DAWAR RUBBER INDUSTRIES Vs. UNION OF INDIA (UOI)

JUDGEMENT

(1.) BY this objection petition under Section 34 of the Arbitration and Conciliation Act, 1996, the petitioner challenges the Award dated 30.5.2003 passed by the sole Arbitrator. The petitioner was the claimant in the arbitration proceedings. The respondent had also filed its counter -claims. The dispute between the parties was basically with regard to the petitioner claiming monies for shoes which it claims to have delivered to the Union of India/respondent and the counter -claim of the respondent was for recovery of the advance payment for these very goods/stores/shoes which the respondent said it did not receive.

(2.) THE Claim (a) before the Arbitrator by the petitioner is with respect to claim for the balance price of the shoes which the petitioner states stand supplied to the respondent because the goods in this case were to be supplied F.O.R (Free on Rail) Verka/Amritsar, Punjab. The counsel for the petitioner contended that the facts of the present case are fully covered by the judgment of Marwar Tent Factory v. Union of India : AIR 1990 SC 1753 and as per which ownership of goods passes to the respondent if there is a term of "F.O.R" in the contract. The counsel for the petitioner accordingly, contended that once the goods were in the railway wagons and railway receipts were issued in favour of the consignee/Union of India making it the owner, the petitioner became entitled to receive the payment, irrespective of the fact that the respondent has actually received the goods or not.

(3.) THE up shot of the aforesaid discussion is that the petitioner as a seller is entitled to receive money only if the goods have either reached the destination and taken possession of by the respondent or if the delivery was FOR, then, the petitioner ought to have taken transit insurance, which admittedly it did not. Since the petitioner was guilty of breach of contract, and the respondent/Union of India has not received the stores/shoes for which the petitioner is claiming payment, I do not find any illegality whatsoever in the Award. The relevant portion of the Award which deals with this issue, and with which I agree, reads as under;