DAMODAR SHAH Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is an application under Section 33 of the Indian Arbitration Act to determine the existence of an arbitration agreement.

(2.) THE petitioner is a contractor who submitted on 18-7-1952 a tender for the supply of sal and teakwood of twenty different specifications for the supply of which tenders were invited by the Directorate of Supply. THE Directorate of Supply purported to accept the tender submitted by the petitioner on 13-11-1952 and an acceptance note was issued on the same date. THE petitioner contends that there was no concluded contract on the so-called acceptance of tender on 13-11-1952, firstly because the tender was open to acceptance by the Directorate of Supply till 31-10-1952 and could not be accepted on 13-11-1952 and secondly, because the terms contained in the tender are different from the terms issued in the A/T dated 13-11-1952 and hence the parties were not "consensus ed idem". THE respondents contend that the A/T dated 13-11-1952 evidences a concluded contract and that the petitioner has committed a breach thereof and as such is liable in damages to the extent of Rs. 1,69,803/8/-. THE present notice has been taken out by the petitioner on 1-3-1954 to determine the existence of the arbitration agreement. THE arbitration agreement is the usual clause in all Government contracts.

(3.) THE first point urged by Mr. Subimal Roy, the learned counsel appearing for the petitioner, is that the tender submitted by the petitioner was open for acceptance till 31-10-1952 and the respondent was not entitled to accept the same beyond that date so as to effect a binding contract between the parties. THE tender submitted by the petitioner is Ex. 1. THE first page is a letter in printed form addressed by the contractor to the Director of Supply. THE letter opens with an offer and there are certain blanks intended to be filled up by the contractor. THE blank portion in the letter in which the date up-till which the tender was to be kept open for acceptance has not been filled up. THE annexed pages in type contains the subject matter of the contract, its terms and conditions and the answer to certain questions the contractor is required to give in that page it is expressly stated that the tender shall remain open for acceptance till 18-8-1952. I do not think that there is any substance in the argument of Mr. Kar that the fact that the contractor did not fill up the date in the first page of the tender shows that the contractor intended to keep the tender open for acceptance for an indefinite period. THE tender must be read as a whole containing the offer of the contractor and it has been expressly stated in the tender, though not in the first page, that the tender shall remain open for acceptance till 18-8-1952. By two subsequent letters the contractor at the request of the Government extended the date of acceptance till 31-10-1952. THEre is no further extension in writing, nor is there dependable oral evidence as to whether the Government wanted further extension and the contractor expressly granted such extension. THEre is, however, evidence that even after 31-10-1952 the Government treated the tender not to have lapsed and was still open to acceptance and the contractor's state of mind was the same. According to witness Neogy, the contractor was coming daily to the office to enquire whether the tender had been accepted, though it is not clear from his evidence whether the contractor came after 31-10-1952. THEre is however a letter by the Director of Supply dated 10-11-1952 asking the contractor to send his representative for discussion in connection with the tender. In his reply dated 13-11-1952 the contractor did not intimate that the date having expired the tender had lapsed and there was no point in further discussion. On the other hand he intimates his desire to meet the Director in his office the next day. More important are the letters of the contractor subsequent to the receipt of the A/T dated 13-11-1952. THEse letters clearly indicate that the contractor kept the tender open for acceptance even after the expiry of 31-10-1952. Further the contractor purported to supply goods against the A/T dated 13-11-1952. It is too late for the contractor now to contend that it was not open to acceptance beyond 31-10-1952. THE conduct of the contractor both before November 1952 and after clearly indicates that it was kept open by the contractor for acceptance by the Government till 13-11-1952.