Dharam Chand Chaudhary, J.@mdashThis judgment shall dispose of the present appeal and the connected one, i.e. OSA No. 3 of 2012 as aforesaid arising out of the judgment dated 27.6.2011, passed by learned Single Judge in Civil Suit No. 123 of 2008 (Objections under Section 30 and 33 of the Arbitration Act, 1940 old), whereby the objections to the award raised by the appellant, hereinafter to be referred as ''the defendant'' have been rejected. While the defendant is aggrieved from the rejection of the objections raised on its behalf to the award, the respondent-claimant, i.e. M/s. Sadhu Singh and Company, hereinafter to be referred as ''the plaintiff'', the award has not been made as a rule of the Court nor the interest was given on the awarded amount. The defendant has approached this Court by filing the present appeal to quash and set aside the impugned judgment whereas the plai ntiff in cross-appeal qua award of the interest and also that the award be made as rule of the Court.
2. The facts of the case giving rise for filing the appeal in a nutshell are that National Hydroelectric Power Corporation Limited, hereinafter referred as ''NHPC'' in short had to set up a hydroelectric project on river Ravi at Chamera. The NHPC had awarded the execution of the work to M/s. National Projects Construction Corporation Limited (appellant-defendant), hereinafter referred as ''NPCC'' in short. The defendant sub-contracted the construction work of diversion tunnel vide letter of intent dated 27.11.1984. The letter of intent was amended further by subsequent letter dated 28.11.1984. It is pertinent to mention here that vide amended letter of intent dated 28.11.1984 additional work of construction of random rubble masonary with hard stone in the coffer wall was also added in addition to the work given vide first letter of intent dated 27.11.1984. Ultimately a formal agreement came to be executed between the parties on 18.8.1986 after the defendant having accepted the offer of the Contractor, i.e., plaintiff qua the execution of the works in terms of the conditions specified in the captioned documents, i.e., documents No. I, documents No. II and documents No. III of the contract agreement.
3. During the course of execution of the work certain disputes arose and the plaintiff-Contractor herein invoked the arbitration clause vide letter dated 23.1.1989 addressed to CMD of appellant-defendant, the competent authority, to appoint the Arbitrator. The competent authority consequently appointed Mr. Justice H.R. Khanna (Retired) as Arbitrator vide letter dated 5/10.4.1989 to enter upon the reference and adjudicate the same in accordance with law. However, in view of certain allegations raised against the Arbitrator so appointed he resigned in June, 1992. Consequently, Mr. K.D. Thite, Chief Engineer (Retired) (Central Water Commission) was appointed as Arbitrator by the competent authority vide letter dated 21.7.1992. Mr. K.D. Thite, the Arbitrator so appointed, entered upon the reference and announced the award on 30.10.1996.
4. The plaintiff-Contractor had invoked Sections 14 and 17 of the Arbitration Act, 1940 by filing an application in the High Court of Delhi at New Delhi registered as S. No. 27A/1997 seeking a direction to the Arbitrator to file the award and the record of the proceedings in the Court and also that the award be made as a rule of the Court. On the direction to the Arbitrator, he filed the award in the High Court of Delhi. Notice of filing of the award was served upon the parties. Consequently, the defendant preferred objections against the award under Sections 30 and 33 of the Arbitration Act, 1940 registered as IA No. 2654/1997. As regards the plaintiff-Contractor, it has accepted the findings against it recorded by the Arbitrator and also the award. Consequently, the plaintiff-Contractor has not filed objections to the award.
