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50. At this stage, it is relevant to extract the internal note of 03.06.2008 prepared by Shri Suresh Babu for MMTC, which reads as under:-

“COAL & HYDROCARBON DIVISION Sub: Finalization of long term price of Coking Coal for Delivery Period of 01-07-2008 to 30-06-2009.

Anglo and BMA had already finalized the price of hard coking coal for the above delivery period with Japanese Steel Mills and SAIL and RINL. The price of prime hard coking coal for the above delivery period is fixed at usd 300/t and Torrington hard coking coal at usd 292.50/ t as against usd 96.4/91.5 per ton respectively in the previous year. It is understood that BMA had not allowed carrying forward the left over quantities for the delivery period 2007- 08 in case of Japanese Steel Mills. So MMTC made all out effort to secure the cargo from both BMA and Anglo within the delivery period itself. MMTC will not be able to lift the entire contracted quantity of Anglo Coal for 07-08 by 30th June, 2008.

81. Dealing with the aspect of the contracted price, namely, US$ 300 PMT, Mr. Kaul highlighted the fact that MMTC had a parallel contract with BHP Billiton Mitsubishi Alliance (BMA). Under the said contract, MMTC lifted five lakh tons of hard coking coal at US$ 300 PMT (Goonyella Middle Seam brand) and US$ 292.5 PMT (Torrington brand) and US$ 270 PMT (soft coking coal) and absolutely no grievance was made about the said contract with BMA. Quantities were lifted and price paid without demur, contends Mr. Kaul. Mr. Kaul further submitted that in fact the price paid to BMA was used as a defence when Anglo sought damages pointing to market price at US$ 126 PMT. The argument of MMTC before the arbitrators was that there was no scope for damages as the market price was what they had paid to BMA.

82. In response to the aspect of supply by BMA, learned ASG submitted that the said transaction was vastly different from the one entered with MMTC. The learned ASG submitted that a. The agreement entertained between BMA and MMTC was qua 5,00,000 MT hard coking coal and 3,00,000 black water soft coking coal whereas Addendum 2 with Anglo by MMTC was only qua 4,66,000 hard coking coal. b. BMA showed flexibility, commercial wisdom and prudence by providing coking coal at the rate agreed that is US$ 292.50 for Torrington brand coking coal and US$ 270 Black water soft coking coal in a staggered manner which commenced from 25.05.2009 till 23.06.2012.

m. The explanation of Anglo that NINL had no say in the quantity since the quantity was fixed in the LTA and MoU and that in fact, NINL’s approval was only for the specification is a plausible one.

n. That MMTC purchased coal from BMA at US$ 300/292 PMT which had not been disputed and in fact the argument in the proceedings to set aside the award was based on the price paid to BMA to contend that no damages occurred to Anglo. Further, the stand of the learned ASG insofar as the supply by BMA is concerned as dealt with above shows that there was indeed supply  by BMA at the rate of US$ 292 PMT and US$ 270 PMT, though the period of carryover offered may have been different.