abs IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO. 403 OF 2007 Square Automation Pvt. Ltd. .. Petitioner V/s Indian Oil Corporation Ltd. .. Respondent Ms.V.M. Choudharifor the petitioner. CORAM : D.G. KARNIK, J. DATE : 29TH APRIL 2008 P.C. P.C. P.C. : 1. Heard the learned counsel for the petitioner. 2. By this petition under section 34 of the Arbitration and Conciliation Act, 1996, the petitioner challenges the award dated 12th June 2007 passed by the sole arbitrator. 3. The respondent floated a public tender in September 1999 for the work of upgradation/revamping of electrical system for their Sabarmati Terminal. The petitioner was the lowest bidder. The petitioner’s bid was accepted and the respondent issued a letter of - 2 - intent to the petitioner on 25th November 1999. The respondent also paid to the petitioner an amount of Rs.9,34,539/- being 10% of the value of the contract as mobilisation advance on 7th January 2000. The work was required to be completed within 12 months from the date of handing over of the site to the petitioner. The site was handed over to the petitioner on 13th June 2000. However, the petitioner did not commence the work as per the work order and only the correspondence ensued between the parties. As per the respondent, the petitioner committed breach of the contract by not even commencing the work as per the work order. The respondent therefore initiated the arbitration proceedings in accordance with the arbitration clause contained in the tender document. Before the arbitral tribunal, the respondent made certain counter claims. The counter claims were rejected. However, so far as the respondent’s claims are concerned, the learned arbitrator directed refund by the petitioner of the mobilisation advance of Rs.9,54,539/- together with interest at 8% per annum from the date of the payment of the mobilisation advance to the petitioner. That order is impugned in this petition. 4. Learned counsel for the petitioner submitted that the arbitral tribunal erred in directing refund of the mobilisation advance paid to the petitioner. The - 3 - learned arbitrator misconstrued the letter dated 3rd January 2004 wherein the petitioner had offered to refund the amount of mobilisation advance. According to the petitioner, the offer contained in the letter dated 3rd January 2004 was conditional offer to refund subject to the respondent compensating the petitioner for the loss suffered by it and therefore the learned arbitrator erred in relying upon the letter in ordering the refund. 5. In my view, the learned arbitrator has committed no error in ordering the refund. The fact that the mobilisation advance was given is not disputed before me. Since the petitioner has not at all done the work as per the work order, the respondent was entitled to refund de hors the admission contained in the petitioner’s letter dated 3rd January 2004. In the circumstances, it cannot be said that the learned arbitrator has committed any error of law in ordering the refund of the amount. 6. As regards the interest on the amount, the learned arbitrator has awarded interest only from the date on which the mobilisation advance was given. Interest as well as the rate was the discretion of the arbitral tribunal. I see no error of law in grant of interest. - 4 - 7. Learned counsel for the petitioner tried to submit that the arbitral tribunal was not right in rejecting the counter claims. However, no material was brought to my notice in support of this contention. 8. No other point was raised. 9. In the circumstances, there is no merit in the petition which is hereby dismissed. (D.G. KARNIK, J.)