LAWS(DLH)-2012-1-166

UNION OF INDIA Vs. ALPINE INDUSTRIES

Decided On January 18, 2012
UNION OF INDIA Appellant
V/S
ALPINE INDUSTRIES Respondents

JUDGEMENT

(1.) The challenge in this petition under Section 34 of the Arbitration and Conciliation Act ('Act') by the Union of India through the Integrated Headquarters of Ministry of Defence (MOD), OMG's Branch, Director General of Supplies & Transport (DGS&T), is to the Award dated 28th May, 2009 passed by the Sole Arbitrator in the disputes between the Petitioner and the Respondent who entered into a contract on 8th August, 1997 for the manufacture and supply of Foot Powder.

(2.) The Respondent has awarded the aforementioned contract for the supply of 17000 kg. of Foot Powder in unit pack of 70 gm plastic bottles as per Specification No.JJS-6840 @ Rs.46/- per kg + Excise Duty and other Taxes. The Respondent's store failed the test as a result of which the supplies could not be completed within the stipulated period. By letter dated 1st May, 2000, the Petitioner cancelled the contract and went in for risk purchase ('RP'). The Respondent's tender for RP was rejected. The Petitioner deducted amount of loss allegedly incurred towards RP from another bill of the Respondent. The resultant dispute was referred to the sole arbitration of the Additional Secretary in the Department of Legal Affairs, Ministry of Law & Justice.

(3.) There were four claims by the Respondent (Claimant) before the learned Arbitrator. Claim No. (i) was for Rs.7,82,000/- being the cost of stores manufactured by the Respondent (17 tons @ 46/- per kg.) with interest @ 18% with effect from the date of first rejection note dated 20th May, 1998.