Full Text
FAO(OS) 298/2013
UNION OF INDIA Appellant
Through: Mr Anuj Agarwal, Adv.
Through: None
HON'BLE MR. JUSTICE VIBHU BAKHRU
03.09.2013 CM No. 9655/2013 Exemption is allowed subject to alljust exceptions.
CM No. 9656/2013 This isanapplication for condonation of delay inre-filing the appeal.
The delay in re-filing the appeal is condoned.
The application stands allowed.
FAO (OS) No. 298/2013 This appeal is directed against the order dated 05.10.2012 passed in OS (OS) No. 707/2007. The appellant has challenged the award dated 09.03.2007 before the learned Single Judge. The award was rendered under the provisions ofthe Arbitration Act, 1940. The only point urged before us by the learned counsel for the appellant is that the respondent had taken contradictory stand by virtue of two separate letters both dated 04.04.1998 and therefore the finding ofthe
2013:DHC:7379-DB arbitrator as also of the learned Single Judge that the DGS&D had made it impossible for Daisy Trading Corporation (the respondent therein) to complete the supplies by 30.06.1988 was not correct.
We have heard the learned counsel for the appellant. We find that this very aspect of the matter has been considered by the learned
Single Judge as would be apparent from the paragraphs 11,12,13,14 and 15 thereof The same are reproduced herein below:-
1988under Reference No. 044/88/126 by registered AD addressed to the DGS&D, DTC stated that since the
DGS&D's Inspector had failed to inspect the material within a reasonable time, "we treat your above A/T as cancelled without any financial repercussion on our side."
ORDER
12. Ms Sharma contended that the aforesaid two letters f dated 4"^ April 1988 of DTC were contradictory. She submitted that since DTC had terminated the contract even before the expiry of the supply period, the DGS&D was entitled to claim reimbursement of the costs and risk purchase which was thereafter undertaken by it. On its part, DGS&D also cancelled the contract by its letter dated 12"^ October 1988. Ms Sharma pointed out that prior thereto, a number of letters were written by DGS&D inviting DTC for meetings. However no effort was made by DTC to complete the supplies within the stipulated time.
13. The above submission has been considered. It is seen that the DGS&D did not respond to the first letter dated 4'"" April 1988 written by the North Zone Representative Officeof DTC asking for re-scheduling of the inspection. On the other hand on 27"^ April 1988 DGS&D responded to DTC's second letter dated 4^ April 1988 and stated: "cancellation of contract not possible repeat not possible." It was further stated that the Inspector QAE (Vehicle), Vikroli, Bombay and CQA (OFV)Jabalpurhad been instructedto expeditetesting of advance sample. By its letter dated 26^ May 1988, DTC informed the DGS&D that it was no longer interested in completing the supply because "your Inspector failed to attend our inspection call within reasonable time inspite of our repeated reminders to all concerned."
14. The learned Arbitrator has analysed the evidence on record as well as the relevant clauses of the contract. His conclusion that the DGS&D had made it impossible for DTC to complete its supplies within the period ending on 30'^' June 1988 was correct in light of thecorrespondence exchanged between the parties. It appears that there was a lack of coordination between the various departments and the DGS&D which brought about a situation where DTC could possibly not complete the supplies within the stipulated time. The learned Arbitrator also correctly ^ concluded that DGS&D provided good grounds to DTC to rescind the contract.
15. The learned Arbitrator has in the impugned Award referred to the fact that DTC had in fact rescinded the contract by writing a letter dated 4"" April 1988. The other letter dated 4^^ April 1988 by which North Zone Representative Office of DTC asked the DGS&D to reschedule the date of delivery by itself did not make much difference to the fact that DGS&D had made it £> impossible for the delivery of the supplies to be completed. Consequently, the learned Arbitrator was right in conclusion that the DGS&D had committed a breach ofthe contract and had no right for go in for risk purchase. The learned Arbitrator held that the demand of security from DTC by DGS&D disabled DTC from participating in the riskpurchase tender. Also, there were variations intheterms oftherisk purchase tender." On going through the above extract and the other portions of the impugned judgment, we find that the learned Single Judge has committedno error in arriving at the conclusion that the DGS&D had made it impossible for Daisy Trading Corporation to complete the supplies within the stipulated period. In any event, these are factual matters based on evidence which the learned arbitrator had considered and arrived at a specific finding. There is no occasion for us to interfere withthe impugned judgement. Consequently, the appeal is dismissed. There shall be no orders as to cost.
BADAR DURREZ AHMED, J VIBHU BAKHRU, J SEPTEMBER 03,2013 kb