STERLITE TECHNOLOGIES LIMITED Vs. ASTER PRIVATE LIMITED

JUDGEMENT

(1.) This application is filed by the petitioner under Sec. 11(5) and (6) of the Arbitration and Conciliation Act, 1996 (for short 'the Act of 1996') read with Scheme for Appointment of Arbitrator, 1996 to appoint the arbitrator on behalf of the respondent, to adjudicate the claims and disputes between the applicant and respondent.

(2.) The facts, in brief, as pleaded by the petitioner are as follows:

(3.) Counter affidavit is filed by the respondent denying the averments in the affidavit filed in support of the application stating that in pursuant to a tender floated by the Transmission Company of Nigeria PLC (for short 'TCN') for design, manufacture, supply, erection, testing and commissioning of all equipment and material for the construction of 132 KV DC Double Circuit Overhead Transmission Lines of approximately 120 kms from the existing Ganmo 330/132/33 Kv substation to the proposed Shonga 132/33 Kv Substation (Lot 7) and approximately 15 kms length from Oshogbo 132/33 Kv Substation to the proposed Ede 132/33 Kv ('Lot 8'), the respondent placed its bid for the same, which was awarded to the respondent by TCN. In pursuant thereto, the respondent executed two contracts on 10/1/2010 and 16/1/2010 for the work mentioned under Lots 7 and 8. As per the terms and conditions, the TCN had agreed to make 15% advance payment to the respondent in case of procuring off-shore material/equipment from the respondent's own suppliers. It was also agreed between the TCN and the respondent that a letter of credit shall be opened for the balance of 85% payment against such off-shore material/equipment. At the time of execution of contracts, TCN had not opened the letters of Credit in respect of Lots 7 and 8 and same was informed to the petitioner. That it was the primary understanding between the petitioner and the respondent that any agreement between them shall be subject to the Letters of Credit being opened by TCN for respondent's execution of the Nigerian Project and the respondent's confirmation to the petitioner to manufacture and supply the products. Though the petitioner is aware of the fact that unless and until TCN opened Letters of credit in favour of the respondent, it would not require the products at all, the petitioner insisted the respondent for issuance of subject purchase orders, which were issued accordingly on 19/8/2011 only to facilitate procurement of aluminium and also to avoid any RBI related issues, as such, there is no basis for the claims raised by the petitioner against the respondent. It is also stated that though the petitioner raised a Debit Note on 21/11/2012, for an amount of Rs.4,63,03,547.00, but, by the time the said claim was made against the respondent through legal notices dtd. 23/5/2013 and 14/10/2013 and the present application, the claim got reduced to an amount of Rs.4,27,78,528.00, which is neither explained nor justified. The petitioner failed to prove that the aluminium was purchased or ordered for consequent to the instruction of the respondent and that no document is filed by him to show that it had bought the aluminium and if bought, whether the same is in its possession or not, as such, the claim of the petitioner is false and sought for dismissal of the application.