Sanjay Kishan Kaul, J. (Oral)


IA No.4704/1995 (under Sections 30 and 33 of the Arbitration Act 1940)


1. The respondent was engaged in the construction of Grain Silas in Iraq as per contracts awarded to it and the petitioner is stated to have approached the respondent for allotting certain portions of work in Iraq. In pursuance to the discussions the letter of intent was issued by the respondent to the

petitioner followed up by an Agreement.


2. The claims of the respondent is that the work was not executed and the petitioner did not take any steps in the said direction. However the petitioner raised certain claims and in view of the Arbitration clause in the Contract, the matter was referred to Sole Arbitrator appointed by the Managing Director of the respondent itself. There was a change of the Arbitrator and the final award has been made by Mr. K.N. Taneja awarding a sum of Rs.1,55,650/- plus simple interest @ 15 per cent per annum from 16.5.1985 till the date of payment or date of decree whichever is earlier.


3. The respondent aggrieved by the same has filed the objections.


4. A perusal of the objections show that the allegations had been made of violation of the principles of judicial procedure and natural justice. However, it is not the case made out that no opportunity of hearing was given by the Arbitrator to the parties. In fact what the respondent contends is that all the claims were bogus and on the material being placed on record the plaintiff had failed to make out a case for grant of any amount. It is the further case set up by the respondent that due weightage was not given to the material placed by the respondent or the submission advanced on behalf of the respondent. It is relevant to note that the award is a non-speaking award and thus it is not possible to go into the thought process of the Arbitrator. The ground of challenge has alleged that the Arbitrator was required to give reasons but nothing has been shown as to the basis for such submission.


5. In the absence of an award being absurd reasonableness is not a matter to be considered by the Court as appraisement of evidence by the Arbitrator is not ordinarily a matter for the Court. Merely because the Court would come to a different conclusion than the one arrived at by the Arbitrator is no ground for the Court to reappraise the evidence and come to a different conclusion. A

reference is made in this behalf to the judgment of the Apex Court in Food Corporation of India Vs. Joginder Pal, Mohinder Pal and Ors. 1989 2 SCC 347. The Supreme Court in M/s. Sudarshan Trading Co. Vs. The Govt. of Kerala and Another AIR 1989 Supreme Court 890, observed that so long as the view taken by the Arbitrator is plausible though perhaps not the only correct view the award cannot be examined by the Court. The petitioner's case is that the award is a non-speaking award and no infirmity in law has been pointed out in law whereby such an award is liable to be set aside.


6. Insofar as the issue of interest is concerned, this Court has been awarding interest @ 12 per cent per annum (simple interest) for the past taking into consideration the prevailing commercial rates of interest during the relevant time. I am thus inclined to modify the award to the extent that the

interest allowed should be @ 12 per cent per annum (simple interest) instead of 15 per cent per annum (simple interest) but from the same date of 16.5.1985 up to the date of decree.


7. No other objection is pressed.


8. The application stands disposed of.


CS (OS) No. 852/1995


1. The objections to the award having been disposed of the award dated 25.1.1994 of the Sole Arbitrator Shri K.N. Taneja is made rule of

the Court with the modifications that the petitioner will be liable to pay interest @ 12 per cent per annum (simple interest) instead of 15 per cent per annum (simple interest) from 16.5.1985 till the date of decree. The petitioner shall also be entitled to future interest from the date of decree till the date of realization @ 9 per cent per annum. The parties are left to bear their own costs. Decree sheet be drawn up accordingly.