BASU AND CO Vs. BIHAR STATE ELECTRICITY BOARD

JUDGEMENT

(1.) - This is a defendant's appeal under Section 39 (1) (iv) of the Arbitration Act, 1940 (hereinafter referred to as 'the Act'), against a judgment dated 26th April, 1989, in title Suit No. 1/81/8/89 whereby the Subordinate Judge, Begusarai, has ordered the agreement to be filed under Section 20(2) of the Act and also appointed Shri Rohit Kumar Agrawal, Advocate, as a sole Arbitrator to arbitrate the dispute between the parties.

(2.) Before coming to the crucial contention of the parties, it would be appropriate to have a brief survey of some of the facts leading to this case. Admitted case of the parties is that the defendant (appellant)entered into an agreement with the plaintiff for transportation of two dismantled cranes from Patratu Thermal Power Station to Barauni Thermal Power Station and also for erection and commission at the latter's site on the terms and conditions as set out in the agreement. But in course of erection of the Gantry cranes, an accident took place on 20th March, 1977, resulting in complete damage to one of the cranes. According to the plaintiffs such incident took place due to negligence and carelessness of the defendants. Therefore, demand was made to make good of the loss in terms of clause 12 of the agreement vide letter dated 25th March, 1977, but in spite of that defendant failed to compensate the damage.

(3.) The defendants in response to the aforesaid letter of the plaintiff, denied the responsibility through letter dated 31st March, 1977, but in view of certain negotiations between the parties, the defendant agreed to do the rectification work of the damaged crane on payment of additional charges. However, after some time, the defendants stopped work on the ground that no payment was made by the plaintiff inspite of a reminder through letter dated 5th July, 1978.