HARYANA TELECOM LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The Department of Telecom, Union of India the respondent herein floated tender for obtaining PIJF underground cables of 1.66 LCKM. The tender was opened on 22.4.1994. The petitioner had submitted his bid in pursuance to the tender enquiry which was accepted by the respondent. Orders were placed on the petitioner for supply of cables on a cash basis and the petitioner was required to submit a performance bank guarantee worth Rs.85 lacs as per clause 4.1 of the bid documents. The petitioner accordingly furnished the bank guarantee dated 27.9.1994 issued by the State Bank of Patiala, Rajpura for the said amount.

(2.) The respondent took the decision to obtain additional quantity of the said cable of 85 LCKM under the same tender enquiry but on deferred payment terms and the petitioner being one of the approved bidders was accordingly informed about the proposal of additional allocation of 3.79 LCKMs. This quantity was enhanced to 4.77 LCKM on 5.12.1994 and distributed to different telecom circles. The Haryana Circle had to be supplied 1.64 LCKM, Punjab Circle 2.40 LCKM and Rajasthan Circle 0.73 LCKM. The petitioner was required to submit their conditional acceptance latest by 9.2.1995 and the same was duly done by the petitioner. In view of this additional supply of 4.7 LCKM the petitioner was required under Clause 4.1 of the Agreement to submit an additional performance bank guarantee for Rs.15.0 lacs to make the total performance bank guarantee of Rs.1.0 crore and the petitioner duly complied with the same by furnishing the additional bank guarantee of Rs.15.0 lacs issued by Canara Bank, IFB Branch, New Delhi. The petitioner was required to have separate agreements with the three Chief Managers of the three respective telecom circles under this deferred payment arrangement and the petitioner entered into such three separate agreements giving different scheduled dates of delivery.

(3.) The dispute arose between the parties on account of the failure of the petitioner to make the supplies and the respondent invoked the bank guarantees. In view of the existence of Clause 20 as the Arbitration Clause Shri A.K. Garg, General Manager, Telecom District Dheradun was appointed as the Arbitrator by the Government of India vide letter dated 8.9.1997. The Arbitrator made and published the award dated 17.12.1999. The petitioner aggrieved by the same has filed the present petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to ?the said Act?).