5. A Single Bench of Delhi High Court has, however, dismissed the objections and made the award as rule of the Court vide judgment dated 18.12.2006. The judgment passed by learned Single Judge was assailed before a Division Bench of High Court of Delhi in FAO(OS) No. 67 of 2007. The appeal so preferred was heard on the question of jurisdiction and the Division Bench vide judgment dated 19.4.2007 has held that Delhi High Court have the jurisdiction in the matter while rejecting the objections to this effect raised by the defendant. The defendant has further assailed the judgment passed by the Division Bench in the Supreme Court by way of filing Civil Appeal No. 4630 of 2008 (arising out of SLP(C) No. 8032/2007). The Apex Court has disposed of the appeal vide judgment dated 24.7.2008, which reads as follows:
"3. After some arguments both Mr. A. Sharan, Additional Solicitor General representing the appellant and Mr. Ashok Grover, Senior Counsel appearing for the respondent, on instructions received from their respective clients, agreed that the appeal may be disposed of in the following terms expressly consented to by both sides:
(i) The order dated 19 April, 2007 passed by a Division Bench of the Delhi High Court in FAO (OS) No. 67/2007 and the order dated 18 December, 2006 passed by a learned Single Judge of the Court in I.A. No. 2654/1997 and C.S.(OS) No. 27-A/1997 are set aside and it is directed that the proceedings in connection with the award dated 30 October, 1996 made by Mr. K.B. Thite, retired Chief Engineer, Central Water Commission shall stand abated as not maintainable before the Delhi High Court.
(ii) The Registry of the Delhi High Court shall return the award dated 30 October, 1996 made by Mr. K.B. Thite, retired Chief Engineer, Central Water Commission and submitted by the Arbitrator before the court, to the respondent within a fortnight from the receipt of a copy of this order.
(iii) It will be open to the respondent to file the award for making it a rule of the court in the Himachal Pradesh High Court where it had earlier filed as C.S. No. 45/1989 under Sections 8 and 20 of the Indian Arbitration Act, 1940 within four weeks from the date it receives it from the Registry of the Delhi High Court. The Respondent shall intimate the date of filing of the award in the Himachal Pradesh High Court to the appellant within one week of the filing of the award.
4. The parties may file before the Himachal Pradesh High Court copies of their respective pleadings already filed before the Delhi High Court as also any additional pleadings within six weeks from the date of the filing of the award in that Court.
5. Mr. Sharan undertakes that the appellant shall not raise any objection before the Himachal Pradesh High Court on grounds of limitation. Having regard to the facts and circumstances of the case the delay in filing the award before the Himachal Pradesh High Court is condoned; the High Court shall consider the case of the parties on merits and pass final orders accordingly."
6. It is how this Court is now seized of the matter. On the return of the award by the High Court of Delhi and presentation thereof in this Court, the same has been registered as Civil suit No. 123 of 2008. The plaintiff-Contractor has filed an application under Section 151 of the Code of Civil Procedure read with Sections 14 and 17 of the Arbitration Act, 1940, registered as OMP No. 622 of 2008 with the prayer to place on record the arbitration award alongwith pleadings, i.e., objections and reply etc. thereto filed by the parties during the course of proceedings in the High Court of Delhi. In this application, following order came to be passed on 24.2.2009:
"This application has been moved by the plaintiff, M/s. Sadhu Singh & Company, for placing on record the judgment(s) of the Delhi High Court, the order passed by the Supreme Court and letter dated 5.11.2008 alongwith copy of the award in 19 volumes of the record of the Arbitrator in original. This application is allowed. The documents are taken on the record of the case."
7. Learned Single Judge on hearing the parties on both sides and taking into consideration the record, has dismissed the objections vide judgment dated 27.6.2011 under challenge in the present appeal.
