BHARAT SANCHAR NIGAM LIMITED Vs. RITES LTD

JUDGEMENT

(1.) Challenge made in this intra-Court appeal is to the order of the learned Single Judge, dtd. 5/10/2021 in Arb.O.P (Com.Div) No.172 of 2021, whereby, the learned Single Judge rejected the prayer under Sec. 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to 'A&C Act') to set aside the award passed by the learned Arbitrator, dtd. 20/4/2021.

(2.) The brief facts leading to the present appeal are that under a tender floated by the appellants, inter alia, for laying underground cables in Chennai Telephones for the year 2001-2002, the respondent was selected as one of the Consultants and was awarded the contract. Even though the contract was executed and certain bill amounts were settled, as far as the claim made by the respondent in respect of filling the trenches with sea sand and removal of excess earth laid after closure of the trenches, the bills were not settled. As a matter of fact, the appellants as well as the respondent, being Government of India Enterprises, since similar claims were made with regard to many of the contracts executed by the respondent, a Committee was set up by the appellants by its communication, dtd. 24/3/2004 and the said Committee also submitted its report recommending the release of such claims. Even thereafter, the amounts were not released. Therefore, the respondent raised a dispute and the same was referred to the sole Arbitrator, appointed by the appellants herein, who rejected all the claims of the respondent, inter alia, on the reasons that the claim is barred by limitation and that no evidence was adduced in relation to the balance payment. The said award was set aside by this Court by an order and subsequently, de novo proceedings were ordered by appointing a learned Retired Judge of this Court as an learned Arbitrator.

(3.) In the second round of arbitration, the respondent filed a Claim Petition seeking to pass an award in terms of the amounts claimed by it under Annexure-A to the claim statement along with pendente lite and post award interest. A counter statement was filed by the appellants to the claim statement. In the counter statement, the appellants contended that they have duly paid 50% of bills initially and the actual disallowed amount by them, shown in the last sitting of the arbitration, is far lesser than the amount claimed by the respondent as disallowed amount and it is for want of necessary supportive documents and thus, question of acknowledgment of retention does not arise. When the respondent is restricting the claim after 16 years by scaling down almost 45% of the claim, that itself is vexatious and the arbitration award passed by the earlier arbitrator holds rhyme and reason. It is the further contention of the appellants that the Avadi Municipality area does not come under Corporation limits at the time of execution of work where sea sand filling is not mandatory and when the optional work is carried out, the question of supportive documents for the claim arise along with it naturally.