UNION OF INDIA Vs. BABULAL GUPTA

JUDGEMENT

(1.) This civil misc. appeal under Section 39(1)(iv) of the Arbitration Act, 1940 (hereinafter "the Act of 1940") has been filed against the order dated 16.08.1999, passed by the learned Additional District and Sessions Judge, Kishangarh, Ajmer dismissing the appellant-non-claimant-railway's application under Section 30 of the Act of 1940 against the award dated 29.12.1997, passed by the Co-Arbitrators.

(2.) The facts of the case are that the appellant-nonclaimant-Railway (hereinafter "the non-claimant-railway") and the respondent-claimant Babulal Gupta (hereinafter "the claimant"), now deceased and represented by his LRs, entered into a contract for supply and loading of 50 mm gauge of 15,000 cum. Stone ballast at Nangal -Degrota siding No.2 on Rewari - Sadulpur section under agreement No.128/W/RE/B/NMH/Siding- 2/81 dated 24.10.1981. Disputes having arisen between the parties, in terms of the arbitration clause under the agreement dated 24.10.1981, the Deputy Chief Engineer/Const., Northern Railway, Shivaji Bridge, New Delhi and the Deputy Financial Advisor - II Northern Railway, Baroda House, New Delhi were appointed as Co-Arbitrators to settle the disputes under the contract. The two Arbitrators with reference to the terms of the governing arbitration clause proceeded to appoint the Deputy Chief Engineer/Const., Northern Railway, Ghaziabad as an Umpire. The parties to the arbitration submitted their claims and counter-claims. The Arbitrators proceeded with active participation of the parties setting up their respective cases as per agreed procedure. Time was also extended by consent of the parties for making and publishing the award upto 31.12.1997. Thereafter on consideration of the statements of the parties, their respective evidences, taking into consideration the technical aspects of the contract, perusing all materials, papers, documents and hearing the contesting parties, the award was passed on 29.12.1997.

(3.) In the award, the Arbitrators noted that the acceptance letter for the contract work was issued on 30.09.1981. The completion period of the work was 18 months and the stipulated date of completion as per agreement 29.03.1983. As per agreement, the claimant was required to supply 2500 cum of stone ballast within time provided for. However, the plots where the ballasts were to be supplied and stoned prior to use could not be made available by the Railway Administration to the claimant owing to certain disputes between the concerning village panchayat and the Railway Administration with regard to the said plots. The claimant consequently could not supply the required quantity of ballast in the time provided under the contract for reasons not attributable to any breach or default on his part. The railway on its part apparently taking into consideration the fact that the claimant had not been able to make the supply within the period provided under the contract for its own fault to identify and clearly demarcate the place where the ballasts were to be supplied, did not issue any notice to the claimant-contractor. Yet certain payment due and outstanding to the contractor-claimant were withheld by the Railway. In these circumstances, the contractor-claimant invoked the arbitrator clause and laid claim for refund of security deposit, refund of penalty illegally imposed, refund of earnest money, payment for the price of ballast to an extent of Rs.35,510/-, damages for washed away ballast, royalty charges, damages resulting from idleness of staff, damages, loss of advances to the labour, loss of advance towards cartage, loss of profit, 24% p.a. interest on the amount found due as also towards recovery of cost of arbitration.