Mere Delay By Employer Would Not Entitle The Contractor To Damages Unless The Loss Is Pleaded And Proved: Delhi High Court

The High Court of Delhi has held that merely because the delay in the execution of the work is attributable to the employer, the same would not entitle the contractor to claim damages unless it pleads and proves that such delay resulted in loss to it. The bench of Justices Vibhu Bakhru and Tara Vitasta Ganju held that a procedural order passed by the earlier arbitrator, not being a final decision on the merits, does not preclude the substitute arbitrator from deciding the claims on their merits. However, the arbitrator was substituted under Section 29A and the substituted arbitrator continued the arbitral proceedings and dismissed majority of appellant's claims on ground of failure to plead and prove loss of profit. Contention of the Parties The appellant challenged the award on the following grounds: That the impugned award is contrary to an earlier order by the First Arbitrator on the issue of cause of action wherein the arbitrator has expressly observed that there is sufficient cause of action for the appellant's claims. The Court that observations made in a procedural order passed by the earlier arbitrator, not being a final decision on the merits, does not preclude the substitute arbitrator from deciding the claims on their merits.