Calcutta High Court
Dcm Decometal Gmbh vs Rohit Ferro Tech Limited on 17 February, 2015
Author: Samapti Chatterjee
Bench: Ashim Kumar Banerjee, Samapti Chatterjee
IN THE HIGH COURT AT CALCUTTA
CIVIL APPELLATE JURISDICTION
IN THE APPEAL FROM ITS CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
Present :
The Hon'ble Justice Ashim Kumar Banerjee
And
The Hon'ble Justice Samapti Chatterjee
APO 428 OF 2014
A.P. 194 OF 2011
DCM DECOMETAL GMBH
VS.
ROHIT FERRO TECH LIMITED
For the Appellant : Mr. Anindya Mitra, Sr. Advocate
Mr. Abhrajit Mitra. Sr. Advocate
Mr. Soumya Roychowdhury, Advocate
Mr. Sandip Dasgupta, Advocate
Mr. Ravitej Chillu Muri, Advocate
For the Respondents : Mr. S.N. Mookherjee, Sr. Advocate
Mr. Tilak Bose, Sr. Advocate
Mr. Ratnesh Kr. Rai, Advocate
Mr.Anumoy Bose, Advocate
Ms. Manali Bose, Advocate
Heard On : 27.01.2015, 28.01.2015, 29.01.2015,
30.01.2015, 3.02.2015 & 4.02.2015.
Judgment On : 17th February, 2015.
Samapti Chatterjee, J.
The appellant/petitioner filed the instant appeal assailing the order dated 23.07.2014 passed by the Hon'ble Single Judge in A.P. No.194 of 2011.
The facts of the case is that the appellant/petitioner is an Austrian Company having its place of business in Austria. The respondent/claimant is an Indian Company having its registered office at 35, Chittaranjan Avenue, Kolkata. The appellant/petitioner and the respondent/claimant entered into a contract dated 4th September, 2008 whereby the respondent/claimant agreed to sell and the appellant/petitioner agreed to buy 4000 MT more or less 10 % at the claimant's/respondent's option high carbon silico manganese. The agreed price was US$ 2060 per M.T., FOB Haldia, Kolkata. The said contract contained an arbitration clause in Serial No.15 which is quoted below:-
"Arbitration Clause : All disputes or difference arising between the parties out of or relating to the construction, meaning and operation or effect of this contract or the breach thereof shall be finally settled under the rules of conciliation and arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with the said rules. The language of the arbitration will be English. The venue of arbitration shall be Kolkata, India."
The appellant/petitioner alleged that by its letter dated 16th October, 2008 the respondent repudiated the contract. The appellant/petitioner then informed the claimant/respondent not to produce any more goods and thereby treating the contract as terminated upon expiry of September, 2008 or latest by 16th October, 2008. According to the claimant/respondent they had already produced the entire quantity of the goods as per contract, therefore, on 21st November, 2008 the claimant/respondent through their lawyer wrote to the appellant/petitioner to perform the contract otherwise the claimant/respondent would "mitigate their losses" for non-performance of the contract. It was also stated in the said letter that the appellant/petitioner was required under the contract to receive the goods @ 1000 MT per months between September and December, 2008. Therefore, breach on the part of the appellant/petitioner was illegal and the claimant/respondent also informed that they were unable to hold the goods already manufactured as per contract for any longer period. Further, on 16th January, 2009, the claimant's/respondent's lawyer wrote to the appellant/petitioner as follows :-
BOSE & MITRA SOLICITORS & ADVOCATES Temple Chambers 1st Floor 6, Old Post Office Street Kolkata-700 001.
16th January, 2009 DCM DECO metal GmbH Grazerplatz 5 A-8280 Furstenfield Austria By Fax: 00 43 3382 55765 & By E-mail:[email protected] Dear Sir, Our Client : Rohit Ferro-Tech Ltd.
35, Chittaranjan Avenue, 1st Floor Kolkata-700 012.
Re: Contract No.SiMn/DXB/09-08/-69 dated 4th September, 2008. We refer to our fax/e-mail of 21st November, 2008 to which we have received no reply. The contract has been terminated by reason of your repudiatory breach. Our client's claim is as follows :
(a) 400 m.t. @ US$ 2060 FOB Haldia/Calcutta =US$ 8,240,000.00
(b) Amount received from mitigation sales of of 1225 mt =US$ 1,2111,799.00 ( c ) Storage charges Plus 12% interest = US$ 120,000.00 US$ 284,608.00
----------------------------
TOTAL US$ 7,399,809.00
----------------------------
We hereby require you to pay the sum US$ 7,399,809.00 of within 14 days of the date of this letter failing which our clients will commence arbitration proceedings against you without further notice in accordance with the terms of the contract dated 4th September, 2008.
