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SUPREME COURT OF INDIA
ROHINTON FALI NARIMAN, K.M. JOSEPH, JJ.
Anglo American Metallurgical Coal Pty Ltd. – Appellant
Versus
MMTC Ltd. – Respondent
Civil Appeal No. 4083 of 2020, Special Leave Petition (Civil) No. 11431 of 2020
Decided On : 17-12-2020
Arbitration and Conciliation Act, 1996 - Section 34 and 37 - Contract - Mining operations - Disputes arose between Appellant and Respondent as to shipments or “stems” that were to be covered by Fifth Delivery Period, which ranged from parties mutually extending this period - A number of emails and letters were exchanged between parties which were examined in detail by a panel of arbitrators consisting of Mr. Peter Leaver (Queen’s Counsel), Justice V.K. Gupta (Retd.) and Mr. Anthony Houghton (Senior Counsel) [“Arbitral Tribunal”] who sat at New Delhi and delivered their international arbitral award in New Delhi - It may be stated at the outset that the award is a majority award of Mr. Peter Leaver and Mr. Anthony Houghton [“Majority Award”] in favour of Claimant, being Appellant before us, a dissenting award being delivered by Justice V.K. Gupta [“Dissenting Award”] in which the claim of Appellant was dismissed in its entirety – Held, In South East Asia Marine Engg. & Constructions Ltd. (SEAMEC LTD.) vs. Oil India Ltd. (2020) 5 SCC 164, a three Judge Bench of this Court referred to judgment of this Court in Dyna Technologies (supra) and found that interpretation of arbitral tribunal in expanding the meaning of clause 23 of contract to include a change in rate of high-speed diesel, not being even a possible interpretation of concerned contract, the High Court in setting aside award, could not be said to be incorrect - Also, other contractual terms when seen together with this interpretation would also render such finding perverse - All aforesaid judgments are judgments which, on their facts, have been decided in a particular way after applying tests laid down in Associate Builders (supra) and its progeny- All these judgments turn on their own facts - None of them can have any application to the case before Court, as it has been found by us that in the fact situation which arises in present case, Majority Award is certainly a possible view of case, given the entirety of correspondence between parties and thus, cannot in any manner, be characterised as perverse - appeal stands allowed.
JUDGMENT :
ROHINTON FALI NARIMAN, J.
1. Leave granted.
2. This appeal is at the instance of an Australian company, Anglo American Metallurgical Coal Pty. Ltd. [“Appellant”] which produces and exports certain types of coal. By a Long Term Agreement dated 07.03.2007 [“LTA”] between the Appellant and MMTC Ltd. [“Respondent”] the Appellant, referred to as the “seller” in the LTA, agreed to supply certain quantities of freshly mined and washed “German Creek” “Isaac” (Blend of 65% Moranbah North and 35% German Creek coking coals) and “Moranbah North” coking coal to the Respondent. Clause 1 of this LTA is material and states as follows:
“CLAUSE 1: MATERIAL, QUANTITY, QUALITY AND DELIVERY PERIOD:
The SELLER shall sell and the PURCHASER shall buy:
(a) The base quantity during the currency of the contract shall be 466,000 (Four hundred Sixty Six thousand) metric tons (of one thousand kilograms each) firm.
(b) During the First Delivery Period (1st July, 2004 to 30th June, 2005), a quantity of 464,374 (Four Hundred Sixty Four Thousand, Three Hundred and Seventy Four) metric tons (of one thousand Kilograms each) firm quantity of freshly mined and washed “Isaac” “Moranbah North” and “German Creek” coking coals.
(c) During the Second Delivery Period (1st July, 2005 to 30 June, 2006) a quantity of 382,769 (Three Hundred Eighty Two Thousand, Seven Hundred and Sixty Nine) metric tons (of one thousand kilograms each) firm quantity of freshly mined and washed “Isaac” “Moranbah North” and “German Creek” cooking coals.
(d) During the Third Delivery Period (1st July, 2006 to 30th June, 2007) a quantity of 466,000 (Four Hundred Sixty Six Thousand) metric tons (of one thousand Kilograms each) firm quantity of freshly mined and washed “Isaac” “Moranbah North” and “German Creek” coking coals.
(e) During the subsequent Delivery Periods, in case of the PURCHASER exercising the option to extend the duration of the Agreement by two more years, at its sole discretion, as indicated at Para 1.3 herein below, a quantity of 466,000 (Four Hundred Sixty Thousand) metric tons (of one thousand kilograms each) of freshly mined and washed “Isaac” “Moranbah North” and “German Creek” coking coals hereinafter referred to as the MATERIALS, in conformity with the Technical Specifications incorporated in Annexure- IIB (applicable for “Moranbah North” coking coal) and Annexure IIC (applicable for “German Creek” coking coal) to this Agreement and which shall constitute an integral part of this Agreement, for use of imported coking coals in the coke ovens in its integrated iron and steel works for production of metallurgical coke. The quality of the prime washed coking coals to be supplied under this Agreement shall under no circumstances be inferior to the Technical Specifications as contained in Annexure IIA, Annexure IIB and Annexure IIC to this Agreement as applicable.
1.1.1 Annual base quantity from 1st July, 2007 to 30 June, 2009, in case Purchaser exercises its option to extend the Agreement by 2 years, shall be 466,000 metric tonnes, subject to further discussions at the time of contract extension and the logical contract specification modifications to reflect the changing nature of existing reserves at the Moranbah North and German Creek mining operations will be mutually agreed.
1.2 For the purpose of this Agreement, the Delivery Period shall be reckoned as follows:
First Delivery Period 1st July 2004 to 30th June 2005
Second Delivery Period 1st July 2005 to 30th June 2006
Third Delivery Period 1st July 2006 to 30th June 2007
The shipments will be evenly spread during each Delivery Period. The PURCHASER reserves the right to prepone shipments against any Delivery Period based on its requirement and subject to availability with the SELLER.
The Purchaser reserved the right to postpone the deliveries to be effected under each Delivery Period by upto 3 months i.e. the month of September following each Delivery Period, without any additional financial liability to the PURCHASER.
1.3 The
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