Doctrine of *res ipsa loquitur* shifts the burden of proof to the bailee in exclusive possession of premises.

The Appellant (CWC) and Respondent (Indo Arya) entered into a warehousing agreement on 20.12.2006 for three godowns.

On 18.12.2008, a major fire broke out in Godown No. 1-ABC, causing extensive structural damage.

The Appellant demanded that the Respondent repair the premises or pay for reconstruction, citing the Respondent’s poor housekeeping and negligence.

When the Respondent denied liability, the Appellant reconstructed the godown at a cost of ₹69,80,229 and raised a demand for the same, along with storage charges.

The dispute was referred to a Sole Arbitrator, who, on 17.09.2018, partly allowed the Appellant’s claim by applying the doctrine of *res ipsa loquitur* to hold the Respondent negligent.

The Respondent challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996.

The District Judge set aside the award, holding that the Appellant failed to prove negligence and that the Arbitrator's application of *res ipsa loquitur* was patently illegal.

This is an appeal under Section 37 against the District Judge's order.

Whether the learned District Judge was justified in setting aside the Arbitral Award on the ground of patent illegality regarding the findings on negligence.

Whether the doctrine of *res ipsa loquitur* was correctly applied by the Arbitrator given that the cause of fire was unknown but the premises were in the Respondent's exclusive control.

The court applied Section 34 of the Arbitration and Conciliation Act, 1996, which limits judicial interference to cases of patent illegality or conflict with public policy.

It relied on the evidentiary principle of *res ipsa loquitur* (the thing speaks for itself), as discussed in *Shyam Sunder v. State of Rajasthan* and *State of Punjab v. Modern Cultivators*, which shifts the burden of proof to the defendant when an accident occurs in a "res" under their exclusive management which wouldn't ordinarily happen without negligence.

Furthermore, it applied the standards for "patent illegality" established in *Delhi Airport Metro Express Pvt. Ltd. v. DMRC*, emphasizing that a court cannot re-appreciate evidence or substitute an arbitrator's plausible view with its own.

The High Court observed that the Arbitrator had scrutinized the agreement (specifically Clauses 5, 8, and 11) to conclude that the Respondent had exclusive control and management of the godown.

Under Clause 11, the Respondent was responsible for maintaining the interior, exterior, and electrical fittings in good condition.

The Arbitrator found that the fire was an "unusual" event and, since the Respondent withheld evidence regarding the stored goods and failed to explain the cause, a presumption of negligence was raised.

The High Court held that the District Judge erred by acting as an appellate court and re-evaluating the evidence under the guise of "patent illegality".

The Court noted that the Arbitrator’s application of *res ipsa loquitur* was a plausible legal view based on the Respondent’s exclusive possession and the nature of the accident.

The District Judge’s requirement for the Appellant to prove the installation of fire safety measures was found to be outside the scope of the original dispute, as the Respondent had never raised such a defense during arbitration.

It held that the Arbitrator’s award did not suffer from patent illegality or contravention of public policy under Section 34.

The Arbitral Award dated 17.09.2018 was restored in its entirety, confirming the Respondent's liability for reconstruction costs and storage charges based on the justified application of *res ipsa loquitur*.