USHA BELTRON LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) A.A. 4/2000, 3/2000, 5/2000, 8/2000, 9/2000, 10/2000,12/2000,13/2000,14/ 2000, 16/2000, 17/2000, 18/2000, 19/2000, 20/2000, 32/2000, 33/2000, 673/99, 674/99 & 675/99 have been filed under Section 11(6) (a) of the Arbitration and Conciliation Act, 1996 (for short 'the Act') read with section 151 Criminal Procedure Code by Usha Beltron Ltd., against Union of India in the Ministry of Communications seeking to refer the disputes between the parties to arbitration. Except the dates of execution of agreements and claim amounts which are given below, identical issues arise for decision in all these petitions and I propose to dispose them of by this common order:- A.A.No. Date of Agreement Claim Amount A.A.4/2000 15.01.1998 27,25,380.00 A.A.3/2000 19.01.1998 14,69,821.00 A.A.5/2000 19.01.1998 19,41,824.00 A.A.8/2000 29.01.1998 10,71,957.00 A.A.9/2000 06.12.1996 20,27,797.00 A.A.10/2000 29.11.1996 26,88,867.00 A.A.12/2000 26.12.1996 28,83,301.00 A.A.13/2000 05.12.1996 14,26,322.00 A.A.14/2000 17.02.1997 08,01,078.00 A.A.16/2000 30.12.1996 28,21,599.00 A.A.17/2000 11.12.1996 20,38,142.00 A.A.18/2000 31.12.1996 10,72,204.00 A.A.19/2000 03.01.1997 11,91,978.00 A.A.20/2000 20.12.1996 05,67,032.00 A.A.32/2000 06.02.1998 22,37,112.00 A.A.33/2000 22.01.1998 21,73,230.00 A.A.673/99 22.01.1998 08,46,243.00 A.A.674/99 23.01.1998 12,57,330.00 A.A.675/99 23.01.1998 26,89,502.00

(2.) A.A. 4/2000 which is being treated as lead case, was filed alleging that petitioner is a Public Limited Company incorporated under the Companies Act, 1956 and Mukesh Gupta, Manager (Marketing) is authorised to sign, verify and institute petition on behalf of petitioner. Petitioner company is engaged in the business of manufacturing of Polyethylene Insulated Jelly Filled (PIJF) cables and for supply there of on deferred payment basis an agreement was entered into on 15/01/1998. Petitioner made supplies of cables of an amount of Rs. 21,04,64,200.00 pursuant to various purchase orders placed on it. Under clause 12.9 of said agreement which is reproduced below the respondent had an option to foreclose the agreement by making one time payment of balance amount due to the supplier.

(3.) Vide letter dated 15/03/1999 the respondent conveyed to the petitioner its decision to foreclose the said agreement by making one time payment of balance instalments by invoking clause 12.9. It is further alleged that outstanding instalments as per said clause can be paid at a time by applying the discounting rate equivalent to prime lending rate which at the material time was 12%, and effective discounting rate would be 15% p.a. Since instalments were payable on quarterly basis, discounting rate of 14.2232% to be compounded quarterly had to be applied to achieve the effective discounting rate of 15% p.a. However, the discounting factor had been calculated at 15% compounded quarterly which is equivalent to 15.1224% p.a., erroneously by the respondent and amount of Rs. 27,25,380.00 was illegally deducted from the bills of petitioner company. It is stated that petitioner is entitled to the refund of this amount together with overdue interest @ 18% p.a. thereon and interest pendente lite and future at the same rate. It is further alleged that aforesaid agreement contains arbitration clause being clause No.25. Petitioner issued legal notice dated 14/10/1999 invoking arbitration clause and claiming payment of the amount due. Respondent sent a reply dated 5/11/1999 thereto denying the claim and referring the disputes to arbitration.