The main legal point established is that the Court does not act as a Court of appeal under Section 34 of the Arbitration and Conciliation Act, 1996, and should not interfere with the arbitrator's findings unless they are arbitrary, capricious, or perverse.

JUDGMENT :

Present appeal is preferred against the judgment and order dated 28.09.2007, passed in Misc. (Arbitration) Case No. 28 of 2005, Smt. Madhav Nayan Vs. Commissioner, by the court of District Judge, Tehri Garhwal (for short “the case”). The impugned judgment and order has been passed on an application filed by the respondent under Section 34 of the Arbitration and Conciliation Act, 1996 (for short, “the Act”) for setting aside the arbitral award dated 23.04.2005, passed by the sole Arbitrator. By the impugned judgment and order, the arbitral award has been set aside.

2. Facts necessary for the disposal of instant appeal, briefly stated, are as hereunder:-

On 31.12.1966, Kamal Nayan and Parshu Ram were granted lease in Plot No.44 Section No.3, below Motor Road Village Khuret, total area 77 nali and 14 muthi (land in question) for the purposes of developing an orchard by planting fruit bearing trees. The lease deed was also executed. Both the lessees are dead. Respondent Madhav Nayan is son of the original lessee Kamal Nayan.

On 19.09.1996, the respondent executed a Power of Attorney with respect to the land in dispute in favour of Rahul Sondhi. It appears that the lessor issued notices to the respondent with regard to the non compliance of the terms of lease and thereafter a joint inspection was ordered on 28.01.2000. Pursuant to which, the Revenue Officers and Forest Officers conducted a joint inspection of the land in dispute. In the joint inspection it was found that though 442 fruit bearing trees were planted in the land in dispute but they appeared to have been planted after 1995-1996. It was also found that there were two houses of seven rooms constructed by Rahul Sondhi on the land in dispute and he had also stationed a Kisan Singh as watchman, whom he paid salary. The joint inspection team was told that the land in dispute has been sold. The joint inspection team also found that the land in dispute was being used for growing agricultural crop and vegetables. In view of it, the District Magistrate, Tehri Garhwal cancelled the lease on 04.02.2003. This order cancelling the lease deed was challenged in Writ Petition (M/B) No.886 of 2003, Madhav Nayan vs. State of Uttaranchal (for short, “the writ petition”). It may be mentioned here that the lease deed was cancelled on two counts (i) Non use of the land in dispute for the purpose for which the lease was granted and (ii) non-payment of the rent.

This Court on 22.09.2003, directed the respondent to pay the arrears of taxes within two weeks since then and on the second question the Court observed “the matter comes under arbitration as mentioned in the terms of allotment and the arbitration lies before the Commissioner”. And the Court further observed “in the circumstances, the petitioner pays arrears of taxes as directed above, he is allowed to raise a dispute before the Commissioner under the arbitration. In that event, the Commissioner will decide the question whether the petitioner has utilized the land for the purpose for which they are allotted.” The respondent paid the rent thereafter. But, the respondent did not raise the issue before the Arbitrator, instead the District Magistrate, Tehri Garhwal referred the matter for arbitration on 23.12.2000. In the communication dated 23.12.2003, the District Magistrate, Tehri Garhwal recorded that the arrears of rent has been paid by the respondent. The arbitrator by its award dated 23.04.2005, observed that there is no reason to interfere in order dated 04.02.2003, passed by the District Magistrate, by which the lease has been canceled. It was so observed on the following grounds:-

(i) The trees were planted after 1995-1996 which is violation of the terms of the lease.

(ii) The respondent did transfer all his rights on land in dispute by way of Power of Attorney, which is a kind of sub lease and defeats the purpose of Chamba Mussorie Fruit Belt Scheme and.

(iii) The family settlement is not recognized.

3. The award was challenge