Delhi High Court
M/S. Orissa Oil Industries Ltd. vs Tribal Co-Operative Marketing ... on 26 October, 2009
Author: Manmohan
#7
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ O.M.P. 232/2004
M/S. ORISSA OIL
INDUSTRIES LTD. ..... Petitioner
Through Mr. Praveen Marahatta, Advocate
versus
TRIBAL CO-OPERATIVE MARKETING
DEVELOPMENT FEDERATION OF INDIA
LIMITED ..... Respondent
Through Mr. Alakh Kumar, Advocate
Date of Decision : 26th October, 2009
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
1. Whether the Reporters of local papers may be allowed to see the judgment?
2. To be referred to the Reporter or not? Yes
3. Whether the judgment should be reported in the Digest? Yes
JUDGMENT
MANMOHAN, J (Oral)
1. With consent of the parties, matter is taken up for final disposal.
2. In fact, the present objection petition has been filed under
Section 34 of Arbitration and Conciliation Act, 1996 challenging the
Award dated 31st March, 2004 passed by Mr. N.L. Kakkar, learned
Sole Arbitrator.
3. Briefly stated the facts of the present case are that petitioner, a
company under liquidation, had entered into an agreement dated 15th
April, 1994 with respondent, a national level apex corporation
federation, for storage and processing of various Minor Forest
Products (hereinafter referred to as "MFP"). The dispute in the
present case pertains to non-return of 4160 metric tons of Mahua
Seed, even though the same had been handed over by respondent to
petitioner for storage and processing.
4. Mr. Praveen Marahatta, learned counsel for petitioner submitted
that the impugned Award was an unreasoned one and further that
since the respondent itself had breached the contract, it was not
entitled to any award of money.
5. On the other hand, Mr. Alakh Kumar, learned counsel for
respondent submitted that the impugned Award is a reasoned one. He
further submitted that the dispute between the parties arose because
petitioner wanted to hand over processed oil to M/s. Utkal Forest
Products Ltd. instead of returning it back to the respondent's nominee.
6. Having heard the parties and on a perusal of the Award, I find
that the learned Arbitrator has given short intelligible reasons in
support of the conclusion that he has arrived at. The finding rendered
by the learned Arbitrator is reproduced hereinbelow :-
"Findings:
Considering the facts and circumstances of the matter and the
documents placed before the Tribunal, it is evident that
Claimant and Respondent entered into an Agreement dated
15/4/94 for the storage and processing of the various MFP
items. Admittedly, the Claimant had given 4160 MTs
(approx.) of Mahua Seed to the Respondent for storage and
processing and the Respondent was liable to perform, fulfil
and observe all the obligations of the Agreement with regard
to storage and processing of the stocks of the Claimant. The
Agreement dated 15/4/94 pertained to various MFP items but
I am concerned with only one commodity i.e. Mahua Oil in
this matter.
As per Clause 11 of the Agreement dated 15/4/94, TRIFED is
the exclusive owner of the stock stored with the Respondent
and as per the Agreement the Respondent was liable to give
the delivery of the stocks including Oil and DOC to the
Claimant or a buyer nominated by TRIFED. But, in the
instant case, the Respondent did not effect the delivery to the
buyer of the Claimant. As a result, the buyer's tankers had to
be returned empty from the factory of the Respondent.
However, the same confirmation was well within the
knowledge of the Respondent. In connection with the non-
delivery of Mahua Oil from the factory of the Respondent, the
Claimant had written various letters to Shri J.P. Lath, the
then Director of the Respondent. The non-delivery of the
Mahua Oil by the Respondent to the Claimant's buyer is a
breach of contractual obligation on the part of the
Respondent. The Claimant has proved the loss claimed by
him. There is no breach on the part of the Claimant in
respect to payment of the godown charges and processing
charges and interest thereon to the Respondent. The
Claimant is not responsible to pay idle charges to the
factories of the Respondent. The Respondent has failed to
fulfil their contractual obligation in accordance with the
Agreement entered into between the Claimant and the
Respondent. The Respondent could not produce the evidence
in support of their counter claim and they also could not
prove their counter claim. Therefore, the counter claim of
Respondent is rejected in toto. The Respondent could not
place the documents before the Tribunal in respect to denying
the claim of the Claimant."
7. It is settled law that an arbitrator is not expected to write a
judgment like a Court of law. Moreover, sufficiency of reasons
cannot be gone into by the Court. A Division Bench of this Court in
College of Vocational Studies Vs. S.S. Jaitely reported in AIR 1987
DELHI 134 has held as under :-
(18)..... When the arbitrator is required to give reasons, it is
not for the Courts to see the reasonableness of the reasons
given by the arbitrator or sufficiency of the reasons. However,
what reasons are required it depends upon the facts of each
case.
(19)......By reasons it means that the award should be
speaking one. In the reasoned award what is expected from
the arbitrator is that he should indicate his mind whereby it
can be ascertained as to how he has arrived at a particular
conclusion. In case of reasoned award, the arbitrator is
required to indicate the trend of his thought process but not
his mental meanderings, the purpose of commercial
arbitration, being speedy certainly and a cheaper remedy.
When the finding of the arbitrator is based on no evidence,
then certainly the Court can go into such finding and set aside
such an award as being perverse. The arbitrator is entitled to
decide rightly or wrongly but if an error of law appears on the
face of the award, then the Court can interfere and set aside
the award."
8. In the present case, I find that the learned Arbitrator has spoken
his mind and he is clear as to how he acted and why he acted in that
manner. (See Indian Oil Corporation Ltd. Vs. Indian Carbon Ltd.
reported in AIR 1988 SC 1340). Consequently, I am of the view that
the impugned Award is a reasoned one.
9. As far as the argument that respondent had committed breach of
contract is concerned, I am of the view that I am not an appellate court
and I cannot re-examine the case. Since admittedly, learned
Arbitrator has not acted contrary to provisions of the contract or to
any statutory law and further that the impugned Award is neither
perverse nor opposed to the public policy, I deem it appropriate not to
re-examine the controversy on merits between the parties.
10. Consequently, present petition being devoid of merits is
dismissed but with no order as to costs.
OCTOBER 26, 2009 MANMOHAN,J
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