Union Of India Through Ministry Of ... vs Kalimata Ispat India (P) Ltd.
2014 Latest Caselaw 652 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

+                         FAO No.179/2012

%                                                   3rd February, 2014

UNION OF INDIA THROUGH MINISTRY OF RAILWAY ..... Appellant
                  Through: None.


                          versus


KALIMATA ISPAT INDIA (P) LTD.              ..... Respondent
                  Through: Ms. Ranny, Advocate.

CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?


VALMIKI J. MEHTA, J (ORAL)

1.           No one was present for the appellant on the first call. No one is

present for the appellant even on the second call although it is 2.30 P.M. I

have therefore heard the counsel for the respondent and after perusing the

record I am proceeding to decide the appeal.

2.           The present appeal has been filed under Section 37 of the

Arbitration & Conciliation Act, 1996 (hereinafter referred to as 'the Act')

for setting aside the impugned order dated 17.12.2011 which has dismissed



FAO No.179/2012                                                 Page 1 of 3
 the objections filed by the appellant under Section 34 of the Act and upheld

the Award dated 22.8.2006.

3.           The Award was passed with respect to the claim of the

respondent herein for MODVAT benefits which were specifically fixed in

the contract at Rs.2.74/- for each ERC Mark-III. The relevant observations

of the Arbitrator in this regard read as under:-

     "1.      There is a specific provision in the contract, that the
     MODVAT benefits as available on the inputs as on date of opening
     of the tender, which has been indicated as Rs.2.74 for each ERC
     Mark-III will be retained by the supplier.
     Though clarification was sought from Railway Board, no instruction
     was issued/action suggested for change in MODVAT Clause.
     Supplementary agreement was also not made.
     2.       Railway Board and the firm have not subsequently entered
     into contractual modification of the MODVAT clause.
     3.       Where a fixed amount has been indicated to be retained by
     the firm, downward variation of Excise Duty does not affect the
     fixed amount so indicated.
     4.      The Respondent shall release to the claimant the differential
     amount of MODVAT to be calculated by the Respondent as per
     award ruling under (1) to (3) above.
     5.      The claimant M/s. Kalimata Ispat Industries Pvt. Ltd. and
     the Respondent represented by General Manager, Eastern Railway,
     Kolkata shall pay 50% towards the arbitrators fee and expenditure
     towards clerkage, stationary and misc. expenses.
     6.       The payment should be made within four months failing
     which the interest @ 8% (eight percent) is to be paid to the party
     from the date of publication of this award."


FAO No.179/2012                                                 Page 2 of 3
 4.           I do not find any violation of law or the contract or perversity in

the Award of the Arbitrator for the objections to have been accepted. In

fact, Arbitrator has correctly proceeded by holding that the parties are bound

by the specific and categorical terms of the contract.        Respondent was

therefore held entitled to the MODVAT benefits.

5.           In view of the above, the appeal is without any merit and the

same is therefore dismissed, leaving the parties to bear their own costs.




FEBRUARY 03, 2014                             VALMIKI J. MEHTA, J.

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