ID No.02401C0175772013 IN THE COURT OF SHRI DR. [ENTITY], ADDL. DISTRICT JUDGE (CENTRAL07), TIS HAZARI COURTS : DELHI. SUIT NO.93/2013 [ENTITY] Through Executive Engineer (Civil) Room No.303, 'C' Wing, I.P. Bhawan, I.P. Estate New Delhi - 110 001. Petitioner/Objector Versus (1) M/s. [ENTITY] D8/5, East Gokal Puri, Dr. Ambedkar Road, Loni Road, Delhi110094 Through Its Partner Sh. Dharampal Singh (2) Sh. [ENTITY] Sole Arbitrator, Government of India, Ministry of Urban & Development 03rd Floor, 'C' Wing, I.P. Bhawan, I.P. Estate New Delhi110001. Respondents Date of Institution : 11.04.2013 Date when the case reserved for order : 27.03.2015 Date of Order : 16.04.2015 O R D E R
1. By this order I shall dispose of the objections filed by the petitioner under [SECTION] of the [ACT] (the [PRECEDENT]) for setting aside the award dated 10.01.2013 passed by respondent no.2 Sh. [ENTITY], Sole arbitrator.
2. Brief facts of the case of claimant/respondent in the claim petition filed before the Ld. Arbitrator are like this. The claimant was provided a work order for repair, rehabilitation of Asia house at K.G. Marg, New Delhi including restoration and external finishing by the plaintiff/nonclaimant on 28.12.2007. The claimant/respondent submitted their rate specified quantity and period annexed to the tender. The work was to be commenced on 10th day of issue of order dated 28.12.2007. The cost of tender was @ Rs.1, 21,660/ and the tendered amount was of Rs.1,56,780/. The dispute arose between the parties and the matter was referred to the Ld. Arbitrator in terms of the 25 clause of the agreement. The plaintiff/respondent failed to hand over the hindrance free site during the entire period of contract, therefore, it was difficult for the claimant/respondent to complete the above said work within the contract period. The work was also delayed on account of various defaults on the part of the plaintiff/nonclaimant. The claimant claimed amount on various head of the claims as given under:
i) Claim no.1 was on account of balance payment for the work executed under the Contract including additional work, extra work and extra involvement etc. but no paid/short paid to the tune of Rs.20,00,000/. This claim was under head Mark A to F.
ii) Claim No.2 was on account of refund of withheld amount deducted from the running account bill of Rs.50,000/.
iii) Claim No.3 was on account of release of performance Guarantee lying with the Department in the shape of Bank Guarantee of Rs.7,82,539/.
iv) Claim No.4 was on account of release of security deposit including earnest money lying with the Department in shape of Bank Guarantee Rs.
2/20 [PRECEDENT] v) Claim No.5 was on account of less payment on account of extra
items/additional work in terms of clause12 of the Agreement of Rs.4,00,000/.
vi) Claim No.6 was on account of payments due in terms of clause10 CA of the Agreement but not paid.
vii) Claim No.7 was on account of nonpayments in terms of clause10 C of the agreement of Rs.4,00,000/.
viii) Claim No.8 was on account of damages/compensation of Rs.8 lacs for staff establishment T & P machineries etc due to breach of Contract committed by the Department as other claims. Other claims are also allowed.
