Punjab-Haryana High Court
Punjab State Warehousing Corp. Ltd And ... vs M/S Goyal Gram Udyog Samiti Dhuri And Anr on 26 August, 2014
Author: Rakesh Kumar Jain
Bench: Rakesh Kumar Jain
vinod kumar
2014.09.04 12:06
I attest to the accuracy and
integrity of this document
Chandigarh
CR No.1654 of 2013 (O&M) [1]
*****
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
CR No.1654 of 2013 (O&M)
Date of decision:26.08.2014
Punjab State Warehousing Corporation Ltd. and another ...Petitioners
Versus
M/s Goyal Gram Udyog Samiti and another ...Respondents
CORAM: Hon'ble Mr. Justice Rakesh Kumar Jain
Present: Mr. K.B.Raheja, Advocate,
for the petitioners.
Mr. Mukand Gupta, Advocate,
for respondent no.1.
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RAKESH KUMAR JAIN, J.
This petition is filed against the order dated 29.01.2013 passed by the Appellate Court, setting aside the order dated 18.07.2012 passed by the Arbitrator.
The brief facts of the case, as alleged by the petitioners, are that they stored 48341 bags weighing 16919.35 quintals of paddy for the purpose of milling with respondent no.1 who failed to supply the rice as per the terms and conditions and the matter was referred to the Arbitrator. The paddy was given only for the purpose of milling and is owned by the petitioners. Since it is a perishable item, the petitioner filed an application to the Arbitrator to allow them to dispose of the stock. However, the order of the Arbitrator has been set aside by the Appellate Court. vinod kumar 2014.09.04 12:06 I attest to the accuracy and integrity of this document Chandigarh CR No.1654 of 2013 (O&M) [2]
***** On the other hand, counsel for respondent no.1 has submitted that as per Clause 11 of the earlier agreement dated 24.01.2011, the quantity of the paddy milled less by the miller during the month will be shifted to other millers at the risk and cost of the miller and there is no clause in the agreement which authorize the petitioners to sell the paddy milled less and since there is no such clause in the agreement, therefore, the Arbitrator had no authority to allow the petitioners to dispose of the paddy milled less.
I have heard learned counsel for the parties and examined the record.
There is no dispute that the rice is owned by the petitioners for which even an affidavit is also filed on 24.07.2014 by Shri Arvinder Singh Bains, IAS, Managing Director, Punjab State Ware House Corporation, Chandigarh alleging that the paddy was purchased by the petitioners and was given to respondent no.1 for milling during the crop for the year 2010-
11. It was purchased for the Central Pool by the petitioners being a purchasing agency of the State, but after milling, the rice was to be delivered to the Food Corporation of India.
Since the dispute between the parties had arisen and the matter was referred to the Arbitrator on an application filed under Section 17 of the Arbitration and Concilliation Act, 1996 (here-in-after referred to as the "Act"), the Arbitrator passed the following order on 18.07.2012:-
"Today, the counsel for the claimant has submitted an application U/s 17 of the Arbitration Act for disposal of Paddy/Rice which is lying in the premises of M/s vinod kumar 2014.09.04 12:06 I attest to the accuracy and integrity of this document Chandigarh CR No.1654 of 2013 (O&M) [3] ***** Goyal Gram Udyog Samiti & others, Dhuri, Sangrur. The claimant has stated that if the stocks are not dispose of, there is a possibility of deterioration in the condition of stocks. The above request of the claimant has weightage as the rice miller has failed to deliver the rice within stipulated period to FCI in the account of PSWC as per the contractual obligation. In view of the above facts, the claimant is allowed to dispose of the stocks Paddy/Rice by following proper procedure on "As is where is" basis at the risk and cost of the rice miller. The disposal of the paddy/rice should be made by the committee. The rice miller may also be asked to participate in the disposal process."
This order was challenged in appeal under Section 37(2)(b) of the Act and the learned Appellate Court, while referring to Clause 11 of the agreement, had observed that in case the rice is milled less, it can only be shifted to the other miller, but there is no authority with the petitioners for disposing of the said rice.
Learned counsel for the petitioners has also relied upon a decision of this Court in the case of Punjab State Civil Supplies Corporation Limited and another v. M/s Diwan Chand Sanjit Kumar and others, CR No.1485 of 2013 decided on 27.08.2013 in which the similar issue was involved. This Court, while referring to the various judgments, extensively observed that only right of the millers is to charge vinod kumar 2014.09.04 12:06 I attest to the accuracy and integrity of this document Chandigarh CR No.1654 of 2013 (O&M) [4] ***** for milling/processing the paddy into rice, meaning thereby that the millers have no ownership over paddy and rice, therefore, whether such condition exists or not, in the agreement will be irrelevant. It is also observed that this kind of a condition not to sell the perishable item cannot be imposed and the interest of the millers could be watched by permitting them to be present at the time of sale of the rice.
It is needless to mention that the same liberty has already been granted by the Arbitrator in his order dated 18.07.2012.
Thus, keeping in view the ratio of the law laid down by this Court in Punjab State Civil Supplies Corporation Limited's case (supra), the present revision petition is found to be meritorious and is thus allowed and the impugned order is set aside.
August 26, 2014 (RAKESH KUMAR JAIN) vinod* JUDGE