Yours faithfully, BOSE & MITRA.
What was claimed in the notice was the price of the goods as per the contract less the amount allegedly received by the claimant on account of the sale of 125 MT of goods. As a result thereof the disputes arose which were referred to an arbitral tribunal comprising of Mr. Chittotosh Mukherjee (former Chief Justice of Calcutta High Court), Mr Sudipto Sarkar (Senior Counsel) and Mr. Alan J Thambiayah. The following issues were framed by the tribunal :-
1. What were the parties' obligations under the Contract ?
2. Have the Respondents breached any obligations under the Contract ?
3. If so, which obligations have been breached by the Respondents ?
4. A. Have the Claimants suffered loss and damage in consequence of any breach by the Respondents; and if so, B. What are the damages suffered by the Claimants ?
5. Whether interest is recoverable by the Claimants, and if so, on what basis?
6. Whether the Claimants or the Respondents are entitled to costs and expenses arising out of this arbitration, including but not limited to reasonable attorney's fees?
7. Whether the Claimants are entitled to any other relief?
The Tribunal passed the Award on 19th January, 2011. Challenging the said award the appellant/petitioner filed an application under Section 34 of the Arbitration and Conciliation Act, 1996" before the Hon'ble Single Bench. The Hon'ble Single Bench by the impugned order dated 23rd July, 2014 dismissed the application for setting aside the award. Hence, the present appeal.
Mr. Anindya Mitra, learned senior Counsel appearing for the appellant/petitioner contended that the arbitral tribunal had travelled beyond their jurisdiction. The pre-existing disputes between the parties were referred to the Arbitral Tribunal and the tribunal had jurisdiction only to adjudicate those disputes and no other disputes not referred to the Arbitral Tribunal.
Mr. Mitra further urged that the dispute between the claimant/respondent and the appellant/petitioner was whether the appellant/petitioner has to pay the difference between mitigated sale price and the contract price since the contract was terminated by the appellant/petitioner.
It was also contended by Mr. Mitra that no reference was ever made by the claimant/respondent claiming differential amount between the contract price and the prevailing market price. Mr. Mitra further contended that only on 7th August, 2010 being the first date of commencement of hearing the claimant/respondent claimed the difference between market price and the contract price which was not the dispute referred to the Arbitral Tribunal.
To substantiate his contention Mr. Mitra referred to the letter dated 21st November, 2008 (at Page 94 Vol-III of the compilation) and the letter dated 16th January, 2009 (at page-96 Vol-III of the compilation). In both the letters claimant/respondent claimed to mitigate sale price as damage.
In support of his contention Mr. Mitra relied on a Supreme Court decision reported in AIR 1962(SC) page 366 (M/s. Murlidhar Chiranjilal, Appellants v M/s. Harishchandra Dwarkadas and another) paragraphs 3,6,7.8,11 and 12 where it is observed by the Hon'ble Supreme Court that the market price prevailing at the time of mitigated sale would be considered where products were to be delivered. Mr. Mitra urged that in the present case claimant/respondent failed to prove the prevailing market price in Kolkata/Haldia. Therefore, the appellant are not obliged to pay compensation for damages. Our attention were drawn by Mr Mitra to the market price mentioned in Metal Bulletin and the market price mentioned in Metal Pages, which in his contention, were the market price at Europe and not the market price prevailing in Kolkata/Haldia. Mr. Mitra also contended that the claimant/respondent miserably failed to produce any documents relating to market price of the goods at Calcutta/Haldia.
Mr. Mitra also relied on 53 CWN page 873 at page 875 to establish his contention that the Arbitral Tribunal has no jurisdiction to entertain the claim for difference between the prevailing market price and the contract price which issue was not referred to the Arbitral Tribunal. In fact, only on 7th August 2010 during first hearing before the tribunal the claimant raised this claim for the first time. Therefore, Mr. Mitra submitted that Arbitral Tribunal had jurisdiction to adjudicate only those disputes referred in the letter of reference dated 21st November, 2008 and beyond those disputes the Arbitral Tribunal had no jurisdiction to adjudicate any other claims/issues. Mr. Mitra further contented that 53 CWN Page-873 was not considered by the Arbitral Tribunal.
