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1 Petitioner is impugning under Section 34 of the Arbitration and Conciliation Act 1996 (the said Act) part of the Majority Arbitral Award dated 20th October 2016 . Petitioner was claimant and respondent was respondent before the Arbitral Tribunal comprising of three Retired Judges. 2 Respondent owned several immovable properties, one of which was a plot of land admeasuring 6754.52 sq.mtrs at Byculla, Mumbai (the said land). Respondent wanted to develop the said land and therefore approached one Kalpataru Construction Overseas Private Limited ("KCOPL") and entered into a Project Management Agreement dated 28 th July 1993 (PMA). Under the PMA, KCOPL would function as a Project Management Consultant (PMC). Petitioner also forms part of the same Meera Jadhav 2/57 carbp-37-17.doc group to which KCOPL belonged. Respondent entered into a development agreement dated 29th October 1993 with Petitioner where under respondent granted the development rights of the said land to Petitioner. Under the development agreement, Petitioner was to pay a sum of Rs.19,89,12,000/- towards land value and also allot 23,365 sq.ft. of area subject to reimbursement of actual cost of construction. It is stated that Petitioner paid to respondent towards land cost an amount of Rs.18,14,16,200/-, while amount of Rs.1,47,95,800/- was still payable. Petitioner allotted 12 flats including one penthouse and two duplex flats having total area of 23,365 sq.ft. to respondent. Petitioner also gave 13 covered car-parking slots in the podium area.

The reason, I am saying this is because the Arbitrator in minority has considered all the evidences and material that were placed on record and came to a conclusion that the cost of construction should be Rs.3100/- per sq.ft. and not Rs.775/- per sq.ft. The Arbitrator in minority came to a conclusion that respondent has not made out a case that the cost of construction was Rs.775/- per sq.ft. as stipulated in the PMA dated 28 th July 1993. Respondent and the Arbitrator in majority relied upon clauses (3) and (4) of PMA between KCOPL and respondent, which was not subject matter of arbitration. Clauses (3) and (4) of the said PMA read as under:

Meera Jadhav 39/57 carbp-37-17.doc

24 Majority award has not even dealt with or considered any of these documents. Just stating ".........We have gone through the pleadings of the parties. We have perused the documents on record and oral evidence adduced by both the sides. We have heard the learned counsel for the parties. We have also gone through written submissions forwarded to all the Arbitrators. On the basis of overall evidence and materials produced, our findings on the above issues are as under ........" OR ".........We have heard the learned Advocates on both the sides. We have also gone through the relevant evidence on record - documentary as well as oral....." OR".....Thus considering the totality of the facts and circumstances we hold that the Petitioners are entitled to ........" in my view can not be accepted as considering all evidence. That would also not amount to giving reasons. It is not the case where in the majority award the arbitrators have considered the documents and come to a conclusion, notwithstanding those documents the rate payable was Rs.775/- per sq.ft. In a letter dated 20th May 2000, addressed by KCOPL to respondent, in response to respondent's auditors query, Respondent records that the cost of construction was yet to be finalised but the same was estimated to be Rs.3250/-. In respondent's letter dated 17 th May 2001 read with letter dated 19th June 2001 addressed to Income Tax Department, respondent has clearly stated that cost of construction was Rs.3,100/- per sq.ft. These were argued before the Learned Arbitral Tribunal as can be seen from the Minority Award but the Majority Award have simply brushed Meera Jadhav 40/57 carbp-37-17.doc aside the whole thing by stating that no evidence or material has been placed on record to prove Rs.3100/- per sq. feet as construction cost or as to on what basis the figure of Rs.7,26,00,000/- had been arrived at by petitioner. Moreover, under the agreement, petitioner was to be paid actual construction cost. Clause (3) of the PMA gives the figure of Rs.775/- per sq.ft. as estimated cost of construction based on sanctioned plan for the development and completion of the project as on that date and the estimates are subject to variations on the revision of the building plans. Admittedly and as recorded in the majority award, the original proposed building was to be of 14 floors and finally was made into 39 storied building. Therefore, the estimate of Rs.775/- given in the PMA will also undergo a major change. Arbitrators in the majority have noted this submission of petitioner but have not dealt with in the award. In the Majority award, the arbitrators, have, therefore, grossly erred in accepting the estimated figure of Rs.775/- mentioned in the PMA which is not the rate under the Development Agreement and which also was not a subject matter of the arbitration as the final rate agreed between the parties/cost of construction by ignoring all other evidences.

(emphasis supplied) 30 If the rate of Rs.775/- per sq.ft., which is estimated, as given in the PMA, was supposed to be the actual cost of construction, parties would have stipulated that amount in the Development Agreement as well. The Minority Award clearly sets out most of the documents referred to and relied upon by petitioner through which they claim for actual cost of construction to be Rs.3100/- sq.ft.. The Minority award then sets out the documents of/to public authorities and goes on to hold that those documents indicate that respondent has informed the Income Tax Authorities that the cost of construction was Rs.3100/- per sq.ft. 31 Another point which requires to be noted is that respondent had paid KCOPL project management fees which is the percentage of construction cost. Respondent had filed counter claim for seeking revision/ reimbursement of the fees paid under the PMA to KCOPL, but Arbitral Tribunal unanimously rejected the counter claim. Once the Arbitral Tribunal accepts that the project management fees was rightly paid under the PMA (fees paid were percentile of construction cost of Rs.3100/- sq.ft.) it would not be open to the Arbitrators in majority to say that there was no evidence or material placed on record. I have to state, though at the cost of repetition, that the original building was to be of 14 floors whereas what was constructed was 39 storied building with 2 large podiums with terrace Meera Jadhav 44/57 carbp-37-17.doc garden, 1 stilt, two flats per floor with cross ventilation, swimming pool and club house. The building plan, from the time when cost was estimated to be Rs.775/-, had undergone drastic and several major changes. The figure of Rs.775/- per sq.ft. was absolutely unrealistic and incorrect. MODIFICATION:-