IN THE HIGH COURT OF DELHI AT NEW DELHI
Manmohan, Saurabh Banerjee, JJ.
Union of India – Appellant
Versus
Om Vajrakaya Construction Company – Respondent
FAO(OS) (COMM) 181 of 2022 & CM APPLs.31540-31541 of 2022
Decided On : 20-03-2023
Arbitration and Conciliation Act, 1996 - Section 34 - Delay in Execution of Contract
Fact of the Case:
The appeal challenged the order partially allowing the objections of the Appellant under Section 34 of the Arbitration and Conciliation Act, 1996, related to the delay in execution of the contract.
Finding of the Court:
The court found that the delay was attributable to the Appellant based on the well-considered view of the Arbitrator, and upheld the decision as it was not amenable to interference under Section 34 of the Act.
Issues: The issues revolved around the attribution of delay in the execution of the contract and the applicability of Section 34 of the Arbitration and Conciliation Act, 1996.
Ratio Decidendi: The court emphasized the principle that concurrent findings of fact and law in an arbitral award should not be disturbed unless there is apparent perversity that goes to the root of the case without a possibility of alternative interpretation.
Final Decision: The appeal and applications were dismissed for lack of merit, with no order as to costs, and the amount deposited by the appellant was ordered to be released to the respondent.
JUDGMENT
Manmohan, J. (Oral)--Present appeal has been filed challenging the order dated 20th December, 2021 passed by the learned Single Judge in O.M.P. (Comm) No.299/2021, whereby the objections of the Appellant under Section 34 of the Arbitration and Conciliation Act, 1996 have been partially allowed.
2. Learned counsel for the Appellant states that though the impugned award was set aside with regard to pendente lite interest, yet the challenge with regard to the remaining Award was dismissed. He states that claims No.5, 6, 7 and 8 were incorrectly allowed, as the same were based on an erroneous finding that the delay was attributable to the Appellant. He states that the learned Single judge has erred in observing that the finding of delay was a question of fact and the same could not be interfered in a Section 34 petition.
3. He states that the reasons given by the respondent for delay in execution of the contract and as upheld by the Ld. Arbitrator are vague and the delay in days attributable to each reason has not been quantified.
4. Per contra, learned counsel for the respondent-contractor, who appears on advance notice, states that various extensions were granted to the respondent-contractor under Clause 17A of GCC - which provides for extension of time on account of delay not attributable to a contractor. He also emphasises that the extensions were granted without levying any penalties or liquidated damages on the respondent-contractor.
5. This Court is of the opinion that the impugned order has correctly held that Arbitrator had evaluated the matter placed before it to come to a well considered view that the delay was attributable to the Appellant since the resources deployed by the Respondent could not be deployed in entirety due to several reasons, including non-availability of drawings, non-availability of free site for execution, non-sanctioning of ESP (Engineering Scale Plan), cutting of trees, etc. The Arbitral Tribunal has also found that there was extensive inter-departmental communications on record to show that the delays and hindrances pointed out by the Respondent had been admitted. The finding of the Arbitral Tribunal that the Respondent was compelled to execute additional items is a question of fact and the impugned judgment has correctly held that it cannot be interfered with in proceedings under Section 34 of the Act.
6. This Court in Mangalwar Filling Station vs. Indian Oil Corporation Limited & Ors., 2021 SCC Online Del 3646 has held that once an arbitral award has been confirmed in an application filed under Section 34 of the Act, the appellate Court must be extremely cautious in disturbing concurrent findings of fact and law as they are ordinarily not amenable to interference under Section 37 of the Act. This Court further observed in the said judgment that the Appellate Court should generally not interfere unless it is apparent that the perversity of the arbitral award goes to the root of the case without a possibility of alternative interpretation that might sustain the award. The Supreme Court vide order dated 16th August, 2021 in SLP No.12125/2021 was pleased to dismiss an appeal filed against the above-mentioned judgment.
7. Consequently, the present appeal along with applications being bereft of merit is dismissed but with no order as to costs. Accordingly, the amount deposited by the appellant with the Registry of this Court shall be released to the respondent. For this purpose list the matter before Joint Registrar on 11th April, 2023.
AI
Concurrent findings of fact and law in an arbitral award should not be disturbed unless there is apparent perversity that goes to the root of the case without a possibility of alternative interpretat....
The main legal point established in the judgment is that the limitation period for challenging an award under Section 34(3) of the Arbitration and Conciliation Act is strict and cannot be extended be....
The unambiguous language of Section 34(3) of the Arbitration and Conciliation Act, 1996 excludes the applicability of Section 5 of the Limitation Act, and delay beyond 30 days after the expiry of the....
Point of Law : Arbitration and Conciliation - Arbitral Award - Challenged - Section 34 provides that recourse to a court against an arbitral award may be made only by an application for setting aside....
The limitation period for filing a petition to set aside an arbitral award under Section 34 is mandatory and cannot be extended beyond the prescribed time, even for reasons of administrative difficul....
The court upheld the principle that arbitral awards should not be interfered with unless there is a clear violation of public policy or a patent illegality.
The court confirmed that judicial interference in arbitral awards is limited to specific grounds, emphasizing respect for the arbitral process and the finality of awards.
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