Delhi High Court Score Information Technology Ltd vs Central Organisation, ExServiceman ... on 12 May, 2020 Equivalent citations: AIRONLINE 2020 DEL 755 $~ * % Reserved on: 27.11.2019 Pronounced on: 12.05.2020 + O.M.P. (COMM) 457/2018 SCORE INFORMATION TECHNOLOGY LTD ..... Petitioner Through: Mr. Mukul Talwar, Senior Advocate with Ms. Gunjan Sinha Jain, Ms. Pallavi Saigal and Ms. Aman Bhalla, Advocates. versus CENTRAL ORGANISATION, EXSERVICEMAN CONTRIBUTORY HEALTH SCHEME ..... Respondent Through: Ms. Monika Arora, CGSC with Mr. Harsh Ahuja, Mr. Kushal Kumar and Mr. Akash Deepgupta, Advocates. HON'BLE MS. JUSTICE JYOTI SINGH JYOTI SINGH, J. 1. Present petition has been filed under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act) for setting aside the Arbitration Award dated 31.07.2018 whereby the Arbitral Tribunal has rejected four claims of the petitioner and has partially allowed one claim. 2. The facts that need to be encapsulated herein are that the petitioner is a MSME engaged in the business of providing Turnkey Information OMP (COMM) 457/2018 Page 1 of 27 Technology Solution and Services including supply of computer hardware, software, etc. The respondent has been established by the Ministry of Defence, Government of India to administer the Ex servicemen Contributory Health Scheme (hereinafter referred to as ECHS). 3. The parties entered into an Agreement dated 31.05.2010 whereunder the petitioner was required to provide Personalized Smart Cards against the approved application of the beneficiary as provided by the respondent. Petitioner was also required to install and maintain specified quantity of computer hardware and software at 100 specified locations as per Clause 1.1.15 read with Clause 2.1.12 of the Agreement. In addition, as per Clause 2.1.2 and Clause 1.1.16, petitioner was required to maintain hardware and software supplied by the petitioner at another 127 locations. In terms of Clause 2.1.1, the petitioner had to provide one Technical Support Personnel at 114, ECHS locations which included Polyclinics, Regional Centres (RCs) and the Central Organisations. 4. As per the Agreement, the petitioner was required to supply Referral Authentication Kits (hereinafter referred to as the Kits) to the empanelled hospitals and laboratories for identifying patients referred by ECHS Polyclinics. The said hospitals / laboratories were required to procure the Kits only from the petitioner. Tenure of the Agreement was five years from 01.06.2010 to 31.05.2015. Initially, ECHS had 227 Polyclinics and 13 Regional Centres but later the number of Polyclinics increased to 426 and the Regional Centres to 28. As a result, the petitioner avers that it had to incur additional expenses in collecting approved application forms and providing additional software support. OMP (COMM) 457/2018 Page 2 of 27 Under Clause 5 of the Agreement, respondent agreed to pay a sum of Rs.135/ per smart card in the time and manner laid down in Annexure „E‟ of the Agreement. Para 2 of Annexure „E‟ provided that respondent would give Sales Tax Form „C‟ once in a year against the invoices raised by the petitioner for supply of the Smart Card. Clause 5 of the Agreement and para 2 of Annexure E are extracted below : "5. CONSIDERATION 5.1 The Parties have agreed that for the Turnkey Solutions, SITL shall be entitled to receive Rs.135/ (Rupees One Hundred Thirty Five only) per Smart Card delivered, to be payable by the Department at the time and in the manner specified in Annexure E. Annexure E 2. SITL will raise the invoice and the Department will give "Form C" against the invoices. One such form will be required to be given one a year from each Regional Center." 5. It is a case of the petitioner that the sum of Rs.135/ per Smart Card was one of the source of revenue generation for the petitioner to cover its expenses towards supply of Smart Cards and supply and maintenance of the hardware and software, coupled with payment of Statutory taxes and other costs of the employees. The only other source of revenue was receipts from the Kits, sold to the empanelled hospitals and labs. 6. Petitioner further avers that the petitioner mobilized its resources and commenced the work for the Smart Card Project till the end of