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1994 Supreme(Del) 470

High Court Of Delhi
R.S.BUILDERS - Appellant
Versus
DELHI DEVELOPMENT AUTHORITY - Respondent
Suit 3948 of 1991
Decided On : 07/20/1994

Advocates Appeared:
B.K.DEWAN, V.K.Sharma

The court's power to interfere with an arbitration award is limited to cases where there is an error apparent on the face of the award.

Headnote:

ARBITRATION - AWARD - CHALLENGE - GROUNDS - ERROR APPARENT ON THE FACE OF THE AWARD - SCOPE OF JUDICIAL REVIEW - INTERFERENCE BY COURT - LIMITED - ARBITRATOR'S DECISION ON FACTS AND LAW - FINAL - COURT CANNOT RE-APPRECIATE EVIDENCE OR REVALUE FINDINGS - AWARD BASED ON REASONED APPRECIATION OF EVIDENCE AND TERMS OF CONTRACT - NO ERROR APPARENT - OBJECTIONS DISMISSED - AWARD MADE RULE OF COURT.

Fact of the Case:

Petitioner, a construction company, was awarded a contract by the Delhi Development Authority (DDA) for the construction of houses. Disputes arose during the contract, and the matter was referred to arbitration. The arbitrator made an award in favor of the petitioner, and the DDA filed objections to the award.

Finding of the Court:

The court held that the arbitrator's award was based on a reasoned appreciation of the evidence and the terms of the contract. The court found no error apparent on the face of the award and dismissed the DDA's objections.

Issues: Whether the arbitrator's award was based on a reasoned appreciation of the evidence and the terms of the contract.

Ratio Decidendi: The court held that the arbitrator's award was based on a reasoned appreciation of the evidence and the terms of the contract. The court found that the arbitrator had considered the evidence led by the parties and had applied his mind to the terms of the contract. The court also held that the arbitrator's decision on facts and law was final and that the court could not re-appreciate the evidence or revalue the arbitrator's findings.

Final Decision: The court dismissed the DDA's objections and made the arbitrator's award a rule of the court.

USHA MEHRA

( 1 ) THE petitioner M/s. R. S. Builders was awarded the work of construction of 1323 SFS Houses at Santa Vihar, Sub-Head: Construction of Cement Concrete, Paths and Pavements in Pocket B by the Delhi Development Authority (in short "d. D. A. " ). During the currency of the contract dispute arose between the parties and finally when they could not be sorted out, the petitioner sought for the arbitration of the disputes. The Engineer Member, D. D. A. referred those disputes to the sole arbitration of Shri A. P. Paracer, respondent No. 2, herein. The said arbitrator made and published his award on 8-11-1991. The said award was filed in the Court. Notice of which was issued to both the parties. The petitioner filed no objections whereas the D. D. A. filed the objections, which are listed as I. A. 6887/94.

( 2 ) THE objections mainly rests on the ground that there was complete non-application of mind and non-appreciation of the evidence led by the D. D. A. before the arbitrator. It is, inter alia, pleaded that the award of Rs. 11,257. 79 against objection No. 2 is contrary to the terms of the contract. The amounts of the bills were to be paid within one month of the submission of the bills and this was precisely what was done and, therefore, the D. D. A. was entitled to deduct rebate at 0. 5% for making the payment of the bill within the stipulated period. However, the arbitrator illegally directed the D. D. A. to refund the rebate. Similarly, award against claim No. 3 has been challenged on the ground that the work which had been done by the petitioner was not extra item but covered under the C. P. W. D. Specification 17-10-2 of the C-IV Specification. The said specification was part of the agreement. It was found that this item was not payable separately because as per the specification it stood included in the item of the work executed. But the arbitrator by ignoring the term of the agreement awarded the amount and hence the award is bad on the face of it.

( 3 ) SO far as claims Nos. 4 and 5 are concerned, these have been challenged on the ground that the arbitrator wrongly came to the conclusion that the C. P. W. D. specifications were not applicable. As regards claim No, 7, the arbitrator ignored the evidence led before him. And so is the case with claim No. 9. In this case arbitrator, on the one hand has awarded damages and compensation on account of damage done by other agencies resulting in damage to his work and at the same" time allowed the amount for barricading in order to save his work. Apparently, it amounts to clear contradiction on the face of the Award and, therefore, the award is liable to be set aside.

( 4 ) THE petitioner refuted the challenge to the objections filed by the respondent, D. D. A. , mainly on the grounds that the arbitrator after appreciating the documentary and oral evidence led before him and after relying on the terms of the agreement and the specifications and the work order items made the award. His is a reasoned award justifying the amounts awarded against different claims lodged by the petitioner. This Court has no power to sit as an appellate authority over the award of the arbitrator.

( 5 ) I have heard learned counsel for the parties and perused the record. Admittedly, the impugned Award is a reasoned award. It is well settled principle of law that this Court can interfere with an arbitration award only if the error is apparent on the face of the award. This Court is not a Court of appeal and, therefore, cannot go behind the award to find out what was the process of mind of the arbitrator to arrive at the conclusion. So far as claims Nos. 2, 3,4, 5 and 6 are concerned, they pertain to facts. The arbitrator is the best Judge of the facts. This Court may come to a different conclusion but that does. not mean that the decision of the arbitrator is bad in law. Now the award can be set aside because it does not coincide with the reasoning of this Court. The reasoning given by the ar








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