National Coop. Consumer'S ... vs Union Of India (Uoi) Through Chief ...
2008 Latest Caselaw 121 Del

JUDGMENT

Pradeep Nandrajog, J.

1. The appellant is aggrieved by the order dated 6.2.1995 passed by the learned Addl. District Judge, Delhi allowing objections filed by UOI to the award dated 24.8.1983 published by Shri K.D. Singh, the learned Sole Arbitrator appointed by the Railway authorities.

2. The learned Arbitrator disallowed the claim for damages laid by Union of India by observing as under:

It has been argued on behalf of the respondents that they had submitted a quotation for supply of urad whole dal to APO against tender inquiry No. J-12027/1/88/Pur-III dated 7.6.1988. It was later on that they had agreed to supply 450 mts. of Urad whole @ 570 per quintal net FOR Bombay. Thereupon the claimants had put a condition unilaterally that the goods will be as per ASC Specification 192. It is evident that no sooner the respondent received aforesaid communication, they had protested vide their letter dated 4.7.1988. I have considered the arguments of both the parties in light of documentary evidence adduced and pleadings filed by both the parties. The claimant did not seem to prove that the respondent had agreed to supply the goods as per ASC specification No. 192. In light of the above, the claim of the claimant is disallowed.

3. Claimant was UOI. Respondent was the appellant before the Arbitrator.

4. Upsetting the finding recorded by the learned Arbitrator, vide impugned order dated 6.2.1995 learned Trial Judge has held as under:

The foremost ground pressed by the Union of India in support of their plea for setting aside the award of the sole arbitrator is that there exist an error of fact and law apparent on the face of the award because the arbitrator rejected the claim of the petitioner mainly on the ground that the petitioner did not decide that the respondents had agreed to supply the goods as per ASC specification No. 192. Learned Counsel for the petitioner Union of India emphatically urged before me that on the face of the available material on record, the petitioner had successfully proved that a valid contract had came into existence between the parties by which this respondent had agreed to supply 450 mt. Urad whole as per ASC specification 192 and, therefore, the finding returned by the arbitrator is wholly against the record. In support of this contention, the learned Counsel has invited my attention to a number of documents vis. invitation to tender dated 7th June 1988 issued by the petitioner. Offer of the respondent No. 1 dated 7.6.1988 annexure (D.18) of reply before the arbitrator. A/T. Telegram dated 28.6.1988 followed by registered AD, Acceptance letter dated 29.6.1988. On going through these documents it cannot be lost sight that the invitation to tender issued by the petitioner Union of India was for the supply of Whole-Urad as per ASC specification No. 192 and the offer made by the respondent was also for the supply of 450 MT. of Urad Whole as per ASC specification. The A/T. also finds mention of ASC specification. Not only this, the respondent No. 1 has in part performance of the said contract and according to the provisions of Clause 4 of the Contract furnished the security deposit in the form of bank guarantee dated 27.9.1988 and tendered part supply of 74.33 MT. of Urad Whole to the petitioner on 5.9.1988, which was rejected because it was not as per the ASC Specification stipulated in the contract. After that, respondent No. 1 requested for extension of delivery period up to Oct.1988 vide letter dated 8.8.1988 and the delivery period was extended by 10th Dec. 1988 with a specific direction that, if the respondent failed to deliver the stores, the contract will be cancelled. It is also not denied that the respondent failed to supply the contracted item within the extended delivery period and consequently the petitioner cancelled the contract at the risk and cost of the respondent vide their letter dated 25.1.1989.

6) On the face of the above factual position emerging from the material placed before the arbitrator it is to be seen as to whether the arbitrator was justified in taking a view that the claimants had not proved that the respondent had agreed to supply the goods as per ASC Specification 192 and rejecting their claim. It seems that the arbitrator has failed to look into the material documents brought on record and had gone wrong in relying upon the letter of the respondent dated 4.7.1988 only in holding that the petitioner failed to prove that the goods were to be supplied subject to ASC Specification 192. It appears that the arbitrator failed to appreciate that on accepting the offer of respondent No. 1 and issuing the A/T. to them for the supply, a valid contract had come into existence between the parties and, therefore, any subsequent document produced by the respondent was of no consequence. The contention of the respondent that they had not submitted the quotation of Urad Whole as against the tender enquiry No. J-12027/1/88/Pur-III dated 7.6.1988 or that it was at subsequent date that they had agreed to supply 450 Mts. Of Urad Whole @ 570 per quintal nett FOR. Bombay; and that the petitioner had put in a condition unilaterally about the supply of goods as per specification ASC 192 ought to have been repelled, on the face of the facts and circumstances obtaining on record. Even if the letter dated 4.7.1988 was to be taken on its face value, this at best would show that the respondent requested to the petitioner not to insist the supply of the goods as per ASC Specification. This would rather show that they having undertaken to supply the goods as per ASC Specification, subsequently wanted the concession from the side of the petitioner which was not agreed to by them. On the face of this position, the arbitrator was not at all justified in holding that ht petitioner had failed to prove that the respondent had agreed to supply of goods as per ASC Specification 192.

