The court clarified the limited grounds for interference with arbitral awards under Section 34 and emphasized the importance of timely goods delivery in contractual obligations.

JUDGMENT

Dharmesh Sharma, J.

1. This judgment shall decide the present appeal preferred by the appellant/claimant under Section 37 of the Arbitration and Conciliation Act, 1996 [The Act] read with Section 13 of the Commercial Court Act , 2015 [CC Act] assailing the impugned judgment dated 27 May 2020 passed by the learned Single Judge of this Court in OMP (COMM) No. 365/2017, thereby partly allowing the petition/OMP filed by the appellant/claimant under Section 34 of the Act where the impugned Award dated 26 May 2017 was challenged.

FACTUAL BACKGROUND:

2. Succinctly stated, the respondent floated a tender on 25 October 2012 for supply of 1,41,309 Light Weight Ground Sheets [Goods] and pursuant thereto, an offer was made by the appellant/claimant on 26 November 2012 to supply the material @ Rs. 501/- per piece aggregating to Rs. 7,07,95,809/-. This offer was accepted on 13 December 2013 inter alia incorporating that the contract was to be governed by DGS&D-229 [Directorate General of Supplies and Disposals] with upto date addendum and the conditions contained in form DGS&D-68 (Revised). [DGS&D-68 (Revised): 14. Delivery - (1) Time for and date of delivery; the essence of the contract: The time for and the date of delivery of the stores stipulated in the schedule shall be deemed to be the essence of the contract and delivery must be completed not later than the date(s) as specified in the contract. (2) Passing of property: Property in the stores shall not pass to the purchaser unless and until the stores have been delivered to the consignee or interim consignee, as the case may be in accordance with the conditions of the contract. (7) Failure and termination: If the contractor fails to deliver the stores or any instalment thereof within the period fixed for such delivery or at any time repudiates the contract before the expiry of such period, the Secretary may without prejudice to the right of the Purchaser to recover damages for breach of the contract: (i) recover from the contractor as agreed liquidated damages, including administrative expenses and not by way of penalty a sum equivalent to 2% of the price of any stores which the contractor has failed to deliver within the period fixed for delivery in the schedule for each month or part of a month during which the delivery of such stores may be in arrears where delivery thereof is accepted after expiry of the aforesaid period, provided that the total damages so claimed shall not exceed 10% of the total contract price]. The tender provided for approval of the goods through 16 numbers of advance samples representing the entire bulk supply, out of which, one number each had to be submitted to the Inspecting Officer, Indentor for each of the 14 consignees and 2 numbers for physical testing with the DIG (Prov.), Directorate General, CRPF, New Delhi and the supplies to be effected within 15 days of the receipt of the order for approval of the goods by the purchaser/respondent.

3. It is the admitted case that the advance samples of the goods were duly approved by the Competent Authority on 10 March 2014 and that information was received by the appellant/claimant on 17 March 2014. The delivery period [DP] of the goods as per the tender condition was four months or earlier, from the date of approval of advance samples for the entire quantity and it is common case that in view of delay on the part of the respondent in processing the approval of the samples, the DP was re-fixed from 10 March 2014 to 09 July 2014 or earlier. However, the app