FAO No. 1774 of 2008 (O&M) 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH -- FAO No. 1774 of 2008 (O&M) . Date of decision: November 18, 2009 Punjab State Civil Supplies Corp. Ltd and others ........ Appellant Versus M/s Guru Kirpa Trading Company Ltd. etc. .......Respondent(s) Coram: Hon'ble Ms Justice Nirmaljit Kaur -.- Present: Mr. C S Bakshi, Advocate for the appellants Mr.M K Dogra, Advocate for the respondents -.- 1. Whether Reporters of local papers may be allowed to see the judgement? 2. To be referred to the Reporter or not? 3. Whether the judgement should be reported in the Digest? Nirmaljit Kaur, J. This is an appeal against the order dated 02.04.2007 passed by the District Judge, Ferozepur, dismissing the objection petition filed by the appellant under Section 34 of the Arbitration and Conciliation Act, 1996 (in short the 1996 Act) against the award dated 29.11.2002. The dispute in the award was on account of alleged non- fulfilment of terms of agreement executed between the parties for custom milling of crop for the year 1994-95. The award of Rs.7,17,131/- plus FAO No. 1774 of 2008 (O&M) 2 interest at the bank rate was announced. The same has been impugned by the Appellant-Corporation on the ground that the Arbitrator had committed serious anomaly in the calculation of the loss suffered by the Corporation and also qua the interest. The original claim was filed for a claim of Rs.1,34,55,574.00 with a request for interest at the rate of 21%. It was stated that finally only award of Rs.11,27,574.00 was granted and only bank rate was granted in stead of rate of 21% as stipulated in the agreement. Learned counsel for the appellant has been heard. As per the open sale policy, firstly the Government of India and then the Punjab Government, vide their circular letter No. RP 1-95/282 dated 21.03.1995 decided to sell paddy through “Open Sale Scheme” from the crop year 1994-95 according to the rates as prescribed in the said scheme. The calculation in accordance with the Open Sale Scheme was done by the Arbitrator. No fault has been found with the said calculation which was done in accordance with the rates as provided in the new policy itself and as per the revised statement submitted by the appellants themselves. The finding arrived at by the Arbitrator is as follows:- “There was a publication in the News Papers about the said sale. Thus, 11,693-16-500 qtls paddy was purchased by the respondent's Company, through R.Os and letters of D.M. PUNSUP, Ferozepur between 23.08.95 to 23.05.1996, 9,303.97 qtls paddy was sold to M/s Jain Paddy Rice Mills through D.M's letters, 1,000.00 qtls. to M/s Shiva Rice Mills, Ferozepur, through letter of DM, Ferozepur and finally 114.60 FAO No. 1774 of 2008 (O&M) 3 qtls paddy was sold to M/s S.S.Gambir Rice Mills, Jalalabad, through letter of the then D.M., Ferozepur. Thus, total 22,111,73 qtls. Paddy of Superfine quality was sold to above said millers for Rs.87,68,684.00. However, in the revised statement of account total quantity of paddy sold is shown as 22211.15 qtls. After the announcement of sale policy by Govt. the respective clauses about charging of 1.5 times the economic cost of paddy and 21% interest for late delivery of rice in the agreement, become redundant. Rather Punjab Govt. vide their circular letter No. RP-2(838)-2000/737, dated 06.06.2000, laid down guide lies for deciding arbitration cases relating to kharif marketing season 1994-95, which had been decided to be followed in toto, by the Board of Directors and according to which interest at Bank rate is to be charged. This rate of interest is on C.C. Limit of Food and Credit. The balance paddy left with respondents' company was thus 2,186-21-800 qtls. The benefit of 2% driage to this left over paddy comes to 43-72-436 qtls. leaving a balance of 2,142.49 qtls. This paddy after conversion into rice at the rate of 67% yield, as per Government of India's letter dated 07.11.96 (Annex C-8) works out to 1435.46 qtls, the cost of which @ Rs.781.20 per qtl. Vide G.O.I's letter dated 29.11.1996 as at Annex C-7/1, works out to Rs.11,21,381.00 which is recoverable from the Respondent's Trading FAO No. 1774 of 2008 (O&M) 4 Company.” Learned counsel for the appellant does not deny that a new policy was adopted by the Government and pursuant thereto, a revised statement of account for award of Rs.13,36,686/- along with interest at the bank rate as mentioned in the policy from 01.07.1995 till realisation was submitted before the Arbitrator. Thus, in view of the revised claim as per the new policy adopted by the Government which was submitted by the appellant themselves, no grievance can be made with respect to the grant of interest at the Bank rate. In view of the above discussion, no ground for setting aside the Award dated 29.11.2002 as well as the judgement dated 02.04.2007 passed by the District Judge, Ferozepur has been made out. Dismissed. (Nirmaljit Kaur) Judge November 18, 2009 mohan