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Delhi High CourtIndian Cases

Delhi Development Authority vs Mittal Construction on 31 May 2004

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Delhi High Court
Delhi Development Authority vs Mittal Construction on 31 May, 2004
Equivalent citations: 2004(2)ARBLR359(DELHI), 2004(75)DRJ425
Author: Mukundakam Sharma
Bench: Mukundakam Sharma

Mukundakam Sharma, J.

1. A work order was issued by the Delhi Development Authority in favor of the respondent by order dated 4th December, 1980. In the said contract, the time allotted for carrying out and completion of the work was 15 months which was to be reckoned from the 10th day of the issuance of the award letter. The work order was issued on 4th December, 1980 and as such the starting time for the work was to be reckoned from 14th December, 1980 and the work was stipulated to be completed by 13th March, 1982. The respondent started the work at the site earmarked for the project but the respondent was asked to shift to another site. It is pointed out from the records filed by the DDA that intimation was sent intimating about the change of sit, on 4th January, 1981. The aforesaid position is also supported and confirmed by letter dated 8th January, 1981 written by the respondent, which is document No.R-30, in which it was indicated that the respondent had to incur an expenditure of Rs. 3,000- due to the decision of the department to change the site.

2. Therefore, the respondent was intimated about the change of the site more or less in and around 4th January, 1981. The Delhi Development Authority rescinded the contract on 15th January, 1982 by serving a notice on the contractor under Cl programme and assured the department that he would complete the work of 15 nos. block by December, 1981. However, it appears that the respondent abandoned the the work on 29th September, 1981. Thereafter, again a further notice dated 30th December, 1981 was issued under Clause 3, on the respondent/objector to show cause. The said notice was received by the respondent on 5th January, 1982. The respondent failed to send a reply to the said show cause notice and accordingly the petitioner proceeded to rescind the contract. The decision of rescinding the contract was conveyed to the respondent vide Regd.A.D letter dated 15th January, 1982 and the letter for final measurement of the work was sent on 25th January, 1982 but the same was returned with the endorsement ‘refused’. After rescinding the aforesaid contract the remaining portion of the work was got done through other agency due to which DDA suffered a huge loss, which was sought to be compensated by the respondent.

3. Since disputes arose between the parties in connection with and/or out of the aforesaid contract, Sh.R.S.Yadav, Surveyor-Works (Slum Wing)DDA was appointed as the sole arbitrator vide letter dated 24th March, 1983 and Clause (4) of the agreement. The parties hereto submitted their claims and counter-claims before the learned arbitrator. The respondent submitted seven claims, whereas the petitioner submitted Counter-Claim Nos.1 to 5. The learned arbitrator passed his award on 30th November, 1983. was allowed to the extent of Rs. 3,000/-, which was directed to be paid. The learned arbitrator allowed counter-claim No.1 amounting to Rs. 27,718/- whereby the amount of security deposit was forfeited by the petitioner/authority. As against Counter-Clame arbitrator held that the parties shall bear their own costs.

5. In the context of the aforesaid background facts, I may now proceed and deal with the contentions raised by the learned counsel for the parties. The first contention that was raised by the counsel appearing for the respondent is that the learned arbitrator was the Surveyor of the work and was, therefore, associated with with day-to-day work connected with the project in question and, therefore, being a party, he was biased. It was submitted that since the arbitrator was not an independent and impartial person, therefore, the entire award is required to be set aside and quashed. I have given my anxious consideration to the aforesaid plea raised for the first time in the objection. It is established from the records of the arbitration proceedings that at no stage, such a plea was raised by the respondent before the learned arbitrator and instead the respondent participated in all the proceedings before the learned arbitrator without any protest or demur in that regard. Therefore, there is waiver and acquaisence as the respondent participated in the proceedings before the learned arbitrator without raising any question of bias before him. In view of the aforesaid position, in my considered opinion, the respondent is debarred from of the matter the objection raised, taking up a plea of bias against the leaned arbitrator, is found to be without any merit and is dismissed.

