- (1.) THE present appeal has been filed by the appellants-applicants under Section 37 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the said Act') challenging the order dated 31.7.08 passed by the Addl. District Judge (Fast Track-7), Jaipur City, Jaipur (hereinafter referred to as 'the court below') in Arbitration Application No. 39/08 (212/05), by which the court below has partly allowed the application of the appellants-applicants by reducing the rate of interest from 15% to 9% per annum awarded by the sole Arbitrator and rejecting the rest of the objections raised against the award dated 21.3.05 made by the Arbitrator.
(2.) THE facts in nutshell, giving rise to the present appeal are that the tender submitted by the respondent-claimant with regard to the excavation of Trenches, laying and joining of pipes and other connected work in section of Dudu-Ajmer, was accepted by the appellants as per the agreement dated 8.1.88. Accordingly the work order was also issued to the respondent on 24.3.88, however, the respondent vide his letter dated 1.6.88 informed the appellants that the soil of the site in question was very hard/rocky and, therefore, the respondent demanded excavation charge @ Rs. 87/- per meter in place of Rs. 14/- per meter applicable to the rocky soil. When the dispute arose with regard to the nature of soil and the charges to be paid to the respondent, the appellants appointed a committee consisting of three members, who visited the disputed site and submitted the report on 23.6.88. The said committee reported that the soil of the disputed site was not ordinary soil and had recommended the excavation charge @ Rs. 39/- per meter. The Director, Telecom Project vide his letter dated 14.6.88 conveyed the acceptance of the rate @ Rs. 39/- per meter which was also accepted by the respondent vide his letter dated 3.7.1988. According to the appellants the respondent thereafter carried out the work in question and he was also paid the excavation charge @ Rs. 39/- per meter, however subsequently the respondent raised the dispute with regard to the said charges. The respondent thereafter filed an application being Arbitration Application No. 399/91 before the District Court, Jaipur City, Jaipur seeking appointment of an Arbitrator under the provisions contained in the Arbitration Act, 1940. The said court after hearing the learned counsels for the parties vide order dated 5.10.91 directed the appellants to appoint the arbitrator to resolve the dispute between the parties as regards the payment of charges for the work in question. During the course of proceedings before the Arbitrator, both the parties agreed and made statement that the matter be decided as per the provisions of the Arbitration and Conciliation Act, 1996. Accordingly the sole Arbitrator Mr. N.K. Narang made the award on 21.3.05 holding that the respondent-claimant would be entitled to the sum of Rs. 17,67,429.30/- as principle amount and Rs. 2,54,917/- as interest amount upto the date 13.9.92 i.e. date of filing of claim petition and further awarded interest @ 15% per annum on the amount of Rs. 20,22,346.30/- from 14.9.92 till the date of the passing of the award. Being aggrieved by the said award made by the Arbitrator, the appellants filed the Objection Application under Section 34 of the Arbitration Act, 1996 before the court below. The said application having been registered as Arbitration Application No. 39/08, was partly allowed as per the impugned order dated 31.7.08.
(3.) IT has been submitted by the learned counsel Mr. Praveen Jain for the appellants that the award made by the Arbitrator was beyond the scope of reference as the Arbitrator had awarded the excavation charge @ Rs. 87/- per meter, though the respondent had agreed to carry out the work at Rs. 39/- per meter. He also submitted that the findings of the Arbitrator in the award in question being perverse, the same were liable to be set aside however, the court below rejected the objection application of the appellants in that regard. Mr. Praveen Jain has relied upon the decision of the Apex Court in case of Oil and Natural Gas Corporation Ltd. Vs. SAW Pipes Ltd. AIR 2003 SC 2629 and in case of O.N.G.C. Ltd. Vs. Garware Shipping Corporation Ltd. AIR 2008 SC 456 in support of his submissions.;