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1989 DIGILAW 258 (DEL)

MUKAND IRON AND STIL WORKS LIMITED v. UNION OF INDIA

1989-07-18

H.C.GOEL

body1989
A. C. Goel ( 1 ) THIS is a petition by M/s. Mukund Iron and Steel Works Ltd. , petitioner, against the Union of India-respondent, under Section 20 of the Arbitration Act seeking reference of the disputes as stated in the petition alleged to have arisen between the parties out of the contract entered into between the parties by A/t No. SDP-3/107/ 93/5409/16. 12. 75/paob/022 dated 23. 2. 1977. The petitioner installed three cranes at the premises of the respondents in accordance with the terms of the contract on 10. 9. 1978, 5. 11. 1978 and 30. 11. 78. The allegations of the petitioner are that the respondents were bound to issue inspection notes in respect of the installation of the cranes soon thereafter. Respondents, however, issued the inspection notes with regard to installation of said three cranes after considerable delay of time i. e. , on 9. 4. 1979. Because of this delay in the issuance of inspection notes, the petitioner became entitled to recover compensation to the extent of Rs. 16,60,000 as detailed in Annexure P-8 to the petition. The further allegations of the petitioner are that some other disputes have arisen out of the same contract which were referred to arbitration. In that reference the Arbitrator had been appointed on 6. 8. 1982. The petitioner had filed a claim seeking the recovery of Rs. 10,60,000 as compensation for use of the cranes by the respondent before the Arbitrator. The petitoner company, however, realising that the claim of Rs. 16,60,000 was not specifically covered by the reference, requested the Director General of Supplies and Disposals vide letter dated 4. 11. 1982 to refer that claim for arbitration to the same Arbitrator. No reply was however, received to this request of the petitioner. The petitioner company made an application to the Arbitrator on 10. 2. 1988 stating that as the aforesaid claim was not specifically covered by the reference, they were dropping that claim from those proceedings. 11. 1982 to refer that claim for arbitration to the same Arbitrator. No reply was however, received to this request of the petitioner. The petitioner company made an application to the Arbitrator on 10. 2. 1988 stating that as the aforesaid claim was not specifically covered by the reference, they were dropping that claim from those proceedings. It is further stated in this application that disputes have arisen in connection with the aforesaid contract as the respondent-Union of India had the benefit of the use of three cranes supplied to them under the contract of the period ranging between 4 to 7 months because of the delay in issuing the final inspection notes and that use was not intended by the parties, and therefore, the respondents are liable to pay compensation to the petitioner company which according to the petitioners works out to be Rs. 16,60,000 as detailed in Annexure P-8 to the petition. It is stated in the petition that cause of action for the present petition arose in November 1982 when the petitioner made a request of the appointment of Arbitrator. It again arose on several dates when reminders were issued by the petitioner for the appointment of the Arbitrator, but the respondent failed to do that. ( 2 ) THE petition has been contested by the respondents. On the pleadings of the parties the following issues were framed : 1. Whether the dispute regarding claim of Rs. 16,60,000 as compensation for use of cranes is covered under the arbitration agreement between the parties ? 2. If the above issue is held in favour of the petitioner, would reference be barred under Order 2, Rule 2 of the Code of Civil Procedure or principles analogous thereto ? ( 3 ) IF the above two issues are held in favour of the petitioner, is there any sufficient cause for not referring the disputes to arbitrator ? 4. Relief. Additional Issue : Whether the present petition is within limitation ? 4. The petitioner, in support of the petition, filed an affidavit of Shri Amrit Bhardwaj, Branch Manager of the petitioner company, and got the documents Ext. P-l to P-8 proved on the record. The respondents also filed an affidavit of one Shri V. P. Gupta, Deputy Director of Supplies, D. G. S. and D. The petitioner in its rebuttal evidence filed another affidavit of Shri Amrit Bhardwaj. P-l to P-8 proved on the record. The respondents also filed an affidavit of one Shri V. P. Gupta, Deputy Director of Supplies, D. G. S. and D. The petitioner in its rebuttal evidence filed another affidavit of Shri Amrit Bhardwaj. ( 4 ) ON the plea of the respondents that the claim in question seeking the recovery of Rs. 16,60,000 does not arise out of the contract in question and it does not relate to the contract in any manner, this issue was framed. The burden of this issue is obviously on the petitioner. The petitioner company has not filed a copy of the contract that was entered into between the parties and out of which the claim is alleged to have arisen. I fail to see as to how in the absence of the terms of the contract being made available by placing a copy of the contract on the record it is possible for the Court to find out if the claim in question relates to or arises out of the contract. It may also be stated here that from the averments as made in the petition read with the relevant annexure P-8, which is the entire material on the record to know as to what is this claim of the petitioner, it is not clear as to what exactly is the claim in question. All that is stated in para 10 of the petition, which is the relevant para on this issue, is that the respondents U. O. I. had the benefit of the use of the three cranes supplied to them under the contract for a period ranging from 4 to 7 months because of the delay in issuing the final inspection notes and that was not intended to be gratituous, and, therefore, they are liable to pay compensation to the petitioner which works out to Rs. 16,60,000 as shown in the work sheet Annexure P-8. From these averments it cannot be understood if the case of the petitioner is that these cranes were supplied over and above which had to be supplied by the petitioner in terms of the contract and for that reason the petitioner is seeking compensation or that the possession of these cranes by the respondent was for any period over and above the one to which the respondent was entitled as per the Items of the contract. The averments in question are cryptic and un-intelligible. In any case the burden of this issue was on the petitioner which the petitioner has failed to discharge. The issue is accordingly held against the petitioner. ( 5 ) AS a result of my finding on issue No. 1 the petition is liable to be dismissed. That being so, I need not record my finding on any other issue. Relief. ( 6 ) AS a result of my finding on issue No. 1 the petition is dismissed with costs.