Point of Law: Arbitration Award - Merely because the arbitrator has taken a view that is plausible and there may be another view also, the award cannot be interfered with.

JUDGMENT :

DINESH KUMAR SHARMA, J

C.M.No. 14983/2022

Exemption allowed, subject to all just exceptions. Accordingly, the application stands disposed of.

FAO (OS) (COMM) 75/2022

1. The present appeal under Section 13 of the Commercial Courts, Commercial Division and Commercial Appellate Division of the High Courts Act, 2015 read with Section 37 (1) (c) of the Arbitration and Conciliation Act, 1996 (hereinafter referred as ‘Act’) has arisen out of the impugned order dated 22nd March 2021 in OMP (COMM) No. 455 of 2019 passed by learned Single Bench under Section 34 of the said Act. In the impugned order, the learned Single Judge has upheld the award of the Arbitral Tribunal pertaining to claim no. 1, however, the Tribunal set aside the award pertaining to claim No.2. It is pertinent to mention that the Arbitral Tribunal had rejected claim nos. 3 and 4 made by the respondents and rejected all the counterclaims raised by the appellant.

2. Short of the details, the facts in brief are that pursuant to a public notice issued by the appellant for auction of plots for the construction of hotels in Delhi, respondent submitted its bid and was awarded contract for the Hotel Plot nos. 13 A and 13 B located at District Centre, Mayur Vihar, Centre, New Delhi. The possession of the plots was handed over to the respondent on 5th December 2006 with the stipulation that work was to be completed on 5th June, 2010. However, the work actually completed on 20th December, 2010. The work related to the project was pertaining to Commonwealth Games and was considered to be a project of national significance. The parties agreed to the general terms and conditions of the auction which were part of the auction notice. Clause – 3.14 of the general terms and conditions which is germane to the present controversy reads as under;

“Clause 3.14 Performance Security The construction of the hotel will have to be completed and made functional within a period of 42 months from the date of possession site/land. The intending auction purchaser shall be required to deposit the performance security to the tune of 5% of the bid amount before the time of execution of the conveyance deed, which shall be in nature of bank guarantee in an approved form valid for 4 years. The institution furnishing such security shall be subject to the approval of the same by the Authority. The penalty for delay in the completion of the hotel beyond 42 months shall be levied as under:

Bank guarantee amount, to the extent there is a delay in completion of hotel, will be encashed as per the schedule mentioned above. The date of completion will be treated as the date on which the necessary completion certificate is obtained by the intending auction purchaser.”

3. In accordance with the terms of the clause – 3.14 of general terms and conditions of the auction, respondent furnished the performance bank guarantee which was duly accepted by the appellant. Subsequent to the issuance of the No Objection Certificate by the DDA (Appellant) on 9th November, 2006, the respondent submitted building plans to DDA for approval on 4th December, 2006. The possession was handed over by the appellant to the respondent on 5th December, 2006 and as per the terms and conditions respondent was required to complete and make the hotel functional by 5th June, 2010 i.e. within 42 months of the delivery of possession of plots. Though, the appellant granted permission for escalation work in respect of plot nos. 13 A and 13 B to the respondent vide communication dated 22nd December, 2006, but imposed a condition