Mr. Mitra vehemently urged that the learned Single Judge added reason to the award by observing that Metal Bullatin price was the prevailing market price. Mr. Mitra further contended that Court should not act as a machinery to cover up the lacuna made in the award by the Arbitral Tribunal. He also emphasized that the contract should be governed by the Indian Law and not by the law of the land and statute should prevail over the Rules Mr. Mitra summed up his submissions as follows:-
i) Arbitrator has no jurisdiction to adjudicate new claim/dispute raised on 7th August 2010 (during first hearing) which was not referred to the Arbitral Tribunal for adjudication vide the letter of reference.
ii) Prevailing market price of the goods in Calcutta/Haldia was determined by the Arbitral Tribunal without any evidence. Market price mentioned in Metal Bulletin, is the prevailing market price in Europe and not in respect of Calcutta/Haldia.
iii) Difference between mitigated sale and contract price was not taken into account.
Mr. Mitra further contended that the costs awarded by the Arbitral Tribunal is highly exorbitant and erroneous beyond the jurisdiction of ICC rule. The said cost was also awarded without any evidence. Mr. Mitra also referred to section 2, Section 21 and Section 28 of the Arbitration and Conciliation Act 1996, which are quoted herein below:-
Section 2 Sub Section 1 (b) -"arbitration agreement" means an agreement referred to".
"Section 21-Commencement of arbitral proceedings-Unless otherwise agreed by the parties, the arbitral proceedings in respect of a particular dispute commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent."
"Section 28-Rules applicable to substance of dispute-(1) Where the place of arbitration is situate in India,-
(a) in an arbitration other than an international commercial arbitration, the arbitral tribunal shall decide the dispute submitted to arbitration in accordance with the substantive law for the time being in force in India;
(b) in international commercial arbitration,-
(c) (I) the arbitral tribunal shall decide the dispute in accordance with the rules of law designated by the parties as applicable to the substance of the dispute;
(d) any designation by the parties of the law or legal system of a given country shall be construed, unless otherwise expressed, as directly referring to the substantive law of that country and not to its conflict of laws rules;
(e) failing any designation of the law under clause (a) by the parties, the arbitral tribunal shall apply the rules of law it considers to be appropriate given all the circumstances surrounding the dispute.
(2) The arbitral tribunal shall decide ex aequo et bono or as amiable compositeur only if the parties have expressly authorised it to do so. (3) In all cases, the arbitral tribunal shall decide in accordance with the terms of the contract and shall take into account the usages of the trade applicable to the transaction."
Mr. Mitra contended that the rule cannot override the substantive law of the land.
Mr. Mitra further contended that in respect of the suit proceedings cause of action is necessary. But the cause of action is not a key factor in the arbitration proceedings. It is only the disputes which are referred to the Arbitral Tribunal for adjudication. But unfortunately in the present case the Arbitral Tribunal accepted the subsequent disputes as the continuation of cause of action regarding difference between prevailing market price at the time of mitigated sale and the contract price though the said dispute was not mentioned in the letter of reference. Therefore, the arbitral tribunal has no jurisdiction to consider the further claim/disputes subsequently referred by the claimant/respondent in the midst of hearing. In support of his contention Mr. Mitra relied on a decision reported in 1989 (2) SCC Page- 163 Para-12 ( A.B.C. Laminart Pvt. Ltd and Another vs A.P. Agencies, Salem) . Para 12 is quoted below :
"12. A cause of action means every fact, which if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the court. In other words, it is a bundle of facts which taken with the law applicable to them gives the plaintiff a right to relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action can possibly accrue. It is not limited to the actual infringement of the right sued on but includes all the material facts on which it is founded. It does not comprise evidence necessary to prove such facts, but every fact necessary for the plaintiff to prove to enable him to obtain a decree. Everything which if not proved would give the defendant a right to immediate judgment must be part of the cause of action. But it has no relation whatever to the defence which may be set up by the defendant nor does it depend upon the character of the relief prayed for by the plaintiff."
And he also relied on AIR 1921 Calcutta Page-342 (Chandmull Goneshmull vs Nippon Munkwa Kabushiki Kaisha).