5. It is urged by learned Counsel for the appellant that it was not within the province of the learned Court to have re-appreciated the evidence and return a contra finding. It is further urged that even appreciation of the evidence by the court concerned is with material irregularity and the issue has not been discussed in the correct perspective. It is further urged that the letter dated 7.6.1988 (D-18) has been incorrectly treated as a letter of the appellant pertaining to supply of Urad whole dal.

6. It is further urged that minutes of a meeting dated 8.6.1988 (Annexure-C) have been totally ignored by the court concerned.

7. To appreciate the contention urged by learned Counsel for the appellant the minutes of the meeting dated 8.6.1988 become material and can be treated as the take off point for the purposes of the present adjudication.

8. The minutes record that pertaining to offers made by 5 parties to supply Dal Arhar, Chana, Moong Chilka and Moong Whole negotiations were held. there from, it is apparent that the tender enquiry was restricted to only aforesaid 4 dals and not to Urad whole. Counsel submitted that pursuant to the notice inviting tender, appellant submitted offer for supplying Arhar dal, Chana dal, Moong Chilka and Moong whole and no other dal.

9. Learned Trial Judge has noted that vide NIT dated 7.6.1988 U.O.I. had invited offer for supply of Urad Dal and that vide offer dated 7.6.1988, appellant had offered to supply Urad Dal.

10. The letter of offer stated to have been submitted by the appellant and in respect whereof the respondent claimed reliance before the learned Arbitrator is a letter allegedly sent by the appellant on 7.6.1988 recording that its offer to supply 450 Mts. of Urad whole confirmed the ASC specification 192.

11. Needless to state appellant denied the said letter. The respondent had to prove that the said letter of offer was that of the appellant.

12. The letter in question makes interesting reading. It reads as under:

Sir,

With reference to our offers against subject tender enquiry and negotiations held on 10.6.88, we hereby make the following order....

13. Indeed, argument of learned Counsel for the appellant merits consideration and acceptance that how could the letter dated 7.6.88 incorporate a reference to negotiations held on 10.6.1988.

14. It is further interesting to note that while captioning the subject of the letter, it refers to an offer dated 7.6.1988 allegedly opened on 8.6.1988.

15. Surprisingly, the learned Court concerned failed to appreciate that the element of creation in the letter in question was self evident.

16. Submission of the appellant that the tender enquiry relating to 4 dals resulted in tenders being opened and negotiations held on 8.6.88 resulting in department informing whether the offerers could even make an offer for Urad whole and pursuant thereto an offer was made by the appellant has been totally ignored by the learned Trial Judge.

17. The record of the arbitration shows that on 27.6.1988 appellant offered, apart from the dals in respect whereof offers were made pursuant to the NIT, to supply 450 mts. of Urad dal whole from Bombay. The said letter Ex. D-25 being the letter dated 27.6.1988 no where records that the dal would confirm to ASC specifications.

18. In response thereto, UOI sent a letter of acceptance dated 29.6.1988 recording accepting the offer but by stipulating that the offer as accepted could relate to Urad whole confirming to ASC Specification 192. On receipt of the letter of acceptance appellant wrote back on 4.7.1988 informing that the dal in respect whereof offer was made was the one imported from Thailand and offer related to said stock and none else.

19. UOI did not respond to the letter dated 4.7.1988. Thinking that its offer has been accepted pertaining to the stock of Urad dal lying with the appellant as imported from Thailand and lying stored at Bombay, appellant dispatched 74.33 mts. of Urad whole dal which was rejected by UOI on the ground that it did not confirm to ASC specification.

20. The conclusion drawn by the learned Judge that the delivery of the consignment evidences a concluded contract belied the knowledge of the basic fact in dispute, namely what was the offer which was accepted.

21. The learned Arbitrator has correctly come to the conclusion that the offer made by the appellant pertained to Urad whole dal lying in its stock and no document was shown that the appellant ever offered or accepted to supply Urad dal confirming to ASC specification 192.

22. It is apparent that the parties were not ad idem. It is apparent that the appellant thought that offer made by it was accepted and therefore appellant proceeded to dispatch 74.33 mts of Urad whole which was imported by the appellant from Thailand.

23. In any case, what stands out is that the original offer pertained to only 4 types of dal. The tender enquiry restricted itself to 4 categories of dal. Evidenced by the minutes of the meeting dated 8.6.1988, when tenders were opened, UOI evidenced a desire to purchase even Urad whole dal in respect whereof appellant made an offer vide its letter dated 27.8.1988. UOI's acceptance dated 29.6.1988 put a condition of acceptance. Thus, the said conditional acceptance has to be treated as a counter offer. On 4.7.1988 appellant wrote back that it would be prepared to supply Urad dal imported by the appellant from Thailand. There is no document on record to show that UOI refuted aforesaid letter dated 4.7.1988.

24. The learned court below has totally failed to appreciate that the alleged offer letter dated 7.6.1988 propounded by UOI was a created document on account of the inherent deficiencies noted hereinabove in paras 12 to 14 above pertaining to the said document.

25. The appeal succeeds. Impugned order dated 6.2.1995 is set aside.

26. The award is restored.

27. No costs.

28. TCR be returned.