KRISHNA BAI Vs. HINDUSTAN STEEL LIMITED

JUDGEMENT

(1.) THIS miscellaneous appeal under Section 39(1) of the Indian Arbitration Act, 1940 (for short 'Act of 1940') is directed against the judgment dated 29-3-1993 passed by the Court of learned 5th Additional District Judge, Durg in Civil Suit No. 9-A/93, whereby learned Additional District Judge has allowed the suit of the respondent herein and set aside the learned Umpire's award dated 20-5-1985.

(2.) FACTS, in brief, are that original claimant Gulab Bhai had some petty contracts with the Bhilai Steel Plant. Earlier contract dated 19-2-1971 was rescinded with the consent of both the parties and fresh sale order dated 22-4-1972 was communicated by the respondent which was accepted by the original claimant vide his letter of Exh. 21. As per the fresh sale order, the original claimant was to lift agreemented mixed coke of 3000 ton @ Rs. 53.62 paise per ton between 22-5-1972 to 22-4-1973 @ 250 ton mixed coke per month. Grievance of the appellants is that the appellants complied with the conditions of sale order and deposited the purchase money for supply of mixed coke along with security deposit. However, the respondent did not allow the appellants to lift the mixed coke as per condition of the sale order. The appellants addressed several letters dated 6-4-1972, 12-6-1972, 6-10-1972, 18-12-1972, 9-8-1976, 25-10-1976, 14-11-1976 and 24-12-1976 requesting the respondent for revalidating the sale order. However, the respondent cancelled the sale order and ordered refund of security deposit of Rs. 1,000/-. In these circumstances, the appellants invoked arbitration Clause vide letter dated 9-3-1977 (Exh. 28) by nominating Mr. R.B. Shukla, Advocate as their arbitrator and called upon the respondent to nominate their arbitrator. In response to the above notice the respondent appointed one Shri Chandrakant as its arbitrator vide letter dated 15-3-1977 (Exh. 12). Thereafter, it appears from the record that the appellants appointed Mr. K.N. Verma as their arbitrator, whereas, the respondent appointed Mr. P.K. Sinha as its arbitrator. The appellants' arbitrator did not deliver the award but prepared a draft of the award. The respondent's arbitrator did not deliver any written award, however, he informed in writing that he did not agree with the draft award. The parties to the proceedings made efforts to appoint Umpire to resolve their dispute, however, when they failed to agree on the name of Umpire, an application under Section 8 of the Act of 1940 was filed for appointment of Umpire and accordingly Mr. Justice P.K. Tare was appointed as Umpire through intervention of the Court and dispute was referred for adjudication to learned Umpire. During the arbitration proceeding before Joint Arbitrators appointed by the parties, original claimant Gulab Bhai died on 15-4-1978 and his legal heirs, Le., appellants herein were substituted.

(3.) THE respondent in its reply denied the claim and objected to the maintainability of the claim on the ground that the same is barred by principle of waiver, acquiescence and estoppel. It is also specifically averred that by accepting the sale order dated 22-4-1972, the appellants also accepted the conditions mentioned in the said order and as per condition No. 2 the material could be lifted within a period of one year from the date of forwarding of the sale order and not beyond that. Since the appellants' right for lifting the material expired after one year, the contract stood cancelled and the respondent vide their memo dated 14-6-1973 formally communicated about the cancellation of the sale order to the appellants.