SANJEEV KILLA Vs. UNION OF INDIA

JUDGEMENT

(1.) The Court: The petitioner/claimant has filed the instant application under sections 30 and 33 of the Arbitration Act, 1944 (hereinafter referred to as 'the Act') being A.P. No. 393 of 1998 praying for setting aside the award dated 28th February, 1998 passed by Sri A.K. Mukhopadhyay, sole Arbitrator in the matter of arbitration between M/s. Supply Emporium v. Union of India.

(2.) The award in question has been challenged by the petitioner/claimant principally on the ground that the learned Arbitrator misconducted himself by not following the price of the goods as agreed upon between the parties as recorded in the contract and thereby erred in law in passing the award. The petitioner/claimant alleges inter alia that either in the counter-statement of claim or at the time of hearing before the Arbitrator the respondent did not dispute about genuineness of the purchase orders or about the inspection certificate or about the delivery challan or about the quality or quantity of the goods delivered by the petitioner and the respondents all through admitted the liability towards the petitioner for the price of the goods sold and delivered. It was only the contention of the respondents that such payment would not be made according to the contractual rate but at the alleged marked rate. It is the grievance of the petitioner/claimant that although it is an admitted position that a contract has been admittedly entered into by and between the parties and there is no dispute with regard to the issuance of the purchase orders containing several terms therein, nevertheless, the learned Arbitrator misconducted himself by holding that it was the intention of the parties in the contract to purchase the goods at a very high rate. It is the contention of the petitioner/claimant that the learned Arbitrator had no jurisdiction to travel beyond the scope of the contract between the parties to assess the alleged market rate of the goods which was admittedly sold and delivered by the petitioner to the respondents in accordance with the agreed terms as contained in the said purchase orders. In the above circumstances the petitioner/claimant has assailed the award in question averring inter alia that the said award dated 28th February, 1998 is bad, perverse and against the settled principles of law governing the contract and the same is liable to be set aside.

(3.) In the affidavit-in-opposition filed on behalf of the respondents it has been alleged inter alia that the rates quoted in the tender are higher than the market rates or the reasonable price prevailing in the market. Certain special circumstances had arisen in the present case to verify the rates of the contractor and after verification of the rates it was found that the rates of the petitioner were not in accordance with the normal market rates or reasonable rates prevalent at that time. It has been further averred by the respondents in their affidavit-in-opposition that in their counter-claim the respondents have duly disclosed the circumstances under which payment of the bill has been kept in abeyance and the investigation reveals that the rates quoted in the purchase orders were abnormally high rates and that was done due to collusion between the contractor and the officials for which necessary actions have already been initiated.