* IN THE HIGH COURT OF DELHI AT NEW DELHI % Judgment Reserved on: 03.02.2026 Judgment delivered on: 10.03.2026 Judgment uploaded on: As per Digital Signature~

+ FAO (COMM) 75/2024 & CM APPL. 24522/2024 CENTRAL WAREHOUSING CORPORATION .....Appellant versus INDO ARYA LOGISTICS A UNIT OF INDO ARYA CENTRRAL TRANSPORT LTD .....Respondent Advocates who appeared in this case For the Appellant : Mr. K. K. Tyagi, Mr. Iftekhar Ahmad and Ms. Garima Tyagi, Advs.

For the Respondent : Mr. Dayan Krishnan, Sr. Adv. with Mr.

Parminder Singh, Mr. Ankit Banati, Mr. Aryanshu Vaibhav Gautam, Mr. Sukrit Seth and Ms. Radhika Yadav.

CORAM:

HON'BLE MR. JUSTICE V. KAMESWAR RAO HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA

JUDGMENT

V. KAMESWAR RAO, J.

1. This appeal has been filed under Section 37 of the Arbitration and Conciliation Act 1996 (“the Act”) challenging the order passed by the District judge (Commercial Court-01), Patiala House Court, New Delhi (“the District Judge”) in OMP (COMM.) No. 115 of 2021, whereby the learned District Judge has set aside the award dated 17.09.2018 passed by the learned Sole Arbitrator.

2. The facts as noted from the appeal are that the appellant and the respondent herein executed an agreement dated 20.12.2006 for providing godowns for a period of three years on reservation dedicated warehousing basis as per the terms of the agreement. Three godowns i.e. godown no.1-

ABC, II- ABC and III- ABC were allotted to the respondent.

3. On 18.12.2008, a major fire incident occurred in godown No.1 -A B C at CW Dadri causing heavy damage to the building.

4. On 31.12.2008, the appellant/claimant issued a communication/notice to the respondent stating that the respondent is liable to make good the losses that occurred on the account of poor housekeeping prone to catching fire unabatedly without any measures from the respondent’s side inside the said godown to control it. On 22.01.2009, the respondent denied the responsibility of the fire.

5. On 24.01.2009, the appellant requested the respondent to get the demised premises repaired/reconstructed at their cost. On 26.02.2009, the respondent vide letter dated 26.02.2009 advised the appellant to take up the matter with their insurer. On 04.03.2009, the appellant vide a letter informed the respondent that the demised premises would be deemed to continue with the respondent till 12.11.2009 and the respondent would be liable to pay storage charges for said period and thereafter handover the godown in usable condition as per Clause 11 of the agreement.

6. On 23.03.2009, the respondent again advised the appellant vide their letter dated 23.03.2009 to take up the matter with the insurer.

7. On 29.05.2009, the appellant issued a legal notice dated 29.05.2009 to the respondent demanding payment of storage charges up to 12.11.2009. It stated that in case of any of failure of the respondent in getting the godown constructed/ repaired, the appellant will be left with no option but to get the work done at their risk and cost and also that the bills would be raised on the respondent and in case of their failure to make the payment, appropriate legal proceedings would be taken for recovery of the damages. On 30.06.2009, the respondent replying to the legal notice denied the claim raised by the appellant. On 05.09.2009, another legal notice was issued on behalf of the appellant.

8. The appellant floated a tender after following due process for construction of the godown in question and the tender was awarded vide award letter dated 24.12.2009. The work of reconstruction started from 24.12.2009 and was completed on 15.06.2010 and the Assistant Engineer thereafter on 29.07.2010 issued completion certificate. The construction cell of the appellant corporation handed over the godown to the Warehouse Manager on 31.05.2010.

9. On 08.07.2011, on the basis of bills received from the Executive Engineer, a demand for an amount Rs. 69,80,229/-, incurred for reconstruction of the godown was raised on the respondent. On 30.0