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IN THE HIGH COURT OF DELHI
Manoj Kumar Ohri, J.
Dharamvir and Company - Appellant
Versus
Delhi Development Authority - Respondent
FAO 147 of 2022
Decided On : 07-07-2022




The court confirmed that the scope of interference under Section 37 of the Arbitration Act is limited, emphasizing the binding nature of arbitration agreements.

Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 37 - Appeal filed against an Arbitral Award and subsequent dismissal of objections - Appellant, an approved contractor, claimed additional payments due to delays caused by the respondent, which the Arbitrator rejected. The learned ADJ confirmed the award citing voluntary acceptance of a final bill - No coercion was observed against the appellant. (Paras 4, 6, 10, 12, 21)

(B) Judicial Scrutiny - Scope of interference under Section 37 is limited; the court cannot reassess merits of the award but must ensure the findings are neither perverse nor contrary to the evidence. (Paras 14, 20)

Facts of the case:
The appellant was awarded a contract for construction work, but disputes arose over payments and delays. The Arbitrator ruled in favor of the respondent, stating the appellant voluntarily accepted a final bill. (Para 4)

Findings of Court:
The Arbitrator's findings that no coercion was present and the acceptance of payment was binding are validated; the appeal was dismissed. (Paras 21, 22)

Issues: Whether the appellant was coerced into accepting a settlement and if claims for enhanced amounts were justified (Para 6).

Ratio Decidendi: Accepting payment as full and final without coercion, and the limited avenue for judicial interference in arbitration were reiterated in this case. (Para 20)

Result: Appeal dismissed.

Table of Content
1. nature of the appeal and factual background (Para 3 , 4 , 5)
2. arguments of the parties in the appeal (Para 6 , 7)
3. court's reasoning based on the arbitral award (Para 8 , 9 , 12 , 13)
4. limitations on interference under section 37 (Para 14 , 15 , 16 , 17 , 19)
5. conclusion and dismissal of the appeal (Para 20 , 21 , 22)

JUDGMENT

Manoj Kumar Ohri, J.

CM.APPL No.24765/2022 (Exemption)

1. Allowed, subject to all just exceptions.

2. Application stands disposed of.

FAO No.147/2022 & CM. APPL. No.24766/2022 (Interim Stay)

3. The present appeal has been filed under Section 37 of the Arbitration and Conciliation Act, 1996 (hereinafter, referred to as the `Arbitration Act') on behalf of the appellant assailing the Award dated 02.11.2015 passed by the learned Arbitrator in Arbitration Case No.132/2013 as well as the order dated 23.03.2022 passed by the learned ADJ-02, West, Delhi in Arbitration No. 60863/16. The appellant also seeks direction to the respondent for fresh adjudication of claims by another Arbitrator.

4. Brief facts of the case, as noted by the learned ADJ, are as follows:

    "2. Petitioner is approved contractor of the respondents as he is listed as such in appropriate class. The work pertaining to development of main land i.e. construction of C/o 60 mtr. & 45 m.MP.P Roads at Dwarka Phase-II, Sector 23(b 24, 25 & 26), Construction of Boundary Wall along Trunk Drain No. 2 was awarded to him. The tender is said to be an "Item rate tender" having an estimated cost of Rs.35,12,293/- but the petitioner had taken it at 8% discount and hence, the tender costs was Rs.32,29,035/-. The work was to start on 23.07.2011 and was to be completed in three months i.e, on 22.10.2011. But the site was provided to the petitioner and hence, the actual date of completion was 16.01.2012. The respondents prepared a final bill of only Rs.34,15,741/- but he was claiming more amount and hence an arbitrator was appointed who ruled against him vide award dated 02.12.2015."

5. Vide the impugned order, the learned ADJ has dismissed the objections filed by the appellant against the impugned Award under Section 34 of the Arbitration Act.

6. Learned counsel for the appellant submitted that the appellant was awarded a contract by the respondent, however, the work assigned could not be completed in time due to delay attributable to the respondent itself. He further submitted that the appellant had accepted the First Bill as full and final settlement of dues, but the acceptance was under coercion since the respondent declined to make any payment at all if the said Bill was not accepted as such. It was also submitted that no copy of the aforesaid Bill was provided to the appellant, as a result whereof, the appellant had no opportunity of seeing the quantities recorded and the rates applied. Lastly, learned counsel argued that the impugned order is cryptic and came to be passed in a mechanical manner.

7. Learned counsel for the respondent, on the other hand, opposed the submissions made on behalf of the appellant and supported the impugned order and Award. It was submitted that no force or coercion was exercised on the appellant for acceptance of the First and Final Bill as settlement of all dues. It was further submitted that despite acceptance of the aforesaid Bill and encashing the relevant cheque, the appellant is now claiming three times the amount agreed upon in the original contract. Learned counsel also submitted that the time period for completion of the work was extended at request of the appellant; in view of the undertaking given by the appellant on the concerned application, that no claim would be made on the basis of delay, as well as the terms of the contract, the appellant is not entitled to any additional/enhanced amount.

8. I have heard learned counsels for the parties and perused the material placed on record.

9. In the present case, the appellant was contracted by the respondent for construction of `Bounda

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