AJANTA TUBES LIMITED v. UNION OF INDIA — 1995 DIGILAW 542 (DEL)

Devinder Gupta ( 1 ) K. P. Singh, Additional Legal Adviser to the Government of India, Ministry of Law, Justice and Company Affairs, New Delhi was appointed as the sole arbitrator by the Director General of Supplies and Disposals, New Delhi to adjudicate upon the disputes which had arisen amongst the parties. The arbitrator on 28. 10. 1992 made and published his award which was filed in this court. Notice of the filing of the award was served upon the respondent-objector on 25th November. 1994. Objections were filed on 3. 1. 1994. The court remained closed from 25th December, 1993 to 2nd January, 1994. There is an objection raised as regards limitation. According to the claimant, objections ought to have been filed on or before 24. 12. 1993 and, thus, the objections filed on 3. 1 1994 are beyond limitations. Learned counsel for the objector states that objections could be filed on or before 25. 12. 1993. The same filed on 3 1. 1994, taking into consideration the court s vacation from 25. 12. 1993 to2. 1. 1994, are within limitation. ( 2 ) THE objector has challenged the award on merits on a short ground. ( 3 ) THE main objection is that the arbitrator has misconducted in not appreciating the facts correctly. The Price Fall Clause (for short fpc ) in the rate contract has not correctly been appreciated and applied. According to the objector, the Price Fall Clause (for short fpc ) was attracted. During the pendency of the contract the price offered by the claimant to the U. P. Jal Nigam (for short upjn )for similar goods was much less than the price offered to the respondent through Director General of Supplies and Disposal rate contract. As such the respondent was entitled to his claim of Rs 5. 62. 815. 41 as against the claimant. ( 4 ) THE facts in brief are that a rate contract for the supply of G. I. pipes of various sizes from 15 mm to 150 mm in light, medium and heavy qualities was awarded to the claimant vvhen his quotation dated 26. 10. 1984 was accepted. 62. 815. 41 as against the claimant. ( 4 ) THE facts in brief are that a rate contract for the supply of G. I. pipes of various sizes from 15 mm to 150 mm in light, medium and heavy qualities was awarded to the claimant vvhen his quotation dated 26. 10. 1984 was accepted. There is no dispute that Clause 3 of rate contract provided the fpc which provided that if at any time the claimant reduces the sale price of the stores or sells such stock at price lower than the price chargeable under the contract for the stores supplied, after the date of coming into force of such reduction sale. In that eventuality the price under the contract shall correspondingly reduced. The rate contract was for the period from 1st September. 1985 to 31st August, 1986. It is not in dispute that the claimant on 26. 10. 1985 offered to sell certain stores to UPJN at a reduced price and on different terms and conditions which gave rise to dispute and to the applicability of fpc ( 5 ) ACCORDING to the claimant, the fpc was not attracted. In the event of offer to sell at a reduced rate. The fpc would have applied provided within that period supplies were actually made or stores were actually sold at a reduced price and not on a mere offer to sell. It is also not in dispute that the respondent through its letter dated 26. 11. 1985 sought the claimant s consent to incorporate and carry out amendment in the fpc . Claimant through its letter dated 14. 12. 1985 agreed to the amendment in the fpc and it was only on 21. 1. 1986 that the said fpc was substituted by a new fpc and as per the amended fpc words" offer to sell" were also included in the original clause. Under the new fpc , even an offer to sell on reduced rates was also made the basis for reduction of the price. The case of the claimant has been that after incorporation of the amendment in fpc no offer was ever made by it to sell stores at reduced rates and as such there has been no violation of fpc . According to the respondent, the amendment in fpc . carried out through letter dated 21. 1. The case of the claimant has been that after incorporation of the amendment in fpc no offer was ever made by it to sell stores at reduced rates and as such there has been no violation of fpc . According to the respondent, the amendment in fpc . carried out through letter dated 21. 1. 1986 relates back to the original period of contract from the first tender of 1985 to 31st August. 1986 and the amendment will relate back to the original period; therefore, on the basis of the admission made by the claimant that on 26th October, 1985 offer to sell was made to UPJN at a reduced price, the respondent was entitled to withhold an amount of Rs. 6,68,815. 40 and the claimant is not entitled to this amount which has been awarded in claimant s favour ( 6 ) LEARNED counsel for the respondent has vehemently urged that award of the arbitrator is vitiated. Arbitrator has wrongly held that amendment did not relate back to the original period or that it is not retrospective. According to the respondent objector, the claimant having accepted the amendment will be deemed to have also accepted any amendment being substituted for all intents and purposes from the date of award of the rate contract and any offer made to sell at reduced price even prior to 21. 1. 1986 wilt be subject to amended clause. ( 7 ) I have been taken through the entire record of the arbitration, including the award. I am not in agreement with the submissions made on behalf of the respondent-objector. The arbitrator has come to the conclusion that fpc came into force only on the date of issuance of the letter dated 21. 1. 1986, therefore, it has no effect on the claimant s making any offer prior to this date to UPJN. The arbitrator has also recorded a categorical finding that the offerwhich was made by the claimant to UPJN was not comparable to the stores supplied to the respondent under the rate contract. 1. 1986, therefore, it has no effect on the claimant s making any offer prior to this date to UPJN. The arbitrator has also recorded a categorical finding that the offerwhich was made by the claimant to UPJN was not comparable to the stores supplied to the respondent under the rate contract. It has been found that offer to sell by the claimant at a lower price to UPJN cannot be considered to be an offer of the goods of identical description- On comparison of the two terms and conditions, namely, offer to UPJN and to the respondent a finding is recorded that there is vast difference in the terms and conditions of the offer made to UPJN by the claimant vis-a-vis terms and conditions on which supply was to be made by the claimant to the respondent. In view of these findings recorded by the arbitrator, the objections filed by the respondent-objector are not such which can be said to be within the limited ambit of challenge admissible under the scheme of Arbitration Act. Under the law the arbitrator is made the final arbiter of disputes between the parties. The award is not open to challenge on the ground that the arbitrator has reached a wrong conclusion or has failed to appreciate facts. In the instant case the arbitrator has reached a conclusion that the offer, which was made by the claimant to sell the stores at reduced rate to UPJN was not comparable since such an offer was made on totally different terms and conditions which were not akin to the terms and conditions on which supplies were to be made to the respondent and since these were not of identical description, there was no question of the fpc operating in this case and, thus, respondents are not Justified in withholding the payment to the claimant. The arbitrator being the sole arbiter is entitled to take his own view of the matter and the court is not entitled to substitute its own view. The view which has been taken by the arbitrator that fpc , as amended, is not attracted in the instant case even if offer was made at a reduced price by the claimant prior to amendment is not only a possible view but the only view which can be taken on the admitted facts. The view which has been taken by the arbitrator that fpc , as amended, is not attracted in the instant case even if offer was made at a reduced price by the claimant prior to amendment is not only a possible view but the only view which can be taken on the admitted facts. The court will not be entitled to substitute the same view taken by the arbitrator is a possible view and cannot be said to be perverse. Thus, there is no error of law or misconduct on the part of the arbitrator due to which award can be said to be vitiated. Objections accordingty are liable to be dismissed and are hereby dismissed. ( 8 ) IN view of dismissal of the objections on merit, there is no need to record any finding as to whether the objections are or are not within the period of limitation. The award made by the arbitrator is made a rule of court. Decree in terms of the award is passed in favour of the claimant against the respondent. Claimant will also be entitled to interest @ 12% p. a. from the date of award till payment. Decree sheet be drawn in accordance with law. Award shall form part of the decree.