Punjab-Haryana High Court
Punjab State Warehouse Corporation vs M/S. Pawan Kumar And Company on 11 February, 2011
Author: Mohinder Pal
Bench: Mohinder Pal
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F.A.O. No.5109 of 2008 (O & M).
IN THE HIGH COURT FOR THE STATES OF PUNJAB & HARYANA
AT CHANDIGARH
...
Date of Decision: February 11 , 2011.
F.A.O. No.5109 of 2009 (O & M).
Punjab State Warehouse Corporation, Chandigarh, through its
Secretary-cum-Joint Manager Director, S.C.O. No.74-75, Sector
17, Chandigarh .......Appellant
Versus
M/s. Pawan Kumar and Company, Ferozepur City, through its
partner Pawan Kumar resident of 55 Jhoke Road, Ferozepur
Cantt and another ........Respondents
CORAM : HON'BLE MR.JUSTICE MOHINDER PAL.
1. Whether Reporters of Local papers may be allowed to see
the judgment ?
2. To be referred to the Reporters or not ?
3. Whether the judgment should be reported in the Digest ?
Present: Mr. A.D.S. Sukhija, Advocate,
for the appellant.
None for the respondent.
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MOHINDER PAL, J.
The appellant has preferred this appeal against the judgment dated 19.5.2007 passed by the learned District Judge, Ferozepur, whereby the objection petition filed by the -2- F.A.O. No.5109 of 2008 (O & M).
appellant under Section 34 of the Arbitration and Conciliation Act, 1996 (for short `the Act') against the Award dated 24.9.2003 passed by Mr. D.S. Chhina, Sole Arbitrator (respondent No.2) was dismissed. Appellant Punjab State Warehouse Corporation (hereinafter referred to as `the Corporation') filed the claim petition for recovery of Rs.6,60,93,017/- against respondent M/s. Pawan Kumar and Company through its partner Pawan Kumar (hereinafter referred to as the `respondent Company') alleging that the respondent-Company had entered into an agreement with the Corporation for storage of paddy and that it (respondent- Company) was to mill the same as per terms and conditions
mentioned in the agreement dated 12.11.1998. It was alleged by the Corporation that the said agreement included the arbitration clause and, accordingly, reference was made to the Sole Arbitrator (respondent No.2). The respondent Company appeared before respondent No.2 through counsel and contended that there was no agreement between the parties for the year 1998-99. Respondent No.2, vide award dated 24.9.2003, held that as the agreement in question had not been signed by the District Manager of the Corporation, one of the parties to the agreement, it (agreement) was a unilateral one and not valid; thereby rejecting the reference made before respondent No.2 by the Corporation. The Corporation challenged the award dated 24.9.2003 passed by respondent No.2 before the learned District Judge, Ferozepur by way of filing a petition under Section 34 of -3- F.A.O. No.5109 of 2008 (O & M).
the Act. The District Judge, Ferozepur, vide judgment dated 19.5.2007 dismissed the objection petition filed by the Corporation by holding, inter alia, that there were no signatures on the agreement on behalf of the Corporation.
In this case, the respondent Company had received paddy for custom milling from the Corporation. The respondent Company (miller) had also milled a part of the paddy which had been delivered to it (miller). The arbitration reference was made by the Corporation to the Sole Arbitrator (respondent No.2) for breach of the terms and conditions by the miller as it (miller) had failed to mill the paddy as per agreement, which contained arbitration clause. As held by the Hon'ble Supreme Court in the case of UNISSI (INDIA) PRIVATE LIMITED VERSUS POST GRADUATE INSTITUTE OF MEDICAL EDUCATION AND RESEARCH, (2009) 1 Supreme Court Cases 107, in case a unilateral agreement has been acted upon, the agreement is legal and valid for the purpose of seeking arbitration. In the said case, Hon'ble Supreme Court, observed as under:-
" Therefore, considering the above aspects of the matter in this case, we must come to this conclusion that although no formal agreement was executed, the tender documents indicating contain conditions of contract contained an arbitration clause. It is -4- F.A.O. No.5109 of 2008 (O & M).
also an admitted position that the appellant gave his tender offer which was accepted and the appellant acted upon it. Accordingly,we are of the view that the learned Addl. District Judge, Chandigarh, erred in holding that there did not exist any arbitration agreement between the parties and, therefore, the order passed by him is liable to be set aside."
For the aforesaid reasons, this appeal is allowed, the Award dated 24.9.2003 passed by Sole Arbitrator and the impugned judgment passed by the learned District Judge are set aside and the matter is remitted to the Sole Arbitrator to decide the dispute between the parties afresh after taking the evidence in accordance with law.
( MOHINDER PAL ) February 11, 2011. JUDGE ak