ORDER

%05.01.2024

1.This hearing has been done through hybrid mode. I.A.196/2024 (for exemption)

2.Allowed, subject to all just exceptions. Application is disposed of. O.M.P.(COMM) 8/2024 & I.A.195/2024 (for delay)

3.The present petition is filed under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter, ‘the Act’) for setting aside of the Arbitral Award. The Petitioner - Panchanan International Private Limited is aggrieved by the impugned award dated 28th August, 2023 passed by the sole Arbitrator.

4.The Petitioner is in the business of wholesale trade and distribution of readymade garments. The Petitioner had availed a fire policy for the sum of Rs.30 crores from the Oriental Insurance Company Limited in 2016, which was valid till 9th May, 2017. According to the Petitioner, a fire broke out in the factory of the Petitioner, which was covered by the Standard Fire and Special Perils Insurance policy executed between the parties availed of by the Petitioner for a sum of Rs.30 crores.

5.It is stated that the goods/ garments of the Petitioner were lying in various godowns in four locations. In one of the locations i.e. Shed at 53/73, Nangli Poona, opposite DIRD College, GT Karnal Road, Delhi-110036 location, a fire broke out on 25th April, 2017 due to some electrical issue and almost 50 fire tenders were stated to have been required to bring the fire under control. In view of the said disaster, it is averred that the Petitioner sent an intimation of the incident to the Respondent in order to avail the fire policy. It is stated that M/s Aditi Insurance Surveyors and Loss Assessors Pvt. Ltd (‘Surveyor’) were appointed by the Respondents to carry out a Survey of the Godown, to ascertain the nature of fire and the quantum of damage.

6.The surveyor of the insurance company assessed the loss at Rs.20,65,27032/-, vide its Report dated 9th July, 2018.However, the insurance company did not pay the said amount and only approved the amount of Rs.65,56,125/-. Further, it is averred that there were discrepancy in valuation from the surveyor basis exclusion policy clause in the said fire policy and the assessed amount was lesser than the claimed amount. The petitioner is stated to have sent multiple reminders to Respondent to process the Petitioner’s Claim amount or inform the Petitioner its decision to reduce the claim. Further, it is also stated that the Respondent unilaterally reduced the amount without any justification.

7.Due to the non-responsive behaviour of the Respondent, the Petitioner moved to invoke arbitration in terms of Clause 13 of the fire Policy. A notice dated 30th December, 2020 was sent to the Respondent invoking arbitration and proposing the name of Mr. Justice (retd.) J.D. Kapoor, Former Judge, Delhi High Court as the sole arbitrator to adjudicate the disputes between parties. However, the Respondent failed to appoint a second Arbitrator or constitute a committee for the said process. In view of the non-responsiveness of the Respondent, the Petitioner filed a Petition under Section 11 of the Act, before this Court seeking appointment of the Arbitrator, to adjudicate the disputes.

8.Vide order dated 28th July, 2021, this Court referred the dispute between the parties to arbitration and appointed Mr. Justice (Retd.) Ajit Bharihoke, as learned sole Arbitrator.

9.The Petitioner thereafter, filed its Statement of Claim before the ld. arbitrator who then decided the matter.

10.The sole Arbitrator rendered award dated 28th August, 2023. By the said award, the Arbitrator has awarded the amount of INR 20,65,27,032/-, which was assessed by the surveyor with 10% interest from the date of filing of the claim petition. Aggrieved by the said award, the Petitioner has filed the present petition.

11.The submission of Mr. Jayant Mehta ld. Senior counsel for the Petitioner is broadly threefold as under:

(1) that the interest for the period prior to filing of the claim petition has not been awarded;

(2)that the errors made by the su