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* IN THE HIGH COURT OF DELHI AT NEW DELHI % Judgment reserved on: 05.02.2026 Judgment pronounced on: 06.04.2026 + O.M.P. 709/2011 MCD .....Petitioner Through: Mr. Sunil Goel, Standing Counsel with Ms. Dimple Aggarwal, Mr. Himanshu Goel, Ms. Varsha, Advocates along with Bhanu Pratap AE, MCD versus ANIL GUPTA AND ORS .....Respondents Through: Mr Aditya Chhibber, Advocate.

CORAM:

HON’BLE MR. JUSTICE HARISH VAIDYANATHAN SHANKAR

J U D G M E N T

HARISH VAIDYANATHAN SHANKAR, J.

1. The present Petition has been instituted under Section 34 of the Arbitration and Conciliation Act, 1996, A&C Act, by the Municipal Corporation of Delhi, MCD/Petitioner, seeking setting aside of the Arbitral Award dated 01.04.2011, Impugned Award rendered in the arbitration proceedings titled ―Shri Anil Gupta v. Municipal Corporation of Delhi‖.

2. The Impugned Award arises out of disputes emanating from the Work Order dated 28.08.2004, Work Order, awarded by the Petitioner to Respondent No.1 for execution of certain works.

3. At the outset, it is noted that the present Petition was earlier disposed of by a Judgment dated 12.12.2018. Subsequently, upon an application filed by the Petitioner seeking modification, the learned Coordinate Bench modified the said judgment vide Order dated 08.08.2019, whereby the learned Single Judge set aside the interest component awarded under the Impugned Award in toto. Aggrieved thereby, Respondent No. 1 preferred an appeal before the Division Bench of this Court, which, vide Judgment dated 30.11.2023, remanded the matter for fresh adjudication confined to the limited issue of grant of interest. Consequently, the present Petition is now listed before this Court for consideration on the said issue.

4. At this stage, the parties are ad idem that the controversy stands narrowed to the issue of interest, which remains the sole surviving point of contention between them. Accordingly, the present adjudication is confined to this aspect alone.

BRIEF FACTS:

5. The present proceedings arise out of disputes between the MCD and Respondent No. 1 in relation to a works contract awarded for the construction of the Zonal Building at Narela. The said work was originally awarded in the year 1998 to another contractor, namely, M/s Satish Chander Ramesh Kumar. However, the said contractor abandoned the work after completing only the basement structure.

6. Subsequently, the Petitioner invited fresh tenders for completion of the remaining work. Pursuant thereto, the Petitioner issued the Work Order in favour of Respondent No. 1 for the balance work of construction of the Zonal Office Building at Narela for a contractual value of ₹4,29,00,830/-, with a stipulated completion period of 24 months. The work was to commence shortly thereafter and the stipulated date of completion was 03.09.2006.

7. Disputes subsequently arose between the parties in relation to certain claims raised by Respondent No. 1, including, inter alia, escalation under Clause 10CC, watch and ward expenses, and interest. In view of the arbitration clause contained in the contract, the disputes were referred to arbitration and Shri Amrit Lal Agarwal, Chief Engineer (Retd.), MCD, was appointed as the Sole Arbitrator by Order dated 28.10.2009 passed by this Court in ARB. P. 120/2009.

8. Respondent No. 1 filed his Statement of Claims before the learned Arbitrator seeking various monetary claims, whereas the Petitioner herein filed its Statement of Defence and also preferred counter-claims. Upon completion of the arbitral proceedings, the learned Arbitrator rendered the Impugned Arbitral Award dated 01.04.2011, whereby certain claims of Respondent No. 1 were allowed, including a claim towards escalation under Clause 10CC and watch and ward charges, together with interest at the rate of 18% per annum and costs.

9. Aggrieved by the said Arbitral Award, the Petitioner instituted the present proceedings under Section 34 of the A&C Act, before this Court, seeking the setting aside of the Impugned Award