UNION OF INDIA Vs. RK JAIN

JUDGEMENT

(1.) It is the appellant's case that the impugned order dated 23.01.2016 and the arbitral Award have erred insofar as the respondent had been awarded an amount beyond the terms of the Contract. As per Clause 7.3 of the contract, the respondent-supplier of Elastic Rail Clip (ERC) was to be given a difference in the MODVAT of steel, if it was more than the quantum of steel input in the MODVAT amount of Rs.2.74 which figure was allowed to be retained by the respondent on the ERC at the time of awarding the Tender. The latter amount had been quoted by the respondent. The Clause 7.3 reads as under:-

(2.) According to the appellant, what the aforesaid Clause envisages is that the respondent-supplier would be allowed a MODVAT benefit of Rs.74 for each ERC, however, MODVAT on steel rods increased, then corresponding amount would be adjustable/payable to the supplier.

(3.) It is argued that the Award has erred in granting MODVAT amount on the ERC-the finished product, instead of only on the steel rod input. The Award has dealt with the issue as under:-