Mr. Mitra further urged that it is a settled proposition of law that the pre-existing dispute covered by the arbitration clause is an essential ingredient for determining the jurisdiction of Arbitral Tribunal which is lacking in the present case. In support of his contention, Mr. Mitra relied on a Division Bench decision reported in AIR 1989 Calcutta Page-6 Para-6 DB (Nanalal M. Varma and Co. Ltd. Vs Alexandra Jute Mills Limited) . Para 6 is quoted below:-
"Having given our anxious consideration to the matter we are of the view that the learned trial Judge had applied the correct principles of law in finding that in the instant case a dispute did arise between the parties which was covered by the arbitration clause of the contract and therefore, the award was not liable to be set aside on the ground that the same was beyond the scope of the arbitration clause. The learned trial Judge has elaborately set out the case law on the point. Therefore, we did not propose to again set out the judicial precedent on the point in extenso, particularly when the learned counsel appearing in either side relied on the same set of authorities which lay down the relevant principles. It is the settled law that the existence of a dispute covered by the relevant arbitration clause in question is an essential condition and pre-requisite for assumption of jurisdiction by an Arbitrator. A dispute implies an assertion of a right by one party and repudiation thereof by another, vide observation in the case of Chandmull Ganeshmull v. Nippon Munkwa, AIR 1921 Cal 342 and also the observation of Bachawat, J. in the case of Nandram Hanutram v. Raghunath and Sons Ltd., AIR 1954 Cal 245".
Any particular dispute which is referred to the Arbitral Tribunal by way of letter of reference the tribunal has the jurisdiction to adjudicate those disputes and should not adjudicate any dispute not mentioned in the letter of reference.
He also contended that no goods were at all manufactured by the claimant/respondent, the claimant/respondent failed to produce any documents regarding manufacturing of contractual goods and the prevailing market price of sale of those goods.
Mr. Mitra further contended that the Arbitral Tribunal arbitrarily without any basis accepted the price mentioned in Metal Bulletin for Europe market as the prevailing market price in Calcutta/Haldia, which is wholly perverse, and beyond the scope of letter of reference.
Mr. Tilak Bose learned Senior Counsel appearing for the claimant/respondent contesting the submissions made by Mr. Mitra, submitted that the dispute referred to the Arbitral Tribunal was very much within the scope of reference. He further contended that the claim for difference between the prevailing market price and the contract price was very much present before the Arbitral Tribunal and in support of his contention Mr. Bose drew our attention to the various paragraphs viz. 9,36,37,38 & from 43 to 48 of the award.
Mr. Bose also urged that the evidence regarding the market price in Europe adduced by the claimant/respondent were same and referred in Metal Page as admitted by the appellant's witness.
Mr. Bose further contended that it was not the case of the appellant that no evidence was adduced in respect of prevailing market price and the contract price.
Mr. Bose further contended that the goods were manufactured as per the contract, therefore, the claimant/respondent is entitled to get the differential amount between the prevailing market price and the contract price, as the contract was terminated.
Mr. Bose further urged that no argument was advanced by the appellant before the learned Single Judge in respect of the cost awarded by the Arbitral Tribunal at the rate of 75% as per ICC terms.
Mr. Bose submitted that the arbitral tribunal after considering the oral and documentary evidence passed a reasoned award and had not travelled beyond the scope of reference. He vehemently contended that it is wholly incorrect to suggest that the award is a perverse one passed without any supporting evidence and beyond the scope of reference.
Mr. Bose also urged that the appellant is inviting this Hon'ble Court to re-appreciate the evidence which is beyond the scope of Section 34 of the Arbitration and Conciliation Act 1996.
Mr. Bose further drew our attention to the para (viii) of volume 3 at page 24, relevant extract passage is quoted below :-
"........The amount in dispute is presently quantified at US$ 53,01,646.04. The Arbitral Tribunal reserves the right to revise the estimated amount in dispute from time to time".
Mr. Bose contended that the letter of reference does not restrict to the amount in dispute, US$ 53,01,646,04 on the contrary it clearly stated that "the Arbitral Tribunal reserves the right to revise the estimate amount in dispute from time to time", therefore, it is not correct to suggest that Arbitral Tribunal travelled beyond the scope of reference in passing the Award. He also pointed out to page 22 of the volume 3. (compilation).
"........) the Respondents' non-opening of any letter of credit. Under the Contract in respect of each of the four monthly installments amounted to a breach, then either the Claimants failed to mitigate its loss or suffered no loss because the market price for the Product on or about each day the Respondents were contractually obliged to open a letter of credit (viz. September 9th 2008, October 10th 2008, November 9th 2008 and December 10th 2008) was not lower than the Contract price. That the claimant/respondent claimed the difference between the prevailing market price and contractual price".