3. The plaintiff/non claimant filed reply to claim of the claimant and raised preliminary objections that the alleged claims made by the claimant/respondent are not supported by evidence. The claim deserved to be dismissed. All the agreed amount have been paid to the claimant/respondent by the plaintiff/nonclaimant. It is further stated that the claimant/respondent failed to fulfill their contractual obligations as stipulated in the contract. The site was made available to the respondents in time. The plaintiff/nonclaimant has already issued required drawing for execution of work at appropriate times to the claimant/respondent. But the claimant/respondent knowing fully that the site condition required to arrange labour, men power, centering and shuttering etc accordingly but they were avoiding as they were not having proper resources. The work was progressed very slowly since beginning as the claimants/respondent were lacking resources like materials, labour, centering and shuttering, scaffolding etc. The claimant/respondents themselves could not provide sufficient resources at site for execution of the work. No material was brought at site, no arrangement was made for testing of water, which are mandatory in terms of [PRECEDENT]. As per Clause31 of the Agreement, the claimants have to make their own arrangements for water and are bound to get tested the same before start of work as per CPWD Specifications Vol.II para 3.1.1.4. Thus the delay on this account is not attributable on the part of the plaintiff/non claimant. The claimant/respondent were also under obligation to submit 'Time and progress Chart' as per requirement of clause5.1 of [ACT] for approval of the plaintiff/nonclaimant, but the claimant/respondent failed to do so. During the inspection of the site, it was found that there was no activity from the claimants side for collecting the construction materials and for their samples and tests etc. and plaintiff/non claimant requested to arrange the required men and materials to expedite the progress of the work. There was no hindrance from the Department side. No decisions were pending with the plaintiff/nonapplicant. Hindrances, if any, were removed then and there as and when pointed out by the claimant/respondent. The work was prolonged due to mismanagement of the claimants/respondents. The petitioner/nonclaimant also requested to increase the labour so that the work should not suffer but the claimants/respondents had taken no action. The claimants have made various lame excuses etc., for the reasons of their own. The petitioner/non claimant are not liable for any losses and damages for the defaults of the claimants of their own. The claimants miserably failed to discharge their contractual obligations from time to time and had taken much time in executing the work including the rectification of defects in spite of great persuasion by the plaintiff/non claimant.
4. It is further submitted in the counter statement by plaintiff/non claimant that the Superintending Engineer (competent authority) took a lenient view on the delays wholly and solely attributable on the part of the claimant/respondent and granted extension of time upto 21.09.2010 without 4/20 [PRECEDENT] levy of compensation. Extension of time under clause 2 had been granted after taking overall view of the hindrances attributable to the claimant / respondents. The gesture on the part of the petitioner/non claimant in granting of extension of time without levy of compensation is being painted by the claimant erroneously and with an intention to mislead the Ld. Arbitrator. As regard payments, the petitioner/non claimant have made regular payments to the claimant/respondents for the work actually executed at site. All the extra items/deviation items executed by the claimant/respondents have been paid as admissible in terms of clause12 of the agreement and nothing is liable to be paid. Admissible payments for the work done were released in terms of the agreement and specification applicable. There was no delay from the petitioner/non claimant side for making payment for the work done. As per clause 7 of the agreement the claimant was eligible for payment of bills when gross value of work done is Rs.10 lacs or more. But the petitioner/non claimant helped him by paying bills even when value of work was less to submit his bills after getting checked from the petitioner/non claimant or his authorized representative as per the program fixed in consultation with the petitioner/non claimant, but the claimant/respondent had not submitted any bills. Even then immediate payments were made by the petitioner/non claimant after submissions of bills so that work may not suffer in progress due to financial hardship shown by the claimant/respondent. It can be seen that the department has paid the RA bills on as many as 5 occasions for much smaller amounts than the limit set in the agreement. It may therefore be seen that the claimants have been paid regularly after 23 months on the basis of work done by the claimants, which they executed at a slow pace of his own accord. Despite all the above, the claimant/respondent did not pay any heed to the requests of the petitioner/non claimant and thus delayed the work. In spite of the various [PRECEDENT] facts that the work was delayed by the claimants. Besides above, before entering into the tendering process all tenderers were require to examine the site and its surroundings and satisfy themselves before submitting their tenders, nature of site, means of access to the site, accommodation they may require and in general shall themselves obtain all necessary information about the risks, contingencies and other circumstances which may influence or affect their tender. The site was available where the work was to be carried out. Most of the work was to be carried out on the outer side of the building which the contractor delayed due to his own incompetence and malafide intention to claim higher rates and drag the matter in arbitration as done by him in all works carried out by him in this Division. The work was executed on the external part of the building and the vacant rooms for which site was made available in parts as the building was an occupied residential building. There was no hindrance at site till February 2010 except as recorded in the hindrance register. When the department found hindrance beyond its control it took up the matter with the competent authority for foreclosure of the work under clause 13 which was in accordance with the terms and conditions of the agreement. The work was foreclosed through petitioner/non claimant's letter dated 20.09.2010 and the claimants were also asked to submit the final bill. But they have not submitted the same so far and instead have preferred arbitration. Clause 13 of the agreement provides that if at any point of after acceptance of the tender the government decides to abandon or decide to reduce the scope of the work for any reason whatsoever and hence not require the whole or any part of the works, the EngineerinCharge shall issue notice and the contractor shall act accordingly. The contractor shall have no claim to any payment of compensation or otherwise whatsoever on account of any profit or advantage which he might have derived from the execution of the work. The [PRECEDENT] shall be paid at contract rates full amount for work executed at site and reasonable amount as certified by the EngineerIncharge for the items mentioned in the agreement. The contractor has not submitted any claim for the left out unused material as there was no material, machinery left at site.
