RAJIV JOSHI vs ANAND SWAROOP

NAVIN CHAWLA, J. (Oral)

1.This petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act) has been filed by the petitioner

challenging the Arbitral Award dated 20th February, 2018 passed by the Sole Arbitrator adjudicating the disputes between the parties in relation to the

alleged Agreement to Sell dated 18th April 2014. Â

2.The petitioner claiming that the respondent had executed an Agreement to Sell dated 18th April 2014 by which he had agreed to sell built up

property bearing No.161, ad measuring 30 sq. yds. situated in the abadi of Hardyan Singh Road, Karol Bagh, New Delhi (hereinafter referred to as

the ‘property’) for a total sale consideration of Rs.5 crores and had also received Rs.2.50 crores from the petitioner as advance in relation to

the said agreement, raised a dispute claiming specific performance of this agreement. During the arbitral proceedings, by way of an amendment, the

prayer for specific relief was given up by the petitioner and instead the relief was confined to refund of an amount of Rs.2.70 crores along with

interest thereon. The petitioner further claimed that apart from Rs.2.50 crores paid to the respondent and as recorded in the Agreement to Sell, the

petitioner had paid another amount of Rs.20 lacs to the respondent on 29th April, 2014 through RTGS.Â

3.The respondent denied having executed such an agreement or having received any amount as sale consideration from the petitioner. The

respondent also alleged that the parties were having various financial dealings and in this regard Rs.20 lacs was transferred in his favour by the

petitioner, however, the said transaction had no connection with the alleged Agreement to Sell set up by the petitioner.

4.This Court with the consent of the parties, appointed a Sole Arbitrator for adjudicating the disputes that had arisen between the parties and the same

has resulted in the Impugned Award.

5.The Sole Arbitrator, in the Impugned Award has considered the evidence led before him and held that the oral testimony of the petitioner and

Mr.Prem Kumar (CW-2) regarding execution of the agreement and the alleged payment cannot be relied upon. He has further considered the

testimony of Mr.Syed Faizel Huda(CW-3) who was examined by the petitioner as a handwriting expert and has held that though his testimony may be

relevant, however, cannot be the sole basis of making an award in favour of the petitioner. He has held that the uncorroborated evidence of the

handwriting expert is a weak type of evidence. He further proceeded to examine the signatures of the respondent on the disputed Agreement to

Sell with the admitted signatures of the respondent and held that the signatures on the alleged Agreement to Sell are different from the admitted

signatures of the respondent.Â

6.As far as the alleged payment of Rs.2.50 crores is concerned, the Arbitrator takes note of the petitioner’s claim that the said amount was paid in

cash. He further takes note of the fact that even as per the petitioner, the said amount was not withdrawn from any bank. The Arbitrator places

reliance on the fact that the petitioner being a builder, it is inconceivable to believe that he would pay an amount of Rs.2.50 crores as advance in cash

and not take possession of the property and then keep quiet for almost an year. The Arbitrator has considered the Income Tax Return produced by

the petitioner in support of his claim, however, he has refused to place reliance on the same on the ground that it had been filed only on 30th March,

2017 and at that time the case was pending adjudication. He further notes that even CW-2 produced by the petitioner as a witness to the execution

of the agreement, had denied seeing the petitioner making the payment to the respondent.

7.As far as the claim of the petitioner that Rs.20 lacs was further paid to the respondent through RTGS, the Arbitrator takes note of the fact that in

the letter dated 27th March, 2015 addressed by the petitioner to the respondent, there was no assertion with regard to the said payment. The

petitioner had also produced his Balance Sheet in support of this payment, however, on being cross examined, the petitioner had taken a stand that

‘A.S.Malik’ mentioned in the same is not the respondent.

8.The above are only few circumstances that have been taken into account by the Arbitrator for his final conclusion that the agreement or payment

thereunder have not been proved by the petitioner.

9.Counsel for the petitioner submitted that the payment of Rs.20 lacs had been made through RTGS and had in fact been admitted by the respondent

and, therefore, the Arbitrator has misdirected himself in not taking the said payment into account for the said transaction. I am afraid that the said

argument cannot be accepted. As noted above, the respondent had admitted receipt of this payment but had claimed that there were other financial

transactions between the parties. In fact, the Balance Sheet produced by the petitioner itself shows that the respondent owed a sum of Rs.18 lacs

to the petitioner. However, on being confronted, the petitioner completely changed his stand and mentioned that the ‘A.S.Malik’ mentioned in

the Balance Sheet is not the respondent.  Apart from the said entry, there is no other entry in the Balance Sheet in which this payment of Rs.20

lacs is shown. If the Balance Sheet is to be relied upon, then the only other amount mentioned therein is of Rs.2.50 crores, which is claimed to have

been advanced by the petitioner to the respondent. If this amount of Rs.20 lacs was also an advance, the amount of Rs.2.70 crores should have been

mentioned in the Balance Sheet instead of and in place of Rs.2.50 crores.

