The court emphasized the limited scope of interference with an Award and the importance of timely payments in arbitration proceedings.

Valmiki J. Mehta, J (Oral)

1. This matter was passed over on the first call and adjournment prayed was refused as it was opposed. Even on the second call the counsel for the appellant refuses to argue the appeal. Counsel for the respondent very vehemently opposes the adjournment and says that the hue and cry of compromise talk is urged although no compromise talks have taken place and just a few minutes back some suggestions were given for compromise as a basis to seek adjournment. It is stated that the object of the appellant is to delay and drag the case and not make payments to the respondent under the Award, although, work has been completed long back and the respondent is out of pocket with respect to amounts spent since the year 1997. Since learned counsel appearing on behalf of the appellant refuses to argue the case, I have heard the counsel for the respondent and am proceeding to dispose of this appeal which is pending since seven years.

2. This first appeal is filed under Section 37 of the Arbitration and Conciliation Act, 1996 against the order of the court below dated 25.11.2006 dismissing the objections under Section 34 of the Act filed by the appellant herein, respondent in the arbitration proceedings and objector before the court below, against the Award dated 8.9.2004 as per which a decree has been passed against the appellant for payment of Rs. 9,67,425/- along with interest @ 12% per annum from 1.7.1998. Award has been passed with respect to the amount claimed by the respondent herein, claimant in the arbitration proceedings, for construction work of the factory of the appellant done by the respondent.

3. The facts of the case are that a contract was entered into between the parties whereby respondent agreed to construct a factory building of the appellant at 23-B, Industrial Area, Shahibabad, U.P. The case of the respondent was that he regularly progressed with the completion of the work but the petitioner/appellant did not make the payment of the running bills. Respondent also complained that time and again work had to be stopped because cheques of the appellant either bounced or the appellant was not making payment. Problem of the bills started from 10th and 11th running bills. The relevant facts in this regard are noted in paras 5 and 6 of the impugned order and which read as under :

“5. After referring to the communication between the parties, the learned Arbitrator concluded that the problem of payment of dues started from 10th and 11th running bills. Numerous cheques issued by the petitioner in payment came to be bounced. Thereafter in pursuance of meeting held in May, 1997, the petitioner proceeded to execute remaining work in May, 1997 but the petitioner did not settle these bills on one pretext or the other. The claimant was apprised of certain defects and these defects were also rectified by the claimant. Learned Arbitrator also noted that the dispute lingered on and the petitioner did not reply to the letters of the claimant asking for payments. In these circumstances, learned Arbitrator concluded that the respondent was liable to make the payment. Further noting that the claimant itself had reduced amount of 12th running bill to Rs. 4,67,425/- learned Arbitrator ordered accordingly. The learned Arbitrator also allowed refund of Rs. 5,00,000/- which had been retained by petitioner to ensure that the defects if any found in the work are rectified. The learned Arbitrator noted that no defect was pointed out during the defect liability period. Learned Arbitrator allowed interest @ 12% per annum on the above claims as per the law laid down by Hon’ble Supreme Court in Executive Engineer Dhenkand Minor Irrigation Division Vs. N.C. Budharaj (2001) 2 SCC 721.

6. Coming to the counter claim, learned Arbitrator dismissed the counter claim nothing that there was no evidence to show that the petitioner had given any notice specifying remaining defects or claimant was put to notice of his cost and ri