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TMI Blog2009 (2) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, not later than six weeks from the date of the filing of the application moved for this purpose by the respondent. - 138 of 1998 - - - Dated:- 12-2-2009 - Mukul Mudgal and Vipin Sanghi, JJ. [Judgment per : Mukul Mudgal, J. (Oral)]. - With the consent of the learned counsel for the parties, this appeal is taken up for hearing. This appeal challenges the judgment of the learned Single Judge dated 23rd March 1998 dismissing the objections to the award dated 24th November 1995 filed by the petitioner, the appellant herein. Shri B.C. Mathur, the Secretary (retired) Ministry of Commerce (Supplies) was appointed as the sole arbitrator by the appellant Union of India and gave the award dated 24th November 1995. 2. The respondent had entered into a contract with the appellant through the Ministry of Defence (Defence Production and Supplies) on 6th September 1985 for supply of Crash Fire Tenders (hereinafter referred to as "CFT"). The price under the said contract for supply of 44 CFTs was fixed at Rs. 21,90,000/- each, with provision that "any statutory variations to the customs duty shall be to the purchaser's account". The appellant could place orders for supply of additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... creasing the quantity by another 7 Nos. subject to your obtaining import clearance from DGTD(.) The excise duty and sales tax shall be admissible as at the time of delivery against documentary evidenced the other terms and conditions including advances shall be the same as in the earlier contract referred to in para 1 above(.)" (emphasis supplied) 5. The letter was followed by a formal supply order dated 10th June 1988 which specifically referred to the negotiation meeting held on 21st March 1988 and the quotation of 21st March 1988 given by the respondent and the telegraphic confirmation dated 30th/31st May 1988 given by the appellant Union of India. The relevant portion of the said supply order reads as follows : "Ref: (i) Negotiation meeting held on 21-3-88 in this Deptt. (ii) Your quotation No. CFT-112/158/88, dt. 21-3-88 (iii) Your letter No. CFT-112/194/88, dt. 30-5-88. (iv) This office advanced telegraphic S.O. No. 7(17)/D(S.II)/CPO-1467, dt. 30/31 May 88. Dear Sir, Please refer to your quotation/discussions cited above. These have been accepted and a formal supply order is hereby placed on you for and on behalf of the President of India for the supply of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or the administration of any Union territory or a local body for fire fighting operations, from - (a) so much of that portion of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), as is in excess of die amount calculated at the rate of 25 per cent ad valorem; and (b) the whole of the additional duty leviable thereon under Section 3 of the said Customs Tariff Act. subject to the condition that the importer, at the time of clearance, produces a certificate from an officer not below the rank of a Deputy Secretary to the Government of India in the Ministry of Home Affairs that the goods are required for fire fighting by any of the aforesaid bodies and recommends grant of the concession. (emphasis supplied) 8. The respondent supplied the 32 CFTs at the fixed price of Rs. 20,45,000/- and received the entire amount. Thereafter, it appears, the appellant sought to made recovery from the respondent of an amount of Rs. 1,77,58,396/- from the respondent on the ground that the respondent had availed of the benefit of customs duty under the aforesaid notification, but had not passed on the said benefit whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of customs duty exemption under Notification No. 62/87-Cus. shall enure for the benefit of the respondent. 12. Firstly, we may state that the issue raised is pure and simple a question of interpretation of the terms of the contract. It is the jurisdiction of the Arbitrator to interpret the agreement, and unless it can be shown that the interpretation given by the Arbitrator is not at all a plausible interpretation, the court would not interfere with the same, merely because the court may have interpreted the agreement differently. If the interpretation given by the arbitrator is plausible, the same shall not be interfered with by the Court. 13. We find that not only the interpretation adopted by the Arbitrator is plausible but in fact the only interpretation possible and the same has rightly been upheld by the learned Single Judge. In our view, the said general conditions contained in Schedule B and C cannot prevail upon the special terms of offer dated 21st March 1988 which were accepted by the appellant and are incorporated in Schedule A. Significantly, in the quotation dated 21st March 1988 in Clause (2) it was clearly provided that as contrasted with Clause 1 where reductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e materials covered by the aforesaid notification were being imported by the respondent for manufacturing CFTs for one of the bodies enumerated in the notification. Such a certificate, the respondent, could legitimately have accepted and demanded appellant to issue the certificate as provided by the appellant since the same merely recited the existing factual position. We may also take note of the fact that the agreed price for the CFTs in the original contract dated 6th September, 1985 was Rs. 21,90,000/- per CFT. This price was fixed, however, statutory variation in custom duty was to the appellant account. After merely three years the respondent had reduced the price to Rs. 20,45,000/-. The reduction in this price was not only in respect of the additional CFTs sought to be procured by the appellant by exercising its auction under the original contract but also in respect of up to 32 additional CFTs. The price per CFT was, in fact, reduced by merely Rs. 1,45,000/- even though the order was placed merely three years after the placement of the earlier order. It appears to us that the parties clearly understood that the benefit of reduction in customs duty on the additional 32 units ..... X X X X Extracts X X X X X X X X Extracts X X X X
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