BSF COMMANDANT Vs. APPLIED COMMUNICATION AND CONTROLS

JUDGEMENT

(1.) The petitioners have filed the present petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter the 'A&C Act') impugning an Arbitral Award dated 29.06.2020 (hereinafter the 'impugned award') passed by the Arbitral Tribunal comprising of the learned Sole Arbitrator.

(2.) The impugned award has been rendered in the context of disputes that had arisen between the parties in relation to a Supply Order dated 31.12.2013 (hereafter the 'Supply Order'). Petitioner No. 1 (hereafter 'BSF') had placed the Supply Order of eight hundred and fifty-five pieces of fogging machines on the respondent, a sole proprietorship concern of Shiv Kumar Sharma (hereafter 'ACC'). The said Supply Order was initially suspended and thereafter, terminated. In the meanwhile, ACC had manufactured and offered two hundred and forty-five machines for inspection.

(3.) By the impugned award, the Arbitral Tribunal has partly accepted the claims preferred by ACC. The Arbitral Tribunal accepted that the termination of the Supply Order was illegal and entered an award for a sum of Rs. 80,85,000 in his favour being the value of two hundred and forty-five pieces of fogging machines less their salvage value. In addition, the Arbitral Tribunal awarded a sum of Rs. 25,65,050 as loss of profit on the balance machines. Thus, awarding an aggregate amount of Rs. 1,06,50,050 in favour of ACC. The Arbitral Tribunal awarded interest at the rate of 18% per annum on the awarded claims from the date of termination of the Supply Order (that is, 23.07.2014) till the date of the award (amounting to Rs. 1,13,65,499.94). And, future interest at the rate of 18% per annum on the awarded amount of Rs. 2,20,15,550 (Rs. 1,06,50,050 plus Rs. 1,13,65,499.94.), if the awarded amount was not paid within a period of thirty days. In addition, the Arbitral Tribunal also awarded a sum of Rs. 5,00,000/- as costs but clarified that future interest would not be payable on this amount, but would only run on the awarded amount of Rs. 2,20,15,550.