Dismissed

M/S Parmar Construction Company v. West Central Railway

Rajasthan HC20 Jan 2026CMA/95/2026

Case brief

AI extract

What is this about?

A commercial court dismissed an appeal arising out of an arbitral award concerning defective box girder removal and penalty charges. The High Court held the alleged objections did not fall within Section 34(2) or 34(2A) of the Arbitration Act as they pertained to factual questions.

What did the court decide?

The appeal was dismissed as the objections raised did not fall within the scope of Section 34 of the Arbitration and Conciliation Act.

M/S Parmar Construction Company Vs West Central Railway — Arbitration | Rajasthan HC (2026)

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[2026:RJ-JP:2406-DB]

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HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR

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D.B. Civil Miscellaneous Appeal No. 95/2026

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M/s. Parmar Construction Company, C-42, Indrapuri, New Delhi110011.

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----Appellant

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Versus

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West Central Railway, Representative through Deputy Chief Engineer/C-1, Kota (Raj.).

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----Respondent

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For Appellant(s) : Mr. Shailesh Prakash Sharma For Respondent(s) :

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HON'BLE THE ACTING CHIEF JUSTICE MR. SANJEEV PRAKASH SHARMA HON'BLE MRS. JUSTICE SANGEETA SHARMA

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Judgment

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20/01/2026

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This is an appeal preferred under Section 37 of the Arbitration and Conciliation Act, 1996 (for brevity ‘the Act’) against the order dated 01.11.2025 passed by the Commercial Court, Kota (Raj.) whereby the objections raised under Section 34 of the Act against the arbitral award were rejected.

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Learned counsel for the appellant submits that the Commercial Court has failed to take notice of the objections raised and the illegality committed by the Arbitrator while passing the award. The brief facts which need to be noted are that the claim was raised by the appellant for the extra expenditure incurred in removing the box girder. It is contended that after the installation of Web Box Girder in span P-4 and P-5, certain cracks were detected during site inspection. The claimant submits that the same were of minor nature and could have been taken care of,

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and there was no occasion for the respondent who had demanded it to be uninstalled and another girder to be put in its place.

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Learned counsel submits that the Arbitrator failed to take notice of the fact that there was an opinion of IIT Roorkee which has been obtained at the instance of the respondent- Railway itself, which reflected that the girder was not required to be dismantled.

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Further, the claim relating to imposition of penalty charges on account of delay in performance of the work was mainly on account of dismantling, which took almost one and a half years, and the Arbitrator failed to take notice of the fact that, on account of the wrongful action on the part of the respondent, the delay had occurred and therefore, the claim set up by the appellant ought to have been allowed. However, the Arbitrator passed an award of NIL amount.

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Learned counsel has also taken this Court through the order passed by the Commercial Court dated 01.11.2025 and submits that the objections have not been correctly examined. 6. We find that, so far as the question examined by the Arbitrator is concerned, it is a pure question of fact which has been considered at length, and the Arbitrator reached to the opinion that the major portion of the delay is attributed to the claimant. It also reached to the conclusion that the factors due to which the cracks were caused, were well within the control of the claimant himself and the respondent had no role in prevention of cracks. Such cracks were preventable, and hence the responsibility for the cracks lies with the claimant alone and the decision of the respondent for directing the claimant to remove

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the defective part, namely the box girder, was well within their rights, and accordingly an award of NIL amount was passed. 7. The scope of interference of an arbitration award is limited and the appellant would have to bring its case within the four corners of Section 34 of the Act.

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Having noticed the above facts, we are of the firm view that the alleged objections raised and examined by the Commercial Court are not of such nature which may come within the four corners of Section 34(2) and Section 34(2A) of the Act.

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One of the reasons behind this is that unlike the enumeration of various criteria made u/s 34(2) of the Act, Section 34(2A) uses the term “patent illegality”. In this regard, the Hon’ble Supreme Court in Patel Engineering Limited vs. North Eastern Electric Power Corporation Limited reported in (2020) 7 SCC 167 , interpreted the term “patent illegality” as:

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“ 22. The present case arises out of a domestic

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award between two Indian entities. The ground of patent illegality is a ground available under the statute for setting aside a domestic award, if the decision of the arbitrator is found to be perverse, or, so irrational that no reasonable person would have arrived at the same; or, the construction of the contract is such that no fair or reasonable person would take; or, that the view of the arbitrator is not even a possible view.”

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The judgment cited at the Bar, namely MMTC Limited vs. Vedanta Limited reported in (2019) 4 SCC 163 only explains the concept of “fundamental policy of Indian law” which would also

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include compliance with statutes and judicial precedents, adopting a judicial approach, compliance with the principles of natural justice and Wednesbury (Associated Provincial Picture Houses vs. Wednesbury Corpn., (1948) 1 KB 223 (CA)) reasonableness.

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No such aspects have been raised by the claimant before the concerned Commercial Court. In view thereto, the case does not fill within the four corners of Section 34(2) and Section 34(2A) of the Act.

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The appeal is accordingly dismissed.

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(SANGEETA SHARMA),J

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(SANJEEV PRAKASH SHARMA),ACTING CJ

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Simple Kumawat /19

M/S Parmar Construction Company v. West Central Railway

Case brief

What is this about?

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M/S Parmar Construction Company v. West Central Railway

Case brief

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