DDA vs Nav Bharat Construction Co.

Shiv Narayan Dhingra, J.—By way of this petition, the petitioner has assailed only one claim i.e. Claim No. 29 of the award dated 28th February 2006 passed by learned arbitral tribunal.

The claimant (respondent herein) made Claim No. 29 for a sum of Rs. 5,30,000/- on account of watch and ward from July 1993 to November 1997. The learned arbitral tribunal held that the flat were completed on 6th July, 1993. The final bill was prepared on 17th September 1997. The allotment started in 2003. The claimant had claimed amount in respect to watch and ward from 6th July 1993 till the bill was finalized i.e. 17th September 1997 i.e. for a period of 50 months. The arbitral tribunal awarded a sum of Rs. 4,16,040/-against this claim on the basis of rates given in the a Circular No. 510.

The objections raised by the petitioner against this award in respect to claim No. 29 is that the claimant has been awarded the claim without any basis and without any proof whether any person had been employed or any payment had been made by the claimant to watch and ward staff. There was no agreement between the parties that respondent (claimant) would do watch and ward of the flats. No such supplementary agreement as ever executed between the parties for watch and ward. The petitioner has relied on State of Jammu & Kashmir and Another Vs. Dev Dutt Pandit, wherein the Supreme Court observed as under:

Under Clause 17 of the contract it is the contractor, who is responsible for any damage or loss to the work or part thereof caused due to any reason whatsoever and he at his own cost is required to repair and to make good of loss or damage. Contractor, therefore, could not claim any loss done to him on account of early onset of monsoon or otherwise. Similarly, under the terms of the contract he cannot claim any amounts towards idle labour. As a matter of fact under Clause 69 these claims are not entertainable at all. Mr. Thakur for the contractor said that "idle employees" as mentioned in Clause 69 of the contract is not the same thing as "idle labour". According to him, the term "idle employees" would mean regular employees on the roll of the contractor like Engineers etc. We do not think such a restricted construction can be put on the term "idle employees" as not include idle about idle labour as well. Read as a whole skilled and unskilled labour are all employees of the contractor under the contract.

Any work done on account of deviation or alteration could not be undertaken without the previous permission in writing of the Engineer. It is admitted case of the contractor himself that there is no writing though it was promised to him orally. In view of Clause 27 of the contract claims 1 and 3 could not have been accepted. When the principal claims were wrongly awarded there is no question of any award of interest on the amounts claimed under those heads.

It is submitted by petitioner/objector that the arbitral tribunal gave the award contrary to the contract as there was no contract for watch and ward. The contractor was at liberty to leave the flats after completion. It would have been the responsibility of DDA to look after the flats once completion certificate has been issued. It is also submitted that the circular relied upon by the arbitrator was not applicable in this case since this Circular had come into force on 2nd June 1997 whereas the contract between the parties was of 1993 and the commercial relations of the parties were not governed by this circular and the decision rendered by the arbitral tribunal was contrary to the agreement and bad in law.

On the other hand, respondent (claimant) had relied upon Anant Raj Agencies v. DDA and Anr. 2005(1) Arb. LR 590 to argue that the Court should not set aside the award lightly and the effort of the Court should be to uphold the award. It is also submitted that the possession of the flats was not taken by DDA and so long as the possession was not taken over by DDA, the petitioner was burdened with this keeping of watch and ward.

It is settled law that an arbitrator is bound by the contract between the parties. The watch and ward of the flats was not part of the contract neither it was the responsibility of the respondent to keep watch and ward of the flats. The respondent/contractor was responsible for completion of the flats and after completion certificate was obtained by the respondent, it was the responsibility of petitioner to protect is property.

If the respondent had completed the work and removed all defects, the respondent was at liberty to leave the flats in accordance with the contract after removal of debris and excess materials etc lying there. The reliance of learned arbitral tribunal on a circular of 1997 for awarding the amount against watch and ward is contrary to the terms of the contract. This circular was not in force at the time when the contract was entered into between the parties. Neither respondent at any point of time had asked the petitioner to enter into the agreement for watch and ward.

In any event, I consider that the contractor cannot be allowed to enrich himself on the ground of making payments to watch and ward staff without showing any proof of making payments. No evidence was led by the contractor that any payment was actually made by him to any chowkidar or anybody was even employed by the contractor. Awarding of the claim by the learned arbitral tribunal has been purely on the basis of a circular without there being any evidence.

I, therefore, consider that the award against claim No. 29 is liable to be set aside. The objections raised by the petitioner are allowed. The award in respect of claim No. 29 is hereby set aside.

The objection petition stands disposed of.