NEO METALIKS LIMITED Vs. ORRISA METALIKS PRIVATE LIMITED

JUDGEMENT

(1.) This is an application under Sec. 34 of the Arbitration and Conciliation Act, 1996 filed by the petitioner challenging the Award passed by the Learned Sole Arbitrator dtd. 16/10/2023 wherein the Statement of Claim of the petitioner was rejected but held that the petitioner will be entitled to adjustment of Rs.4,49,55,000.00 paid to the respondent on 30/4/2022 being the 10% of the total contract price of the goods from the compensation payable to the respondent and the Counter Claim of the respondent was allowed in part directing the petitioner to pay a sum of Rs.1,57,95,372.00 as compensation after adjustment of the amount of Rs.4,49,55,000.00 with interest at the rate of 18% per annum from 25/4/2022 till the date of realization to the respondent. The Learned Sole Arbitrator also directed the petitioner to pay a sum of Rs.52,43,696.00 as cost to the respondent with interest at the rate of 18% per annum from the date of Award.

(2.) As per agreement entered between the petitioner and the respondent dtd. 22/2/2022, the respondent agreed to sell and the petitioner agreed to purchase 10,000 MT of Lam Coke of the specification mentioned in the contract. The petitioner in discharge of its obligation as per the contract has paid Rs.4,49,55,000.00 to the respondent being the 10% of the contract amount on 22/2/2022. The balance consideration was to be paid by the petitioner by opening a required Letter of Credit seven days prior to arrival of the vessel and the said Letter of Credit would be in a mutually agreed format from a First Class Bank.

(3.) The petitioner by an email dtd. 1/4/2022, requested the respondent to share the format of the proposed Letter of Credit and on 8/4/2022, the respondent forwarded a format of the Letter of Credit to the petitioner. On receipt of format of Letter of Credit, the petitioner had sent an email dtd. 9/4/2022 suggesting track changes to the format of Letter of Credit. On 9/4/2022 and 13/4/2022, the petitioner sent reminders to the respondent requesting confirmation of the draft Letter of Credit.