B K VASHISHT Vs. EAST INTERNATIONAL LIMITED

JUDGEMENT

(1.) This is a petition filed under Section 14 and 17 of the Arbitration Act, 1940 seeking filing of the award and for making it a rule of the court. In pursuance of the same notices had been issued and objections have been filed by the respondent under Section 30 and 33 of the Arbitration Act, 1940 (for short the Act). It has been asserted that the arbitrator had committed an error in not awarding the claim of the objectors towards load port claims and acted contrary to the terms of the charter party relating to load port laytime calculations. By not accepting the load port laytime calculations of the objectors the arbitrators travelled beyond the scope of the charter party and acted against the terms of the contract between the parties. Similarly it is asserted that they committed "an error apparent in not awarding the claim of the charters towards discharge port claims relating to discharge port laytime. calculations. They committed grave error in awarding the claim of the vessel owners for demurrage at discharge port in contravention of the charter party provisions and thus acted beyond the terms of the contract. They made a miscalculation of the demurrage at the discharge port between their revised time-sheet and laytime calculation, Plea has also been raised that the arbitrators erroneously awarded interest from 29/5/1990 to the date of the award when the vessel owners have no right to claim the same in view the charter party terms. The arbitrator even failed to follow the principles laid down by the Supreme Court by not providing for exchange rate of conversion of the present award which is in a foreign currency.

(2.) Notice was issued and the claimants/applicants contested the objections. It was alleged and pleaded that objections are barred by time. The objectors have not pointed any irregularity which would vitiate the award and therefore they are meritless. It is denied that arbitrator committed an error in not awarding the claim of the objectors towards load port claims. It is also denied that the arbitrators misconducted themselves by not accepting the claims of the objector with regard to discharge port laytime or that they misunderstood the proceedings by awarding the claim of the vessel owner for demurrage at discharge port in contravention of the charter party provisions.

(3.) During the course of arguments the plea that the objections were time barred as such had not been pressed. The short question that came up for consideration was as to whether the arbitrators have misconducted themselves or not. In this regard before proceeding further one can refer to the award of the arbitrators. The objectors had chartered the claimants vessel for carriage of wheat from USA to India. The cargo was loaded at the port of Portland and discharged at the port of Tuticorin in East Coast of India. Under Clause 17(b) of the charter party 90% of the freight was payable by the charterers within seven days upon arrival of the ship and cargo at the discharge port in India. The balance 10% freight together with demurrage, if any, and the adjustment of despatch was payable within 120 days of completion of discharge. The objector paid US $ 8,24,470.27 to the applicant towards 90% of the freight. The disputes arose and the petitioners/claimants had their 10% freight bill showing the balance due as US $ 1,17,968.87 from the objectors. In the meantime, the objectors had realised US $ 63,873.74 towards 10% freight. The case of the claimants was that vessel had incurred load port demurrage amounting to US $ 10,031.25 and incurred discharged port demurrage amounting to US $ 13,218.75. After adjustment of the demurrage commission at 3.75% claimants/applicant had laid the claim referred to above. They received US $ 63873.74 and the claim is for the balance. It is the balance amount which is in dispute besides the interest. The objectors made a counter statement stated that they have to pay demurrage for DHM 3.00.59 amounting to US $ 9122.92 at load port and entitled to get discharge port despatch for DHM 3-15-26 amounting to US $ 5464.88. While arriving at discharge port despatch objectors A.W.H. formula for calculating the allowable laytime. The arbitrators recorded their award and with respect to the formula to be adopted, it was held: