SANJIV KATYAL Vs. DELHI DEVELOPMENT AUTHORITY

JUDGEMENT

(1.) The petitioner has filed this petition under Sections 14 and 17 of the Arbitration Act for making the award rule of the Court. The respondents have filed objections by way of IA 2724/93. Most of the objections filed by the respondents relate to the counter claim of the respondent. Ms. Salwan, learned counsel for the respondents has vehemently contended that non-award in relation to counter claim no.3 in which the respondent has claimed Rs. 31,586/- on account of levy of compensation under Clause 2 of the agreement was not proper on the part of the arbitrator. The arbitrator ought to have allowed counter claim no.3 of respondent. In support of her submission, learned counsel for the respondent has cited Arbitration Law Report 1995 (2) p.307. She has farther contended that clause 2 of the agreement was not arbitral and hence the rejection of the counter claim on that score was illegal and the arbitrator has committed legal misconduct and to that extend the award be set aside.

(2.) On the other hand, Mr.Kapur, learned counsel for the petitioner has contended that the arbitrator, after holding that the delays were on the part of the respondents and there was a wrongful recession of the contract by the respondent, no compensation under clause 2 could be levied and, therefore, the arbitrator has rightly rejected the counter claim no.3 of the respondent.

(3.) I have given my careful consideration to the arguments advanced by learned counsel for both the parties and perused the award. The arbitrator has specifically mentioned that the date of start of the work was 23.7.1987 and stipulated date of completion of the agreement was 26.2.1987. Notice of this proportionate progress were not issued by the respondents as prescribed under clause 2 of the agreement. In fact, the show cause notice under Clause 2 was issued on 23.9.1987 (Ex.R 10), whereas compensation was levied on 7.3.1989 (Ex. R 12), i.e. after about one year and six months of recession of contract. Therefore, the arbitrator has held that under those circumstances the action of the respondent in making compensation under clause 2 was not found to be justified.