Delhi Development Authority vs M/S. R.S. Sharma & Co., New Delhi

2) The facts, in a nutshell, are as under:

6) The work relating to development of land at Pappankalan (Dwarka) Project in South West Delhi, Phase-I was awarded under Agreement No. 6/EE/WD 10-A/90-91/DDA to M/s R.S. Sharma & Co.- respondent herein. During the execution of the said work, certain disputes arose between the parties and ultimately they were referred to Mr. A.P. Paracer, Additional Director General (Retd.) C.P.W.D. for adjudication. After adjudication, the Arbitrator, on 29.7.1992, made and published his Award. The said Award was filed in Court and after issuance of notice, DDA filed its objections. The main 7 dispute relates to Claim Nos. 1-3 and additional Claim Nos. 1- 3 wherein the claimant had claimed extra rate of Rs.30/- per cubic meter over and above the rate agreed to in the Agreement under Item Nos. 2, 3 and 4 for extra cartage involved in bringing the stone aggregate from Nooh quarries to Delhi. According to the claimant, it was required to use Delhi quartz stone conforming to CPWD specifications and as the claimant had obtained blue quartz stone from Nooh quarries in Haryana and since DDA had failed to indicate the approved quarry at Delhi for obtaining supplies of Delhi quartz stone, the claimant was entitled to extra rates at the rate of Rs.30/- per cubic meter for procurement of stone aggregate from the quarries at Nooh in Haryana. According to DDA, the Arbitrator has misconstrued and misunderstood the Agreement between the parties, particularly, clause 3.16. Though the learned single Judge set aside the Award in respect of claim Nos. 1-3 and additional Claim Nos. 1-3 on the ground that there were no material before the Arbitrator to accept those claims, the Division Bench, reversed the same and confirmed the Award as granted by the Arbitrator. 8

(3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under section 33, from the date on which that request had been disposed of by the arbitral tribunal:

With this submission too we find it difficult to agree. While dealing with a petition under Section 20, the court has to examine: (i) whether there is an arbitration agreement between the parties, (ii) whether the difference which has arisen is one to which the arbitration agreement applies, and

Illegality must go to the root of the matter and if the illegality is of trivial nature it cannot be held that award is against the public policy. Award could also be set aside if it is so unfair and unreasonable that it shocks the conscience of the court. Such award is opposed to public policy and is required to be adjudged void."

1-3 and additional Claim Nos. 1-3 of the claimant or the appellant-DDA has made out a case for setting aside the 17 Award in respect of those claims with reference to the terms of the Agreement duly executed by both parties.

18) Under these circumstances, we allow the appeal of DDA and set aside the judgment and order dated 10.8.2001 passed by the Division Bench in FAO (OS) No. 104 of 1996 and restore the order of the learned single Judge insofar as Claim Nos. 1-3 and additional Claim Nos. 1-3 are concerned. There shall be no order as to costs.