IRCON INTERNATIONAL LIMITED Vs. KRISHNA TRADING CO

JUDGEMENT

(1.) THE petitioner, a Government of India Undertaking, was desirous of supplying stone boulders to Bangladesh and elicited offers for the same. A tender was floated dated 6th/8th September, 1999 and the respondent submitted a tender which was opened on 24. 9. 1999. There were apparently some subsequent discussions between the parties for renegotiation of terms which resulted in a letter from the petitioner dated 6. 10. 1999 and a revised offer from the respondent dated 12. 10. 1999. This revised offer was accepted vide a letter of the petitioner dated 6. 11. 1999.

(2.) A formal contract was also executed on 7. 12. 2000. The respondent made the supplies but, according to the petitioner, there were deficiency in both quantity and quality. The result of the same was that against the payment sought for by the respondent of Rs. 25,22,772. 48 the petitioner paid only an amount of Rs. 16,82,037. 48 and deducted an amount of Rs. 8,40,735/ -. This gave rise to disputes between the parties. Clause 31. 0 of the General conditions of Contracts provided for settlement of disputes through the mode of arbitration and the arbitrator was to be appointed by the Managing director of IRCON. Mr. Rajendra Nath, a retired Engineer of the Railways was appointed as the sole arbitrator.

(3.) THE petitioner filed an application under Section 16 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the said Act) but the same was decided against the petitioner on 28. 4. 2005 and ultimately the award was passed on 21. 7. 2006 awarding the disputed amount along with interest to the respondent. The petitioner has now filed the present petition under Section 34 of the said Act challenging both the order under Section 16 of the said Act and the award dated 21. 7. 2006.