M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 39 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:33 +0530 to or arising from any such suit or claim.
33. Learned Arbitrator had dealt with such objections of the respondent in para no. 36 of the award and relied upon the judgment of Hon'ble Supreme Court in the case of M/s Umesh Goel Vs Himachal Pradesh Cooperative Group reported in (2016) SCC 313, to hold that the Arbitration proceedings are not covered in the bar created under section 69 of the Partnership Act. No fault can be found on such observations. It has been held in catena of judgments that the arbitration proceedings do not constitute a suit for application of bar under section 69 of the Partnership Act.
34. Similarly, claims before the Arbitral Tribunal cannot be said to be hit by section 19 of The Indian Partnership Act because the claim petition was filed by the partnership M/s Bhawani Distributors. Even in the opening paragraph of the statement of claim, claimant was referred as a partnership firm. Probably for this reason the respondent did not raise this issue before the learned Arbitrator. The respondent cannot now be permitted to raise this issue for the first time before this court.
35. On perusal of reply or statement of defence filed by the respondent before learned Arbitrator, it can be safely said that the learned Arbitrator had rightly observed that the respondent made vague and evasive M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 40 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:38 +0530 denial. Learned Arbitrator has duly relied upon the relevant provisions of law and judgments of Hon'ble Supreme Court that non-specific, vague and evasive denial amount to admission.
36. Claims of the claimant were duly considered by learned Arbitrator to be supported by documentary evidence. When there is specific admissions of liability in the statement of accounts of the respondent, the respondent cannot now plead that the claimant did not provide minute details of the consignments and transportation etc. The learned Arbitrator has observed that respondent themselves did not provide the documents. It is worth to mention here that the details of supply of material to the claimant must have been available with the respondent himself. Respondent had chosen not to produce these documents before the learned Arbitrator. Interpretation of the terms of contract and appreciation of evidence is the prerogative of learned Arbitrator. In the case of McDermott International Inc. v. Burn Standard Co. Ltd. (2006) 11 SCC 181, it was held that interpreting the terms of a contract, even when it involves legal questions, is a matter for the arbitrator to decide. Relevant paragraphs of the judgment are extracted as under:
"112. It is trite that the terms of the contract can be express or implied. The conduct of the parties would also be a relevant M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 41 of 44 OMP Comm 91/24 Digitally signed by AJAY AJAY PANDEY PANDEY Date: 2025.12.12 15:07:43 +0530 factor in the matter of construction of a contract. The construction of the contract agreement is within the jurisdiction of the arbitrators having regard to the wide nature, scope and ambit of the arbitration agreement and they cannot be said to have misdirected themselves in passing the award by taking into consideration the conduct of the parties. It is also trite that correspondences exchanged by the parties are required to be taken into consideration for the purpose of construction of a contract. Interpretation of a contract is a matter for the arbitrator to determine, even if it gives rise to determination of a question of law.
113. Once, thus, it is held that the arbitrator had the jurisdiction, no further question shall be raised and the court will not exercise its jurisdiction unless it is found that there exists any bar on the face of the award."
(emphasis added).
37. Learned Arbitrator noted conduct of parties in interpreting terms of contract and specifically observed that dues in different heads as claimed by claimant were time to time duly reimbursed by respondent.
38. In the case of Associate Builders v. Delhi M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 42 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:49 +0530 Development Authority (2015) 3 SCC 49, Hon'ble Supreme Court held that the interference under Section 34 is limited and extremely circumscribed and is permissible only when the award is tainted by patent illegality, i.e. illegality going to the root, and not mere erroneous application of law. In the case of Ssangyong Engineering & Construction Co. Ltd. v. National Highways Authority of India (2019) 15 SCC 131, the Hon'ble Supreme Court narrowed the scope of "public policy" under Section 34, observing that it is confined to cases where the award is in conflict with the fundamental policy of Indian law, is patently illegal, or is in conflict with most basic notions of morality or justice. Moreover, in the case of MMTC Ltd. v. Vedanta Ltd. (2019) 4 SCC 163, the Hon'ble Supreme Court reiterated that Section 34 is not a provision for appeal, and Courts cannot reappreciate evidence or substitute their view for that of the arbitrator. Interference is permissible only on the limited grounds specified in the Act
39. Court is not supposed to re-appreicate the evidence led before the learned Arbitrator. Even if two views are possible, the court cannot substitute its own view in preference to the view taken by learned Arbitrator.
40. From a comparison of statement of claim and the findings of learned Arbitrator, it is seen that there is mismatching of the claims. For example claim no. 1 in M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 43 of 44 OMP Comm 91/24 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:07:55 +0530 the amended statement of claim is referred as claim no.2, claim no.2 is referred as claim no.4, claim no.3 is referred as claim no.5, in the award or so on. It is however clear that only claims referred in the claim petition have been dealt with by learned Arbitrator. Reasoned award was passed. Mere mismatching of the serial numbers of the claims or grant of cost/expenses do not go to the root of the matter or shake conscience of the court to interfere in the award.
41. It is rightly submitted by learned counsel for claimant that no ground as required under section 34 (2) or (2A) of The Arbitration and Conciliation Act is made out calling for any interference in the award dated 10.05.2024.
42. Objection petition is accordingly dismissed.
43. Petition under section 34 of The Arbitration & Conciliation Act as well as application for stay of operation of impugned award are accordingly dismissed.
44. File be consigned to record room after due compliance.
Announced in the open court on the 12th day of December, 2025 Digitally signed AJAY by AJAY PANDEY PANDEY Date: 2025.12.12 15:08:00 +0530 (Ajay Pandey) District Judge (Commercial Court-10) Central, Tis Hazari Courts, Delhi.
M/s Haldiram Bhujia Wala Vs M/s Bhawani Distributors Page no. 44 of 44 OMP Comm 91/24