UNION OF INDIA Vs. VEEKAY INDUSTRIES

JUDGEMENT

(1.) Arguments were heard on the petition for final disposal on the request of the parties. These two cross first appeals are directed against an order of an Additional District Judge dated 17/7/1998 by which the award dated 27/2/1998 published by respondent no.2 Air Vice Marshal V.B.Batra, was made rule of the court.

(2.) Appellant Union of Indie, in FAO No.34/1999 (hereinafter referred to as the first appellant) and Veekay Industries Limited, Appellant in FAO No.123/1999 (hereinafter referred to as the second appellant) entered into contract for supply of Jack Screw Lifting 4 Tons Capacity for 12,400 Nos by the latter to the former by 26th March l994.

(3.) The second appellant supplied part of quantity numbering 2690. The contract for supply of the remaining articles was cancelled by the first appellant on 24/5/1994 for inordinate delay in the supply. The first appellant allegedly spent additional sum of Rs.22,19,706.00 over and above the contracted amount on account of risk purchase at the cost of the second appellant. A dispute arose between the parties about the claim of this sum and also adjustment of a sum of Rs.75,000.00 which was adjusted by the first appellant by encashing the bank guarantee furnished by the second appellant by way of security. The first appellant also withheld 5% of the amount which was payable to the second appellant against its bills for the goods supplied which amounted to Rs.62,405.00. The second appellant filed a petition under Section 20 of the Arbitration Act,1940 bearing suit no.1527/1994 for making reference of the dispute between the parties to an arbitrator. The court by order dated 14/1/1995 appointed Air Vice Marshal V.B.Batra - respondent no.2 as Sole Arbitrator for arbitrating the dispute between the parties. The Arbitrator made and published its award on 27/2/1998. The second appellant then filed a? petition bearing suit no.200/1998 under Section 14 of the Arbitration Act,1940 for directing the Arbitrator to file the award in the court. He also raised several objections against the award.