JEEVAN ENGINEERING WORKS Vs. UNION OF INDIA

JUDGEMENT

(1.) THE objections filed by the petitioner vide I.A. No.4766/1997 under Sections 30 and 33 of the Arbitration Act, 1940, upon service of notice of filing of the award, are for consideration. Disputes arose between the parties out of a contract placed by the respondent on the petitioner for supply of six diesel dumpers. It was inter alia a term of the said contract that if the respondent was not satisfied, after trial of the two dumpers to be supplied initially, it could foreclose the order for the remaining four dumpers without any financial liability. THE respondent, prior to the expiry of the period of trial of the first two dumpers supplied, called upon the petitioner to rectify certain defects found therein. However, simultaneously the petitioner was also called upon to supply the remaining four dumpers. It is the case of the respondent that the petitioner failed to rectify the defects in the first two dumpers and also failed to supply the remaining four dumpers within the stipulated time. THE petitioner though had dispatched the remaining four dumpers; according to the respondent though it was not inclined to accept the delivery of the remaining four dumpers for the reason of the delivery having been offered after the stipulated period therefor but there being no procedure of the railways for returning the consignment the delivery of remaining four dumpers was accepted and the same were rebooked with the railways to the petitioner. THE petitioner however failed to take the delivery of such four dumpers and the same were ultimately reconsigned back to the respondent. It is not in dispute that thereafter the four dumpers remained with the respondent.

(2.) THE petitioner before the arbitrator made a claim of Rs.8043/- towards the balance 5% price of the first two dumpers and of Rs.3,21,705/- being the price of the remaining four dumpers, besides for interest and costs of arbitration. THE respondent made a counter claim of Rs.1,59,625/- for expenses towards repair/rectification of the first two dumpers which the petitioner had failed to carry out and of Rs.1,13,406.35p towards the infructuous expenditure incurred in consignment / re-consignment and freight charges incurred with respect to the remaining four dumpers, besides for interest and costs.

(3.) THE petitioner has in the objections also pleaded lack of opportunity of being heard before the arbitrator. However, no arguments were addressed on that aspect. THE counsel for the petitioner during hearing before this Court has contended that even though it is not in dispute that the remaining four dumpers were also with the respondent, the arbitrator has still denied the price thereof to the petitioner. It is also contended that there was no evidence whatsoever before the arbitrator of the respondent having incurred expense of Rs.1,59,625/- for repair / rectification of first two dumpers or of Rs.1,13,406.35p in payment of freight /consignment/re-consignment of the remaining four dumpers. THE award is also challenged on the ground of being without reasons though required to be speaking. It is also contended that there was no delay in delivery of the remaining four dumpers inasmuch as the same were offered for inspection within the stipulated time. Holes are also poked in the claim of Rs.1,13,406.35p by contending that for the same distance, different freights are being claimed. It is also pointed out that while in the communication dated 12th February, 1992 C-24 in the arbitrators record, the respondent has claimed only Rs.17,518/- towards repairs of the first two dumpers but in the claim before the arbitrator the amount was inflated to Rs.1,59,625/-. It is also urged that there was no reason for the arbitrator to decline interest on 5% balance price of the first two dumpers admittedly found due to the petitioner. It was argued that the award is without any application of mind and liable to be set aside.