The court affirmed that the limited jurisdiction in reviewing arbitration awards restricts interference unless there is a clear legal error, confirming the validity of claims and interest awards in the absence of fraud.

JUDGMENT

Navin Chawla, J. (Oral)--This appeal has been filed under Section 37 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the `Act') challenging the Order dated 27.09.2021 passed by the learned District Judge (Commercial-02) South District, Saket Court, Delhi, dismissing the petition filed by the petitioner appellant under Section 34 of the Act, being OMP (COMM) 30 of 2020.

2. By way of the above petition filed under Section 34 of the Act, the appellant had challenged the Arbitral Award dated 16.07.2020 passed by the learned sole Arbitrator, allowing the claim preferred by the respondent, directing payment of Rs.20 lakhs along with interest at the rate of 18% per annum from the date of filing of the Claim Petition, that is, 21.10.2011, till the date of realisation of the payment. The learned Sole Arbitrator further directed that in case the appellant fails to pay the said amount within a period of three months from the date of pronouncement of the Award, it will bear interest at the rate of 24% per annum (pendente lite and future interest). The learned Sole Arbitrator also awarded a cost of Rs.05 lakhs in favour of the respondent.

3. The dispute between the parties arose out of a Work Order dated 11.07.2011, by which the respondent had awarded the work of execution of electrical work at its Housing Project Kapashera, New Delhi for 27 blocks with basement, stilt, four-storeys and lift machine room to the appellant. The respondent had, in terms of the said Work Order, released an advance of Rs.20 lakhs towards mobilization advance to the appellant.

4. The respondent terminated the Work Order vide its letter dated 28.05.2012 alleging that despite receiving the mobilization advance, the appellant had failed to mobilize the resources in terms of men and material at the site and thus failed to commence and execute the entrusted work.

5. The appellant resisted the claim by contending that since the civil construction of only four units at basement and stilt parking with the ground floor in two units/blocks were constructed by the respondent till January 2012, there was no occasion for the appellant to carry out electrical work. The appellant further contended that it had carried out conduiting electrical pipes in the constructed basement, stilt and ground floor portion for the only constructed ten units in four blocks and was ready and willing to perform its part of the contract, however, the stage of electrical work was not reached. The appellant further contended that the respondent was carrying out unauthorized construction without any sanctioned building plan and hence, the appellant had to stop the work intermittently due to the fault of the respondent.

6. The learned Sole Arbitrator vide the Award dated 16.07.2020, allowed the claim of the respondent as mentioned hereinabove. The learned Sole Arbitrator in his Award has held as under:

"16. I find that the two major issues to be decided at the outset are (i) Whether the Respondent, carried out the work at the worksite in question in consonance with the terms of the Work order dated 11.07.2011 (Exhibit PW1/2), and (ii) Whether the termination letter dated 28.05.2012 (Exhibit PW1/9) issued by the Claimant terminating the Work Order dated 11.07.2011 (Exhibit PW1/2) awarded in favour of the Respondent was legal, valid and in accordance with law. Hence before proceeding with the respective Claims and Counter Claims, I find it appropriate to decide these issues first.

I am proceeding to decide the first issue, i.e., Whether the Respondent carried out the work at the worksite in question in consonance with the