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2014 DIGILAW 1024 (DEL)

Brij Lal & Sons v. Union of India

2014-03-26

VALMIKI J.MEHTA

body2014
JUDGMENT : Valmiki J. Mehta, J (Oral) 1. This is a very peculiar appeal, peculiar because of the history of this case. History of this case pertains to passing of three Awards till date by the arbitrator, the details of which will be given hereafter. At the outset it may be noted that this first appeal is filed under Section 37 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as ‘the Act’) against the order of the court below dated 17.10.2012 by which the court below while allowing the objections under Section 34 of the Act and remanding the matter to the arbitrator for a fresh decision directed that the petitioner/appellant refund an amount of Rs.4,19,639/- which was received by the appellant/petitioner/claimant under the original Award dated 15.9.2004. The amount has been ordered to be refunded by the appellant/petitioner alongwith interest @ 18% per annum simple, which rate of interest is the only disputed aspect before this Court. 2. Appellant argues that since under the Award, appellant was only entitled to interest @ 9% per annum simple, the court below should not have directed refund of the amount pending the fresh decision by the arbitrator alongwith interest only @ 9% per annum simple and not @ 18% per annum simple. 3. The facts of the case are that the appellant was a claimant in the arbitration proceedings. The same resulted in the Award dated 15.9.2004, the first Award. By this first Award, the appellant/claimant was awarded a sum of Rs.3,12,697/- alongwith interest @ 9% per annum simple. This Award, on the objections which were filed by the appellant herein under Section 34 of the Act, was set aside by the order of Sh. Rakesh Tewari, ADJ, Delhi dated 9.12.2009 and the matter was remanded back to the arbitrator to decide afresh because proper opportunity was not given to the petitioner for proving his case. The arbitrator thereafter passed the Award dated 8.8.2011, the second Award, whereby the arbitration proceedings were terminated and Award was passed dismissing the claim petition on the ground that the appellant/petitioner had already received a sum of Rs.4,19,639/- in full and final settlement of the first Award dated 15.9.2004 i.e during the pendency of the first objections against the first Award dated 15.9.2004. The amount of Rs.4,19,639/- was received by the appellant/petitioner by a cheque on 22.3.2006. The amount of Rs.4,19,639/- was received by the appellant/petitioner by a cheque on 22.3.2006. The appellant/claimant challenged this second Award dated 8.8.2011 countering that the claim petition could not have been dismissed on the ground of full and final satisfaction inasmuch as the amount was received in the year 2006 whereas the judgment which was passed by Sh. Rakesh Tewari was rendered later on 9.12.2009, and consequently the direction of the court of Sh. Rakesh Tewari, ADJ becomes final whereby the matter was to be considered on merits. It is against this second Award that the impugned order dated 17.10.2012 has been passed by setting aside the Award but simultaneously directing the appellant/petitioner to refund the amount of Rs.4,19,639/- alongwith interest @ 18% per annum simple. The appellant/petitioner accordingly contends that though there is no quarrel with the order to return back the amount of Rs.4,19,639/-, interest has to be paid on the amount of Rs.4,19,639/- not at 18% per annum simple, but only at 9% per annum simple. 4. For the completion of narration, I may state that the counsel for the appellant states that the arbitrator has now passed a third Award dated 11.3.2014 (I may note that original arbitration record including the Award dated 11.3.2014 is also before this Court) and by the third Award dated 11.3.2014, the appellant/claimant has been awarded an amount of Rs.4,21,410/-. Since the appellant/claimant had already received a sum of Rs.3,12,697/- out of the amount of Rs.4,19,639/- (received by the appellant/claimant on 22.3.2006), balance amount of Rs.1,08,713/- has now been awarded. 5. The only issue before this Court is that by the impugned order the refund should have been made of the amount of Rs.4,19,639/- alongwith interest @ 18% per annum simple or only at 9% per annum simple, and which is the only aspect which is urged before this Court on behalf of the appellant. 6. In my opinion, counsel for the appellant is justified in arguing that refund of the amount of Rs.4,19,639/- should only be alongwith interest @ 9% per annum simple inasmuch as the first Award dated 15.9.2004 pursuant to which the appellant received the total amount of Rs.4,19,639/- including the principal amount of Rs.3,12,697/- was alongwith interest @ 9% per annum simple. In my opinion, counsel for the appellant is justified in arguing that refund of the amount of Rs.4,19,639/- should only be alongwith interest @ 9% per annum simple inasmuch as the first Award dated 15.9.2004 pursuant to which the appellant received the total amount of Rs.4,19,639/- including the principal amount of Rs.3,12,697/- was alongwith interest @ 9% per annum simple. Therefore, since the appellant received the amount of Rs.3,12,697/- alongwith interest @ 9% per annum simple, appellant will have to refund the amount of Rs.4,19,639/- alongwith interest only @ 9% per annum simple, and not at 18% per annum as directed in the impugned order dated 17.10.2012. 7. Appellant has deposited the amount of Rs.4,19,639/- in this Court. This amount be paid to the appellant and which will be treated as an appropriate/part satisfaction in terms of the Award dated 8.8.2011 read with the Award dated 11.3.2014. If after the appellant has received the amount of Rs.4,19,639/- as deposited in this Court, further balance is due in terms of the Award dated 11.3.2014 to the appellant, the appellant can take such appropriate steps for recovery of the balance amount, if pending, in accordance with law. 8. Appeal is disposed of in terms of aforesaid observations, leaving the parties to bear their own costs.