Kulgaon Badlapur Municipal Corporation Through Its Chief Officer vs M/S Sparsh Pratisthan Through Its President Kedar Dawalbhkta
- Court
- Bombay High Court
CNR No : HCBM010368502026
2026:BHC-AS:34951-DB
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
COMMERCIAL ARBITRATION APPEAL (ST) NO.21703 OF 2026
WITH
INTERIM APPLICATION NO.6134 OF 2026
Kulgaon Badlapur Municipal Council, ]
Through its Chief Officer, ]
Having address at:- ]
Late Dubey Hospital Building, ]
st
1 Floor, Adarsh Vidyamandir Rd., ]
Near Fly over bridge, Badlapur- ]
421 503, Dist: Thane. ] … Appellant
V/s.
M/s. Sparsh Pratishthan ]
Through Its President Kedar ]
Dawalbhkta, S/at: M1 B1, ]
Mezzanine Floor, Manas ]
Anand C.H.S., Dongripada, ]
Ghodbunder Road, Thane. ] … Respondent
Mr. Narayan R. Bubna a/w. Adv. Aryanraj A. for the Appellant.
Mr. Abhijit P. Kulkarni a/w. Adv. Abhishek Roy, Adv. Sweta Shah for the
Respondent.
CORAM : A. S. GADKARI AND
KAMAL KHATA, JJ.
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DATE : 11 August, 2026
Judgment (Per : A. S. Gadkari, J) :-
1) By this Appeal filed under Section 37 of the Arbitration and
Conciliation Act, 1996 (‘the Arbitration Act’) the Appellant impugns the
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Digitally
signed by
SUMEDH
NAMDEO
SONAWANE
Date:
2026.08.25
17:00:50
+0530
SUMEDH
NAMDEO
SONAWANE
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Judgment and Order dated 29 June 2026, passed by District Judge-2,
Kalyan in Civil Miscellaneous Application No.53 of 2024. By the impugned
Judgement, the learned Judge dismissed the said Application filed under
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Section 34 of the Arbitration Act, thereby confirming the Award dated 15
February 2024, passed by the learned Sole Arbitrator.
2) Heard Mr. Bubna, learned Advocate for the Appellant and Mr.
Kulkarni, learned Advocate for the Respondent. Perused entire record.
3) Record indicates that the Respondent is a Non-Government
Organization duly registered under the provisions of Bombay Public Trust
Act, 1950, with the Office of the Charity Commissioner, Maharashtra. The
Appellant is a local Authority established under the provisions of
Maharashtra Municipal Council, Nagar Panchayats and Industrial Township
Act, 1965.
4) The Appellant had published a Tender Notice for a Project
Management Consultant to undertake work of preparing a Detailed Project
Report (‘D.P.R.’) to construct 3000 tenements under JNNURM-BSUP (Basic
Services to Urban Poor) Scheme floated by the Government of India under
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Pradhan Mantri Awas Yojana (PMAY). An Agreement dated 6 September
2016 was executed with the Respondent being selected as the lowest
bidder. The Respondent had to invoke the Arbitration since, despite having
rendered its services to the Appellant, its payments were not released on
the schedule dates as per the terms of the Agreement. The Sole Arbitrator
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after recording evidence and hearing the learned Advocates for the
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respective parties, by its Award dated 15 February 2024, was pleased to
partly allow the claim of the Respondent and reject the counter-claim and
set off of the Appellant. By the said Award, the Appellant was directed to
pay the Respondent an amount of Rs.6,72,96,000/- (Rupees Six Crores
Seventy Two Lakh Ninety Six Thousand Only) alongwith an interest at the
rate of 12% per annum from the date on which it became due till the date
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of realization of the amount, as per the work Order dated 17 September
2019. Additionally, the Appellant was directed to pay a sum of
Rs.6,50,000/- towards cost of the said Arbitration proceedings to the
Respondent, and to bear its own costs.
5) Aggrieved by the said Award, the Appellant preferred Civil
Miscellaneous Application No.53 of 2024 under Section 34 of the
Arbitration Act before the learned District Judge-2, Kalyan. The learned
Judge of the first Appellate Court dismissed the said Application by its
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impugned Judgment and Order dated 29 June 2026.
