2019 (8) TMI 1779 - HC - Insolvency and Bankruptcy

Execution of works contract - Section 34 of the Arbitration and Conciliation Act, 1996 - HELD THAT - It is stated on instructions that though the aforesaid plea was not specifically urged, it forms a part of the grounds taken in the Section 34 petition relating to non consideration of the written submissions filed by the appellant. We are afraid, such a plea cannot be permitted to be taken in appeal for the first time. The impugned order shows that no such ground was urged on behalf of the appellant before the learned Single Judge by pointing out the effect and scope of Clause 39 of the General Conditions, which is now sought to be raised to assail the impugned judgment. Besides the above mentioned plea, no other ground has been taken to assail the impugned judgment. The impugned judgment does not warrant interference and is accordingly upheld - Appeal dismissed.

Summary

Issues:
1. Appeal against judgment under Section 34 of the Arbitration and Conciliation Act, 1996.
2. Failure to file written submissions in arbitration proceedings.
3. Alleged errors in the arbitration award based on the agreement between the parties.

Issue 1: Appeal against judgment under Section 34 of the Arbitration and Conciliation Act, 1996:

The appellant challenged a judgment dismissing their petition under Section 34 of the Arbitration and Conciliation Act, 1996, regarding an Award dated 08.1.2019. The dispute arose from a contract between Hindustan Construction Company Limited (HCC) and IPEX Infrastructure Private Limited (Ipex) related to the construction of a tunnel and station for the Delhi Metro Rail Corporation. The appellant raised two grounds in their appeal: the arbitrator's alleged failure to consider belated written submissions and the failure to account for the agreement between HCC and DMRC.

Issue 2: Failure to file written submissions in arbitration proceedings:

The Sole Arbitrator rejected the appellant's request for additional time to file written submissions and dismissed their subsequent application for reconsideration. The appellant eventually submitted their written arguments after the deadline, which were not exchanged with the respondent as required. Consequently, the arbitrator made a decision based on available records, leading to the issuance of the Award on 08.1.2019. The appellant contested this process, arguing that the arbitrator should have considered their delayed submissions, which contained crucial documents affecting the outcome, specifically related to idle charges.

Issue 3: Alleged errors in the arbitration award based on the agreement between the parties:

The appellant contended that the arbitrator overlooked the provisions of the agreement between HCC and DMRC, particularly Clause 39(h) prohibiting payment for idle charges. They claimed that had the arbitrator considered the belated submissions, the outcome of the Award might have been different. However, the High Court noted that the appellant did not raise this argument during the initial proceedings, and introducing it on appeal was not permissible. The court upheld the judgment, stating that the grounds raised in the Section 34 petition were limited to the failure to consider the written submissions, and no other grounds were presented during the appeal.

In conclusion, the High Court dismissed the appeal, upholding the judgment that rejected the Section 34 petition. The court found no justification for interference, as the appellant's arguments regarding the arbitrator's handling of the belated written submissions and the agreement provisions were not raised during the initial proceedings, precluding their consideration on appeal.