Section 34 courts cannot reappraise evidence or substitute factual findings absent patent infirmity.

Delhi Jal Board awarded M/s Rajora Builders the balance work of constructing a 15 MGD Sewage Pumping Station at Geeta Colony, Shahdara, Delhi, for Rs.36,65,799.08, with the work scheduled from 25 January 1992 to 24 January 1993.

The work was completed on 22 January 1997. Pursuant to an order of the High Court dated 19 January 2007, a sole arbitrator was appointed, who rendered an award dated 22 July 2013.

The arbitrator awarded amounts under various claims, including balance payment, watch-and-ward expenditure, dewatering expenses, escalation under Clause 10CC, interest and costs.

Delhi Jal Board challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996, principally alleging limitation, acceptance of the final bill and measurements, improper reliance on a technical expert’s report, and error in awarding claims 1, 2, 4, 5 and 10.

1. Whether the arbitral claims were barred by limitation, considering completion of the work in January 1997 and invocation of arbitration on 18 July 2005?

2. Whether the arbitrator erred in rejecting the Delhi Jal Board’s reliance on the final bill, recorded measurements and payments made under the running bills?

3. Whether the award of Rs.8,56,763.38 under claim no. 1, based substantially on the report of the consensually appointed technical expert, warranted interference under Section 34?

4. Whether the awards under claims 2, 4 and 5, relating to watch-and-ward expenditure and dewatering expenses, were contrary to the contract or otherwise legally unsustainable?

5. Whether the award of escalation under claim no. 10 pursuant to Clause 10CC was liable to be set aside?

6. Whether the award of 9% simple interest from 21 April 1997 was disproportionate or otherwise liable to interference?

The Court applied Section 34 of the Arbitration and Conciliation Act, 1996, under which an arbitral award may be set aside only on the statutorily recognised grounds and not merely because the reviewing court might take a different view of the evidence or contractual interpretation.

The Court reiterated the principle of limited judicial review over arbitral awards, particularly where the arbitrator has considered the evidence, interpreted the contract and recorded reasoned findings of fact.

It further applied the principles that limitation objections must be adjudicated in the arbitration proceedings and that factual findings concerning the final bill, measurements, work executed and consequential expenditure cannot be substituted by the Court in Section 34 proceedings absent a patent or jurisdictional infirmity.

The contractual provisions, including Clause 10B concerning measurements, Clause 10CC concerning escalation and the obligation to keep the works drained, were considered in the factual context determined by the arbitrator.

The Court declined to entertain the limitation challenge as a basis for setting aside the award because the material did not show that Delhi Jal Board had raised or obtained an adjudication of that objection before the arbitrator; in any event, the dispute regarding whether the final bill was accepted involved factual findings based on correspondence and the contractor’s repeated objections.

The arbitrator had found that the alleged 16th and final bill was unsigned, incomplete and did not accurately reflect the work executed. Claim no. 1 was supported by a report prepared after site inspection and examination of the records by a technical expert appointed with the parties’ consent, and the Court found no sufficient ground to interfere with the resulting award.

Claims 2, 4 and 5 were not mechanically allowed: the arbitrator reduced the claimed watch-and-ward expenditure, restricted the number of pumps and generators, and assessed dewatering expenses by reference to delays attributable to the Board, including non-supply of materials and drawings.

The escalation award under Clause 10CC was based on the finding that the delay resulted from the Board’s failure to perform its contractual obligations, while the interest award was reasoned and fixed at a moderate rate of 9% simple interest from expiry of the defect-liability period.

Since the objections substantially sought reappreciation of evidence and substitution of factual conclusions, the threshold for interference under Section 34 was not met.

The arbitral award dated 22 July 2013, including the awards under claims 1, 2, 4, 5 and 10 and the interest component, was upheld.

There was no order as to further costs.