5. So far as the reply to the specific claim, the nonclaimant/plaintiff has replied that claim no.1 regarding all work executed, measured and accepted by the contractor have been paid in accordance with the terms & condition of the agreement. The payment of some of the items for which part rates were paid have also since been made. The respondent/claimant was asked to submit the final bill, but respondent/claimant not submitted the same so far. The payment for deviated quantities have been correctly made in accordance with the terms and condition of the agreement Schedule F item no.2 (x) of the tender documents which provides percentage on cost of material and labour to cover overheads and profits @ 10% where as the contractor is claiming 15% which is not in accordance with the term and condition of the agreement hence the claim is unlawful and denied which may kindly be rejected. The additional amount payable to agency in final bill works out to only Rs.3,038/ and has since been paid in the final bill. The claim for Rs.3,14,093/ is false, fabricated. The items paid at part rates are in accordance with the terms and condition of the agreement as these items were not finished at the time of payment of the running bill the same have since been paid at the time of final payment of the bill. The detailed evaluation of amount paid and due to claimant has been tabulated and detailed in annexures. The amount due to him after release of part rates works out to Rs.1,45,110/ and has been released in the final bill. It is further stated regarding Claim no.2 that certain defects were noticed by the Quality control Unit of the Ministry of Urban Development for the work executed not [PRECEDENT] as per CPWD specification, for which the amount approximately Rs.50,000/ was withheld. The defects were also conveyed to the contractor vide letter dated 02.03.2010. The withheld amount has since been released vide [CASE NUMBER] dated 25.02.2012. Claim numbers 3 and 4 were also denied. It is further stated regarding Claim No.5 for the payments for extra items/additional work have been made strictly as per provisions of clause12 of the agreement and as approved by the competent authority which is inclusive of labour cess and vat etc., nothing extra is payable. Claimant/respondents have always accepted running account bill in which extra item have also been paid. Claimants claim for revision of rates have always come to the petitiner/non claimant beyond limitation period as per the provision of the agreement clause. It is submitted that if the claimant/respondents were not satisfied with the rates of extra items being paid by petitioner/non claimant, they should have immediately stopped the work. All the rates for each and every individual extra item have been derived and paid to the claimant/respondent, strictly according to the provisions contained in agreement clause 12.
6. It is further stated regarding Claim No.6 that clause 10CA was not applicable in the above said agreement as such the claim is denied. The ScheduleE at page10 may be referred where provision of component of cement, steel, other materials and labour etc., due to price escalation has been stuck off. Hence, calculation given by the claimant may be ignored as it is not provisioned in the agreement. It is further stated that Claim No.7 pertains to the Clause 10C was not applicable in the above said agreement as such the claim is denied. It is further stated that Claim No.8 is false. There is no provision for payment for such expenses in the agreement. Overheads are inclusive in the items and not payable separately. Claimants establishment was there at site only where work was executed. All the [PRECEDENT] overheads which are inclusive in the work done have been paid automatically. The work was executed in the external part of the building and the vacant room for which site was available there was no delay on the part of the plaintiff/nonclaimant. Despite grant of provisional extension of time, and again without prejudice to the right of the government to recover liquidated damages in accordance with the provision of clause 2 of the said agreement and lot of cooperation from the department, the claimant failed to execute the work, which is evident from the time to time payment released by the department. There was no hindrance at site till February, 2010. Unfortunately, after award of work, contractor slept and neither they submitted any programme nor mobilized T & P and not procured any material and not started any activity at site. They let off this precious time wasted without any work. It is further stated that Claim no.9 is false. There is no provision for payment of such expenses in the agreement. It is submitted that the claim is not payable as per the terms of the agreement and also not covered under any clauses. In the sketchy details provided by the claimant regarding overhead charges he has not worked out his figures on the basis of actual cost so incurred but claimant/respondent has submitted a roundabout and indirect/imaginary manner which is not admissible. The principle of this claim is that the claimant is to prove the mitigation measures taken by him in this regard and he has to prove the actual amount spent by him in this regard. Claim is an afterthought and does not satisfy essential conditions of agreement namely definite proof of breach of contract on the part of