LABH CONSTRUCTION AND INDUSTRIES LIMITED Vs. NARESH KAPOOR

JUDGEMENT

(1.) LABH Construction and Industries Ltd. ('LCIL') has filed this petition under Section 34 of the Arbitration and Conciliation Act, 1996 ('Act'), challenging an Award dated 13th April 2006, passed by the learned sole Arbitrator in the disputes between LCIL and the Respondent M/s Naresh Kapoor except to the extent that the learned Arbitrator allowed Counter Claim No. 2 of LCIL in the sum of Rs. 11,92,179.

(2.) LCIL states that it is a leading construction company based in Ahmedabad. In the year 1998, it was awarded the contract for construction of 2014 one room tenements for economically weaker sections ('EWS') and 504 shops using hollow concrete block masonry, including internal water supply, sanitary and electrical installation along with internal development in Sector-4, Rohini, Delhi for a value of about Rs. 1906 lakhs. The project was for rehabilitation of jhuggi jhonpri dwellers in Motia Khan, Delhi by the Delhi Development Authority ('DDA').

(3.) ACCORDING to LCIL it agreed to the above condition because a 19% return on the value of gross work done by the Respondent was an attractive offer for a government contract where LCIL did not have to do anything and also was relieved of any hidden risk on account of cost escalation, labour management etc.