Delhi High Court
Oceanic Dehydrates Pvt. Ltd. vs Union Of India (Uoi) And Anr. on 16 March, 2007
Author: S K Kaul
Bench: S K Kaul
JUDGMENT
Sanjay Kishan Kaul, J.
IA No. 6295/2004 (Objections on behalf of the Petitioner)
IA No. 6296/2004 (Objections on behalf of the Respondent)
1. The petitioner was awarded a contract for supply of de-hydrated onion of various quantities on 06.11.1982. The delivery of goods was made. There is no dispute about the quality of goods or the payment to be made under the present contract. Respondent No. 1, however, detained the payments against other contracts. The balance amount has been subsequently released to the petitioner, but the amounts have been detained as security against what is alleged to be due from the petitioner to respondent No. 1 under different contracts.
2. The aforesaid dispute was referred to arbitration and the sole arbitrator Sh. K.D. Singh has made and published his award dated 30.07.1993. Apparently the disputes relating to the other two contracts in respect of which the amounts had been detained were also referred to Sh. K.D. Singh. The other two awards have also been made and published on the said date. The objections against those awards are stated to be still pending before the competent court.
3. A perusal of the award shows what the Sole Arbitrator Sh. Singh has awarded is the balance amount after taking into consideration the other two awards rendered by him.
4. The submission of the learned Counsel for the petitioner is that such adjustment could not have been made though he does not dispute that in terms of the Clauses under the contract the amounts could have been detained till the award was made in respect of two other contracts.
5. On the other hand, the grievance of the learned Counsel for the respondent is that they have filed objections in respect of the award as larger amounts are due and payable from the petitioner than what was awarded by the Arbitrator under the two other contracts.
6. In my considered view it is obvious on a consideration of the aforesaid that the power did exist in the arbitrator to consider the aspect of the respondent detaining the amount against the other contracts till the awards were made in those contracts in view of the admitted clause in the contract to that effect. The relevant Clause 18A is as under:
18-A LIEN IN RESPECT OF CLAIMS IN OTHER CONTRACTS
Any sum of money due and payable to the contractor (including the security deposit returnable to him) under the contract may be withheld or retained by way of lien by the purchaser or Government or any other person or persons contracting through the Secretary against any claim of the purchaser or Government or such other person or persons in respect of payment of a sum of money arising out of under any other contract made by the contractor with the purchaser or Government or with such other person or persons.
It is an agreed term of the contract that the sum of money so withheld or retained under this clause by the purchaser or Government will be kept withheld or retained as such by the purchaser or Government or till his claim arising out of in the same contract or any other contract is either mutually settled or determined by arbitrator, if the contract is governed by arbitration clause or by the competent court under Clause 20 hereinafter provided, as the case may be, and that the contractor shall have no claim for interest or damages whatsoever on this account or on any other ground in respect of any sum of money withheld or retained under this clause and duly notified as such to the contractor.
7. No doubt both the parties would have the right to contest those two awards and the further amounts payable by one party or the other would depend upon the fate of those proceedings. There is thus no infirmity in the present award giving the balance amount to the petitioner ofRs. 35,884.98/-. There is no other objection pressed.
8. Both the applications are dismissed.
CS (OS) No. 2077/1993
1. The award of the sole arbitrator Sh. K.D. Singh dated 30.07.1993 is made rule of the Court. The amount becomes payable on the date of the award since the other two awards are also made on the same date. I consider it appropriate to grant interest at 12 per cent per annum from the date of award till date of payment on the said principal amount.
2. Parties are left to bear their own costs.
3. Decree sheet be drawn up accordingly.