plaintiff/nonclaimant to be established with evidence, actual loss suffered with proof of evidence, institution of claim at appropriate time, proof of effort to avoid such losses and notice under [SECTION] of the [ACT], Moreover, it is agreed terms of contract that any delay in completion of work is governed by clause of the contract. The contractor failed [PRECEDENT] to execute the work despite lot of persuasion and even after handing over of hindrance free site. The department is not responsible for his lapses and breaches on the part of contractor. The claimant/respondent vide letter dated 22.12.2009 had intimated that the letter was to be treated as notice under [SECTION] and [SECTION] of [ACT]. He has told the department that the work done was 22 lakhs but no payment were being made, whereas, the 10th RA Bill was paid to agency on 10.12.2009 for Rs.15,68,543/ and next 11 th RA Bill was paid on 31.03.2010 for Rs.6,00,340/ which shows that the claim was false and hence malafide. It is further stated that Claim no.10 for the execution of work was based on the agreement entered into between the parties and as per clause 13 through letter dated 20.09.2011 it was inferred that the above cited work have been foreclosed. The contractor did not submit any claim for the damages mentioned under clause 13 of the general condition of the contract as there was no material was left at site. The claim of expected profit being made by the claimant is specifically inadmissible under the clear provision of clause 13 of the agreement. It is further stated that Claim No.11 is false and the site was made available to the contractor immediately after award of the work. Most of the work was executed in the external part of the building and vacant flats but the claimant/respondent failed to execute the work within the stipulated time causing undue hardship to the allottees. As such the prolongation of the contracts is due to the contractor's inability and the department is not responsible for the breach and lapses on the part of the contractor. So far as claim No.12 is concerned the work was delayed by the contractor. The prolongation of the contract is due to claimant contractor's inability and the department is not responsible for the breach and lapses on the part of the contractor. The claim no.13 was also denied. Moreover, it is agreed terms of contract that any delay in completion of work is governed by clause of the contract.
[PRECEDENT]
7. The Ld. Arbitrator after considering the claim and counter claim and the evidence led by the both the parties passed by the impugned award and feeling aggrieved by the impugned award, the present objection has been filed.
8. It has been contended that respondent no.1/claimant was awarded contract but he failed to complete the contract within the time despite the site being made available to him within the time and supplying of the drawing for the work to be executed at the site. As per clause 31 of contract, the claimant/respondent no.1 was supposed to arrange for water and other resources so the delay is attributable to the respondent/claimant. Respondent no.1 was also obliged to submit progress chart as per the requirement of the clause 5.1 of [ACT] for approval of the petitioner but respondent has failed to do so. Although the delay was attributable to the respondent/claimant competent authority even then granted extension of time upto 21.09.2010 for completing the work without levying any compensation. The petitioner has also made required payment to the respondent/claimant for the work executed at the site. All the extra items/deviation executed by the claimant/respondent no.1 has been paid as admissible in terms of clause 12 of the agreement. The provisions of the clause 7 of the agreement were not applicable to the applicant/respondent no.1 even then the petitioner/non claimant helped the claimant/respondent no.1 by making the payment of the bill and despite the fact that claimant/respondent no.1 failed to deposit the bill as per clause 7 of the agreement. The petitioner has raised the following objection against the impugned award:
i) that the delay was attributable to the claimant/respondent no.1 in not completing the work well within the time despite the site being made 11/20 [PRECEDENT] available immediately at the time of entering into the agreement.
ii) that the claimant/respondent no.1 failed to complete the work in terms of the clause 12.4 of the agreement which required him to send once every three months an account of details of the work completed to the Engineerincharge.
iii) that the delay in completing the work was attributable to the claimant/respondent no.1 despite that competent authority granted time to claimant/respondent no.1 to complete the contract. The claimant/respondent no.1 failed to complete the clause 7 of the agreement which required the claimant to submit his bill despite that bill were cleared by the plaintiff.
iv) that the claimant/respondent no.1 had led no evidence as to how the damages suffered by him, even damages have been awarded by the Ld. Arbitrator.
v) that the Ld. Arbitrator has not appreciated the clause 10 CC of the contract and wrongly allowed the claim of the claimant/respondent no.1.
vi) that the impugned award is in conflict with the public policy of India and passed in gross violation of principles of natural justice and violates the well established principle of law.
