1. The Petitioner, Union of India through Director General Supplies & Disposal (‘DGS&D’), has filed this petition under Section 34 of the Arbitration and Conciliation Act, 1996 (‘1996 Act’) challenging the Award dated 29th August 2002 followed by corrigendum dated 12th September 2002 passed by the learned Sole Arbitrator arising out of the dispute between the Petitioner and Respondent No. 1 Modi Industries Limited pertaining to the Running Contract dated 26th February 1979 for supply of two items of “branded Enamel Synthetic Exterior”.

2. Pursuant to the tender notice issued by DGS&D, the above contract was entered into between the parties for the period from 1st February 1979 to 31st December 1979. The value of the contract was Rs. 13,42,269.70. The delivery schedule prescribed in the running contract was at 50,000 litres per month commencing from 30th April 1979 & completion by 31st August 1979. The contract also provided an increase or decrease of the quantity by 25% at purchaser’s option. It was stated that in exercise of the tolerance clause provided in the running contract, further quantities were ordered by amendment letters dated 31st May, 21st July and 26th Novemb