MAHANAGAR TELEPHONE NIGAM LTD Vs. HARYANA TELECOM LTD

JUDGEMENT

(1.) By this objection petition under Section 34 of the Arbitration and Conciliation Act, 1996, the petitioner challenges the Award of the Arbitration Tribunal dated 12.3.2003. The Award arrives at a finding holding the respondent guilty of delay in supply of the goods, yet, denies the benefit of the clause of liquidated damages to the present petitioner on the ground that the petitioner was in law bound to prove loss, however, it failed to prove that any loss was caused to it. The Award therefore directs the petitioner to refund the amount of Rs. 1,03,20,763/- appropriated by it towards liquidated damages. The basic stress in the Award is that the petitioner failed to prove that any loss has been caused to it, and therefore, it was consequentially held that the relevant sub-Clause 16.2, providing for liquidated damages was in the nature of penalty/in terrorem and that therefore the petitioner was not entitled to appropriate the amount towards liquidated damages.

(2.) The facts of the case are that the petitioner had floated a tender for supply of underground Jelly Filled Telephone Cables. The offer of the respondent herein was accepted and four purchase orders were placed upon the respondent as under:-

(3.) An amendment was entered into between the parties on 13.3.1995 and as per which amendment, an extension for supplies was granted with Liquidated Damages.