9. Per contra it has been contended by Ld counsel for the respondent/claimant that none of the grounds/objections as detailed in this petition are filing within four corners of the provisions of [SECTION] of the Act. The award is a reasoned one and each and every claim has been [PRECEDENT] passed/awarded to the respondent/claimant with specific reasoning. Therefore, objections of the petitioner deserves to be dismissed. The objection that the award is against the public policy is erroneous as none of the ground/objections as detailed in the plaint is falling within the definition of public policy as defined by the superior courts. The award can be set aside if the arbitrator exceeds jurisdictions but even if there is error apparent on the fact of the award, the award can be set aside. In this regard the reliance is placed upon "The [PRECEDENT]." It is further contended that the main objection of the petitioner/nonapplicant is that award is wrong and illegal. The award passed by Ld. Arbitrator with reasons where dealing all the claims and counter claims after appreciating the evidence led by the parties. It is settled law that attempt of the court should be to support the award. The petitioner has failed to establish any reason/grounds within [SECTION] of the Act. As per the settled principle of law of superior court, the ground on which the award of arbitrator can be challenged, have been severally cut down and such challenge is only permitted on the basis of want of jurisdiction, want of proper notice to the parties on the appointment of arbitrator, even the statement of objections and reasons of the Act clearly lays down that the main objection of the legislation was to minimise the supervisory role of the court in arbitral proceedings. In this regard he has relied upon " [PRECEDENT]".
10. It is further submitted that if the arbitrator has interprated a clause in an agreement in particular manner and has taken a decision that positive view which is a possible view, it is not possible for the court to substitute its own evaluation in the conclusion of the law or fact. When the [PRECEDENT] have chosen forum to refer their disputes to arbitrator/common forum. The court will not substitute its own opinion with that of the arbitrator. The award cannot be held as invalid merely by a process of inference and arguments that arbitrator has committed himself mistake in arriving at his conclusions. The only fact to be seen is whether the construction placed by the arbitrator is contrary to the facts, terms of contract and law and the Ld. Arbitrator has proceeded illegally. The re appreciation of the evidence by the court is not permissible u/[SECTION] of the Act. Finding of fact cannot be interfered by the court. In this regard he had relied upon "[PRECEDENT].
11. It is further submitted that arbitrator is empowered to award damages, loss on profit to the claimant, if the same is proved on record. In this regard he has relied upon : [PRECEDENT]; [PRECEDENT]; [PRECEDENT]; [PRECEDENT]; [PRECEDENT]; and [PRECEDENT].