8. Challenge to the impugned judgment is on the grounds inter alia that the claims preferred by the plaintiff were barred under Section 69 of the Partnership Act, however, learned Single Judge has erroneously held the same maintainable. There was no privity of contract between the claimant, i.e., M/s. Kular Constructions Limited and the defendant and that Shri Bhajan Singh has no valid authority to represent M/s. Sadhu Singh and Company, the plaintiff, however, this aspect of the matter has not been appreciated in its right perspective. The law laid down by the Apex Court and cited before learned Single Judge has been misunderstood and misconstrued. The objections qua jurisdiction of the Arbitrator could have been taken at any stage and mere participation cannot de-bar the defendant from raising such objection, however, this aspect of the matter has also been misunderstood and misconstrued. The findings that the objections qua excepted matters under Clause 18.2 of the contract agreement were not taken before the Arbitrator, have also been claimed to be erroneous and perverse as according to defendant, non-raising of such objection not clothe the Arbitrator to exercise jurisdiction and to adjudicate the excepted matters. The objections more particularly qua the interest part have been ignored erroneously. The arguments addressed on behalf of the defendant were not appreciated properly. The acceptance of reconciliation statement dated 14.1.1992 as an admission on behalf of the defendant is absolutely wrong, as learned Single Judge allegedly has failed to take note of the affidavit filed by Shri R.C. Jain, an Officer of the defendant in which the said reconciliation statement was contested on the ground that he never signed the same. That document was the result of fraud having been practised by the plaintiff-Contractor and fabricated/engineered one. No reasons have been assigned by learned Single Judge for rejection of the affidavit filed by Shri R.C. Jain aforesaid. Sub-Clauses (ii) and (iii) of Clause 18.2, Clause 53, which, as a matter of fact, are in the form of final and binding in nature and Clauses 23.6(c) and 15.1 have also not been appreciated by learned Single Judge in proper perspective. The factum of the plaintiff having raised the amount over and above the one he claimed while invoking the arbitration clause during the course of arbitral proceedings, is also erroneously ignored and by considering such exaggerated claims the Arbitrator misconducted on the part of sole Arbitrator, has not been taken note of by learned Single Judge. The observations that there is no compliance of Clause 53, amount to reviewing the award on merits, which according to learned Single Judge also, is not legally permissible. The finding that out of 24 claims of the plaintiff-Contractor only seven claims have been allowed, indicate that the application of mind by the Arbitrator are stated to be erroneous, as learned Single Judge allegedly failed to appreciate that the award of the Arbitrator allowing rates qua excess and substituted/additional items were completely against the terms of the contract between the parties. It is also claimed that the award otherwise being harsh and oppressive, is liable to be quashed and set aside.
9. In the connected appeal filed by the plaintiff, the complaint is that learned Single Judge though has dismissed the objections, however, failed to make the award as rule of the Court so that the decree could have been followed. The claim qua the interest sought by the plaintiff also stood omitted, as the same has not been rejected. The law laid down by the Apex Court that the interest on the awarded amount has to be awarded till the realization of the same is also not taken note of by learned Single Judge, therefore, in modification of the judgment dated 27.6.2011 a prayer has been made to make the award as a rule of the Court and interest at the rate of 15% per annum be given on the awarded amount till realization of the same.
10. Shri J.S. Bhogal, learned Senior Advocate assisted by Shri Anand Sharma, Advocate, during the course of arguments, has pointed out that the claims in view of Section 69(2) of the Indian Partnership Act, were not at all maintainable and that the Arbitrator has exceeded the jurisdiction vested in him by adjudicating the excepted matters which as per Clause 53 and Clause 18.2 (ii) and (iii) of the contract agreement being final could have not been gone into by the Arbitrator. In view of the nature of the documents on record, without there being any supporting evidence, the same could have not been looked into. The road to the site was to be maintained by the plaintiff-Contractor. The defendant could have not been burdened with head load charges on the failure of the plaintiff to maintain the road. The Arbitrator could have also not gone into the question of correctness of rates fixed by the defendant. Various claims raised by the plaintiff-Contractor have been awarded without any legal and acceptable evidence available on record. The Arbitrator has entertained the claims which were not raised at the time of making reference to Arbitrator and rather later-on during the course of arbitral proceedings without seeking amendment in the claims, which were already preferred. Although, reply to the amended claims is stated to be on record, yet the application for amendment is not available. The amount as claimed is stated to be on lesser side, however, the awarded amount is on higher. The Arbitrator could have only awarded the claims on higher side had there been a request for amendment of the claims already preferred and such amendment allowed.
11. On the other hand, Shri Subhash Sharma, Advocate, assisted by Shri V.D. Khidtta, Advocate, while repelling the arguments addressed on behalf of the defendant has submitted that learned Single Judge, has rightly dismissed the objections to the award raised by the defendant and urged that the award may be ordered to be made as a rule of the Court and on the awarded amount interest at the rate of 18% per annum be also awarded till realization of the entire award amount.
