VINDHYA TELELINKS LIMITED Vs. MAHANAGAR TELEPHONES NIGAM LIMITED

JUDGEMENT

(1.) Faced with invocation of performance bank guarantee dated 4.10.1999, in pursuance of letter No.MTNL/BG/1047 dated 4.10.2001 of Mahanagar Telephone Nigam Limited(respondent No.1) to the State Bank of India, Main Branch, Rewa(MP),(respondent No.2) the petitioner, M/s.Vindhya Telelinks Limited, approaches this Court for intervention by seeking to invoke its power under Section 9 of the Arbitration and Conciliation Act, 1996.

(2.) Facts unfolded by pleadings indicate that for procurement of PIJF Telecom Cables of different sizes, the respondent No.1 floated a tender dated 14.5.1999 leading to submission of its bid by the petitioner in response thereto. The petitioner turned out to be a successful bidder. Accordingly, a Letter of Intent dated 29.09.1999 was issued to the petitioner. On completion of certain formalities, including furnishing of a performance bank guarantee, for a sum of Rs.37,10,529.00, the respondent No.1 issued a purchase order dated 12.10.1999 for supply of PIJF Cables of thirteen different sizes, as specified in Annexure-'A' thereto. The supplies were to be made in a phased manner by the scheduled dates of delivery, as indicated in Annexure-'B' to the purchase order. Out of a total quantity of 1,49,520 CKM of PIJF Cables of all the thirteen sizes required to be delivered by 15th of February, 2000, the petitioner supplied 62,200.6 CKM to the respondent No.1 by the second week of January, 2000. For rest of the supplies, the petitioner, by its letter dated 12.01.2000, requested the respondent No.1 for extension of time till 31st of March, 2000. By a memorandum dated 28.2.2000, the respondent No.1, however, extended the delivery period for seven sizes of PIJF Cables only, and request for extension of delivery time for the remaining six sizes was, thus, not acceded to by the respondent No.1. In view of persistent requests for extension of delivery period in respect of remaining six sizes, the respondent No.1, eventually, relented and extended the delivery period up to 31st of March, 2000 for another four sizes vide its memorandum dated 16.5.2000. In spite of repeated requests, no extension of delivery period for the remaining two sizes of PIJF Cables being 2000/O.4(A) and 2000/O.4(UA), was, however, granted.

(3.) On or about 26th of June, 2001, the petitioner received a letter dated 26.06.2001 from the respondent No.1 terminating the contract by short closure of outstanding supplies and the petitioner was asked to deposit a sum of Rs.7,43,907.00 on account of liquidated damages at the earliest.