BATLIBOI LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) Parties entered into two contracts for supply of two sets of machines for production of arms by the ordnance factory of the Onion of India. The first contract stipulated supply of five machines and the second one was for supply of 11 machines. The contracts stipulated a particular period within which delivery was to be made in both cases. There had been admitted delay in supply. The contracts also stipulated payment of exercise duty as well as Sales Tax by the purchaser 'at the time of delivery'. It also stipulated payment of liquidated damages to the extent of 5 per cent on the outer limit on account of delay in supply.

(2.) The supplier could not supply within the stipulated period in either of the cases. They prayed for extension of time which was granted by the Union of India. Union of India, however, had put conditions to the extent that they would be entitled to recover damages in terms of the contract. For such delay they would also be not liable to pay any additional duty towards the sales tax or exercise. After supplies were made, claimant raised their bills. Union of India paid them in both the cases as well as deducting the additional duty they had to bear on account of sales tax and exercise. Claimant raised protests. Ultimately, matter was referred to arbitration. The Arbitrator after giving hearing both sides, published bis award. The award of the Arbitrator has been challenged by both the parties being Union of India as well as the claimant.

(3.) Both the applications for setting aside were heard analogously by me yesterday, i.e. April 12, 2005 and today, i.e. April 13, 2005. These two applications are disposed of by this common judgment and order.