6. It was next submitted by the counsel appearing for the respondent that the learned arbitrator was required to record his findings and conclusions in respect of each and every claim in favor of either of the parties whereas in the present case the learned arbitrator has failed to record reasons and, therefore, on that count the award is required to be set aside and quashed. The aforesaid contention is, however, found to be without any merit on a bare perusal of the entire award passed by the learned arbitrator. The learned arbitrator has discussed all the pleas that have been raised and also has discussed the evidence on record and on appreciation thereof has come to a finding which is recorded in the award. Therefore, it cannot be said that the award given by the learned arbitrator is devoid of reasons. This court cannot and do not possess the power either to reappreciate the evidence or to examine the sufficiency of the reasons given by the learned arbitrator. The obvious fact, however, is that in the present case reasons have been recorded by the learned arbitrator as against each of the claims and, therefore, the award cannot be said to be a non-speaking award. In my considered opinion, the ratio of the decision of this court DELHI DEVELOPMENT AUTHORITY VS. M/S.ALKARAM, NEW DELHI is not applicable to the facts and circumstances of the present case inasmuch as in the said case the award did not contain any reason and in that context the said judgment was passed whereas in the present case reasons have been recorded by the learned arbitrator. Whether the said reasons are sufficient or the learned arbitrator was required to write a detailed order giving sufficient reasons, is a matter which is longer res integra in view of the decision of the Supreme Court in INDIAN OIL CORPORATION VS. INDIAN CARBON LTD. and also by this court in D.C.KAPOOR VS. DDA reported in 1996 (2) Arb.L.Reporter 349 wherein it was held that insufficiency of reasons cannot be a ground for setting aside the award. It is also not necessary for the arbitrator to write a very detailed order, provided he has recorded his reasons for his conclusion.

7. It was also submitted that the award is otherwise contrary to the entire evidence and that the findings of the learned arbitrator are totally perverse on the face of it. In support of the said contention, reference was made to the findings recorded by the learned arbitrator with regard to shortage of cement. The learned arbitrator discussed the aforesaid aspect and gave his reasons for coming to his conclusions. He has held that it is established from the records that cement bags were is used to the respondent but the respondent failed to draw the cements from the main store and, therefore, it cannot be held that there was shortage of supply of cement in the present case. It is , however, to be noted that findings have been recorded by the learned arbitrator holding that the respondent failed to draw cement from the main store, which fact is based on appreciation of the evidence on record. This court would not and could not sit over the appreciation of evidence to record a different (sic) reached a wrong conclusion or he has failed to appreciate facts.

8. It was next submitted by the counsel appearing for the objector that although the learned arbitrator agreed with the contention of the objector that the site was changed suddenly by the petitioner herein yet he did not given any weightage to the delay cause on account of the change of site and the damage suffered on that account for dismantling the entire infrastructure and to re-establish the same at the new site. It was also submitted that the learned arbitrator also failed to appreciate that the drawings issued for the previous block could not have been used for the new site as the foundation drawings for the new site were to be different than the earlier one because of the change in the site situation.

9. I examined the aforesaid contention in the light of the records, which are available. It was, however, held by the learned arbitrator that the respondent could start the work at the new site on 20.1.1981 after the supply of foundation details to it but that even in spite of it, during the next eight months period it could complete work of Rs.4,13,335.38p only. It was also held by him that after 21.5.1981 unobstructed site was available for 24 blocks. It is to be noted that according to the time schedule given in Clause-II of the agreement the respondents were obliged to execute 3/8 of the work in half the stipulated period and 1/8 in + of the stipulated period. The learned arbitrator considered the said aspect and held that while giving allowance for genuine hindrances and delays the claimants should have executed work worth Rs.8.04 lakhs in the 15 blocks, site of which was available to them on 20.1.1981 to 26.9.81 and work amounting to Rs.1.40 lakhs approximately should have been exacted in the remaining 9 blocks clear possession of which was available to the claimants with effect from 21.5.80 but the respondent executed the work amounting to Rs.Four lakhs only as against the work costing Rs.9.44 lacs approximately. It was also held that even after executing the said work for Rs.Four lacs, the respondent abandoned the work.

10. There had been persistent efforts on the part of the petitioner instructing and requesting the respondent to expedite the work. It is , therefore, clear that the learned arbitrator considered the entire evidence on record and thereafter has recorded his findings. There is nothing on record which could influence this court to reappreciate the said evidence. It is also not the case of the respondent that the said findings are perverse. Therefore, the aforesaid contention that the learned a bitrator did not consider the effect of delay factor on account of change of site, is incorrect. The said aspect was duly considered by the learned arbitrator.

11. Regarding drawings, the learned arbitrator has recorded extensive findings after recording the pleas of both the parties. Findings have been recorded after examining all the pros and cons and on appreciation thereof. It was recorded that the work was never held up or delayed due to lack of drawings or technical decisions from the petitioner and that the delay was simply because the respondents have been extremely slow in executing the work right from the beginning. It was also held (sic) the learned arbitrator that the petitioner was prompt enough to give the alternate site in the same complex for the work to the respondent. Those findings, which are recorded by the learned arbitrator are indeed findings of fact and I am not inclined to interfere with such findings of fact recorded by the learned arbitrator.

12. Having gone through the records including the award, the aforesaid contentions, which are raised by the respondent, are found to be without any merit. I, therefore, reject the objection filed by the respondent. The award filed by the learned arbitrator is, therefore, made a rule of the court. Decree should be drawn up accordingly.