DENEL PROPRIETARY LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The aforesaid three petitions are being disposed of by this common order inasmuch as the facts of the three cases are more or less similar. Wherever the need arises to refer to a difference in an issue or fact for any individual case, then, the same would be adverted to. These petitions have been filed by the petitioner under Section 9 of the Arbitration and Conciliation Act, 1996 seeking restraint against the invocation of the Bank Guarantees totalling to an amount of approx. USD 6,110,038 by the respondent No. 1. The Bank Guarantees are given by the banks which have been arrayed as other respondents.

(2.) The facts of the case are that the petitioner was awarded various contracts by the respondent No. 1/Union of India for supply of certain defence equipments such as AMR Rifles and ammunition. In pursuance of the requirements of these contracts, the petitioner gave two types of Bank Guarantees. The Bank Guarantees are Warranty Bank Guarantees and Performance Bank Guarantees. On the ground that the petitioner employed agents and gave commission for securing the contracts in question, disputes arose between the parties, and the respondents have sought to inter alia encash the Bank Guarantees. I may note that so far as OMP Nos. 710/2009 and 711/2009 are concerned, the arbitration proceedings were initiated between the parties way back in the year 2007. The Arbitration Tribunal was constituted and certain orders were passed by the Arbitration Tribunal. At the present stage, the Arbitration Tribunal is however non-functional firstly on account of the demise of the presiding Arbitrator, secondly on account of, the Arbitrator appointed by the petitioner having recused himself and thirdly because the petitioner has filed proceedings for removal of the Arbitrator appointed by the respondent No. 1.

(3.) The cases on behalf of the petitioner were argued by Mr. N.K. Kaul and Mr. V.P. Singh, Sr. Advocates. So far as OMP 703/2009 is concerned, Mr. Kaul raised the following contentions: