CMA/2332/2020 of JAIPUR NAGAR NIGAM Vs NIDAN (N.G.O.) NON GOVERNMENT ORGANIZATION on 12 August 2026

Order

12/08/2026

1. The appeal herein is directed against an order dated 14.08.2019 passed by the learned Commercial Court No.4, Jaipur, dismissing the objection petition filed by the appellant under Section 34 of the Arbitration and Conciliation Act, 1996 upholding the award dated 16.05.2015 rendered by the learned Arbitral Tribunal.

2. The dispute arises out of a Contract Agreement dated 18.01.2007 executed between parties for a period of three years from 25.04.2007 to 24.04.2010. The Letter of Acceptance dated 04.04.2007 followed and the Contractor commenced work on 26.04.2007. As per the agreement

(2 of 5) [CMA-2332/2020] the respondent was to provide complete sanitation work of Chitrakuta, Vaishali Nagar and Hanuman Nagar of Ward No. 3 area, Civil Line Zone, Jaipur. Disputes thereafter arose over refund of the security money, deductions from the monthly bills and termination of the contract by the Employer. 2.1 The Contractor then invoked arbitration and filed its claim before the Arbitral Tribunal. It alleged that it performed its obligations but the Employer illegally terminated the agreement on 19.12.2008, causing financial loss and business damages. 2.2 The Employer contested the claims. It stated that it terminated the contract because the Contractor breached the contractual conditions and rendered seriously deficient services. It also stated that the deductions were justified and duly explained, and that the Contractor promised improvement but failed to deliver. The Tribunal framed seven issues on breach, validity of the termination, entitlement to the invoice amounts and refund of security money, interest, damages, costs and other reliefs. It decided Issues 1 to 5 wholly and Issue 6 partly in favour of the Contractor. It held that the Contractor was not solely responsible for the breach and that forfeiture of the security amount was unjustified. 2.3 By the final award, the Tribunal directed the Employer to pay Rs. 90,95,082/- as the principal amount under the invoices, with interest at 12 percent per annum from 14.11.2007 till payment. It also awarded Rs. 5,01,913/- as the balance security money. The Employer challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996. The learned Commercial Court dismissed that application by order dated 14.08.2019.

3. Hence this appeal.

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4. We have heard learned counsel for the parties in the aforesaid backdrop. We have also perused the case file.

5. The appeal was filed on 24.08.2020. It has remained pending ever since, for one reason or another.

6. When the matter was called out in the first half today, an associate appearing for the arguing counsel, Mr. P.C. Jain, mentioned the matter out of turn. He stated that the other side had no objection to an adjournment and sought an adjournment on that basis. When the matter reached its turn, learned counsel for the respondent appeared and denied that position. He submitted that the respondent had never consented to any adjournment. He added that the respondent was not even informed that the matter would be mentioned. Learned counsel for the appellant was therefore requested once again to come to Court and argue the matter. On returning, he again sought an adjournment. We are not inclined to grant it, for reasons more than one.

7. Firstly, the order dated 01.04.2022 passed by Co-ordinate Bench of this Court, then seized of the matter, remains uncomplied with to this day. That order reads as under:- "Having regard to the submissions made by the learned counsel for the parties and taking into consideration the facts and circumstances of the case, execution/operation of the order dated 14.8.2019 passed by the Commercial Court No.4, Jaipur in Arbitration Application No. 18/2019 shall remain stayed on the condition that the appellant shall deposit 50% of the decretal amount with the Commercial Court concerned within a month from today. On deposition of the said amount, same shall be disbursed to the respondent on its furnishing a solvent security and an undertaking on oath to the effect that if the appellant ultimately succeeds in appeal, the said amount shall be refunded by the respondent to the appellant with interest @ 6% p.a. from the date of withdrawal till the date of refund. The stay application stands disposed of accordingly."

(4 of 5) [CMA-2332/2020] 7.1 The stay so granted was conditional. The condition was deposit of fifty percent of the decretal amount within one month. That deposit was never made. The protection of the order therefore never came into effect.

8. Secondly, learned counsel for the respondent informs us that the execution proceedings then pending culminated on 29.06.2022. The entire awarded amount was deposited in those proceedings and was disbursed to the respondent. The relief claimed in this appeal has thus already worked itself out.

9. Thirdly, the appellant took no step to seek a stay of the execution proceedings. The objections it did raise there. However, same were dismissed by order dated 24.12.2021. The appellant challenged that order before this Court without success. We are informed that the appeal against it was dismissed by order dated 22.04.2024. The appellant thus permitted the award to be executed to its conclusion.

10. In this backdrop, learned counsel for the respondent also submits that the scope of interference under Section 34 of the Act is narrow and well settled, and that the jurisdiction in appeal under Section 37 is narrower still. On the conduct of appellant, he submits that the appellant never deposited fifty percent of the decretal amount as directed on 01.04.2022, took no step to stay the execution proceedings, and suffered dismissal of its objections on 24.12.2021 and of the challenge to that dismissal on 22.04.2024. He submits that the entire awarded amount stood deposited and disbursed when the execution concluded on 29.06.2022, and that nothing survives for adjudication in this appeal.

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11. In parting, we may observe here that we concur with the submissions of learned counsel for the respondent, noted hereinabove. That is a further reason for us not to interfere with the impugned order.

12. Resultantly, the appeal is dismissed.

13. All pending applications, if any, stand disposed of. (ASHUTOSH KUMAR),J (ARUN MONGA),J 42/Shivam/Aman