In support of his contention that the goods were manufactured and sold Mr. Bose drew our attention to the excise return at (page 149 para 37 of Section 34 petition). In support of his contention Mr. Bose relied on AIR 1981 (SC) page 162. M. Lachia Setty and Sons Ltd. V. The Coffee Board, Bangalore. Mr. Bose submitted that the award should be upheld and the appeal arising out of the impugned order should be dismissed. In support of his contention Mr. Bose relied on the following decisions: AIR 2013 Calcutta 52 Union of India V. Binod Kumar Agarwal. AIR 1981 Supreme Court 162 Malachia Setty and Sons Ltd. V. The Coffee Board, Bangalore, Mr. Bose further contended that while hearing a setting aside application court should not act as an appellate forum, court also should not re-appreciate the evidence adduced before the Arbitral Tribunal, furthermore, Court also should not interfere with the tribunal's interpretation, unless such interpretation are perverse or contrary to the terms of the contract.
We have heard the rival contentions advanced by the parties and also perused the petition on record. It is well settled principle of law that the Court has very little scope to interfere with the award passed by the Arbitral Tribunal as the Court cannot act as an appellate forum and sit in appeal on the award passed by the Arbitral Tribunal. Further the Court has no power to re-appreciate evidence adduced before the Arbitral Tribunal. In the letter dated 21st November, 2008 the Advocate on record of the claimant/respondent inter alia mentioned that ....
"We on behalf of our client therefore require you to nominate a vessel to load the entire quantity of 4000 m.t. within December, 2008 and to open a letter of credit in accordance with the terms of the contract. Our client require you to comply with both these conditions within 7 days of the date of this letter, failing which our client will have no option but to regard the contract as terminated by reason of your repudiatory breaches and claim damages for all losses we suffer by reason of your repudiatory breach.
It is evident that the appellant/petitioner failed to open any letter of credit in favour of claimant/respondent due to turmoil in the global financial and commodity market which also constituted a breach of contract on the part of the appellant/petitioner. We also find that in the paragraph 30 of the award the Arbitral Tribunal discussed ILR 1950 (1) Calcutta Page-497 equivalent to 53 CWN Page-873 at Page 87 which was referred to by the appellant/petitioner before the arbitral tribunal. Paragraph 30 and 31 are quoted below:-
"Paragraph 30- The proposition of law for which the Respondents relied on ILR 1950 (1) Calcutta 497 = 53 CWN 873 at page 875 as authority is not novel, and, in any event, if need not concern the Arbitral Tribunal overmuch as the claim and dispute heard by the Tribunal on 7th and 8th August 2010 did not comprehend new causes of action then being introduced in this arbitration for the first time.
Paragraph-31- For the reasons set out above, the Arbitral Tribunal finds tht it did not cease to have jurisdiction in this reference on and after August 7, 2010 and it does have jurisdiction to decide any claim for a difference between market price and contract price, and to award any amount on that basis."
In respect of losses/damages suffered by the claimant/respondent for ceasation/breach of contract made on the part of the appellant/petitioner, the Arbitral Tribunal relied on official excise documents produced by the claimant/respondent during Arbitral Proceedings to substantiate their contention that the contractual goods had been manufactured by the claimant which is referred in Paragraph- 34 and 35 of the award, relevant extracts are quoted below:-
Paragraph-34- The documents produced in evidence by the Claimants were the duly signed official form E.R.-1 (being tables of return of excisable goods, including details of) for the months of September 2008, October 2008, November 2008 and December 2008. The information contained in these forms discloses details of manufacture, clearance and duty payable. The Claimants submitted that such information confirms that the contractually required quantity of the Product had indeed been manufactured and were available to be shipped under the Contract. Paragraph-35- The Claimants submitted that the following matters should also be taken into account in considering the question whether the 4,000 mt of the Product had been manufactured :
i. The Respondents have admitted that the Claimants' factory has the capacity monthly and the Claimants had been regularly manufacturing the Product up to such capacity. ii. In its contemporaneous e-mail to the Respondents of 6th October, 2008, the Claimants stated that they had already produced 2,000 mt of the Product.
iii. The Respondents' e-mail of 16th October 2008 acknowledged that the Claimants had already produced material under the Contract, which had been transported to warehouses in the port.
iv. In cross-examination, the Respondents' witness said that the e-mail of 16th October 2008 confirmed what he believed to be true, and that he accepted that the Claimants were in a position to deliver the Goods."
