1996 Supreme(Del) 818
High Court Of Delhi
PISHORI LAL MAGGO - Appellant
Versus
DELHI DEVELOPMENT AUTHORITY - Respondent
Decided On : 10/08/1996
The court cannot probe into the thought process of the arbitrator while giving an award.
Headnote:
ARBITRATION - AWARD - OBJECTIONS - VALIDITY - ARBITRATOR'S AWARD - INTERPRETATION - COURT'S JURISDICTION - THOUGHT PROCESS OF ARBITRATOR - SECTION 30, 33 ARBITRATION ACT, 1940 - SECTION 73 CONTRACT ACT, 1872
Fact of the Case:
The petitioner, a contractor, filed a suit to enforce an arbitration award in his favor. The respondents, the employer, filed objections to the award under Sections 30 and 33 of the Arbitration Act, 1940.
Finding of the Court:
The court upheld the award in respect of Claims No. 2, 3, 8, and 9, but set aside the award in respect of Claim No. 4.
Issues: 1. Whether the arbitrator's award was valid and enforceable. 2. Whether the court could probe into the thought process of the arbitrator. 3. Whether the contractor was entitled to claim damages for loss of profit.
Ratio Decidendi: 1. The court held that the arbitrator's award was valid and enforceable as it was based on the evidence and materials placed before him. 2. The court held that it could not probe into the thought process of the arbitrator as it was not its jurisdiction to do so. 3. The court held that the contractor was entitled to claim damages for loss of profit as it was a breach of contract by the employer.
Final Decision: The court dismissed the objections filed by the respondents in respect of Claims No. 2, 3, 8, and 9, and allowed the objections in respect of Claim No. 4. The court made that part of the award relating to Claims No. 2, 3, 8, and 9 a Rule of the Court and set aside the award in respect of Claim No. 4.
( 1 ) THE Arbitrator filed the award alongwith the proceedings on filing of which the present suit was registered and notices were issued to the parties directing the parties to file the objections within the statutory time limit. On service of notice the petitioner did not file any objection but the respondents filed their objections under Sections 30 and 33 of the Arbitration Act which was registered as I. A. No. 6320/1994. The petitioner filed his reply to the aforesaid objections filed by the respondents.
( 2 ) IN the objections filed by the respondents objections were taken with regard to the award passed by the Arbitrator in respect of Claim No. 2,3,4,8 and 9.
( 3 ) I have heard the learned Counsel for the parties who have taken me through the grounds of objections, the award passed by the Arbitrator and also the records of the arbitration proceedings. On consideration of the materials on record and upon hearing the Counsel for the parties I propose to dispose of the present objections filed by the respondents dealing with each of the objections claim-wise as follows :
( 4 ) CLAIM No. 2: The objections raised against the award of the Arbitrator in respect of claim No. 2 awarding a sum of Rs. 7,825. 00 infavour of the petitioner relates to the non- disclosure of the mental process by the Arbitrator in arriving at an arbitrary amount of Rs. 7,825. 00. Accord ing to the learned Counsel the reason to arrive at the aforesaid conclusion of awarding a sum of Rs. 7,825. 00 in favour of the petitioner is not disclosed in the award. According to him the basis of the amount having not been disclosed and the fact that such a claim having been rejected by the Arbitrator against claim No. 7 on the ground that site was not available and therefore, there was no necessity of bringing the material on the site, the claim in respect of claim No. 2 should have also been rejected on the same ground as the structural drawing was not given to the petitioner nor the site was made available and no work was started.
( 5 ) IN respect of the aforesaid submissions of the learned Counsel for the respondent it could be said that so far as the reasons given by the Arbitrator in respect of claim No. 7 rejecting the claim of the petitioner is concerned, it appears that the same was rejected on the ground that there was no necessity of bringing the materials mentioned therein at that stage since such materials were required for construction work above the plinth level. However, so far as the claim in respect of claim No. 2 is concerned the same is for the materials pilferred, damaged and due to loss in transportation etc. in respect of stone grit, bricks, Yamuna sand and Badarpur sand which were not similar materials as that of the materials of claim No. 7. It is also stated in the award that the claimant had brought at site 2,50,000 bricks, 500 cum. 40 mm. stone aggregate and 500 cum. 12 mm. stone aggregate. In view of the aforesaid admission and on considering the evidence on record the Arbitrator has come to a finding that the petitioner is entitled to a claim of Rs. 7,825. 00.
( 6 ) ACCORDING to the learned Counsel for the respondents the aforesaid award is arbitrary and without any reason. However, it is well settled by the decisions of the Supreme Court that the Court cannot probe into the thought process of the Arbitrator. While giving the award against claim No. 2 the Arbitrator has stated categorically that "on consideration of the submissions and facts placed before him", which means that he has considered the materials placed before him. Besides there is a clear admission of the respondents in the arbitration proceedings that the materials like bricks, stone aggregate to the site. Considering all those facts when the Arbitrator came to the conclusion that there was some loss of materials due to handling in transportation and storage. I do not find any illegality in respect of the aforesaid award made by the Arbitrator as against