10.The above contradiction itself shows that the Balance Sheet produced by the petitioner cannot be relied upon.

11.Counsel for the petitioner further submits that the Arbitrator has misdirected himself in ignoring the evidence of the hand writing expert. He

submits that as the respondent had not produced any evidence in support of his claim that the signatures on the alleged agreement were forged, the

evidence of the handwriting expert should have been relied upon by the Arbitrator. In my opinion, the said argument cannot be accepted. In

terms of Section 45 of the Indian Evidence Act, 1872, the opinion of the handwriting expert, though relevant, is not conclusive. It can at best be

uncorroborated piece of evidence but cannot take the place of substantive evidence.  The Supreme Court in Shashi Kumar Banerjee v. Subodh

Kumar Banerjee, AIR 1964 SC 529, in relation to the opinion of the handwriting expert has held as under:-

“We do not consider in the circumstances of this case that the evidence of the expert is conclusive and can falsify the evidence of the attesting

witnesses and also the circumstances which go to show that this will must have been signed in 1943 as it purports to be. Besides it is necessary to

observe that expert's evidence as to handwriting is opinion evidence and it can rarely, if ever, take the place of substantive evidence. Before acting on

such evidence it is usual to see if it is corroborated either by clear direct evidence or by circumstantial evidence. In the present case all the

probabilities are against the expert's opinion and the direct testimony of the two attesting witnesses which we accept is wholly inconsistent with it.â€​

12.In the present case, the Arbitrator has refused to place reliance on the oral testimony of the petitioner and CW-2 in relation to the execution of the

Agreement to Sell. He has also compared the alleged signatures of the respondent on the Agreement to Sell with the admitted signatures of the

respondent and has opined that the signatures do not match. I have no reason to find fault with the said finding.

13.Counsel for the petitioner further submitted that one of the circumstances taken by the Arbitrator to doubt the execution of the Agreement to Sell is

that the property was owned by ‘A.S.Malik & Company Pvt. Ltd.’ and not by the respondent.   He submits that the fact that the property

was owned by the respondent himself had not been denied by the respondent in his affidavit filed in opposition to the petition under Section 11 of the

Act being Arbitration Petition No.376/2015. On being queried, he fairly submits that this document/affidavit was not produced before the

Arbitrator. Â

14.Be that as it may, the Arbitrator has taken note of the fact that all the documents relating to the title of the property were available with the

petitioner prior to the execution of the alleged Agreement to Sell. Though counsel for the petitioner may be right in his submission that some of

these documents refer to the title holder as only ‘A.S.Malik & Company’ and not ‘A.S.Malik & Company Pvt. Ltd.’, at the same time, it

cannot be denied that the documents bearing the full name ‘A.S.Malik & Company Pvt. Ltd.’ were also available with the petitioner prior to the

execution of the alleged Agreement to Sell. In any case, this fact may lose some significance in light of the fact that even otherwise the Arbitrator

has held that the execution of the agreement and the payment has not been proved.  As noted above, the Arbitrator has taken into account that

the petitioner was a builder and it is inconceivable that he would pay an advance of Rs.2.50 crores in cash without making sufficient inquiry about the

title of the property and on the basis of such an agreement without security or possession of the property.

15.It is finally submitted by the counsel for the petitioner that the Arbitrator having found that the Agreement to Sell had not been proved to have been

executed, should have rejected the reference under Section 16 of the Act rather than giving a finding on the transaction in the Impugned Award. Â

16.I do not find any merit in the said submission. In the present case, the factum of the execution of the Agreement to Sell or the payment having

been made in relation to the same are intrinsic to the question of the existence of the Arbitration Agreement as the Arbitration Agreement is alleged to

have existed only in the alleged Agreement to Sell and not in any other independent document.   It was therefore, necessary for the Arbitrator

to have scrutinized the evidence led before him to find out and conclude whether the execution of this Agreement to Sell has been duly proved by the

petitioner or not. The Arbitrator having done so, cannot be faulted for having performed the function he was entrusted upon. Â

17.In any case, the findings of the Arbitrator being based on appreciation of evidence led before him, this Court in exercise of its powers under

Section 34 of the Act cannot sit as a Court of appeal and re-appreciate the entire evidence to arrive at its own conclusion. Â

18.In view of the above, I find no merit in the present petition and the same is accordingly dismissed with no order as to costs. Â