The acknowledgment of debts in accounts extends the limitation period, validating claims for trade discounts despite non-receipt of subsidies, under the Arbitration and Conciliation Act.

JUDGMENT

Jasmeet Singh, J. The present appeal has been filed under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 read with Section 13 of the Commercial Courts Act, 2015 challenging the impugned judgment dated 05.01.2022 passed by the learned Single Judge of this Court in O.M.P. (COMM) 432 of 2019 titled `National Seeds Corporation Ltd. vs. National Agro Seeds Corporation (India)'.

2. Briefly stating the facts giving rise to filing of the present appeal are as under:

2.1. The State of Uttar Pradesh had floated various subsidy schemes such as scheme for popularization of cultivation of hybrid paddy in the State of Uttar Pradesh. Under the schemes, farmers were eligible for distribution subsidy at the rate of about 50 % of the seed costs and the Appellant would receive the subsidy amount directly from the State Government. Under these subsidy schemes, the seeds were to be supplied to the farmer, where 50% of the cost of seeds was to come from the farmer which was to be received by the appellant through the dealers (respondent herein) and the remaining 50% costs of the seed was the subsidy component which was to be paid for by the State Government. The Appellant had accordingly entered into agreements with various dealers including the respondent for implementation of the subsidy schemes.

2.2. The appellant was involved in selling the seeds to the farmers through its dealers. The beneficiary list of farmers was to be verified by the concerned Local Agriculture Departmental Authority and then the claim for subsidy amount was to be submitted to the State Agriculture Department along with verified beneficiary list for release of subsidy amount by the State Government to the appellant.

2.3. With this objective in mind, the appellant and the respondent entered into a Distributorship Agreement dated 24.10.2009, which was renewed by an Agreement dated 01.04.2010, which has been extended from time to time on the same terms and conditions.

2.4. As per the agreement, the respondent had agreed to sell certified seeds of approved varieties with subsidies at the retail price fixed by the appellant after reducing the admissible amount of subsidy.

2.5. In consideration for the same, the appellant had agreed to provide a trade discount to the respondent. As per the terms and conditions of the distributorship agreement, the respondent was also required to sell 25% of the oil seeds and pulses and 30% of the wheat certified seeds to farmers from SC/ST category. In terms of its obligation contained in Clause 11 of the agreement, the respondent was obliged to collect all records, cash memos, registers and subsidized sale details in the approved format and submit the same to the Regional Office of the appellant after verification from the appropriate authority of the Agriculture Department.

2.6. The respondent submitted that it had complied with all its obligations under the agreement and had sold the seeds obtained from the appellant at the discounted price. Accordingly, it claimed that it was entitled to trade discount. The respondent quantified the outstanding commission/trade discount against the seeds distributed as on the date of filing of statement of claim at Rs.1,46,40,005.02/- and further claimed interest.

2.7. Since the Appellant did not make the said payment and disputed the amount, the Respondent herein invoked the arbitration clause in terms of clause 9 of the agreement dated 01.04.2010. The parties filed their respective claims, counter-claims, lead evidence before the Arbitral Tribunal of a sole arbitrator.

3. The Arbitral Tribunal