12. On analyzing the rival submissions and also the record, following points arise for adjudication by us in these appeals:
"Point No. 1: Whether learned Single Judge has failed to appreciate the objections raised and the evidence produced before learned Arbitrator in its right perspective and as a result thereof the judgment under challenge is vitiated, hence not legally sustainable?
Point No. 2: Whether learned Single Judge has omitted to make the award as a rule of the Court and to pay interest on the awarded amount, if yes, to what rate of interest the respondent-claimant is entitled?"
Point No. 1:
13. Now if coming to point No. 1 hereinabove, the appellant-defendant has assailed the impugned judgment on the following grounds:
"i) There being no privity of contract with M/s. Kular Constructions Limited. Shri Bhajan Singh had no authority to have raised the dispute and sought the appointment of the Arbitrator vide letter dated 23.1.1989 (the letter is dated 20.1.1989, however, signed on 23.1.1989).
ii) The plaintiff-Contractor an un-registered firm could have not initiated the arbitral proceedings against the defendant.
iii) The objections qua learned Arbitrator entertained the claims raised during the arbitral proceedings without seeking an amendment in the claims originally preferred vide letter dated 23.1.1989 and thereby exceeded the jurisdiction vested in him, have not been appreciated and rather rejected without application of mind.
iv) Learned Singled Judge has failed to appreciate that the Arbitrator by entertaining the excepted matters travelled beyond the scope of Clause 18.2 of the contract agreement and thereby misconducted himself and also exceeded the jurisdiction vested in him.
v) The objections qua acceptance of reconciliation statements by learned Arbitrator without assigning any reason to the stand of the appellant-defendant that its Officer Shri R.C. Jain never signed such statements have also not been properly appreciated and decided in accordance with law?"
14. Before coming to the grounds of challenge as aforesaid it is deemed appropriate to discuss the law applicable in a matter of this nature.
15. This Court in
"......In short, this is not a case where the Division Bench has interfered on the ground that the award suffers from an error of law apparent on the face of award. This is a case where a new ground - and that too factual in nature - was made out for the first time at the letters patent appeal stage for setting aside the award, a reading of the judgment of the Division Bench shows that the Bench approached the matter as if it was sitting in first appeal over the award. The judgment does not even indicate on which recognised ground is it setting aside the award. It does not say either that the award is vitiated by an error of law apparent on the face of it nor does it say that the learned umpire was guilty of any misconduct in conducting the proceedings or otherwise. We are of the firm opinion that this could not have been done. "
16. One should not lost sight of the fact that an award announced by a technical expert and experienced Arbitrator [Shri K.D. Thite, Chief Engineer (Retired) in the case in hand] should normally not be interfered with by the Court. We have drawn support in this regard from the judgment of the Apex Court in
"...There was no evidence before the arbitrators or material adduced before the Court as to the nature of these operations. It is difficult to say, by merely reading the terms of contract that the arbitrators have erroneously interpreted the terms of the contract. It is not without significance that the departmental officers did not dispute the rate of the claim. Equally, the arbitrators were experienced engineers and would not have passed, what is now said to be, an astounding claim without thought. It is difficult to assume that all these persons have overlooked that the contractor had already been paid at Rs. 18 under item 4.09(a) especially when it is so stated on the face of the claim. This, therefore, is not a case where the arbitrators can be said to have ignored or overlooked a term of the contract; on the contrary, they have acted upon a particular interpretation of certain clauses of the contract on which two views are possible. This case certainly cannot be brought under the principle that the arbitrators have ex facie exceeded the authority or jurisdiction conferred on them by the contract. At worst, what can be said is that they may have committed an error in deciding the issue referred to them but the error is not apparent on the face of the award even if the contract is read as part of it both because the arbitrators have not given their reasoning and because the view taken by them of the relevant terms of the contract cannot be said to be clearly erroneous. In a matter on which the contract is open to two equally plausible interpretations, it is legitimate for the arbitrators to accept one or the other of the available interpretations and, even if the Court may think that the other view is preferable, the Court will not and should not interfere. This view is too well settled to need any reference to any precedent other than
17. We are also not oblivious to the legal position that the Court should not interfere with an award which is speaking one.
