Full Text
JUDGMENT
UNION OF INDIA &ORS Appellants L OC KJS\0 - ^
Through: MrJoydeep Mazumdar and Mr.Debojyoti Bhattacharya, Advs. for
Railways.
Through: Mr.Anil Goel, Adv.
•HTDGMENT
SANJIV KHANNA. J. (ORAL) r.M.No.l4414/2016 (delay in refilling—the—appeal)—and r:.M.No.l4410/2016 (delpy it' filinfy tlie appeal)
Delay of206 days in re-filing the appeal and 35days offiling the appeal is condoned as there is no opposition.
The applications are accordingly allowed.
, The petitioner in tliis intra-court appeal impugns order dated
12.02.2015 passed by the learned Single Judge allowing objections under Section 34 ofthe Arbitration and Conciliation Act, 1966. The impugned order sets aside the award passed of the sole Arbitrator dated 21 07.2012 for being contrary to the decision and judgment of the learned Single Judgedated 02.06.2011 in W.P.(C) No. 7289/2010
Kishan FreightForwardersvs. Union ofIndia &0,s. and connected matters and being perverse and therefore unsustainable. The
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2017:DHC:9045-DB respondent has been held entitled to refond ofRs.22,29.557/- along with interest @9% perannum.
2 It is anaccepted and admittedpositionthatthe respondentwa:awardedrightofleasingofparcelsvanswith carryingcapacityof[2] tonnesinVPUintminNo. 13040/39Ex.DelhitoHowrahforapenod ofthreeyearsfrom01.12.2007to30.11.2010.
3. Clause20.[1] oftheagreementrelatingto extensionofterm.and enhanced freight rate was as under:
4. The appellant, thereafter, had issued circular dated 28.03.2006 which had stipulated as under;- Extension ofLease: -ui^ nnlv in I Extension of lease is permissible only m case oflong term lease of3years.
2. In case ofLong Term Lease, on expiry of the contract period, the same extended only once, by 2 more years a lease rate of 25% more than lumpsum leasedfreight rate.
3 Such extension will be subject to satisfactory performance by the lease holder. Page 2 of[4] h without any penalty for overloading or violation ofany provision ofthe contract.
4. In case of expiry of contract period and non-finalization of new contract due to administrative delays, temporary extension can be permitted by the CCM only once,for a period of[3] months
5. The appellant had issued another circular dated 13.07.2010 holding that all old cases should be decided as per the earlier applicable lease policy of 2006 at the divisional level. The reasonwas that as per the revisedpolicy dated 09.02.2010, which was also known as Commercial Circular Policy No. 3/2010, the leased freight rate on renewal was enhanced.
6. Learned Arbitrator despite the specific term in the contract and judgment ofthe HighCourtmKishan Freight Forwarders (supra) accepted the plea and content of the appellant that revised rate in Freight-Marketing Circular No.3/2010 would apply. The reason was that the respondent had submitted security deposit of Rs.5.[5] lacs in the form of bank guarantee, which amountCalculated on the basis of the enhanced rate, as per the Freight-Marketing Circular No. 3/2010, and not in terms of the contract. Principle of estoppel was applied.
7. In the impugned order, holds that aforesaid reason given by the learned Arbitrator is perverse, observing that the respondent had always protested and objected to the enhanced freight rate being applied. The respondent had no option but to furnish bank guarantee or otherwise the renewal would not have been granted. The respondent had already filed OMP 164/2011 under Section 9 ofthe Act for restraining the appellant from FAO(OS) 121/2016 Page[3] of[4] 1/ charging the hi^er lease rental @ 35"/. i.e. as per Freight-Marketing CircularNo. 3/2010. This is factually accepted as correct. InthisOMP o. 164/2011,the following orderwas passedon 25.04.2011.- "According thepresentpetition is disposedofby directing that in case the petitioner continues to pay the charges as demanded by the respondent m Is communicated dated 15.12.2010. whereby the extensionfor two years was granted the petitioner shall be entitled to use the parcel vans aforesaid, subject to the petitioner complying with all other terms and conditions. The said payment shall be made by thepetitioner withoutprejudice to its right and contentions and subject to final determination by the arbitral tribunal. The arrears bepaidwithin two weeks. Dasti".
8. This being the position the Arbitrator had clearly erred without doubt in holding that the respondent had accepted the Freight- Marketing Circular No. 3/2010 because he had furnished bank guarantee as asecurity deposit, though the issue was akeady pending and subjudice in the High Court. The aforesaid reasoning of the Arbitrator is, therefore, contraryto all canons oflaw and perverse. In view ofthe aforesaid, we do not see any reason to interfere. The appeal is dismissed, with no orderto as to costs.
SANJIV UAY22,20Mlmr C.HARISHANISR,