IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 109 FAO-3655-2026 (O&M) Date of Decision : July 07, 2026 CHIEF INFORMATION COMMISSIONER, HARYANA AND ANOTHER .....Appellants VERSUS M/S SHERWAL ENTERPRISES AND ANOTHER .....Respondents CORAM: HON'BLE MS. JUSTICE LAPITA BANERJI Present : Mr. Shashank Bhandari, Addl. Advocate General for the appellants. **** LAPITA BANERJI, J. (Oral) CM-12885-CII-2026 This is an application for condonation of delay of 60 days in filing the present appeal. Perused the grounds in the application. Such grounds are found sufficient. The application is allowed and delay of 60 days in filing the present appeal is condoned. CM-12884-CII-2026 Allowed, as prayed for. Main case 1. In the present appeal, the challenge is laid to the award dated 11.06.2018 and the dismissal of the application under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the 1996 AJAY KUMAR 2026.07.17 09:01 I attest to the accuracy and authenticity of this order/judgment Chandigarh FAO-3655-2026 (O&M) -2- Act’) by the learned Additional District Judge, Chandigarh vide order dated 06.01.2026. 2. Brief facts of this case are as follows:- i) The appellant-judgment debtor had invited tenders for providing man powers services for housekeeping, security etc. to the State Information Commission for a period of one year. The respondent-decree holder was the successful bidder. ii) An agreement was entered into between the parties on November 27, 2015. As per the said agreement, respondent No.1 was required to disburse wages to the deployed workers by the 7th day of every successive month, failing which penalty @ Rs.1,000/- per day was leviable on the contractor-respondent No.1. Respondent No.1 was entitled to service charges over and above the total wages payable for the deployed man power. The same was to be paid by the appellants being the consumer of the manpower to the Respondent No.1. iii) 83 persons were deployed by respondent No.1 w.e.f. 01.11.2015. iv) Respondent No.1 had failed to make payment to all the 83 workers as 43 cheques were dishonoured on account of “insufficient funds”. v) For the breach of such contractual obligation, the appellants terminated the respondent’s contract vide order dated December 23, 2015. vi) The disputes and differences were referred to a sole Arbitrator. AJAY KUMAR 2026.07.17 09:01 I attest to the accuracy and authenticity of this order/judgment Chandigarh FAO-3655-2026 (O&M) -3- vii) Vide award dated June 11, 2018, the claims of respondent No.1 were allowed by the learned Arbitrator and an award was passed in its favour. viii) Claim No.1 was with regard to the fact that the contract was illegally terminated by the appellants. After a detailed discussion, the learned Arbitrator held that the disputes could have been amicably settled between the parties and the termination of the contract without providing one month’s notice to the appellants was a harsh decision. It was true that 43 cheques out of 83 issued were dishonoured but since the appellants did not make any payment to the respondent No.1 on account of payment to the employees and security deposit to the tune of Rs.5 lacs was forfeited by the appellants without giving the requisite notice of one month for termination of the contract and it made said termination illegal. It was held that the appellants had acted in an unduly harsh manner. ix) Claim No.2 was in respect of refund of Rs.5 lacs deposited by respondent No.1 with the appellants on account of security deposit. The learned Arbitrator held that the security deposit was forfeited by the appellants without proving any loss to itself for the forfeiture of such security deposit. Therefore, security deposit was directed to be refunded with interest @ 9% per annum from December 23, 2015 till such date when the security amount was actually refunded. x) Claim No.3 was partly allowed whereby the appellants were directed to pay to the respondent No.1 service charge to the tune of Rs.72,302.74 alongwith interest @ 9% per annum from the period of November 01, 2015 to December 17, 2015. AJAY KUMAR 2026.07.17 09:01 I attest to the accuracy and authenticity of this order/judgment Chandigarh FAO-3655-2026 (O&M) -4- xi) Claim No.4 was on account of loss and damages for service charge which the claimant/respondent No.1 could have earned in the event the agreement was not terminated abruptly. The said claim was partly allowed and a sum of Rs.75,000/- alongwith interest @ 9% per annum was awarded. xii) Claim No.5 was on account of legal fees and the fees of the learned Arbitrator. A sum of Rs.70,000/- was allowed on that head alongwith interest @ 9% per annum. xiii) The said award was challenged before the learned Additional District Judge, Chandigarh by filing an objection petition under Section 34 of the 1996 Act. The learned Additional District Judge, Chandigarh discussed the award in detail in paragraphs No.13 and 14 of the impugned order and held that there was no infirmity in passing of the said award. 