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1994 DIGILAW 104 (DEL)

VIKAS ENGINEERING COMPANY v. DELHI DEVELOPMENT AUTHORITY

1994-02-15

VIJENDER JAIN, VUENDER JAIN

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Vijender Jain ( 1 ) THIS is an application filed by the Delhi Development Authority (for short DDA) under Sections 30 and 33 of the Arbitration Act against the award published on 6th May, 1991 by Shri O. P. Goel Arbitrator. The main challenge to the award is to claims No. 1, 2, 3 and counter-claim preferred by the DDA before the Arbitrator. The learned counsel for the DDA has vehemently argued that in view of Clause 2 of the Agreement, it is the Superintending Engineer of the DDA whose decision in writing regarding compensation shall be final. Clause 2 of the said agreement is reproduced below : THE time allowed for carrying out the work as entered in the tender shall to strictly observed by the contractor and shall be reckoned from the tenth Day after the date on which the order to commence the work is issued to contractor. The work shall throughout the stipulated period of the contract by proceeded with all sue disliquence and the contractor shall pay as compensation and amount equal to one present or such smaller amount as the Superintending Engineer. Delhi Development Authority (whose decision in writing shall be final) may decide on the amount of the estimated cost of the whole work a shown in the tender, for every day that the work remains uncommenced or unfinished after the proper dates. And further, to ensure good progress during the execution of the work, the contractor shall be bound in all cases in which the time allowed for any work exceeds, one month (save for special jobs) to complete one-eigth of the whole of the work before one-forth of the whole time allowed under the contract has elapsed : three-eight of the work, before one half of such time has elapsed, and three-eight of the work, before three-forth of such time has elapsed. However for special jobs if a time-schedule has been submitted to the Contractor and the same has been accepted by the Engineer-in-Chief, the contractor shall comply with the said time-schedule. However for special jobs if a time-schedule has been submitted to the Contractor and the same has been accepted by the Engineer-in-Chief, the contractor shall comply with the said time-schedule. In the extent of the contractor failing to comply with this condition, he shall be able to pay as compensation an amount equal to one per cent or such smaller amount as the Superintending Engineer Delhi Development Authority (whose decision in writing shall be final) may decide on the said estimated cost of the whole work for every day at the due quantity of work remains incomplete, provided always that the entire amount of compensation to be paid under the provisions of this Clause shall not exceed ten per cent, on the estimated coast of the work as shown in the tender. " ( 2 ) MS. Salwan has further argued that the said Clause along with the finding of the learned Arbitrator claim No. 1 whereby the Arbitrator has awarded the refund of security amount is illegal as Arbitrator had no jurisdiction to decide this claim as it was the discretion and final authority of the Superintending Engineer of the DDA. Learned counsel for the DDA, has cited 1993 ALR Vol. (2) 165, 1989 SC 952, 1991 ALR 180, 1993 DLT Vol. (1)1551 and AIR 1991 SC 957 to support her arguments. There cannot be any dispute with the proposition that in case when the time the essence of the contract the judgment of the Superintending Engineer of the DDA is final as per clause 2 for compensation of delay. This has been approved in Vishwanath Sood v. UOI, AIR 1989 SC 952 , However in the present case before me, the Super- intending Engineer of the DDA has not involved Clause 2 for determination of compensation on account of delay and this is further borne out from the counter claim filed by the DDA before the Arbitrator. The stand of the DDA in the said counter claim is as follows : "in the said letter, claimants were again reminded that action under Clause 2 of the Agreement is liable to be taken against the claimants if they fail to engage more labour at site to accelerate the progress of the work. . . . . . . . . . . . . . . . . " ( 3 ) IN view of this categorical assertion made by the DDA itself that action is liable to be taken against the petitioner and on that basis DDA cannot argue that the Superintending Engineer has invicted Clause 2 and has taken decision and thereby the award of Arbitrator is illegal. Clause 2 specificaliy provides that the decision of the Superintending Engineer has to be in writing. Therefore, this contention of the learned counsel for the DDA is without any force and the same is rejected. Once I hold that there is no decision taken by the Superintending Engineer in this regard the arguments placed by Ms. Salwan regarding award without jurisdiction and rejection, of counter claim No. 2 by the Arbitrator on this ground is also without any merit. ( 4 ) THERE is another aspect of this matter while making award in relation to the claim No. 1. The Arbitrator has categorically given a finding that after producing the evidence of both the per lies the work which was stapulated to be completed with 12 months i. e. , by 3rd September, 1994 could not be completed by the claimants at the were hindered on account of difficulties in availabiliy of site, availability of drawings and shortage of materials difficulties caused by other contractors for laying coaduties etc. The delayed performance had been accepted by the respondents upto the stipulated date of completion without by objection. When such a finding is given by the Arbitrator that the original recission of the contractor was on account of delays in performance of its obligation by the respondent. ( 5 ) MS. Salwan has further contended that the award of the learned Arbitrator is bad, as inconsistant of findings have been given in relation to claims No. 1 and 6. The argument is that while disposing the claim No. 1 learned Arbitrator has pinpointed the delay on the part of the rsspondents whereas while disposing the claim No. 6 the learned Arbitrator has held both the parties responsible for delay. The fallacy in the arguments of the learned counsel for the DDA is that the claim No. 1 was for refund of security whereas claim No. 6 was for damages due to the breaches committed by the respondent-PDA. The fallacy in the arguments of the learned counsel for the DDA is that the claim No. 1 was for refund of security whereas claim No. 6 was for damages due to the breaches committed by the respondent-PDA. While the claim of refund of security has been allowed and on the other hand the learned Arbitrator has disallowed the said claim No. 6 for damages which the claimants had prayed for. This objection is also not sustainable. Needless to say that when an arbitration clause is provided in the Agreement, it is the Arbitrator who is last the basis of the facts and evidence before him and this court does not set in as court an appeal. It is only in the circumstances and case where it has been brought to the notice of the court that the Arbitrator has Acted without jurisdiction or has misdirected the proceedings or has misconducted himself then the court should interfere. ( 6 ) HOWEVER, Ms. Salwan has pointed out that there is a correction which is required to be made on the basis of the material available on record. While awarding a sum of Rs. 1. 18,681. 24 paise. The learned counsel for the petitioner, Mr. Mittal, says that this amount of Rs. 1,08,682. 40 paise is the correct amount and let the same be corrected in the award. I direct that in claim No. 2 the amount awarded be read Rs. 1,08,682. 40 paise. These objections are dismissed as stated hereinabove. The award is made rule of the court. The petitioner will be entitled to interest at the rate of 15% from the time of making the award till actual payment. ( 7 ) IN the facts and circumstances, parties are left to bear their own costs. ( 8 ) DECREE by prepared accordingly.