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IN THE HIGH COURT OF DELHI
C. Hari Shankar, J.
Tantia Construction Limited - Appellant
Versus
Ircon International Ltd. - Respondent
O.M.P. (COMM) 593 of 2020 & I.A. 12328 of 2020
Decided On : 13-04-2021
(Video-Conferencing)
1. This petition, under Section 34 of the Arbitration and Conciliation Act, 1996 ("the 1996 Act"), is directed against a supplementary award dated 20th August, 2020, passed by the learned arbitrator. By the supplementary award, the amounts awarded in favour of the petitioner in the original award dated 23rd January, 2020, against Claims No. 6 and 12, were reduced. The amount of Rs.1,90,86,595/-, awarded in respect of claim no. 6, was reduced to Rs.97,85,184/- and the amount of Rs.58,08,475/-, awarded in respect of claim no. 12, was reduced to Rs.54,01,882/-. Side by side, the learned arbitrator also modified the reasons for awarding the aforesaid amounts. The changes effected by the impugned supplementary award stand captured, in the impugned award itself, in a tabular form, thus:
| "Claim no. 6 Claim for illegal encashment of performance bank guarantee | Amount claimed (Rs.) | Amount awarded in Original award (Rs.) | Award modified (Rs.) |
| 1,90,86,595 | 1,90,86,595 | 97,85,184 |
| Original reasons of award | Modified reasons of award |
| As deliberated in above paras, the termination of the contract was wrongful, illegal and arbitrary due to the occurrence of earthquake in Nepal which also led to declaration of National Emergency, severely affected the citizens. Tender categorically stipulates that in the event of occurrence of a force majeure event, neither party shall be entitled to terminate contract in respect of non-performance or delay in performance. Hence claim amount of Rs.1,90,86,595/-, is reasonable and payable. | As deliberated in above paras, the termination of the contract was wrongful, illegal and arbitrary due to the occurrence of earthquake in Nepal which also led to declaration of National Emergency, severely affected the citizens. Tender categorically stipulates that in the event of occurrence of a force majeure event, neither party shall be entitled to terminate contract in respect of non-performance or delay in performance. As against claim amount of Rs.1,90,86,595/-, respondent has mentioned they have adjusted the recoveries other than mobilization advance in the final bill for Rs.93,01,410 in the encashed amount of PBB. Hence balance PBG amount of Rs.97,85,184 is reasonable and payable. |
| "Claim no.12 Claim for unbilled quantity of blanketing materials layed | Amount claimed (Rs.) | Amount awarded in Original award (Rs.) | Award modified (Rs.) |
| 66,90,000 | 58,08,475 | 54,01,882 |
| Original reasons of award | Modified reasons of award |
| As per 17th & final bill total quantity paid up to 16th running bill was 47485.880 cum of granular blanketing material but in the aforesaid 17th & final bill it has been reduced to 39411.264 cum. Since the 47485.880 cum is a measured and paid quantity, payment of balance quantity 8074.616 cum recovered from the final bill for amounting to amounting to Rs.58,08,475.00 to be refunded to claimant. | As per 17th & final bill total quantity paid up to 16th running bill was 47485.880 cum of granular blanketing material but in the aforesaid 17th & final bill it has been reduced to 39411.264 cum. Since the 47485.880 cum is a measured and paid quantity, payment of balance quantity 8074.616 cum recovered from the final bill for amounting to amounting to Rs.54,01,882.00, after adjusting the rate quoted by the claimant, to be refunded to claimant. |
| Original concluding paras | Modified concluding paras |
| In conclusion, the respondent, IRCON INTERNATIONAL LIMITED shall pay to claimant, M/s Tantia Construction Limited. DD-30, 7th floor, Sector-1, Salt lake city Kolkata a sum of Rs.4,80,37,967.00 (Rs. four crores eighty lacs thirty seven thousand nine-hundred sixty seven only) in full and final settlement of all the claims/counter claims of both the parties arising out of dispute as referred vide IRCON International Limited, Saket's letter No. IRON/CO/ARBN/Tantai Con/JOG-Biratnagar/129/2601/74 dated 12.11.2015. | In conclusion, the respondent, IRCON INTERNATIONAL LIMITED shall pay to claimant, M/s Tantia Construction Limited |
The court held that the failure to adhere to the audi alteram partem principle and rectify errors under Section 33 without the appellant's hearing invalidated the supplementary arbitration award.
Violation of Section 33(1) of the Arbitration and Conciliation Act, 1996 and the principles of natural justice led to the setting aside of the impugned supplementary award.
The main legal point established in the judgment is that the applicants were entitled to the benefit of the amendment made to Section 34 of the Arbitration and Conciliation Act, 1997, and that the de....
The main legal point established in the judgment is that once an arbitral award becomes enforceable after the prescribed time limit, no further application under Section 33 of the Act can be entertai....
Arbitral Award – Limitation – S. 34(3) specifically states that an application for setting aside may not be made after three months have lapsed from date of which party making an application had rece....
Scanned signed copy of the award/order of the Arbitral Tribunal to the parties would be a valid delivery as envisaged under Section 31(5) of the Arbitration and Conciliation Act, 1996.
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