R.N.TANDON Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is appeal under Section 37 of the Arbitration and Conciliation Act, 1996. The appellant is aggrieved by judgment and order dated 18th December 2007 passed by learned District Judge, Nagpur when he had set aside the Award of Arbitral Tribunal in respect of price escalation awarded to the contractor in the sum of Rs. 7,36,469/ - with interest @ 8% per annum.

(2.) IT is grievance of the appellant that respondent Union of India had awarded the work of construction of bridges between CH. 3550 meters to 8000 mtrs in Section III of Metpanjara -Kohli Section of Central Railway which included Earth Work also for tender value in the sum of Rs. 57,21,132/ -. The work was to be completed within nine months from the date of acceptance letter excluding monsoon period of four months from 15th June to 15th October and, therefore, total period for completion of contract was 13 months. On issuance of acceptance letter dated 23.1.1991, appellant undertook the aforesaid work. The contract agreement was signed on 25.9.1991 by the appellant and it was sent for signature of respondent at Mumbai, which was received back sometime in November 1991 January 1991.

(3.) LEARNED counsel for the appellant submitted that learned District Judge failed to consider this aspect before setting aside the award passed by the Arbiral Tribunal. Learned District Judge also erred to answer in the negative a question as to whether escalation is available in the agreement and whether interference is possible in the Award under Section 34 of the Act. Considering that three similar agreements were entered into by respondent with other similarly circumstanced three contractors in respect of adjoining Sections during the same contract period as that of the appellant, the Arbitral Tribunal could have exposed malafide action if any of the respondent by insisting upon evidence of the contracting persons when price variation clause appeared scored off in the contract. The dispute is, as to who scored off and who made the endorsement and whether Appellant had consented to it. Oral evidence insisted upon could have settled this vital controversy between the parties. That being so, impugned order passed by learned District Judge must be set aside in exercise of appellate jurisdiction.