UNION OF INDIA Vs. AMERICAN STORES

JUDGEMENT

(1.) IN November 1947 the Government of INdia invited tenders for the purchase of certain American surplus foodstuffs which were lying at three depots viz. Northbrook Depot, Lybion Depot and Gangalbuoy Depot. The American Stores, a partnership firm, offered Rs. 4,17,000/15/3 for the entire stock on the basis of certain valuations and calculations and this tender was accepted by the Government on the 22nd of December, 1047. Possession of the stock was delivered to the firm in due course. The firm removed certain quantities of these goods, but then the Medical Authorities. Calcutta, intervened and declared certain stores to be unfit for human consumption. Thereupon disputes arose between the purchasers and 'the Government and the parties by document dated the 6th of July, 1950 entered into an arbitration agreement. Under the agreement the Government appointed Bakhshi Shiv Singh and the firm appoint' ed Raizada Narsingh Das Bali as arbitrators. The latter, however, refused to act and INdar Singh was appointed an arbitrator in his place by the firm. Proceedings were taken by the arbitrators and the firm claimed Rs. 6,13,817 as damages. The arbitrators failed to agree and the case was forwarded on the 24th of September, 1951 to Diwan Hukam Chand a retired Magistrate, who had been previously appointed as an umpire by the arbitrators. Thereafter the Government counter-claimed rent for godowns and for this claim Diwan HuKam Chand was appointed as the sole arbitrator by the parties. The umpire entered into reference on both the matters and decided the disputes by separate awards given on the 28th of August 1952. The umpire awarded Rs. 6,05,215 to the American Stores and rejected the counter-claim of the Government. The umpire sent an intimation of the awards to the counsel for both parties. It is not necessary to refer to the proceedings relating to the Government's counter-claim as it is not before me and the Government has not filed an appeal against the order of the trial Court making that award a rule of the Court which allowed costs to the firm.

(2.) ON the 14th of October, 1952, the American Stores made an application in Court under Section 14 of the Arbitration Act for a direction to the umpire to file the award in Court with all the documents and record of proceedings and thereafter to make it a rule of the Court. After the award etc. had been filed in Court, the Government filed objections to the award inter alia on the grounds that (1) the umpire was guilty of misconduct as he had been approached by the claimants, (2) the umpire had not produced the real award in Court which he had already sent to the Government, and (3) in any case the award is against law on the face of it. The other objections raised by the Government before the trial Court were not pressed and were also ignored in this Court. The trial Court" overruled all these objections and ordered the award to be made a rule of the Court. The Government has filed' this appeal in this Court to, get the award set aside.

(3.) NOW, the covering letter recites the fact that he had been appointed an umpire in one " case and the sole arbitrator in Government's counter-claim and gives the amounts that he had awarded to the firm. The letter then proceeds to say.