The Delhi High Court while addressing the maintainability of an appeal filed under section 37 of the Arbitration & Conciliation Act, 1996, stated that the Jurisdiction of the court under Section 37 of the Act is limited in scope.
Brief Facts of the Case:
The present appeal was insinuated under section 37 of the Arbitration & Conciliation Act, 1996. The dispute between the parties related to the claim filed by the respondent with respect to Notice Inviting Tender. The appellant had invited for a tender a which was awarded to the respondent after which an agreement was executed between them for the construction of a road.
The respondent invoked arbitration claiming that the entire work was completed within the stipulated time and that the liability for maintenance was over but neither the balance payment was made nor amount deposited towards the Security deposit was refunded. The Arbitral Tribunal passed the Award allowing the respondent’s claim towards the refund of security and amount towards the balance payment along with the simple interest on the first delayed payment.
Contentions of the Appellants:
The counsel contended that the Measurement Book provided to the respondent wasn’t entirely placed before the learned tribunal and the award of the interest amount was not legal.
Contentions of the Respondents:
The respondent contended that the appellant had filed extra pages of MB which were not placed on record before the learned Arbitrator or the Court along with its objections filed under Section 34 of the Act. He also alleged that the same had been filed after fabrication and manipulation in the MB.
High Court's Observations:
The Court first dealt with the scope of an appeal filed under Section 37 of the Act stating that the award passed by the Arbitral Tribunal can be interfered with in the proceedings under Sections 34 and 37 of the Arbitration Act only in a case where the finding is perverse and/or contrary to the evidence and/or the same is against the public policy.
The Court added that in the present case, the categorical findings arrived at by the Arbitral Tribunal are on appreciation of evidence considering the relevant provisions and material on record as well as on interpretation of the relevant provisions of the contract, which are neither perverse nor contrary to the evidence in record.
Hence, the Court decided to refrain from the reassessment or re-examination of the merits of the case, as though it were a Court of Appeal against the Award. The court took the reference of the decision made by the Supreme Court in Reliance Cellulose Products Ltd V. ONGC (2018) 9 SCC 266, that interest is compensatory in nature and is parasitic on the principal amount and also noted that interest was not barred in the underlying agreement. The court also ascertained with the reference of Iqbal Singh Marwah & ANR Vs. Meenakshi Marwah & ANR [2005] INSC 167, 2005 Latest Caselaw 167 SC that it is not the respondent’s case that any offence committed in respect of the MB or any other documents after it has been filed in the Court.
Decision:
The Court dismissed the objections and upheld the Arbitral award.
Case Title: North Delhi Municipal Corporation v. Suresh Singhal
Case No: FAO 318/2018
Coram: Hon'ble Mr. Justice Manoj Kumar Ohri
Advocates for Petitioner: Ms. Namrata Mukim, Standing Counsel with Ms. Garima Jindal, Advocate
Advocates for Respondent: Mr. Avadh Kaushik, Advocate.
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