2018 Supreme(Del) 2154
IN THE HIGH COURT OF DELHI AT NEW DELHI
NAVIN CHAWLA, J.
Tejpal Singh - Petitioner
Versus
Surinder Kumar Dewan - Respondent
O.M.P. (COMM.) 178 of 2018 & I.A. 10579 of 2018
Decided On : 09-08-2018
For the Petitioners: Mr. Sachin Datta, Sr. Adv. with Mr. Amit Mehta & Mr. Jayant Kumar, Advs.
For the Respondents: Mr. Anil Kher, Sr. Adv. with Mr. D.R. Bhati and Ms. Subiya Akbar Warsi, Advs.
The court emphasized the importance of proving the authenticity of documents and upheld the principle of limiting damages to the period of contractual breach.
Headnote:
Arbitration and Conciliation Act, 1996 - Collaboration Agreement - Section 34
Fact of the Case:
The petitioner filed a petition challenging the Arbitral Award dated 29.12.2017 passed by the sole arbitrator adjudicating the disputes between the parties in relation to the Collaboration Agreement dated 03.05.2005. The Collaboration Agreement had three versions, and the petitioner disputed the authenticity of the second and third versions. The respondent suffered losses due to unauthorized construction and non-completion of the Agreement by the petitioner and filed claims before the Sole Arbitrator.
Finding of the Court:
The court found that the Arbitrator erred in relying on the unproved version of the Collaboration Agreement in awarding a claim in favor of the respondent. The court also held that the petitioner was in breach of the Collaboration Agreement by carrying out unauthorized construction. The court modified the award to set aside the amount awarded in favor of the respondent under claim A and limited the damages awarded under claim B to a specific period.
Issues: Authenticity of the Collaboration Agreement versions, liability for unauthorized construction, and calculation of damages.
Ratio Decidendi: The court found that the Arbitrator erred in relying on an unproved version of the Collaboration Agreement and held the petitioner in breach of the Agreement for unauthorized construction. The court limited the damages awarded to a specific period.
Final Decision: The court partially modified the award, setting aside the amount awarded in favor of the respondent under claim A and limiting the damages awarded under claim B to a specific period.
NAVIN CHAWLA, J.
1. This petition under Section 34 of the Arbitration and Conciliation Act, 1996 has been filed by the petitioner challenging the Arbitral Award dated 29.12.2017 passed by the sole arbitrator adjudicating the disputes between the parties in relation to the Collaboration Agreement dated 03.05.2005.
2. There were three versions of the Collaboration Agreement produced before the Arbitrator.
3. The first one was the original Collaboration Agreement produced by the petitioner marked as RW 6/D. The same contains handwritten corrections such as in Clause 4, where instead of non-refundable security deposit of Rs. 25 lakhs, a cutting had been made to correct it to Rs. 22 lakhs. There is no dispute between the parties regarding these corrections.
4. The second copy of the Collaboration Agreement was the one filed by the respondent alongwith the Statement of Claim, marked as CW1/1. The same had some handwritten portion in the document. The petitioner in its statement of defence has denied this document and claimed it be tampered and forged.
5. Third version of the Collaboration Agreement was the one filed along with the rejoinder filed by the respondent before the arbitrator and the same was marked as CW 1/C. This also had some cuttings and additions made by hand, out of which, the petitioner admitted to a few, while denying the rest, specifically what was marked as ‘A’ and ‘B’ in the said document. The said document bears the signatures of the petitioner on other changes which have been made in the document by hand. In this regard the relevant portion of the cross-examination of the petitioner is reproduced herein below:-
“Q18. Please see the collaboration agreement dated 3rd May, 2005 marked as Annexure CW1/C. Is it correct that this document has been signed by you on every page and you have also signed the cuttings on the said document?
Ans. Yes. The document has been signed by me on every page. Cuttings have also been signed by me except that the cutting at point “A” on internal page no.5 of the document does not appear to be mine. However, signatures appearing at the said cutting at point “B” appears to be mine but I had not signed.”
6. The reference to point ‘A’ and point ‘B’ is reproduced herein below:-
6. That the said shall be divided between the parties as under :
Owners Allocation : Entire Ground floor and Entire First floor only, with common driveway and stairs:
Second party Allocation : Entire second floor 'A 8' 'C' with its roof/terrace right upto sky,
11. That at time of lantor of first floor the second party will be bound to pay balance amount Rs. 8,00,000/- (Rupees eight Lakh only) to the firs Entire party and after the receipt of such amount the first party will be bound to execute the proper sale deed of entire second floor, with its roof right upto sky of the above mentioned property in favour of the second party of his nominees and after the completion of the construction, the second party shall hand over the actual vacant and peaceful possession of the owners allocation to him
12. That the second party and first party both under take not to
7. It is an admitted case between the parties that the property was sealed by the Municipal Corporation of Delhi (MCD) on 30.05.2006 due to unauthorized construction. An FIR was also registered on 28.09.2006 against the said unauthorized construction. The officials of the MCD also demolished the third floor portion of the said property. On 22.01.2007 the property was de-sealed by the MCD for a period of seven days to remove the unauthorized construction, however, instead of regularizing the construction, the petitioner started to complete the unauthorized construction including reconstruction of the third floor. Thereafter, the respondent vide letter dated 25.04.2007, requested the MCD not to entertain any requests of the petitioner with regard to the sanctioning of the plans in respect of the property and further vide legal notice dated 11.05.2007 terminated the Coll