The present case deals with the concept of limited scope of the Hon'ble Court in exercising its power under Section 37 of the Arbitration and Conciliation Act, 1996.

The present Appeal was filed under Section 37 of the Arbitration and Conciliation Act, 1996 challenging the Order dated 03.10.2023 passed by the Hon'ble Delhi High Court in the OMP (COMM) bearing No. 405 of 2023, wherein, the Hon'ble Delhi has upheld the Award dated 16.06.2023, in view of the substantial evidence and observation made by the Ld. Tribunal and also in view that there is no ground to interfere with the Award.

In the Award dated 16.06.2023, the Ld. Arbitrator has awarded Rs. 33.69 + Rs. 9.83 Crores along with interest in the favour of the Respondent herein.

The Brief Facts of the present case are: -
  • The Appellant on 13.04.2016 issued Notice inviting E-Tender for 5 years of 2G GSM BSS Network in uncovered village of Arunachal Pradesh ad Karbi and Dima Haso District of Assam along with the radio V SAT backhaul.
  • The said Bid was called upon by Appellant pursuant to calling upon by Universal Obligations Fund.
  • Thereafter, from 17.10.2016 to 24.03.2017, the Respondent carried out pre bid testing and technical evaluation of its equipment.
  • On 25.04.2017, the Respondent was found to be a successful bidder and after negotiation, it was agreed that the Respondent will provide with a discount of 11% on the quoted price of all OPEX Items.
  • Since the area where the project was to be executed was in the remotest villages, with no connectivity and with poor road network. The area being at the place near to China border and hit by insurgency, the Respondent undertook the task of pre-planning and preparation during the course of finalisation of the bid.
  • On 01.03.2018, the Appellant directed the Respondent to initiate all preparatory actions and  to give unequivocal and unconditional acceptance for field test with live traffic for 3 months.
  • Thereafter, on 15.03.2018, the Respondent accepted Additional Field Test requirement and sought for the issuance of Advance Purchase Order.
  • Subsequently, on 21.03.2018, the Appellant issued the Advance Purchase Order, which was unconditionally accepted by the Respondent and in furtherance of which, the Respondent also submitted the Performance Bank Guarantee, which was returned later on.
  • Upon the Respondent starting deploying of the resources at the project sites, the Appellant failed to issue the Advance Purchase Order and ultimately withdrew the earlier issued Advance Purchase Order, after a delay of 4 years.
  • Being aggrieved by the said Act of the Appellant, the Respondent invoked the Arbitration clause of the Agreement and initiated the Arbitration Proceedings claiming the loss and damages suffered due to withdrawal of Advance Purchase Order.
  • The Arbitral Tribunal, after the completion of the pleadings and after hearing the arguments of the parties, partly allowed the Claim of the Respondent and awarded Rs. 33.69 + Rs. 9.83 Crores along with interest in the favour of the Respondent herein.
  • Being aggrieved by the Award passed by the Ld. Arbitral Tribunal, the Appellant herein approached the Hon'ble Delhi High Court by way of Petition under Section 34 of Arbitration and Conciliation Act, 1996.
  • The Hon'ble Delhi High Court, on the date of Admission Hearing itself, after hearing both the parties, dismissed the Petition of the Appellant herein.
  • Being aggrieved by the said Order, the Appellant invoking the jurisdiction of the Hon'ble Delhi High Court under Section 37 of the Arbitration and Conciliation Act, 1996 has filed the present matter.
After the hearing the arguments advanced by the parties, the Hon'ble Delhi High Court was of the opinion/view that: -
  • It is settled position of law that the scope of Appeal under Section 37 of the Arbitration and Conciliation Act, 1996 is very limited and this Court cannot undertake independent assessment of the evidence and merits of the award.
  • The jurisdiction of the Court under Section 37 of the Arbitration and Conciliation Act is only to the extent of only ascertaining whether the exercise of power under Section 34 of the Arbitration and Conciliation Act has been to the extent of scope of provision.
  • The Court ought not to interfere with the Arbitration Award only because there is a possibility of an alternative view on facts and interpretation contract.
Thereafter, in view of the submissions made on merit and on law and further the opinion of the Court, the Hon'ble Delhi High Court was pleased to dismiss the present Appeal as the Hon'ble Court found no infirmity with the Impugned Judgement.

JUDGEMENT RELIED UPON BY PARTIES AND HON'BLE COURT
  • MMTC Ltd. v. Vedanta Ltd. (2019) 4 SCC 16
  • K. Sugumar v. Hindustan Petroleum (2020) 12 SCC 539
  • Konkan Railway Corporation Limited v. Chenab Bridge Project Undertaking [2023 INSC 742]
  • MCD v. Ravi Kumar (2017) SCC OnLine Del 11902

LEGAL MAXIM USED

  • Quantum Meruit - Meaning "as much earned" or "as much as deserved as per the Contract"

STATUTES INVOLVED

  • INDIAN CONTRACT ACT, 1872
  • ARBITRATION AND CONCILIATION ACT, 1996
COUNSEL WHO APPEARED
  • Mr. Dinesh Agnani, Senior Advocate with Ms. Leena Tuteja, Advocate for Appellant
  • Mr. Rajeev Nayyar, Senior Advocate with Mr. Omar Ahmed, Mr. Abhishek Singh, Mr. Saad Shervani, Mr. J Amal Joshy, Ms. Aayushi Mishra and Mr. K V Vibhu Prasad, Advocates for Respondent

IMPORTANT LINKS
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