Anant Raj Agencies Pvt. Ltd. Vs. Delhi Development Authority and Others - Court Judgment

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the case debated on the objections raised under sections 30 and 33 of the arbitration act, 1940, on the ground that the reasons adduced by the arbitrator were not valid - it was held that the reasons given in this regard were valid - so, if it was assumed that there was an error of construction of the agreement or an error of law in arriving at a conclusion, then such error could not be considered as error which could be amenable to the correction even in a reasoned award under the law - hence, the said objections were dismissed - - submitted that the reasons given by the arbitrator while awarding the amount in respect of this claim are not good ones. inspire of the opportunity did not place on record the final bill indicating their final sanction of the extra and substituted item and in the circumstances it was just and fair to proceed on the basis of the recommended rate and quantities as recorded in the measurment book no. 768 recommended for sanction by engineer in charge.sat pal, j.1. this petition has been filed by m/s. anant raj agencies pvt. ltd. (hereinafter referred to as the contractor) against the delhi development authority (hereinafter referred to as the d.d.a.) under sections 14 and 17 of the arbitration act, 1940 (hereinafter referred to as 'the act'). in this petition it has been prayed that defendant no. 2 who was the arbitrator in this case be directed to file the original award along with the arbitration proceedings and thereafter notice of filing of the award be issued to the parties. after the receipt of the award and the proceedings notice of filing of award was issued to the parties. thereafter d.d.a. filed the objection petition bearing is no. 172/89 in respect of claims no. 1, 2, 3, 6, 7, 8 and 10 under sections 30 and 33 of the act. the objections have been controverter by the contractor in their reply to the said ia. the following issues were framed :- (1) whether the award is liable to the set aside for the objections filed by the respondent-dda (2) relief. 2. as directed by the court, both the parties have filed affidavit in support and in opposition to the objections against the award. 3. mr. manoj sharma, learned counsel appearing on behalf of the d.d.a. submitted that the reasons given by the learned arbitrator with regard to claims no. 1 and 2 were not valid. i, however, do not find any substance in the submissions made by the learned counsel with regard to the aforesaid claims. the reasons given by the learned arbitrator in awarding these claims are that the parties were at ad-idem and the understanding between them was that the entire quantity of materials consumed in the work were to be supplied by the d.d.a. the claimants had claimed the amount only in respect of the material which was not supplied by the d.d.a. and they had to purchase the same from the open market and amounts claimed represents the costs of the material purchased from the open market which has been duly certified by the auditors. the reasons appeared to be quite valid and as such the award cannot be set aside in respect of the aforesaid claims. here i may refer to a judgment of the supreme court reported in the case of u.p. hotels v. u.p. state electricity board : air1989sc268 , wherein it was held, even assuming that there was an error of construction of the agreement or even that there was an error of law in arriving at a conclusion, such an error is not an error which is amenable to correction even in a reasoned award under the law. 4. as regards claim no. 3, the arbitrator has awarded a sum of rs. 1,10,000/- on account of damages/compensation at market rates for the work executed beyond the stipulated date. while awarding this amount, the learned arbitrator has held that the proforma of extension filed by the d.d.a. shows that the major delay on account of laying of conduits pipes was by the electric contractor and because of non laying of cables by desu. he has further held that the delay is attributable to the d.d.a. since the laying of conduits and desu cables were not the responsibility of the claimants. the reasons given by the arbitrator cannot be said to be perverse, as such i do not find any merit in the objection raised by the d.d.a. in respect of claim no. 3. 5. as regards the claim no. 6, the learned arbitrator awarded a sum of rs. 1,93,750.40 in favor of the contractor. during the course of arguments it was however, admitted by the learned counsel for the contractor that against the awarded amount in respect of the claim no. 6, a sum of rs. 1,43,903.35 has already been paid to the contractor by the d.d.a. in september 1989. learned counsel for the d.d.a. submitted that the reasons given by the arbitrator while awarding the amount in respect of this claim are not good ones. the learned counsel contended that some of the extra and substituted items were pending approval of the competent authority and as such the contractor could not be paid any amount for this extra and submitted items. from the award, i find that the learned arbitrator has given valid reasons for awarding the amount in respect of this claim. in the award it has been stated that the d.d.a. inspire of the opportunity did not place on record the final bill indicating their final sanction of the extra and substituted item and in the circumstances it was just and fair to proceed on the basis of the recommended rate and quantities as recorded in the measurment book no. 768 recommended for sanction by engineer in charge. since the awarded amount is based on the recommendations made by the engineer in charge, i do not find any error in the reasons given by the arbitrator. accordingly, the objections in respect of claim no. 6 are also rejected. 6. as regards the claim no. 7 the learned counsel for the d.d.a. could not point out any discrepancy in the reasons given by the arbitrator while awarding this amount. 7. with regard to claim no. 8, the learned arbitrator awarded a sum of rs. 1,40,852.40 p. against claim of rs. 3.00 lacs of the contractor on account of increase in quantity and the deviation limit payable under clause 12(a) of the contract. learned counsel for the d.d.a. submitted that the finding of the arbitrator while awarding this amount was contrary to clause 12 of the contract. learned counsel contended that the restrictions mentioned in clause 12(vi) have not been met and as such claim for individual items could not be allowed under clause 12(a). from the award i find that the learned arbitrator while awarding the amount in respect of this claim, has held that the respondent-d.d.a. had admitted that an increase of 10% over the agreement rate was reasonable and justified against 25% being claimed. it was in these circumstances that the arbitrator awarded to the contractor a sum of rs. 1,40,852.40. in view of the aforesaid reasons given by the arbitrator, i do not find any merit in the objections raised by the d.d.a. in respect to this claim. 8. against claim no. 10, the learned arbitrator has awarded to the contractor interest @ 15% p.a. with quarterly rests on the amounts awarded from the date of reference till the date of decree or payments whichever is earlier. i do not find any infirmity in respect of this claim as the rate of interest which is 15% p.a. appears to be quite reasonable except that there is no justification for interest with quarterly rests. accordingly, i hold that the contractor will be entitled to the interest @ 15% p.a. but not with quarterly rests, till the date of decree. the view have taken is supported by my own judgment reported in the case of m/s. j.n. constructions v. n.d.m.c. 1993 3 del 1121. 9. in view of above discussion, the objections contained in is 172/89 are dismissed. objections against the award having been dismissed, the award dated 29th april, 1988 as notified in respect of claim no. 10 is made rule of the court. let a decree be drawn in terms of the award as modified. the award will form a part of the decree. i further direct that in case the decretal amount is not paid to the contractor within two months from the date of decree, the contractor will be entitled to the interest @ 15% p.a. from the date of decree till realisation. the parties are, however, left to bear their own costs. 10. petition dismissed.