In respect of difference between market price prevailing at the time of mitigated sale and the contract price the claimant/respondent relied on the price published in the Metal Bulletin Limited while appellant/petitioner relied on the price published in the Metal Page which are similar in nature. The price published in Metal Bulletin Limited was not disputed by the witness of the appellant/petitioner. Regarding difference between prevailing market price (at the mitigated sale) and the contract price the Arbitral Tribunal discussed in detail in Paragraph 46 which is quoted below :-
"Paragraph-46-The Claimants produced a schedule setting out the computation of the loss and damage said to have been suffered by them. This schedule set the average pregvailing Metal Bulletin prices of the goods on 28th November, 2008, 2nd January, 2009, 16th January, 2009 and 3rd April, 2009. The Metal Bulletin prices are in Euro per metric ton, and the Claimants converted these to US$ per metric ton (using the applicable conversion rate from Euro to US$ prevailing on each relevant date), to bring them in line with the Contract. Since the prices mentioned in the Metal Bulletin indices included ocean freight, inland freight and insurance, the Claimants deducted from the Metal Bulletin prices the components of freight and insurance to reflect the FOB price (being the price under the Contract). The Claimants calculated the difference between the Contract price and the adjusted Metal Bulletin price on each relevant date and multiplied the resultant amount by 4000 mt, the Contract quantity.
The Respondents did not seriously challenge the method of computation set out above."
Considering the records and in view of the discussions as above we are of the opinion that the decisions cited by Mr. Mitra have no manner of application in the present case. We find from the arbitration clause as quoted in Section 34 application that the parties expressly agreed to be bound by the Rules and Conciliation and the Arbitration of the International Chamber of Commerce (ICC). Therefore, following the Article 31 of the ICC Rules the cost was awarded by the Arbitral Tribunal in the present case to which no question could be raised by the appellant/petitioner.
We also find the decision reported in 53 CWN Page-873 does not help the appellant/petitioner in the present case where it is held that the dispute not within the scope of reference could not be subject matter of arbitration. It is well settled principle of law that dispute not referred in the letter of reference cannot be agitated before the Arbitral Tribunal but in the present case it was held by the Arbitral Tribunal after perusing evidence adduced by the parties that the dispute was very much within the zone of reference of the Arbitral Tribunal for consideration. It is evident from the award that the decision reported in 53 CWN (Supra) has been considered by the Arbitral Tribunal.
The decision in AIR 1963 (SC) Page 366, in our opinion, does not assist the appellant's case as in that case the seller failed to supply the buyer, therefore, buyer was granted damages on the price prevailing at Kanpur where the buyer was supposed to supply the goods, but in the present case it is the buyer who breached the contract and not the seller. Here the seller is ready with the product, as per contractual agreement but the appellant/buyer breached the contract by not purchasing the contractual goods, therefore, the seller is entitled to be compensated by the differential amount between the prevailing market price and the contract price.
Regarding claim of mitigated loss Mr. Basu relied on AIR 1981 (SC) Page 162 Paragraph 13, the extract of the Paragraph 13 is quoted below:-
"Paragraph-13-At the outset it must be observed that the principle of mitigation of loss does not give any right to the party who is in breach of the contract but it is a concept that has to be borne in mind by the Court while awarding damages. The correct statement of law in this behalf is to be found in Halsbury's Laws of England (4th Edn.) Vol.12, para 1193 at page-477 which runs thus ; "1193 Plaintiff's duty to mitigate loss. The plaintiff must take all reasonable steps to mitigate the loss which he has sustained consequent upon the defendant's wrong, and, if he fails to do so, he cannot claim damages for any such loss which he ought reasonably to have avoided." The decision supports the case pf the claimant/respondent.
We find that the damages/claims awarded by the Arbitral Tribunal considering the loss suffered by the claimant/respondent for breach of contract by the appellant/petitioner cannot be assailed as unreal loss. Therefore, the contention of the appellant/petitioner against the grant of damages to the claimant/respondent is totally unsustainable.
Summing up the above discussions and perusing the petition and the records annexed to the petition and also considering the decisions cited by the Counsels we are of the opinion that the award in question cannot be assailed as perverse, not supported by any documents or that it was passed travelling beyond the scope of reference. Further, we are also of the opinion that sitting in appeal we hardly have any scope to re- appreciate the evidence adduced before the Arbitral Tribunal. It is also well settled that the Court will not investigate or probe into the mental process of the arbitral tribunal. Therefore, we have no hesitation to hold that the Judgment and Order passed by the Hon'ble Single Judge does not deserve any interference.
Since there is no merit, the appeal should fail. Therefore the appeal is dismissed.
I agree (Ashim Kumar Banerjee, J) (Ashim Kumar Banerjee, J) (Samapti Chatterjee, J)