3. Learned counsel appearing on behalf of the appellants submits that the impugned award and the impugned order of the learned ADJ are arbitrary and perverse and should be set-aside since as per the terms of the contract, the appellants could have terminated the contract as per the terms of the contract as the man power deployed by the contractor-award holder was not being paid. The liability to pay its man power was completely on the contractor which liability it had failed to discharge. Learned counsel appearing on behalf of the appellants further submits that due notice albeit a short one, was given to the contractor, in accordance with the terms and conditions of the contract. AJAY KUMAR 2026.07.17 09:01 I attest to the accuracy and authenticity of this order/judgment Chandigarh FAO-3655-2026 (O&M) -5- 4. This Court has heard the learned counsel appearing on behalf of the appellants and perused the material on record. 5. The award passed by the learned Arbitrator is a speaking award whereby all the claims have been discussed and the reasons for allowing/partly allowing the same have been recorded. The learned ADJ, Chandigarh has also passed a reasoned order by appreciating the reasons given in the award. The said reasoning has also been analysed by this Court in paragraphs 2(vii) to 2(xii). 6. The scope of Section 37 of the 1996 Act is very limited as is stated in the judgment of the Apex Court in Associate Builders Vs. Delhi Development Authority reported in (2015) 3 SCC 49. The relevant extract is reproduced hereinafter:- “12 xxxxx xxxxxxx xxxxxx xxxx xxxx It must clearly be understood that when a court is applying the “public policy” test to an arbitration award, it does not act as a court of appeal and consequently er fact cannot be corrected. A possible view by the arbitrator on facts has necessarily to pass muster as the arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon when he delivers his arbitral. Thus an award base on little evidence or on evidence which does not measure up in quali on this score[1]. Once it is found that the arbitrators approach is not arbitrary or capricious, then he is the last word on facts. xxxx xxxxx xxxx xxxx xxxx xxxx An arbitral tribunal must decide in accordance with the terms of the contract, but if an arbitrator construes a term of the contract in a reasonable manner, it will not mean that the award can be set aside on this ground. Construction of the terms of a contract is primarily for an AJAY KUMAR 2026.07.17 09:01 I attest to the accuracy and authenticity of this order/judgment Chandigarh FAO-3655-2026 (O&M) -6- arbitrator to decide unless the arbitrator construes the contract in such a way that it could be said to be something that no fair minded or reasonable person could do. It was opined by this court that when it comes to setting aside of an award under the public policy ground, it would mean that the award should shock the conscience of the court and would not include what the court thinks is unjust seeking to substitute its view for that of the arbitrator to do what it considers to be “justice”. xxxx xxxxx xxxx xxxx xxxx xxxx” 7. A beneficial reference may be made to the decision of the Apex Court in Konkan Railway Corporation Limited Vs. Chenab and Bridge Project undertaking reported in (2023) 9 SCC 85. The relevant extract is reproduced hereinafter:- “14. Analysis: At the outset, we may state that the jurisdiction of the Court under Section 37 of the Act, as clarified by this Court in MMTC Ltd. v. Vedanta Ltd., (2019) 4 SCC 163, is akin to the jurisdiction of the court under Section 34 of the Act. Scope of interference by a court in an appeal under Section 37 of the Act, in examining an order, setting aside or refusing to set aside an award, is restricted and subject to the same grounds as the challenge under Section 34 of the Act. 15. Therefore, the scope of jurisdiction under Section 34 and Section 37 of the Act is not akin to normal appellate jurisdiction.9 It is well-settled that courts ought not to interfere with the arbitral award in a casual and cavalier manner. The mere possibility of an alternative view on facts or interpretation of the contract does not entitle courts to reverse the findings of the Arbitral Tribunal.10 In Dyna (2019) 19 SCC 9.” 8. When there is no arbitrariness or perversity in the award the Court hearing the application under Section 34 of the 1996 Act cannot AJAY KUMAR 2026.07.17 09:01 I attest to the accuracy and authenticity of this order/judgment Chandigarh FAO-3655-2026 (O&M) -7- interfere with the same. The scope of interference in appeal under Section 37 of the 1996 Act is even more limited. 9. In view of the aforesaid discussion, this Court is of the opinion that the award dated June 11, 2018 is neither perverse nor arbitrary/against public policy of India. Furthermore, by upholding the impugned award dated June 11, 2018, the learned ADJ, Chandigarh has not committed any infirmity. Therefore, the present appeal being FAO-3655-2026 is dismissed in limine. 10. Connected applications, if any, are also disposed of. (LAPITA BANERJI) July 07, 2026 JUDGE ajaysharma Whether speaking/reasoned. : Yes/No Whether Reportable. : Yes/No AJAY KUMAR 2026.07.17 09:01 I attest to the accuracy and authenticity of this order/judgment Chandigarh