KRISHAK BHARATI CO Vs. M/S. ALUTEC INC.

JUDGEMENT

(1.) The present petition is filed under section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act) for setting aside the Award dated 03.03.2011 of the learned Arbitrator.

(2.) Some of the brief facts are that the petitioner and the respondent entered into a Service Agreement on 25.11.1994 for carrying out Consultancy Services for the Due Diligence Process and Project Implementation activities for Engineering, Technological, Environmental, Economical, Financial and Legal Analysis of Target plants of M/s.Mulberry Phosphaate Inc., Piney Point Plant and Wingate Creek Mine in USA and two target plants in Russia, i.e. M/s Ackron Nitrous Phosphate Novgorod and M/s IRGIZ Chemical Complex, Balakova. As per the Service Agreement, the petitioner in consultation with the respondent was to identify and appoint Expert Engineering, Environmental, Financial, Legal and Accounting Consultancy Services to support the project. The Service Agreement stipulated a total fee of US $295250 for consultancy services to be provided by the respondent for due diligence in relation to the target plants both in USA and Russia. The Agreement also stipulated the reimbursable cost during the entire project session not exceeding US $137850 (which was subsequently corrected to US $127850) payable to the respondent.

(3.) Two amendments to the Agreement were agreed upon i.e. Amendment-I on April 03, 1995 regarding total reimbursable expenses and Amendment-II on 04.05.1995 again seeking break up of reimbursable expenses as per the terms of the Service Agreement. Sub-consultants in USA were appointed in consultation with the respondent on 28.01.1995. Tripartite Service Agreements were entered into amongst the petitioner, respondent and Sub-Consultants to whom a letter of intent was issued. The Sub-Consultants were appointed at an aggregate fee of US $480000/- that was to be paid directly by the petitioner.