JUDGMENT
V.S. Aggarwal, J.
1. Shri Shiv Prakash was appointed as the sole arbitrator and he submitted the award dated 30th April, 1990. In pursuance of the notices having been issued objections have been filed by Union of India under Section 30 and 33 of the Arbitration Act, 1940.
2. It has been asserted that the arbitrator has misconducted himself and the proceedings in rejecting the claim of Union of India for Rs. 12,94,095/- on account of general damages suffered by Union of India due to breach of contract committed by M/s Laxmi Chemical & Industries Pvt. Ltd. (hereinafter described as the respondent). Furthermore it is claimed that the arbitrator misconducted himself in disallowing the claim for the reason that market rate prevailing at Mattupalyam (Distt. Coimbatore) cannot legally form the basis for claiming general damages and had gone wrong in calculating that the claim for general damages would be difference between rate and the market rates which prevailed on the date of the breah. Furthermore it is claimed that the arbitrator misconducted himself in firstly holding that the respondent has committed the breach of the contract and the question involved was only to the extent of the assessment of the compensation. It did not consider that M/s Tan India had expresly confirmed that stores covered in their invoices establish the market rates were exactly the same as mentioned in the market rate enquiry dated 10.4.1981.
3. The respondent contested the objections and in the reply filed asserted that there is no ground set out in the objections for setting the award. The arbitrator had made the award within the terms of the contract reference and interpreted the same. He is the master of facts. There was no reason disclosed in the objection petition filed by the petitioner for setting aside the award. The arbitrator has given the award as per valid and proper reason after appreciating the facts. There is no failure of rules of natural justice. The arbitrator had given valid reasons and consequently keeping in view the provisions of Section 33 the claim was rightly refused. It was denied that the petitioner Union of India had paid any substantial price as alleged. The demand of the petitioner was basis of increase in the price during the relevant period for which petitioner produced certain evidence but the arbitrator after examining the same and appreciating it found it to be not substantiated and proper and in accordance with law. In accordance with the provision of Section 73 of the Contract Act even remove damages were not payable.
4. The resume of the facts given above percepitates the sole controversy that comes up for consideration is as to whether the award for the arbitrator is liable to be set aside or not in terms that he had misconducted himself, which is the assertion of the Union of India.
5. Before proceeding further reference can well be made to the award pronounced by the arbitrator. Union of India had laid a claim of Rs. 12,94,095/- on account of general damages alleged to have been supplied by them because of breach of subject contract committed by the respondent by not supplying the part quantity of the stores. The arbitrator disallowed the claim for the reason that the market rates prevailing at Mattupalyam, District Coimbatore cannot legally form the basis for claiming general damages when under the subject matter supplies were to be made by the respondent on basis of rates prevailing at Kharagpur, West Bengal. Interest was also claimed by the Union of India who keepin in view the findings with respect to claim No. 1 the same was disallowed. The respondent contractor had also laid a counter claim of Rs. 15 lakhs. It was disallowed having not been proved besides another counter claim for Rs. 48,882/- on account of balance price of the stores supplied. The controversy in the present matter before the court is confined to claim No. 1 for Rs. 12,94,095 for general damages.
6. On behalf of the respondent reliance strongly was placed on the decision of the Supreme Court in the case of Murlidhar Chiranjilal v. Harishchandra Dwarkadas and Anr. . In the cited case a contract had been entered into between two persons for sale of certain canvass at a particular rate. Delivery was to be made through railway receipt for Calcutta FOR Kanpur. The railway receipt was to be delivered on 5.8.47. This was not done. Thereupon a civil suit was brought for damages against the party committing the breach of the contract. The plaintiff claimed the rate of canvass in Calcutta on or about the date of breach. The Supreme Court held that the purchaser/plaintiff had purchased the canvass for re-sale. It was open to him to sell the railway receipt as soon as it was received at Kanpur and there could be no inference from mere fact that goods were to be set to Calcutta and they were meant only for sale at Calcutta. Therefore, the measure of damages had to be calculated as they would naturally arise in the usual course of things. The plaintiff had to prove the market rate at Kanpur on the date of the breach and that fixing the amount of damages in the case that rate had gone above the contract rate. It was not done.
7. Almost identical is the decision of this court in the case of Universal Woolen Mills v. Union of India 1995(1) Arb. LR 59. In the cited case the Director General, Supply and Disposal had invited tenders for barrack blankets required by Inspector General of Police Manipur and Assam Rifles. The tender of Universal Woolen Mills was accepted. A formal order dated 15.6.84 was placed for supply of 18,750 barrack blankets for the total value of Rs. 14,80,875/-. Extension of time was granted but the barrack blankets were not supplied in time. The question once again that came up for consideration was as to whether Union of India was entitled to claim the damages in the present case. It was held that the market rate of controversy which was to be supplied at a specified place could not prove the rate on same commodity at another place.
8. Identical is the position in the present controversy. The arbitrator had considered the said controversy and noted that market rates prevailing at Mattupalyam cannot be legally forming the basis for claiming general damages. When under the subject matter the supplies were to be made on basis of rates prevailent at Kharagpur, West Bengal. There is no ground in the face of the aforesaid precedents to interfere.
9. There is another way of looking at the matter. The arbitrator is the final judge with respect to the findings. If on appreciation of the facts the arbitrator had come to a particular finding this court. This court will not re-appraise the evidence as if an appeal was being heard. Even if this court feels that finding of fact could be otherwise still it would be reluctant to interfere. Consequently, there is no force in the objections.
10. As a result of the reasons given above objections fail and are dismissed. Award is made a rule of the court and decree in terms of the award to be passed.
ORDER
V.S. Aggarwal, J.
For detailed order, please see Judgment of even date in Suit No. 319 of 1991.