DELHI DEVELOPMENT AUTHORITY versus M/S R.S. SHARMA & CO., NEW DELHI

DELHI DEVELOPMENT AUTHORITY versus M/S R.S. SHARMA & CO., NEW DELHI

Grant of extra cartage is unsustainable as it is contrary to Clause 3.16 of the contract, which makes contractor responsible for all leads and prohibits extra cartage; there was no evidence that the Department insisted upon using stone from Nooh; the Arbitrator failed to give reasons and departed from contract terms, constituting error apparent and patent illegality under Section 34(2) of the Act.

Parties
Appellant: Delhi Development Authority; Respondent: M/s R.S. Sharma & Co., New Delhi
Jurisdiction
India
Judgment Date
26 August 2008
Procedural Posture
Civil Appeal / Appeal From Division Bench Judgment of High Court, Restoring Single Judge Order
Outcome
Appeal allowed
Legal Topics
Setting Aside Arbitration Awards, Contract Interpretation, Public Policy Under Arbitration Act
Arbitration Setting Aside Arbitration Awards Contract Interpretation Public Policy Under Arbitration Act

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Parties

Delhi Development Authority

Appellant

M/s R.S. Sharma & Co., New Delhi

Respondent

Procedural Posture

Civil Appeal / Appeal From Division Bench Judgment of High Court, Restoring Single Judge Order

Legal Issues

  1. 1 Whether the arbitration award granting extra cartage was contrary to Clause 3.16 of the agreement and liable to be set aside under Section 34(2) of Arbitration and Conciliation Act, 1996

Ratio Decidendi

Grant of extra cartage is unsustainable as it is contrary to Clause 3.16 of the contract, which makes contractor responsible for all leads and prohibits extra cartage; there was no evidence that the Department insisted upon using stone from Nooh; the Arbitrator failed to give reasons and departed from contract terms, constituting error apparent and patent illegality under Section 34(2) of the Act.

Court Disposition

Appeal allowed

Orders

  • Judgment and order of Division Bench of High Court set aside
  • Order of Single Judge of High Court restored