18. In view of the legal position discussed hereinabove and also that learned Single Judge has discussed each and every aspect of the case it is not deemed appropriate to look into each and every claim objected to by the defendant and rather to look into the main grounds of challenge discussed hereinabove would serve the ends of justice .
19. Now, if coming to the competency of the plaintiff-Contractor to file the claims and sought to initiate arbitral proceedings, the plea as raised is that the plaintiff-Contractor being not registered partnership firm and there being no privity of contract with M/s. Kular Constructions Limited, Shri Bhajan Singh had no valid authority to invoke the arbitration clause. It is apparent from perusal of the letter dated 23.1.1989 (Volume-VII page 29) that Bhajan Singh has raised the dispute and requested the competent authority, i.e., Chairman and Managing Director of the defendant to appoint an Arbitrator in the capacity of Managing Director for Sadhu Singh and Company (A Unit of Kular Constructions Limited). The defendant has relied upon the list of partners as is given at page 1 (bottom) and page 2 of the contract agreement. They are 11 in number. The defendant has also placed reliance in this regard on partnership deed dated 1.1.1984. No doubt, initially there were 11 partners of M/s. Sadhu Singh and Company, the Contractor; however, partnership-deed dated 19.4.1985 produced before learned Arbitrator makes it crystal clear that in amendment to the earlier deed of partnership dated 1.1.1984 M/s. Kular Constructions Limited has also been impleaded as 12th partner. Due intimation in this regard was given to the defendant vide letters dated 30.10.1985 and 13.3.1986. Letter dated 30.10.1985 is at page 122 of Volume-XVIII, whereas letter dated 13.3.1986 at page 124 of that very volume. The perusal of letter dated 30.10.1985 makes it crystal clear that the same refers to the deed of partnership dated 19.4.1985.
20. So far as letter dated 13.3.1986 is concerned, the same has been addressed by the plaintiff-Contractor to the defendant notifying thereby that the Registrar of Firms has issued new certificate of registration of the firm after including M/s. Kular Constructions Limited as its 12th partner. Not only this, but letter dated 1.1.1988 at page 129-130 of Volume-XVIII reveals that the firm M/s. Sadhu Singh and Company later on was dissolved with effect from 1.1.1988 and M/s. Kular Constructions Limited took over the rights and liabilities of M/s. Sadhu Singh and Company. Therefore, when the contract was entered into M/s. Kular Constructions Limited was one of the partners of M/s. Sadhu Singh and Company, the Contractor and M/s. Sadhu Singh and Company was a duly registered partnership firm with 12 registered partners.
21. Therefore, the Arbitrator and for that matter learned Single Judge has not committed any illegality while holding that the claim as laid by the Contractor was maintainable and M/s. Kular Constructions Limited was justified in pursuing the claims on retirement of M/s. Sadhu Singh and Company, the Contractor, vide deed of retirement dated 1.1.1988. The authority of Shri Bhajan Singh to raise the dispute and lodge the claim also cannot be challenged for the reason that he was Managing Director of M/s. Kular Constructions Limited. Therefore, in our considered opinion, the objection to this effect has been raised merely for rejection. We are further of the opinion that the objection qua the authority of M/s. Kular Constructions Limited is again without any substance for the reasons that the said firm was added as 12th partner of the Contractor-Company, i.e., M/s. Sadhu Singh and Company. Not only this, but on retirement of M/s. Sadhu Singh and Company, its assets and liabilities were taken over by M/s. Kular Constructions Limited. Therefore, the objection qua the validity and competency of M/s. Kular Constructions Limited to raise the dispute and pursue the arbitral proceedings has been raised merely for rejection.
22. Now if coming to the provisions contained under Section 69(2) of the Indian Partnership Act, the Contractor-Company was not unregistered. In this view of the matter when the Contractor is a registered firm, therefore, competent to initiate the arbitral proceedings against the defendant. The law laid down by the Apex Court in
23. Now if coming to the third ground, it has been urged that vide letter dated 23.1.1989 while invoking the arbitration clause the plaintiff-Contractor has claimed only a sum of Rs. 5,05,29,417.78 and it is the said claims which were referred to the Arbitrator, however, during the course of arbitral proceedings the claims were enhanced to Rs. 7,08,07,516.91. The complaint, therefore, is that the claims filed beyond the claims submitted for reference to arbitration were beyond the scope of the reference, hence could have not been entertained.
