JUDGMENT

MADON, J.:—These cross appeals by special leave arise out of execution proceedings adopted by Forasol, a French Company, having its principal office in Paris, France against the Oil and Natural Gas Commission, a statutory body incorporated under the Oil and Natural Gas Commission Act, 1959 (Act XLIII of 1959), hereinafter for the sake of brevity referred to as ONGC.

2. On July 30, 1962 the Government of India invited global tenders for structural drilling for exploration of oil in the Jaisalmer area of the State of Rajasthan. The tender of Forasol was accepted by the Government of India and in pursuance thereof a contract date February 17, 1964, headed "Structural Drilling Contract", was entered into between ONGC and Forasol. Under the said contract, ONGC engaged Forasol to carry out structural drilling in relation to the exploration for oil in the Jaisalmer area of the State of Rajasthan on the terms and conditions contained in the said contract. The said contract was for a period of one year commencing from the date of the start of the drilling work. The said contract also gave an option to ONGC to extend the period by one more year. Article IX-3 of the said contract deal