M.N. ARORA Vs. DDA

JUDGEMENT

(1.) The petitioner was awarded the work of construction of 590 dwelling units under Self Financing Scheme in Sector-C, Pocket-5, Vasant Kunj, New Delhi vide Agreement No. 19/HD-II/84-85. The work was not completed within the time-frame provided in the agreement and spilled over to a much later period. Disputes and differences arose between the parties, which were referred to arbitration in terms of the Arbitration Agreement and Mr. O.P. Goyal was appointed as the sole Arbitrator to resolve the disputes between the parties. The parties filed the following claims and counter claims before the Arbitrator:

(2.) The Arbitrator entered the reference and after hearings, made and published his Award dated 14.5.1995 thereby upholding only two claims of the petitioner-contractor, i.e., claim No, 2 of the petitioner-contractor for a sum of Rs. 4,98,045.00 as against the claim of Rs. 9,50,000.00 and claim towards refund of security amount of Rs. 1 lac in favour of the Contractor. The Arbitrator, however, rejected the counter-claims. Aggrieved by the Award of the claims to the above extent in favour of the petitioner-contractor, DDA has filed objections under Sections 30 and 33 of the Arbitration Act, 1940, mainly on the grounds that the Arbitrator has misconducted himself and the proceedings by ignoring important documents, more particularly, terms and conditions of the contract in awarding a sum of Rs. 2,88,000.00 towards escalation costs in terms of Clause 10(c) and by disallowing the counter-claims of the objector, DDA.

(3.) I have heard learned Counsel for the parties and given my thoughtful consideration to their respective submissions. Mrs. Salwan on the strength of certain observations made and finding given by the Arbitrator himself in the opening part of the Award has strongly urged that after taking such an overall view of the matter in regard to the delay in completion of the work being attributable to both sides, the Arbitrator was not justified in granting the cost of escalation towards increase in wages of the labour to the contractor. It is true that the Arbitrator has observed in the Award that the delay in execution of the work within the time frame was attributable to both sides and DDA but as did not take any coercive steps against the contractor for its failure to complete the work within the stipulated time, the Contractor was entitled to escalation towards labour and wages. This explains the award of the amount in favor of the contractor and, therefore, the Award cannot be said to be inconsistent with the earlier observations/findings of the Arbitrator. In any case, it is not open to this Court to examine this question as a Court would do while sitting in an appeal against an order or findings because an Arbitrator is the sole Judge of facts and law. In the opinion of this Court, no fault can be found with this finding and therefore the award is not liable to be set aside on this ground. Similarly, the Award in regard to the refund of security is to be upheld based on the overall general view taken by the Arbitrator as to how the two sides have conducted themselves during the course of execution of the work.