24. This objection has also no legs to stand for the reason that in the letter dated 5/10.4.1989 (page 1, Volume-I) whereby the Chairman and Managing Director of the defendant had appointed the Arbitrator, no amount as claimed by the Contractor and no mention to the claimant''s letter dated 23.1.1989 find mention. Meaning thereby that the appointing authority had not restricted the claim of the plaintiff-Contractor.
25. We find from the record that learned Arbitrator has rejected claims No. 2, 3 and 4 of Section I and claim No. 2 of Section V on the ground that the same were not raised in the letter dated 23.1.1989. Otherwise also, the plaintiff-Contractor had claimed a sum of Rs. 5,05,29,417.78, however, learned Arbitrator has awarded only a sum of Rs. 88,31,709.16 plus Rs. 5 lacs on account of refund of Bank Guarantee. Therefore, learned Single Judge has not committed any illegality or irregularity while rejecting the plea to this effect raised on behalf of the defendant.
26. Now if coming to the objection that the excepted matters in terms of Clause 18.2 of the contract agreement should have not been entertained. The complaint is that under Clause 18.2 decision of the Engineer-in-Charge in assessing the rates qua variations being final was binding upon the parties and as such being non-arbitral, should have not been entertained being excepted matters. Clause 18.2 of the General Conditions of the Contract Agreement reads as under:
"18.2 i) The rates already provided in the Schedule of Quantities, shall apply in respect of the same item(s) of work to the executed irrespective of any variation.
ii) In case same terms are not available in the Schedule of Quantities, the rates of such items, as far as practicable, shall be derived from the quoted rates of analogous item(s) in the Schedule of Quantities after actual observance at site. The decision to select analogous item(s) shall be taken by the Engineer-in-Charge which shall be conclusive and binding on the contractor.
iii) Provided where some extra items and/or analogous items are not available in the Schedule of Quantities, the rates for such item(s) to be executed shall be determined by the Engineer-in-Charge on the basis of actual analyzed cost comprising of the cost of material to be supplied by the contractor (including transportation and taxes, levies if paid), labour operation of plant and machinery used for the work plus 15% to cover the overheads, profits, contractor''s supervision and other charges, if any. The decision of the Engineer-in-Charge in deriving rates as aforesaid, shall be conclusive and binding on the contractor."
27. A perusal of Clause 18.2 (ii) ibid, no doubt, reveals that decision of Engineer-in-Charge in deriving rates qua items not available in the schedule of quantities was final and binding between the parties, however, nothing has been brought to our notice that the Engineer-in-Charge had ever determined and derived such rates and the plaintiff-Contractor having questioned such rates arisen in an issue as to whether the Arbitrator could or could have not gone into such issue in view of Clause 18.2(iii) of the General Conditions of the Contract Agreement. Therefore, no such objection could have been raised. Learned Arbitrator has clearly mentioned in the award that at no point of time the defendant had determined the rates for the substituted items and for the quantity of works executed beyond deviation limit as prescribed and as such the Arbitrator had no occasion to exceed his jurisdiction in determining any such derived rates. Learned Single Judge on appreciation of this aspect of the matter in its right perspective has rightly discarded the arguments addressed in this behalf. Therefore, the ratio of the judgment of Delhi High Court in
28. The acceptance of reconciliation statements has been hotly contested on behalf of the defendant. The reconciliation statements dated 14.1.1992 (page 117-127, Volume-I) and 18.2.1992 (page 128-131, Volume-I), are in the nature of concession/admission attributable to the parties on both sides. As a matter of fact, reconciliation statements were filed on the direction of Mr. Justice H.R. Khanna (Retired). Consequently, the defendant has filed the reconciliation statement dated 14.1.1992 duly signed by its employees Shri U. Selvakumar and Shri R.C. Jain. As regards the statement dated 18.2.1992, the same has been signed by one Shri A.R. Dharadhar and Shri U. Selvakumar.
