Point of Law: Arbitration Award - An Award however can be interfered with if it is found to be vulnerable under any of the grounds in Section 34 including being in contravention with the fundamental policy of Indian law or vitiated by patent illegality appearing on the face of the Award under 34(2) (b) (ii) and 34 (2A), respectively.

JUDGMENT :

MOUSHUMI BHATTACHARYA, J.

1. This is an application under Section 34 of The Arbitration and Conciliation Act, 1996, for setting aside of an Award dated 12th September, 2015 passed by a learned Sole Arbitrator in an arbitration between the petitioner herein, who was the claimant in the arbitration and the respondent.

2. The petitioner herein is a contractor who made a claim against refusal on the part of the respondent to refund the deducted amount towards liquidated damages which was imposed by the respondent upon the petitioner for alleged delay in the completion of work. The dispute arose out of an agreement dated 20th September, 2007 for renovation of a 6 KV Indoor Sub-Station for the Kolkata Port. By the impugned Award, the Arbitrator held that the Kolkata Port Trust has the right to levy liquidated damages from the petitioner herein under the terms of the contract by reason of the delay in the execution of the contract and further that the amount deducted as liquidated damages is not refundable to the petitioner. The petitioner was awarded the work of renovation of a 6 KV Indoor Sub-Station by the respondent for a total sum of Rs. 92,56,341/- and by an agreement dated 20th September, 2007, the petitioner was to complete the work within six months from 31st July, 2007 ending on 31st January, 2008. The Work Order issued to the petitioner on 31st July, 2007 indicates that the completion period was six calendar months from the date of the Work Order.

3. According to Mr. Arik Banerjee, learned counsel appearing for the petitioner, the petitioner was prevented from completing the work within the first time frame due to the laches of the respondent, including delay in approval of the drawings which were provided by the petitioner to the respondent. Counsel states that the impugned Award suffers from perversity and gross impropriety. Counsel submits that the Award is in conflict with the public policy of India and is also in contravention with the terms of the contract and hence against the relevant provisions of the 1996 Act. Counsel relies on Clause 8.2 of the General Conditions of Contract governing the agreement between the parties pertaining to liquidated damages to submit that the contractor (petitioner in this case) would only be liable to pay compensation in the nature of liquidated damages to the respondent if the contractor fails to complete the work within the stipulated date or within the extended period as granted by the Engineer of the respondent. Counsel submits that the Arbitrator has disregarded Clause 8.2(a) in refusing to grant refund of the liquidated damages and has also disregarded the fact that the respondent extended the time for completion of the contract of thirty days by a letter dated 7th February, 2008. Counsel relies on Associate Builders vs. Delhi Development Authority, (2015) 3 SCC 49 for the proposition that an arbitral Tribunal must take into account the terms of the contract and on Karam Chand Thapar and Bros. (P) Ltd. vs. H.H. Jethanandani, 76 CWN 338 and Union of India vs. Raman Iron Foundry, AIR 1974 SC 1265 for the proposition that an assessment of actual loss is required to be done for a claim of liquidated damages and the onus of such being on the person making the claim.

4. Mr. Probal Mukherjee, learned Senior Counsel appearing for the respondent, Port Trust/KoPT, submits that the Arbitrator was wholly justified in holding that the parties to the contract expressly agreed under Clause 8.2 that KoPT would be entitled to liquidated damages in the event KoPT suffered for the inability of the petitioner to complete the work within the stipulated time. Counsel submits that there was an admitted delay of 67 weeks on the part of the petitioner from the scheduled date of completion and further submits that the Arbitrator hence found that although the respondent KoPT was liable for the delay of seven weeks, the remaining sixty weeks of delay was attributable to the petitioner. Counsel cites