Case: The Kamrup Industrial Gases Limited Vs. Union Of India

by the respondents Counsel, but his evidence on this topic has remained unshaken. Reference is made to Qs. 1044 to 1047 and Qs. 1370 to 1411 in cross-examination, put to the said A.N. Jha. The said A.N. Jha has proved that the said Blown off statements had been delivered by him personally to the responents employees at the General Managers Office. The said A.N. Jha has also deposed that the people at the General Managers Office of the respondent refused to acknowledge receipt of the said statements on the copies of the Statements produced by the claimant and the copies of the said Statements were kept in the office of the claimant which they have produced in this Reference and which have been exhibited herein as mentioned before. The claimant has also produced in this Reference their Plant Reports and proved the same through their witness, A.N. Jha (Qs. 244 to 265 in examination-in-chief). The Plant Reports were exhibited in these proceedings as Exhibit PPPPPPP series. The said A.N. Jha has deposed that the said Plant Reports were prepared by the Foreman on duty of the respondent on the basis of the production and sale of Oxygen and D.A. Gases during the relevant periods. The said Plant Reports were prepared under his supervision. The Plant Reports have entries regarding production, available gases lifted by DLW, Sales to other customers, Blown Off Statement and Closing Stock of the Claimant-Company. The Plant Reports are internal documents of the claimant, produced and proved by A.N. Jha in these proceedings. The other documents on which the claimant relies with regard to their case of blowing off of the gases are various bills submitted by the claimant in respect of the gases, both lifted and unlifted quantitites, made on the respondent. The claimants Counsel has contended that though these bills were duly served on the respondent in accordance with Clause 7 of the Agreement, no objections were raised regarding the accuracy and/or contents of the said bills." (emphasis is ours)13. Having perused the documents furnished by the appellant, at the asking of the Diesel Locomotive Works, and having perused the findings recorded with reference to the statement made by Shri A.N. Jha, before the Arbitrator (extracted above), we are satisfied, that on each occasion, before the shortfall of the gases were blown off, the appellant duly informed the Diesel Locomotive Works, and in that view of the matter, it is not possible for us to concur with the findings recorded by the High Court, that due intimation was not furnished by the appellant - Kamrup Industrial Gases Ltd., to the respondent - Diesel Locomotive Works, before carrying on the exercise of emptying their cylinders, by blowing off the unlifted gases. It is also relevant in this behalf to make a reference to the determination recorded by the Arbitrator, again based on the statement of the aforesaid Shri A.N. Jha, that on different occasion, relevant bills were raised by the appellant - Kamrup Industrial Gases Ltd., indicating payments claimable by the appellant. The bills raised also denoted the amounts deducted on account of the sale proceeds of the gases which the appellant could sell in the open market. According to Shri A.N. Jha, all the bills were duly furnished to the Diesel Locomotive Works. Details in this behalf are extracted below: "The claimant had called one A.N. Jha (full name Amar Nath Jha) as witness. Jha was the Office Superintendent of the Claimant-Company in 1971 and was appointed as the Assistant Manager in 1972 and was posted at the claimants factory at Varanasi during the relevant time. Jha had deposed that all the relevant bills with covering letters from the claimant were served on the respondent at the F.A. & C.O. Department of DLW at Varanasi by him personally and the receipt of the said bills were acknowledged by various officers of the said F.A. & C.O. Department of the respondent on the copy of the said bills (vide Qs. 32 to 75 in Examination-in-chief). The evidence of Jha in this respect had not been shaken in cross-examination by the learned Counsel for the respondent. With respect to bills for uplifted quantity of gas, the respondents case is that they made part payments for the gas supplies at the contract rate but withheld payment of escalation charges relating to rise in the price of Carbide mentioned in the said bills. Receipt of the said bills was not denied by the respondent. In respect of bills for the price of unuplifted quantities of gas, the respondents Counsel put Qs.1470 to 1497 to the said Jha in cross-examination. Jha maintained that he personally served the said bills at the Office of the F.A. & C.O. of the respondent and obtained acknowledgements by the people working at F.A. & C.O. Department of the respondent of the receipt of the said bills on the