Alpine Industries vs Union Of India And Anr.
1993 Latest Caselaw 60 Del

JUDGMENT

C.M. Nayar, J.

(1) This is a petition under Sections 14, 17 and 29 of the Arbitration Act, 1940, on behalf of the. petitioner M/s Alpine Industries, for directing respondent no.2 to file the award dated October 14, 1988, in this Court along with all the relevant record of the case and making the Award a Rule of the Court.

(2) The Brief facts of the case are that in response to a Tender Enquiry due for opening on November 18, 1986, the petitioner submitted a tender bearing No. 86-87/AI/DGS&D/1-RE/1609 dated November 3, 1986. The said tender of the petitioner was accepted by respondent no.1 Union of India, vide their advance acceptance of rate contract dated December Ii, 1986, which was followed by a formal rate contract No.DM-2/RC-1660/Mcthyldopa/86-87/52/COAD/202 dated December 1986/7th January, 1987, for the supply of drugs for the period 1st December, 1986, to November 30,1987.

(3) The disputes and differences arose between the parties and the matter was referred to the sole arbitration of respondent no.2. The respondent no.2 entered upon the reference and made the Award dated October 14, 1988.

(4) The Award was filed in Court. Respondent has Filed objections against the award under Sections 16,30 and 33 of the Arbitration Act. Petitioner filed reply to the objections.

(5) The following issues were framed on 16th November, 1990:

1. Whetherthe award is liable to be set aside for the reasons given in the application? Opp 2.Whether the objections are time barred ? Opp 3. Relief.

(6) I have heard learned counsel for the petitioner as well as for the respondent.

(7) The sole point, which arose for his consideration was, whether, the amount claimed by the petitioner, i.e.Rs.5,10,116.00 was validly withheld by the respondent No.1. The arbitrator came to the conclusion that the Union of India is not entitled to recover the amount on this account, in view of the fact that the drugs with expiry dates, would not be covered by the Fall Clause. The Fall Clause stipulated that the price charged for the stores supplied under the contract by the contractor shall in no event exceed the lowest prices at which the contractor sells the stores or offer to sell the stores of identical description to any persons/organisations including the purchaser or any department of Central Government or any Department, a State Government or any statutory undertaking the Central or State Government, as the case may be, during the period till performance of all supply orders placed during the currency of the rate contract is completed. The above stipulated clause however, was not to apply .to (a) Exports by the contractor, (b) Sale of goods as original equipment at prices lower than the prices charged for normal replacement; (c) sale of goods such as drugs which have expiry dates.

(8) Learned counsel for the petitioner has accordingly contended that the Fall Clause was not applicable in case of the drugs, which had expiry dates. Mr. E.X.Joseph, Learned counsel for the respondent Union of India, has not been able to point full any infirmity in the Award of to justify the non release of the amount of Rs.5,10,116.00 as held due, to the petitioner. There is no doubt that the Fall Clause would not apply to the drugs, which have expiry date,and the Arbitrator has correctly ordered the release of the amount to the petitioner.

(9) The petition is accordingly allowed. The Award dated October 14, 1988, is hereby made Rule of the Court and decree in terms of the Award is passed. The Award shall form part of the. decree. The petitioner shall also be entitled to interest at the rate of 12 per cent per annum from the date of the Award till actual payment. No order as' to costs.