6) In this precise factual background, the Appellant has preferred the
present Appeal under Section 37 of the Arbitration Act.
7) Mr. Bubna, learned Advocate for the Appellant, submitted that,
the Award deserves to be set aside as the Respondent did not complete the
work and thereby has not performed its part of the obligation, therefore no
award could have been passed in the Respondent’s favour by the learned
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Arbitrator. He submitted that at the most, the Respondent is entitled to an
amount for which the work stands competed and certainly not for entire
claim. He submitted that both, the learned Arbitrator, as well as the learned
Judge of the first Appellate Court have not taken into consideration the
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relevant clauses from the Contract dated 6 September 2016. He submitted
that, both the Authorities below failed to take into consideration the fact
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that subsequently, a fresh Agreement was executed on 5 November 2021
and in view thereof, the earlier Agreement was not to be acted upon. He
submitted that the Respondent failed to comply with its obligations as per
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the fresh Agreement dated 5 November 2021 and therefore, the claim of
the Respondent awarded by the Arbitrator is not only excessive but is
contrary to the provisions of both the Agreements. He therefore prayed that
both the impugned Award and the Judgment passed by the first Appellate
Court be set aside, allowing the Appeal.
8) Mr. Kulkarni, learned Advocate appearing for Respondent,
vehemently opposed the Appeal. He submitted that the learned Judge of
the first Appellate Court has categorically observed that the Agreement
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dated 5 November 2021 was never acted upon and therefore, the
submissions of learned Advocate for the Appellant to that extent are not
only contrary to record but thoroughly misconceived. He submitted that
both forums have properly evaluated the evidence on record and have
reached the correct conclusion while passing the impugned Order. He
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submitted that there is no merits in the Appeal and that it may be
dismissed.
9) Perusal of record indicates that the Respondent has performed its
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part of obligations as per terms and conditions of the Agreement dated 6
September 2016. It was only when the Appellant did not release and/or pay
its legitimate dues that the Respondent was constrained to invoke
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Arbitration proceedings. The Award dated 15 February 2024, in paragraph
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No. 70 thereof, has recorded a finding that the said Agreement dated 5
November 2021 was never acted upon.
10) Apart from the submissions recorded hereinabove, the other
submissions advanced by the learned Advocate for the Appellant amount to
re-appreciation of the evidence, which is not permissible in an Appeal under
Section 37 of the said Act. Perusal of record clearly indicates that the
learned Arbitrator, as also the learned Judge of the Appellate Court, have
not committed any error while considering and appreciating the evidence
on record.
11) In M.P. Road Development Corporation. Ltd. v. Jabalpur Corridor
(P) Ltd., reported in 2026 SCC OnLine SC 1001 the Supreme Court has
held as under:
“40. From the consistent pronouncements of this Court, it
is evident that the jurisdiction under Sections 34 and 37
of the 1996 Act is narrowly circumscribed and cannot be
equated with ordinary appellate jurisdiction. The
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appellate Court under Section 37 does not sit as a court of
appeal on the merits of the arbitral award; its role is
confined to examining whether the Court under Section
34 has acted within the limits prescribed by law.
Interference is permissible only where the Section 34
Court has exceeded its jurisdiction or failed to exercise it
within the confines of Section 34, and not merely because
another view of the facts or interpretation of the contract
may appear preferable. Courts ordinarily must give
requisite deference to finality of arbitral awards unless it
is palpably clear that the award is perverse and
unreasonable. The arbitral tribunal remains the final
authority on appreciation of evidence, and concurrent
findings under Sections 34 and 37 are entitled to great
deference. The statutory scheme thus reinforces the
principle of minimal judicial intervention, ensuring that
arbitral awards are not disturbed save in circumstances
expressly contemplated by the Act.”
12) According to us, there is no error either in law or on facts,
committed by the learned Judge of the Appellate Court in passing the
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impugned Judgment and Order dated 29 June 2026.
13) Considering our minimalistic role under Section 37, we find that
the Appeal is entirely dehors of any merit and is accordingly dismissed.
14) In view of disposal of Appeal, Interim Application filed therein
does not survive and is accordingly disposed off.
(KAMAL KHATA, J.) (A.S. GADKARI, J.)
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