GHAN SHYAM DAS Vs. UNION OF INDIA UOI

JUDGEMENT

(1.) This is an appeal under Section 37 (B) of the Arbitration and Conciliation Act, 1996, agatnst the order dated 17.4.2002 in Regular Suit No. 30 of 2001, Union of India v. Ghan Shyam Das passed by the District Judge, Lucknow.

(2.) I have heard the learned counsel for the parties and have gone through the record.

(3.) It appears that initially a tender was issued by the respondent inviting offers for supply of wooden planks and scuttling to the Inspector of Works Line in his store. The tender was opened on 12.4.1987 and the appellant's offer was accepted by the respondent at the cost of Rs. 62,800 vide letter dated 7.2.1988. The appellant was directed to commence the work immediately so as to complete the same within three months from 7.2.1988. The appellant could not complete the work and extension of time was granted several times. When upto 25.11.1988, the work could not be commenced, the Assistant Engineer (Northern Railway) informed through letter dated 25.11.1988 that the appellant has not commenced the supply despite the notices, therefore, the agreement was terminated in terms of Clause 62 (k) of the General Conditions of Contract, 1971. Since the respondents were entitled to invite fresh tender under the terms the conditions at the risk and costs of the appellant, therefore, fresh tender of supply of wooden planks and scuttling to Inspector of Works Line in his store under the Assistant Engineer-II Northern Railway, Lucknow, was floated. The appellant again offered the tender at the risk and costs of the appellant and ultimately, it was accepted by the respondent on 3.7.1990 at the approximate cost of the work Rs. 1,14,100. This letter is Annexure-5 to the counter-affidavit. In this letter a note was specifically indicated that the difference of cost, i.e., Rs. 51,300 (1,14,100-62,800) shall be recovered from the appellant. The work was to be completed within three months from 3.7.1990. The appellant accepted the letter and provided a F.D.R. dated 19.7.1990 for Rs. 2.900 as earnest money and signed the agreement on 23.7.1990. It was stipulated in this letter that the difference of cost of Rs. 51,300 will be recovered from the appellant. The copy of the agreement dated 23.7.1990 is Annexure-R-7 to the counter-affidavit. Again the contractor got the time extended upto 31.12.1990. The first bill was submitted on 16.10.1990 and the subsequent bill later on. The recovery was made from the different bills. It was for the first time after one year nine months on 3.9.1990 that the appellant referred the dispute with regard to the first agreement dated 22.4.1988. A copy of the representation dated 3.9.1990 is Annexure-R-8. This was rejected by the respondent. The final bill was submitted on 23.7.1991 and according to the terms, supplementary agreement was executed between the parties. After receipt of the final bill, the appellant submitted no claim certificate dated 4.10.1991 requesting therein to release the earnest money of Rs. 2,900. The earnest money was released with reference to the agreement dated 23.7.1990. A copy of the letter of the appellant dated 23.3.1991 is Annexure-R-11 to the counter-affidavit. The appellant filed a Writ Petition No. 735 of 1991 for mandamus directing the respondents not to recover the amount of Rs. 51,300 but this petition was dismissed. The appellant had also filed suit for appointment of the Arbitrator. It was decided on 21.1.1999. This order of the Civil Judge (Senior Division), Lucknow is Annexure-4 to the counter-affidavit. The learned Civil Judge directed the respondent to appoint an Arbitrator. The appellant also filed an application under Section 8 of the Arbitration Act, 1940, before the Civil Judge, Lucknow and the same was registered as Misc. Case No. 4 of 1992 praying therein to appoint an Arbitrator to whom the dispute existing between the parties may be referred for arbitration with respect to the two agreements but in compliance of the order of the Civil Judge, Lucknow dated 21.1.1999, Shri Mahipal Singh was appointed as sole Arbitrator and a reference was made through Annexure-R-12 annexed to the counter-affidavit along with the claim of the contractor, the claim of the Railway for Rs. 51,300 was also referred to the Arbitrator. Ultimately an award was given on 30.4.2001 (Annexure-7 to the first appeal). The Union of India, the respondent No. 1 filed an application under Section 34 of the Arbitration Act for setting aside the arbitral award dated 30.4,2001 which was decided by the impugned order dated 17.4.2001. It is against this order passed by the District Judge, Lucknow, the present appeal has been filed.