HIGH COURT OF CALCUTTA
S. C. GHOSH
SOORAJMULL NAGARMAL - Appellant
Versus
GOLDEN FIBRE AND PRODUCTS - Respondent
Matter 1 Of 1969
Decided On : FEBRUARY 24, 1969
ARBITRATION - Setting aside of Award - Delay in filing application - Sufficient cause - Interpretation of contract - Import duty.
Fact of the Case:
The petitioner, a partnership firm, entered into a contract with the respondent to purchase Siam Mesta Habijabi. Disputes arose between the parties and were referred to arbitration. The arbitrator made an award in favor of the respondent. The petitioner applied to set aside the award on the ground that it was prevented from making the application within the prescribed period due to the occupation of its office by its employees and that the arbitrators misconducted themselves in refusing to allow its counterclaim for the refund of import duty.
Finding of the Court:
The court found that the petitioner had not shown sufficient cause for the delay in making the application and that the arbitrators had not misconducted themselves. The court held that the contract did not entitle the petitioner to a refund of the import duty.
Issues: 1. Whether the petitioner had shown sufficient cause for the delay in making the application to set aside the award. 2. Whether the arbitrators had misconducted themselves in refusing to allow the petitioner's counterclaim for the refund of import duty.
Ratio Decidendi: 1. The court held that the petitioner had not shown sufficient cause for the delay in making the application. The petitioner knew that the notice under Section 14 (2) of the Arbitration Act had been served upon it and that judgment and decree had been passed on the award on November 25, 1968. Even then, the petitioner did not take any steps until December 9, 1968, when it made an application before the Chief Presidency Magistrate to enable it to enter its office. The petitioner could have searched the records of the Court and taken inspection of the relevant documents from the records in the Award case. 2. The court held that the arbitrators had not misconducted themselves in refusing to allow the petitioner's counterclaim for the refund of import duty. The contract did not entitle the petitioner to a refund of the import duty. The contract stipulated that increase or decrease of Import duty would be on buyer's account.
Final Decision: The court dismissed the petitioner's application to set aside the award.
( 1 ) THIS is an application by the petitioner, inter alia, for setting aside or revocation of the decree dated November 25, 1968; upon the said decree being set aside, for setting aside of the Award dated June 4, 1968 passed by the Bengal Chamber of Commerce and Industry in case No. 210 of 1967. The petitioner is partnership firm and carries on business under the name and style of Shree Hanuman Jute Mills. The petitioner in the name of the said jute mills agreed to purchase from the respondent and the respondent agreed to sell to the petitioner on March 5, 1965 Siam Mesta Habijabi (1964-65 crop) of 100 tons (1016 Kg) at Rs. 156 per bale of 400 Ibs, gross delivery Mill jetty. A letter dated March 5, 1965 written by the respondent confirming the sale of the said goods and recording the terms and conditions of such sale has been annexed as Annexure "a" to the petition. The said contract between the parties contains an arbitration clause which is set out hereunder: "arbitration -- Bengal Chamber of Commerce and Industry, Claims, if any, are to be lodged within 3 days of the arrival of the parcel at the mills".
( 2 ) THE respondents delivered the contracted goods to the petitioners' said Shree Hanuman Jute Mills. Thereafter disputes and differences arose between the parties. The said disputes were referred to the arbitration of Bengal Chamber of Commerce and Industry. The said Arbitrator having heard the parties and considered the evidence led by the parties before it, made and published an award on June 4, 1968. A copy of the said award has been annexed to the petition and is Annexure "d". Notice under Section 14 (2) of the Arbitration Act 1940 was served upon the parties. The petitioner was served with the said notice on September 21, 1968.
( 3 ) DISPUTES and differences cropped up between the petitioner and its employees since about April, 1967. The employees of the petitioner according to the petitioner, grew violent and disobedient and started violent activities even inside the petitioner's office at No. 8, Dalhousie Square East. The petitioner terminated the services of all employees and closed down the office by a notice dated November 3, 1968. The dismissed employees of the petitioner stayed on in the office premises at No. 8, Dalhousie Square East at No. 1/1, R. N. Mukherjee Road, Calcutta. According to the petitioner on and from November 3, 1968, some of the employees of the petitioner were obstructing egress and ingress of the partners and office bearers of petitioner from or to the said office premises. As a result, necessary papers, documents including those of the arbitration proceedings in respect of the instant award case could not be taken out of the office of the petitioner.
( 4 ) ON November 12, 1968, Mr. B. M. Bagaria, on behalf of the petitioner, wrote to Messrs. M. L. Khemka and Co. , Solicitors of the respondent, asking as to whether notice under Section 14 (2) of the Arbitration Act in the instant case was served upon the petitioners. in the said letter, it was alleged that, ". . . . . . . . . . . . all their documents are lying in their office and it is not possible for them to remove any document from their said office". Mr. Bagaria requested the Solicitors of the respondents to send a copy of the said notice under Section 14 (2) to him as his clients wanted to make an application for setting aside the said award. In the said letter Mr. Bagaria gave the name of the clients of Messrs. M. L. Khemka and Co. as Golden Film and Products. On November 16, 1968, M. L Khemka and Co. informed Mr. Bagaria that they had no client by the name of Golden Film and Products. On November 19, 1968, Mr. Bagaria corrected the error and informed that the name of M. L. Khemka's client was Golden Fibre and Products. By letter dated November 22, 1968, Messrs. M. L. Khemka and Co. informed Mr. Bagaria that the matter would appear for judgment upon award on the 25th instant in the list of Sabyasachi Mukharji J.
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