Prasar Bharati v. M/S Eisa Lifts Pvt Ltd

NAVIN CHAWLA, J JANUARY 25, 2019 RN/rv

Page 1 * IN THE HIGH COURT OF DELHI AT NEW DELHI + O.M.P. (COMM) 190/2016 Reserved on: 13.11.2018 Date of decision : 25.01.2019 PRASAR BHARATI ..... Petitioner Through Mr.Virag Gupta and Mr.Gaurav Pathak, Advs. versus M/S EISA LIFTS PVT LTD ..... Respondent Through Mr.Anil Airi, Sr. Adv. with Mr.Sunil K.Chandwani, Mr.Ravi Krishan Chandna, Mr.Sameer Chandwani and Ms.Sadhana Sharma, Advs. CORAM: HON'BLE MR. JUSTICE NAVIN CHAWLA 1. This petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the "Act") has been filed by the petitioner challenging the Award dated 07.07.2014(hereinafter referred to as the "Impugned Award") passed by the Sole Arbitrator rejecting the counter claims of the petitioner, while granting the claims of the respondent to the extent of Rs.24,44,500/- plus interest thereon. 2. The petitioner by Letter of Award dated 31.10.2008 awarded the work for "Construction of Soochna Bhawan Phase-V at New Delhi (SH- supplying, installation, testing and commissioning of 4 nos. 20 passenger lifts)" to the respondent. The lifts were numbered as Lift Nos. 3, 4, 5 Page 2 and 6. The period of completion of the work as per the Letter of Award was eight months, commencing from 18.11.2008 till 17.07.2009. The contract amount for the said work was Rs.1,01,00,000/-. 3. The petitioner placed a deviation order dated 29.01.2009 with the respondent for replacement of two more Lifts, that is, Lift no. 7 and 8. The petitioner agreed to pay Rs.25,00,000/- for each of these lifts, in addition to Rs.80,000/- for dismantling each of the existing lifts. 4. The petitioner released a sum of Rs.1,26,25,000/- in favour of the respondent upto 30.03.2010. 5. On 27.04.2011, the petitioner issued a show cause notice to the respondent alleging delay/suspension of work by the respondent. The petitioner, vide its letter dated 27.07.2011, terminated the Agreement and also forfeited the Earnest Money Deposit, Security Deposit and the Performance Bank Guarantee of the respondent as also put the respondent to notice that it would be taking services of another contractor to complete the balance work. 6. The respondent, however, raised various claims against the petitioner and the same were referred to the Arbitrator. 7. The petitioner, apart from resisting the claims of the respondent, also raised its own counter claims before the Arbitrator. 8. The Arbitrator, by the Impugned Award has allowed certain claims of the respondent, while rejecting the counter claims of the petitioner. The summary of the Award is as under: Page 3 Summary of Award Claim No. Amount Claimed in Rs. Amount Awarded in Rs. 1. 16,56,400/- 9,56,250/- 2. 18,74,000/- Nil 3. 22,65,000/- Nil 4. 5,05,000/- 5,05,000/- 5. 5,05,000/- 5,05,000/- 6. 5,70,000+ 148826+ 160000 + 300000 2,18,250+0+160000+0 7. 2,00,000/- 1,00,000/- 8. 1,05,600/- Nil 9. Intt. @ 18% p.a. Intt. @ 10% p.a. on amounts 10. 5,00,000/- Nil C.C. No.1 to 7 154.84 lakh Nil C.C.No.8 Intt. @ 18 % p.a. Nil 9. The learned counsel for the petitioner submits that the Arbitrator has erred in awarding a sum of Rs. 9,56,250/- in favour of the respondent under Claim no. 1 in spite of the fact that the respondent could complete only four out of six lifts and had not brought all the material to the site. 10. I do not find any merit in the said objection. The Arbitrator, in awarding the above amount, has relied upon the measurement conducted by the petitioner itself while passing the final bill in December, 2012, that is, after the termination of the Agreement. The Arbitrator, therefore, cannot be faulted. 11. The learned counsel for the petitioner further challenges the Award of Claim no. 4 (refund of security deposit inclusive of earnest money Page 4 deposit) and Claim no. 5 (refund of the amount received on forfeiture of bank guarantee). 12. The learned counsel for the petitioner submits that the Arbitrator having held that in the later stages of the work, the delay was on part of the respondent i