29. The record reveals that on the change of the Arbitrator, the defendant has filed an application dated 29.3.1996 stating therein that the reconciliation statement dated 14.1.1992 was not signed by Shri R.C. Jain. Another application was filed on 6.7.1996 stating therein that reconciliation statement dated 18.2.1992 being not based on record is not correct. Learned Arbitrator has considered both the applications and rejected the same while making reference to the orders passed from 16.2.1991 to 1.5.1992 and taking into consideration the amended reply to the claim filed by the defendant on 5.6.1993. The record further reveals that Shri R.C. Jain had attended the hearing on number of occasions. Had the reconciliation statement dated 14.1.1992 not been signed by him, he would have disputed his signatures thereon. He, however, never disputed his signatures on the statement and it is for the first time when his signatures were disputed in the application filed on 29.3.1996. On the other hand, the other signatory Shri U. Selvakumar in his affidavit sworn-in before learned Arbitrator has admitted the filing of two reconciliation statements after reconciliation of quantities and recoveries. The defendant, therefore, is not justified in disputing the reconciliation statements dated 14.1.1992 and 18.2.1992 that too taking the benefit of a situation when Mr. Justice H.R. Khanna retired from the arbitration proceedings and new Arbitrator Shri K.D. Thite has entered upon the reference. Therefore, reconciliation statements dated 14.1.1992 and 18.2.1992 cannot be said to be disputed documents and rather it is satisfactorily established on record that the same were signed on behalf of the defendant by its employees attending the hearing during the course of arbitral proceedings.
30. Otherwise also, under Section 17 of the Arbitration Act, 1940 normally no appeal shall lie from the judgment passed by learned Single Judge making the award as a rule of the Court and followed by the decree save and except the same is in excessive and the judgment so pronounced by the Court (Single Judge) is otherwise not in accordance with the award. In the case in hand, the judgment under challenge is neither excessive nor can be said to be not in accordance with award. Therefore, on this score also, we find no interference in the appeal filed by the defendant.
31. In view of all the reasons recorded hereinabove, in our considered opinion, learned Single Judge has not committed any illegality or irregularity while rejecting the objections to the award raised by the defendant because the award has been passed by an Arbitrator who is not only a technical expert but experienced also. Not only this, but the award is speaking one and based upon correct appreciation of evidence which was produced during the course of arbitral proceedings. Point No. 1 is, therefore, answered accordingly.
Point No. 2:
32. Point No. 2 as aforesaid pertains to the cross-appeal filed on behalf of the plaintiff-Contractor. We find substance in the grounds raised in the cross-appeal for the reason that once learned Single Judge rejected the objections to the award raised by the defendant, the award should have been ordered to be made as a rule of the Court and the decree to follow. Learned Single Judge seems to have omitted to make the award as a rule of the Court due to oversight or an accidental slip. Therefore, we order to make the award as rule of the Court.
33. Now if coming to the interest part, learned Single Judge has not touched the same. The perusal of the award reveals that the Arbitrator has awarded the interest on the awarded amount at the rate of 15% per annum from 12.4.1989, the day when the notice of arbitral proceedings was issued to the defendant by the Arbitrator and on Rs. 5 lacs from 10.2.1990, the day when Bank Guarantee was encashed till the date of announcement of the award, i.e., 30.10.1996 and thereafter simple interest at the rate of 18% per annum from the date of award to the date of decree and realization of the awarded amount.
34. Section 29 of the Arbitration Act, 1940 is applicable in these proceedings. The Court may award the interest on the awarded/decretal amount at such a rate as deemed reasonable. We find the interest as awarded by the Arbitrator is on higher side. Therefore, we modify the award to this extent and allow the interest throughout, i.e., from 12.4.1989, the day when notice of pendency of arbitral proceedings was issued to the defendant at the rate of 9% per annum (simple) till the entire amount is realized. The cross-appeal, therefore, succeeds and is accordingly allowed.
35. In view of what has been said hereinabove, the appeal filed by the defendant fails and the same is accordingly dismissed, whereas, the cross-appeal succeeds and allowed. No order so as to costs.