copies of the said bills, which are tendered in evidence in these proceedings.The respondents on their part called one M. Singh as their only witness. The said M. Singh was the Senior Clerk working in the Stores Department of the respondent at the relevant time. He did not belong to the F.A. & C.O. Department of the respondent and had no knowledge of affairs of the said F.A. & C.O. Department. No one from the said F.A. & C.O. Department or the General Managers Office has been called by the respondent to contradict the deposition of Jha. Further, the respondent did not produce Receipt Register from the F.A. & C.O. Department to controvert the evidence of Jha although the respondents witness, the said M. Singh, deposed that the respondent maintained Receipt Registers at the relevant time. The respondent has adduced no evidence to rebut the testimony of Jha that the bills had been served on the respondent. I accept the evidence of Jha on this point." (emphasis is ours) Interestingly, there was no rebuttal to the assertions made by Shri A.N. Jha, before the learned Arbitrator.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]5. During the course of hearing it emerged, that the main reason for the Division Bench of the High Court in accepting the appeal was, that the appellant did not produce vital documents called for by the Diesel Locomotive Works, before the Arbitrator.We find substance in the contention advanced at the hands of the learned counsel for the appellant, more particularly because learned counsel for the respondent, could not dispute the factual position recorded in the proceedings conducted before the Arbitrator, on 16.08.1989. We therefore, hereby set aside the finding recorded by the High Court, to the effect, that the documents sought for by the buyer - Diesel Locomotive Works, were neither produced before the Arbitrator, nor provided to the respondent.9. The next question, that arises for consideration is, whetherthe appellant was entitled to payment on account of short lifting of gases by the Diesel LocomotiveWorks. In this behalf, it has already been noticed hereinabove, that the Diesel Locomotive Works, would lift a minimum of 12,900 cubic meters of Oxygen gas, and a minimum of 2,500 cubic meters of Acetylene gas, per month. And whether or not they lifted the minimum quantity, the appellant herein - Kamrup Industrial Gases Ltd., would be entitled to payment for the same. Be that as it may, it is imperative to determine, before the appellant can be held to be entitled to claim the right of such payment, that the appellant - Kamrup Industrial Gases Ltd., had actually produced the gases in terms of the stated minimum quantum, and further, the appellant was not able to sell the shortfall, in the open market. The question of payment to the appellant would arise only if, there was a subsisting shortfall, after the steps referred to above were followed. This could be done by adding the amount of gases lifted by the Diesel Locomotive Works, and the amount of gases sold by the appellant in the open market. Payment for the shortfall would emerge, "only" if the shortfall of gases thus established, were shown to have been blown off, as has been claimed by the appellant before the Arbitrator, and before the High Court.The above factual finding of the High Court, has also been assailed by the appellant.13. Having perused the documents furnished by the appellant, at the asking of the Diesel Locomotive Works, and having perused the findings recorded with reference to the statement made by Shri A.N. Jha, before the Arbitrator (extracted above), we are satisfied, that on each occasion, before the shortfall of the gases were blown off, the appellant duly informed the Diesel Locomotive Works, and in that view of the matter, it is not possible for us to concur with the findings recorded by the High Court, that due intimation was not furnished by the appellant - Kamrup Industrial Gases Ltd., to the respondent - Diesel Locomotive Works, before carrying on the exercise of emptying their cylinders, by blowing off the unlifted gases. It is also relevant in this behalf to make a reference to the determination recorded by the Arbitrator, again based on the statement of the aforesaid Shri A.N. Jha, that on different occasion, relevant bills were raised by the appellant - Kamrup Industrial Gases Ltd., indicating payments claimable by the appellant. The bills raised also denoted the amounts deducted on account of the sale proceeds of the gases which the appellant could sell in the open market. According to Shri A.N. Jha, all the bills were duly furnished to the Diesel Locomotive Works.15. The list of dates reveals, that on 1.9.2006 the Calcutta High Court decreed the award dated 18.4.2004 (in Award Case No. 12/2004). The said factual position is not disputed in the counter affidavit filed on behalf of the respondent.