12. I have heard the counsel for the parties and have perused the material available on record.
13. At the very outset it may be noted that arbitrator has passed the various claims in claim no.1 to 13.
[PRECEDENT]
14. Claim no.1 has been bifurcated under six parts namely, Mark A to Mark F. Under Mark A, item no.32 and 33 are regarding fixation of 24 fins with 4 studs and nuts in each fin. After appreciating the evidence ld. Arbitrator has awarded Rs.62,090/ after holding that 24 fins were fixed by the claimant/respondent. Ld. Arbitrator has allowed claim item no.15 of Mark A of claim no.1 for extra amount for reinforcement, as non claimant/petitioner has not paid for the same. Other claims under Mark A to F of claim no.1 were rejected. So far as Mark B on claim no.1 is concerned, item no.1 and 30 were rejected and for item no.35 of Mark B of Claim No.1, a claim for execution of extra quantity of 116.33 sq. meter in excess of deviation limit has been allowed @ Rs.1,700/ per sq. meter after 3 % increase in the rate of agreement item, After applying the [ACT], as per which there was increase of 2.6 % on the price of the concerned items. Mark C of claim no.1 pertains to the payment of extra items to the tune of Rs.4,89,607/ as claimed by the claimant/respondent. Ld. Arbitrator after reducing the rate to the tune of 5 % as claimed by the respondent awarded an amount of Rs. 2,50,414/. As far as claim pertaining to Mark D of claim no.1 regarding extra items, ld. Arbitrator rejected the claims similarly. Claim made in Mark 'E' of claim no.1 regarding credit of material lying at the site. The Ld. Arbitrator after appreciating the evidence has awarded only Rs.2,014/. Mark 'G' claim no.1 was rejected in the same manner. Claim no.2, 3 and 4 were rejected. Claim no.5 was made by claimant on account of less payment of account of extra item/addition of work in terms of clause 12 of the agreement for an amount of Rs.4,00,000/. Ld. Arbitrator has allowed only 1 % labour cess on the total work executed by the claimant/respondent and awarded only Rs.33,540/. The Claim no.6 is regarding Rs. 10,047/ under the provision of 10 CA on account of increase in the price of cement and the petitioner/non claimant has calculated the said amount. The ld. Court has [PRECEDENT] awarded to the tune of Rs.9,875/. Claim no.7 rejected by Ld. Arbitrator. Under claim no.8, the claimant has claimed damages for compensation for staff establishment and after calculating the amount payable to the claimant after appreciating the documents and evidence on record, ld. Arbitrator has awarded Rs.2,59,500/. The T & P Scaffolding under Part B of claim no.8., the claimed amount was of Rs.6,79,911/, ld. Arbitrator has observed that there has been delay in the work and claimant/respondent has to bear extra cost of Scaffolding for which contractor has to be compensated by awarding amount of Rs.3,95,000/. Claim no.9 pertains to escalation in construction cost due to market inflation for the works executed beyond the stipulated period of contract for an amount of Rs.18,00,000/ and ld. arbitrator after going through the record has observed that extension of time has been granted without any compensation/damages demanded by the petitioner/non claimant, therefore, the claimants are entitled for increased prices of materials during extended period and after relying upon the provisions of clause 10 CC available in standard CPWD General Condition of Contract had awarded an amount of Rs.3,69,305/. Claim no.10 pertains to claim of the petitioner for gains prevented for the agreement due to breach of contract committed by the petitioner/non claimant for an amount of Rs.5 lacs. ld. Arbitrator after considering the facts of the case and judgment relied upon by the parties has observed that the contract was awarded for an amount of Rs. 1,56,50,780/ and substantial 77 % component of work of Rs.1,19,77,700/ was executed at the time of foreclosure of contract and as per details of final bill, work of Rs.8862798.18 was executed against agreement items and remaining work of Rs.31,14,902/ was executed in the form of extra items. As per clause 2(x) under Schedule F contractor's profit is allowed @ 10 % and the claimant has already been paid 10 % contract profit and overhead cost on cost of Rs. 35,25,010/ towards extra items paid on market rate. Claimant has quoted a [PRECEDENT] tender amount 28.85 % above the estimated cost based on [ENTITY]. In the agreement under Schedule F, claimant/contractor's profit and overhead as prescribed @ 10 % in CPWD practice contractor comprises items @ 7.5 % and the remaining component 2.5 % comprises towards overhead charges. The tender for the work was submitted in August, 2007 and in [CASE NUMBER] CPWD cost index was 260, therefore, tender amount would have also been close to 57 % (260/166) above estimated cost based on [ENTITY] to cover 10 % (CP & OH) and the claimant/respondent has executed 77 % contract at the time of foreclosure of the same. He would have earned some profit may be less than 7.5 %. Ld. Arbitrator has awarded 3.75 % profit on remaining cost of work executed and the profit has been assessed Rs.12,23,060/. Claim no.11 was rejected.
15. The objection of the petitioner is that ld. Arbitrator has misconstrued the provisions of the agreement executed between the parties and has travelled beyond his jurisdiction in passing the award which is against the public policy. In this regard it may be noted that in "[PRECEDENT]" in para 44, it has been observed as under :
44. The legal position in this regard has been summarised in para 18 of the judgment of this Court in [PRECEDENT] and which has been referred to above. Similar view has been taken later in [PRECEDENT] to which one of us ([ENTITY], J.) was a party. The observation in para 43 thereof are instructive in this behalf.
