Rites Ltd. Through Its Cmd v. B. L. Kashyap and Sons Ltd. and Ors

SUBRAMONIUM PRASAD, J. APRIL 25, 2023 N.Khanna

* IN THE HIGH COURT OF DELHI AT NEW DELHI + Date of Decision: 25.04.2023 % FAO(OS) (COMM) 57/2022 & CM APPL. 11469/2022 RITES LTD. THROUGH ITS CMD ..... Appellant Through: Mr. G.S. Chaturvedi, Adv. versus B. L. KASHYAP AND SONS LTD. AND ORS ..... Respondents Through: Mr. S. K. Maniktala, Mr. Jatin Kumar, Mr. Udit, Mr. Mohit Sharma, Mr. Samaksh Sharma, Mr. Kritik, Advocates for R-1 Mr. Dhanesh Relan, Mr. Anuj Shrotriya, Advocates for Respondent No.2 CORAM: HON'BLE THE CHIEF JUSTICE HON'BLE MR. JUSTICE SUBRAMONIUM PRASAD SATISH CHANDRA SHARMA, CJ. (ORAL) 1. The present appeal arises out of an order dated 14.12.2021 passed by the learned Single Judge in O.M.P.(I) (COMM) 350/2018. 2. The facts of the case reveal that a contractual dispute arose between B.L. Kashyap & Sons Ltd. (Claimant) and EMAAR MGF Land Ltd. (Respondent) pursuant to which an Arbitral Tribunal was constituted and Hon'ble Mr. Justice Ajit Prakash Shah (Retd.) was appointed as the Sole Arbitrator (Delhi International Arbitration Centre) vide order dated 06.09.2018. Through the same order, the CMD of Appellant-RITES Ltd. was issued directions to constitute and depute a team for assessing the status of work done at the subject site, and to measure the unexecuted balance work. The directions contained in the order dated 06.09.2019 read as under: "(ii) RITES Limited having its office at Rites Bhawan, 1, Sector 29, Gurgaon-122001 via its Chairman and Managing Director will constitute and depute a team for carrying out the mandate of this Court by visiting the subject site and discharging its function in accordance with what is stated hereafter. The team so constituted will, hereon, be referred as the Local Commissioner(s). (iii) The Local Commissioner(s) shall measure the work already carried out by the respondent, the work in progress, and the unexecuted (balance) work at the subject site, having regard to the scope of the contract in issue. (iv) The Local Commissioner(s) shall prepare an inventory of the building and construction materials which will include mechanical, electrical and plumbing materials available on the project site and in the stores, the plant & machineries, tools and equipments lying at the project site." 3. The aforementioned order passed by this Court in sub-para (xii) makes it very clear that fees payable to Local Commissioners shall be payable to M/s Rites Ltd. and the same shall be fixed in consultation with the CMD, Rites or its nominee. 4. The Appellant herein upon examining the Project site, and in consultation with the representatives of the parties, fixed the fees at Rs. 80 Lakhs plus 18% GST vide letter dated 25.09.2018. 5. That the fees so fixed was to be borne equally by the parties. While 50% was payable upfront, the remaining 50% was payable upon submission of final report by M/s Rites. 6. It is also an undisputed fact that the claimant and the Respondent paid their respective shares of 50% i.e. Rs. 23,60,000/- each (inclusive of GST). 7. That the Appellant M/s. Rites, later on filed I.A No. 15004/2018 before this Court for grant of extension of time to complete the Commission and for enhancement of its fee. This Court by an order dated 31.10.2018 permitted M/s. Rites to place its additional bill before the parties. The relevant portion of the order dated 31.10.2018 is reproduced as under: "(iv) RITES is given liberty to place their additional bill of costs before the parties. Parties will, accordingly, make payments by sharing the burden equally." 8. The record of the case further reveals that on 12.11.2018, the Appellant M/s. Rites enhanced the fees to Rs. 4 Crores Plus GST and the Respondent EMAAR MGF Land Ltd, out of this sum, tendered a payment of Rs. 1.3 crores plus GST on 16.11.2018. 9. That M/s. Rites filed another application i.e. I.A. No. 3736/2019 before this Court seeking further extension of time to execute the commission and also seeking directions against the Claimant (BL Kashyap & Sons), to pay the enhanced fees. This