UNION OF INDIA Vs. ARCTIC INDIA

JUDGEMENT

(1.) THE challenge by means of this First Appeal under Section 37 of the Arbitration and Conciliation Act, 1996 is to the impugned judgment of the Court below dated 22.2.2003, and by which judgment the Court below dismissed the objections of the appellant under Section 34 of the Act.

(2.) THE facts of the case are that a contract for operation and maintenance of Chilled Water Plant in DIPAC area of Delhi Cantt was awarded to the respondent for the period from 16.12.1996 till 15.12.1997 and this period was extended on two occasions for two months each ending on 31.4.1998. After the completion of the period of the contact, the respondent/contractor submitted his final bill for Rs.4,74,028.38, which was however not paid by the appellant resulting in the arbitration proceedings. THE Arbitrator allowed the Claim Petition of the respondent and awarded the amount for the work done under the contract of Rs.4,74,028.38 along with interest at 12% per annum till the date of Award and 15% per annum thereafter if the payment is not made within 90 days. THE Arbitrator dismissed the counter claim of the appellant for Rs.18,30,000/- which was made on the ground that the respondent was guilty in causing damage to the machinery during the period of the maintenance and therefore the said machinery was got rectified at the risk and cost of the respondent/contractor.

(3.) THE Arbitrator held that so far as the case with respect to supply of defective compressor under another contract is concerned, there was already an Award against the appellant which became final and in which it was held that the compressor supplied by the respondent was not defective. THE Arbitrator further held that there was no question of any malpractice or negligence on behalf of the respondent/contractor because if that was so there would have been really no question of grant of two extensions to the respondent/contractor. Finally the Arbitrator held that the so-called rectification of defects which were got rectified were not covered under the scope of the contract as new equipments/parts were purchased although the same should have only been got repaired.