The central legal point established in the judgment is the requirement for credible evidence to support a claim for loss of profit in construction contracts and the narrow scope of interference by the court under Section 34 of the Arbitration and Conciliation Act, 1996.

JUDGMENT :

G.S. SISTANI, J.

1. The present appeal filed under Section 37 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’) is directed against the judgment dated 25.02.2010 passed by a learned Single Judge of this Court by which objections filed by respondent No.1 to the Award dated 15.07.2002 have been allowed, and also costs of Rs.50,000/- have been granted in favour of respondent No.1.

2. Some necessary facts required to be noticed for the disposal of this appeal are that the parties entered into an agreement for construction of Doordarshan Bhawan, Mandi House, Phase-II SH: Sub Structure upto plinth level including RCC foundation and double basement. As per the agreement, the stipulated date for commencement of work was 12.04.1990 with the stipulated date of completion as 11.04.1991. The actual completion of work was done by the appellant on 30.10.1994. Some disputes arose between the parties. The matter was referred to an Arbitrator, who vide Award dated 11.02.1999 (hereinafter referred to as ‘First Award’), decided Claim No.12 in favour of the appellant by which Rs.1,44,83,830/- was awarded to the appellant on account of the loss of profit. It is the case of the appellant that the following reasons were given by the learned Arbitrator while deciding claim No.12:

(i) It is an admitted position that the complete site and drawings were not handed over by respondent No.1 due to which the work could not be completed on time;

(ii) Non-availability of funds with respondent No.1;

(iii) Non laying of electric conduits caused hindrance in execution of work;

(iv) A reading of documents available on record shows that the delay was caused by respondent No.1.

3. Aggrieved by the aforesaid findings, a petition was filed by respondent No.1 bearing OMP No.162/2019 under Section 34 of the Act before the learned Single Judge of this Court. The learned Single Judge vide order dated 20.05.2002, remanded the matter back to the Arbitrator for reconsideration. The Arbitrator vide Award dated 15.07.2002 (hereinafter referred to as ‘Second Award’) reiterated the First Award and held that the material available on record is sufficient to establish the loss of profit.

4. Respondent No.1 again approached the Single Judge of this Court and filed a petition being OMP No.331/2002 under Section 34 of the Act, wherein the learned Single Judge vide judgment dated 25.02.2010 set aside the Second Award with respect to Claim No.12 and also imposed a cost of Rs.50,000/- upon the appellant.

5. Mr. Chetan Sharma, learned Senior Counsel appearing for the appellant, submits that the impugned judgment is contrary to law as well as material available on record. The counsel for the appellant submits that the learned Single Judge has failed to appreciate that there is no infirmity in the findings returned by the Arbitrator vide the Second Award by which it held that the appellant has placed sufficient evidence on record to enable assessment of the loss of profit, on the other hand, respondent No.1 has led no evidence to rebut the plea of loss of profit before the Arbitrator. Mr. Sharma contends that the appellant is an established contractor and is capable of earning profit but could not complete the work for the reason that all the resources were blocked by respondent No.1 due to work being prolonged. It is also the case of the appellant that though, it was held by the learned Single Judge that there is no dispute with regard to respondent No.1 being guilty of causing delay, however, the Court did not appreciate the material available on record as well as the findings rendered by the Arbitrator.

6. Mr. Sharma further submits that the learned Single Judge has wrongly relied upon the judgment in the case of Bharat Engg. Enterprises v. Delhi Development Authority reported at 2006 SCC OnLine Del 829, as the facts of the present case are different from those of the judgment relied upon. It is further submitted that identical issues relating to los