Indian Potash Limited v. M/S. Emmsons Gulf Dmcc

NAVIN CHAWLA, J SEPTEMBER 25, 2018 (RN/Arya)

Page 1 * IN THE HIGH COURT OF DELHI AT NEW DELHI + O.M.P. (COMM) 30/2018 & IA 4862/2018(stay) Reserved on: 6th September, 2018 Date of decision :25th September, 2018 INDIAN POTASH LIMITED ..... Petitioner Through: Mr. Arvind Minocha, Adv. versus M/S. EMMSONS GULF DMCC ..... Respondent Through: Mr.Sanjeev Puri, Sr. Adv. with Mr.Tejas Parashar, Adv. CORAM: HON'BLE MR. JUSTICE NAVIN CHAWLA 1. This petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the "Act") has been filed by the petitioner challenging the Arbitral Award dated 30th November, 2017 passed by the majority of the Arbitrators, awarding a sum of Rs.11,74,39,806/- in favour of the respondent alongwith interest @12% per annum from 8th December, 2011 to 30th November, 2017 and further directing that if the awarded sum is not paid within one month from the date of the Award, the petitioner shall pay interest @18% per annum from the date of the Award till the date of payment. 2. The disputes between the parties are in relation to the Agreement dated 30th August, 2011 by which the respondent had agreed to supply a quantity of 1,90,000 MTs (+/-) 10% (shipping tolerance) Prilled Page 2 /Granular Urea(in bulk) under the terms and conditions set out therein. Clause II of the Agreement provides as under:- "II. Shipment Schedule : Arrival by November 07th, 2011 at Indian discharge Port." 3. The dispute between the parties is confined only in relation to the supply of a quantity of 30,000 MTs +/- 10% Urea, which was supplied admittedly beyond the contractually stipulated date, as provided in clause II of the Agreement read with the Addendum No.2 dated 25th November, 2011 executed between the parties. 4. The respondent by its e-mail dated 21st November, 2011, that is much after the expiry of the contractual period of supply, informed the petitioner of nomination of Vessel MV ADVENTIST for supply of the above noted quantity of Urea with a laycan of 23rd - 26th November, 2011. 5. The petitioner on 25th November, 2011, addressed an e-mail to the respondent giving its acceptance to the nomination of Vessel MV ADVENTIST with a laycan of 23rd - 26th November, 2011, inter alia subject to the following condition: "SELLERS SHALL BE LIABLE FOR LIQUIDATED DAMAGES AS PER THE TERMS OF SUBJECT CONTACT FOR DELAY IN SHIPMENT /ARRIVAL AT DISCHARGE PORT IN INDIA, BEYOND THE CONTRACTUAL DATE." 6. On the same day, the parties entered into the Addendum No.2 to the Agreement, which is rather short and is reproduced hereinbelow: "At the request of the seller the last date of shipment under Clause No.II (Shipment Schedule of Contract No.- IPL/EMMSONS/UREA/2011-12/27 DATED August 30, 2011, is being revised as under: Page 3 "Shipment from load port latest by 30th November, 2011 The same is subject to terms & conditions under Clause XIV and other provisions of the subject contract." 7. Admittedly, the vessel did not sail till 30th November, 2011 and the respondent vide its letter dated 9th December, 2011 informed the petitioner that the loading could be completed only on 8th December, 2011 and that the vessel had sailed on 9th December, 2011 with the estimated time of arrival at the delivery port being 12th December, 2011. 8. Clause XXI of the Agreement between the parties clearly recorded the fact that the petitioner was purchasing the Urea on behalf of the Government of India. Therefore, on receipt of the letter dated 9th December, 2011 from the respondent, the petitioner promptly wrote to the Department of Fertilizers on 9th December, 2011 itself, informing the Department regarding the sailing of the vessel and made the following request: "We request you to inform the all concerned and issue the DOF nomination letter." 9. The Department of Fertilizers, however, by an e-mail dated 9th December, 2011 informed the petitioner that as the shipment period under the contract had been extended only upto 30th November, 2011, late shipment was not acceptable to it. 10