45. This para 43 reads as follows : ([PRECEDENT])
43 The umpire has considered the fact situation and placed a construction on the clauses of the agreement which according to him was the correct one. One may at [PRECEDENT] the highest say that one would have preferred another construction of Clause 17.3 but that cannot make the award in any way perverse. Nor can one substitute one;s own view in such a situation, in place of the one taken by the umpire, which would amount to sitting in appeal. As held by this Court in [PRECEDENT], the Court while considering challenge to arbitral award does not sit in appeal over the findings and decision of the arbitrator, which is what the High Court has practically done in this matter. The umpire is legitimately entitled to take the view which he holds to be the correct one after considering the material before him and after interpreting the provisions of the agreement. It he does so, the decision of the umpire has to be accepted as final and binding.'.
16. The objection of the petitioner is that Ld. Arbitrator has wrongly awarded all the claims mainly the claim no.9 regarding escalation and consideration cost due to market inflation for the work executed beyond the stipulated period and damages have been wrongly awarded. In this regard, it is relevant to mention here that extension of time was granted to the respondent/claimant by the engineer in chief of the petitioner/nonclaimant without any compensation and ld. Abribtator has observed that extension of time case was submitted by respondent/claimant and hindrances have been justified on account of fact that full site was not available by the respondent welfare association, Asia House. The work was also stopped by HC DCC1, because of adverse effect of the storm causing damage to the fins and further non availability of suites. The extension of time was recommended without any compensation.
17. Ld. Arbitrator has rightly held that the respondent is entitled for increasing prices on material during extended period as per clause of agreement. During the course of arguments counsel for the petitioner failed to point out as to how the clause 10 CC and clause 10 C of the agreement are [PRECEDENT] not applicable to the facts of the case of the respondent/claimant, therefore, this objection is hereby rejected. So far as grant of damages for loss of profit under claim no.10 of the award is concerned, it may be noted that the ld. Arbitrator has observed that the contract was foreclosed under provision of clause 13 of the agreement by Chief Engineer through letter dated 14.09.2010 and therefore, claimant/respondent cannot be foreclosed if government decides to abandon or reduce of scope of work in for any reason whatsoever and ld. Arbitrator has further observed that after applying [SECTION], the claimant/respondent is found entitled to earn profit to the tune of 3.75 % on the remaining cost of the work not executed as the contract was not foreclosed by the competent authority.
18. It is relevant to mention here that perusal of the award makes it crystal clear that findings recorded by the Ld. Arbitrator are findings of fact which has been arrived at after appreciations of the evidence led by the parties and these findings cannot be termed as unreasoned one. It is settled law that findings of facts cannot be interfered by the court dealing with [SECTION] of the [ACT] and as the court is not supposed to act as appellate court substituting his own view with the plausible view already taken by the ld. Arbitrator. The parameters of the powers to be exercised by the court while dealing u/[SECTION] of Act have been laid down by the Hon'ble Supreme Court in this regard. As far as the damages awarded to the claimant/respondent by the arbitrator for loss of profit is concerned, it may be noted that arbitrator is empowered to award damages when there is a breach of contract in respect of the work contracts and it cannot be said that contractor would not be entitled to damages in respect of such breach of contract. There is a finding of fact by the ld. Arbitrator that there is a breach of contract on behalf of the petitioner/nonclaimant. There is also finding of [PRECEDENT] fact that such breach of the contract has caused loss of profit to the respondent/claimant. So far as the question whether ld. Arbitrator is empowered to award loss of profit/damages to the contractor is concerned, law is settled as laid down by the Hon'ble Supreme Court in M/s [ENTITY] (Supra) which has been followed in other case law as detailed in para 11 of this judgment that ld. Arbitrator is empowered to make award in respect of losses suffered by respondent/claimant. Last objection of the petitioner/nonclaimant is that award has been passed by the Ld. Arbitrator itself against the public policy of India. In this regard this is relevant to submit that during the course of arguments ld. Counsel for petitioner/nonclaimant has failed to point out any defect in the impugned award which may support the said contention of the petitioner that award is against the public policy of India. So this objection is also rejected.
19. From the above discussions, I do not find any infirmity in the award passed by the ld. Arbitrator. Therefore, this petition being devoid of merits is dismissed. No order as to cost.
File be consigned to Record Room.
ANNOUNCED IN THE OPEN COURT, On 16th Day of April, 2015.
(DR. [ENTITY]) ADJ(CENTRAL07)/DELHI 16.04.2015 20/20 [PRECEDENT]