Delhi High Court: Arbitral Tribunal Sole Judge Of Quality & Quantity Of Evidence, Court Not Required To Re-appreciate Or Re-evaluate It U/S 34 A&C Act
The Delhi High Court was considering an Appeal against an order of the Commercial Court whereby the Appellant’s application under Section 34 of the A&C Act was rejected.
The Delhi High Court has re-iterated the settled law that the Arbitral Tribunal is the sole judge of the quality and quantity of the evidence and that the court is not required to reappreciate or reevaluate the evidence and reagitate the disputes.
The Court was considering an Appeal against an order of the Commercial Court whereby the Appellant’s application under Section 34 of the A&C Act was rejected.
The division bench of Justice Vibhu Bakhru and Justice Tejas Karia observed, "It is well settled that the court is not required to reappreciate or reevaluate the evidence and reagitate the disputes. The scope of examination under Section 34 of the A&C Act is confined to determining whether the arbitral award is required to be set aside on the grounds as set out under Section 34(2) and 34(2)(a) of the A&C Act."
The Appellant was represented by Advocate Ekta Choudhary while the Respondent was represented by Advocate Deepak Dhingra.
Facts of the Case
The Appellant, a media company running an English News Channel named ‘NewsX’ filed the present appeal under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 against an order of the Commercial Court whereby the Appellant’s application under Section 34 of the A&C Act was rejected. The Respondent was engaged in the business of providing services of a ‘Cab Operator’ to public in general. The Appellant being desirous of availing such services had entered into the Agreement. It was agreed that the term of the Agreement would be for three years commencing from September 05, 2011, however, the same could be terminated by either parties without assigning any reason by giving three months’ notice in writing. Further, the Appellant could also terminate the Agreement forthwith without any notice if it was found that the Respondent had failed to discharge any of its obligations under the Agreement. The impugned Arbitral Award whereby the Arbitral Tribunal had awarded a sum of ₹45,58,193.11 along with pendente lite interest at the rate of 9% per annum in favour of the Respondent. The Arbitral Tribunal had further awarded future interest at the rate of 9% per annum from the date of the impugned award till the date of realization, if the awarded amount was not paid within the period of 30 days.
It was the Respondent’s case that it provided the agreed services and periodically raised the bills for the services rendered. However, the Appellant did not discharge the bills in entirety and a sum of ₹46,95,759/- remained outstanding. The Respondent claimed that it sent legal notices and called upon the Appellant to pay the outstanding amount along with interest at the rate of twenty-four per cent per annum, but the appellant failed and neglected to do so. Therefore, the Respondent issued a Notice under Section 21 of the A&C Act seeking reference of the disputes to arbitration. However, the appellant rejected the respondent’s request.
Reasoning By Court
The Court at the outset noted that the Arbitral Tribunal accepted the Respondent’s claim as the Respondent had produced its statement of account and copies of bills to establish its claims. However, the Appellant had not produced any document to counter the claims made by the respondent.
It took note of the fact that the Commercial Court held that in proceedings under Section 34 of the A&C Act, it was impermissible for the Court to reappreciate the evidence and re-adjudicate the claims relying on the decision of Supreme Court in Arosan Enterprises Limited v. Union of India & Others.
The Court pointed out that the question whether the copies of the bills, were sufficient for the Arbitral Tribunal to accept the Respondent’s claim, is a question, which relates to quality and quantity of evidence. It also added that the impugned award does not rest solely on the copies of the bills claimed to have been raised by the respondent.
"Whilst, the appellant disputed the accounts produced by the respondent, but it did not produce the running account maintained in its books despite acknowledging that it had maintained a running account. It claimed that the copies of the bills raised by the respondent were bogus, however, did not produce the copies of the bills that were furnished by the respondent," it stated.
The Court was of the view that the Arbitral Tribunal drew its conclusion after evaluating the evidence and material produced by the parties. It stressed that although the provisions of Indian Evidence Act, 1872 are not applicable to the arbitral proceedings, its trite that the fundamental principles of the said enactment would serve as a guide for the Arbitral Tribunal to evaluate the material and draw its conclusions.
Noting that the present is not a case where the impugned award is based on no material or evidence at all, the Court observed that it is settled law that the Arbitral Tribunal is the sole judge of the quality and quantity of the evidence.
The Appeal was accordingly dismissed.
Cause Title: Direct News Pvt. Ltd. vs. DTS Travels Pvt. Ltd. (2025:DHC:1380-DB)
Appearances:
Petitioner- Advocate Ekta Choudhary, Advocate Anand Krishna, Advocate Ayush Kumar
Respondent- Advocate Deepak Dhingra, Advocate Sneh Somani
