RASHTRIYA CHEMICALS AND FERTILIZERS LTD Vs. CHOWGULE BROTHERS

JUDGEMENT

(1.) This appeal by special leave is directed against an order dated 5th April 2006 passed by the High Court of Bombay whereby Appeal No. 884 of 1997 has been allowed, the order passed by a learned Single Judge of that Court set aside and the majority award passed by the arbitrators restored.

(2.) The appellant, a Government of India undertaking invited tenders for allotment of clearing, forwarding, handling and stevedoring jobs at Mormugao Port initially for a period of one year commencing from 15th January 1983 upto 14th January 1984 but extendable at the option of the appellant for a further period of one year on the same terms and conditions except statutory increases in the wages of Dock labourers referred to in Clause 2.03 of tender notice. In response, the respondent submitted a tender which was accepted culminating in the issue of a work order dated 10th January 1983 in its favour. It is common ground that the appellant by its communication dated 13th October 1983 exercised the option available to it in terms of Clause 2.03 of the NIT and extended the contract for a further period of one year ending 14th January 1985.

(3.) The extension aforementioned was accepted by the respondent in terms of its communication dated 7th December 1983 in which it was inter-alia pointed out that statutory revisions in the wages of Mormugao Dock Labour Board (for short M.D.L.B.) that had come about during the period of one year need be considered while extending the contractual period. In response, the company by its letter dated 27th January 1984 pointed out that Clause 2.03 of Schedule II of N.I.T. provided for increases on account of statutory revisions made upto 15th January 1984 alone to be considered for purposes of granting rate escalation. Increases in wages that may have been under negotiations or those granted on a later date with retrospective effect could not consequently be considered, said the appellant. The respondent-Company was on that basis called upon to furnish documentary evidence regarding increase if any in wages allowed by the M.D.L.B. upto 15th January 1984 without waiting for issuance of any fresh circulars.