POLOSINGH AND COMPANY Vs. DELHI DEVELOPMENT AUTHORITY

JUDGEMENT

(1.) Disputes having arisen between the parties, the same were referred to Shri H.P. Patel, as sole Arbitrator, for adjudication. The learned Arbitrator adjudicated upon the disputes and returned his award dated 26/12/1993. The said award was challenged in this Court by the Delhi Development Authority by filing objections which were decided by judgment dated 30/5/1997. While rejecting all other objections, as far as award on claim no. 5 is concerned, this Court remitted the matter back to the Arbitrator for fresh determination in the light of observations made in the said Order. That is how this claim was reconsidered by the learned Arbitrator who has made and published the award dated 4/3/1998. By means of IA. 701 Oof 1999, Delhi Development Authority has filed its objections under Section 30 and 33 of the Arbitration Act, 1940 in respect of claim no.5.

(2.) Claim no. 5 was preferred by the petitioner claiming loss of profit for pre-mature and wrongful rescission of contract. Admittedly, the work was started by the petitioner, after the award of the contract, on 17/03/1989 and stipulated date of completion was 16/06/1990. Delhi Development Authority rescinded the contract by letter dated 21/8/1989. This rescission was also challenged by the petitioner and in the earlier award dated 26/12/1993 the Arbitrator had returned the findings that the said rescission was illegal. Finding to this effect were upheld by this Court vide aforesaid judgment dated 30/5/1997 by dismissing the objections of the Delhi Development Authority on this aspect. The learned Arbitrator by impugned award has awarded a sum of Rs. 12,35,74. 21- under this claim. Relevant para of the award giving reasons in support of this claim reads as under:-

(3.) The only submission made by learned counsel for the Delhi Development Authority is that the claim of loss of profit was a claim of remote nature which was not permissible under Sections 73 and 74 of the Contract Act. In support of this proposition learned counsel for the objector has relied upon the judgment of this Court in the case of M/s. R.B. Chy. Ruchi Ram Khattar and Sons Vs. Delhi Development Authority reported in 1997 (1) Arbitration Law Reporter p.372. It is also contended that such a claim should not have been awarded as it is not necessary that after undertaking the work contractor would always earn profits.