NARENDRA KUMAR JAIN Vs. SWASTIC TRADING AGENCY

JUDGEMENT

(1.) The petitioner and the respondent are engaged as wholesale merchants in the business of paper. It is during this business relationship that disputes arose between the parties. The case of the petitioner that four cheques of Rs.5.00 lakh each were handed over by the petitioner to the respondent. The petitioner claims that on 20.7.1999 a letter was written to the respondent wherein on account of non-supply of goods by the respondent in time, the petitioner claimed losses. The order placed is stated to have been cancelled and a request was made for return of four cheques. The cheques were not returned despite the intimation of the petitioner that the bank account against which the cheques were issued has been closed. The petitioner claimed that an assurance was given by the respondent that the cheques were lost and would not be misused.

(2.) The respondent, however, filed a claim before the Paper Merchants Association, Chawri Bazar, Delhi arising from the aforesaid dispute. Initially, Shri Jagan Nath Gupta was appointed as the sole arbitrator with the consent of the parties but he subsequently resigned and Shri Ram Bhaj Mittal was appointed as the new arbitrator. Shri Ram Bhaj Mittal made and published an award dated 29.11.2004 awarding to the respondent a sum of Rs.42,64,034.00 with interest @ 12 per cent per annum from 19.4.2001 till date of realisation against the petitioner.

(3.) The petitioner has challenged the award under Section 34(2) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the said Act) alleging that the award is in conflict with the public policy of India and the arbitrator has misconducted the proceedings.