TaxTMI 
TaxTMI 
2015 (1) TMI 1432
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....as been described in various communications amongst the parties but the contract itself does not carry such title or heading. The contract was executed on 28thAugust, 2007. We find from page 31 of the compilation tendered before us by Mr. Banerjee that the selection of the respondents who represented themselves as a joint venture was onthe basis of bidding process. The State had issued a letter dated 12th December 2011 for suspension of payment in terms of Clause 2. 8 of the GCC followed by another notice issued on 9th February 2012 seeking to terminate the contract. The dispute between the parties primarily originated from termination of contract by the State. There were disputes on other counts also. An Arbitral Tribunal was constituted by an order passed by this Hon'ble Court for addressing the disputes by and between the parties. 2. For proper appreciation of the rival contentions, were produce below two clauses, being2. 8 and 2. 9 from the General Conditions of Contract:- "2. 8. Suspension The Client may, by written notice of suspension to the Consultants, suspend all payments to the Consultants hereunder if the Consultants fail to perform any of their obligations under th....
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.... on the one hand granted the 2ndextension vide letter No. 623 dated 25. 11. 2011 but on the other hand issued a letter No. 626 on the same day i. e. 25. 11. 2011 threatening suspension of payment under Cl. 2. 8 of the GCC alleging certain deficiencies. 20. On 05. 12. 2011, a review meeting was held between the parties, followed by a letter dated 07. 12. 2011 issued by the Claimant in reply/compliance of the said letter dated 25. 11. 2011. 21. Without properly considering the said letter of the Claimant, dt. 7. 12. 2011, the Respondents issued letter No. 663 dated 12. 12. 2011 invoking Cl. 2. 8 of the GCC for suspension of payment, alleging certain deficiencies. Cl. 2. 8 reads as follows:- "Cl. 2. 8: Suspension The Client may, by written notice of suspension to the Consultants, suspendsall payments to the Consultants hereunder if the Consultants fail to perform any of their obligations under this Contract, including the carrying out of the services, provided that such notice of suspension (i) shall specify the nature or the failure and (ii) shall request the consultants to remedy such failure within a period not exceeding thirty (30) days after receipt by the Consultants o....
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.... Settlement Any dispute between the parties as to matters arising pursuant to this contract which cannot be settled amicably within thirty (30 days) after receipt by one party of the other party's request for such amicable settlement in accordance with the provisions specified in the SC. " 27. But without considering the said reply of the Claimant and without responding to the request for amicable settlement, the Respondents issued a letter dated 01. 03. 2012, asking the Claimant to adhere to Cl. 2. 9. 4 of GCC- "Cessation/Closing the Service. " 28. The Claimant through a legal notice dated 10. 03. 2012 denied and disputed the allegedevents specified in Cl. 2. 9. 1(a) and cautioned the Respondents not to terminate the contract in view of Cl. 2. 9. 6 of GCC. , and referred the matter to arbitration, by naming Mr. G. Sharan as arbitrator. Cl. 2. 9. 6 of GCC reads as follows:- "Cl. 2. 9. 6 Disputes about events of termination If either party disputes whether an event specified in paragraphs (a) through (e) of Clause CC 2. 9. 1 or in Clause GC 2. 9. 2 hereof has occurred such party may within forty five days after receipt of notice of termination from the other party ....
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.... Accordingly, the purported termination of the contract is held illegal and invalid. " 5. On the basis of such finding the individual claims weredealt with and the award was made on 15thFebruary 2015 for a sum of Rs. 2, 10, 87, 304/-and counterclaim stood altogether rejected. 6. The award was challenged under Section 34 of the Arbitration and Conciliation Act, 1996 before the Commercial Court, Ranchi. The Presiding Officer of the Commercial Court found no reason to interfere with the award. Referring to various authorities primarily dealingwiththe jurisdiction of the Court under the aforesaid provision to interfere with the award, the learned Commercial Court held:- "18. The objection that the award is bad and illegal, it was contrary to the terms and condition and against the public policy are not sustainable. Nothing has been explained for such objection. The perusal of the record as well as the award, nowhere show that it is contrary to the terms and conditions of the agreement. 19. The learned Arbitrators have dealt with the matter in detail after giving cogent reasons and has arrived at conclusion that petitioners herein are jointly and severally liable to pay an amoun....
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.... (Rtd.), High Court of Jharkhand and Mr. G. Sharan and Mr. Indoria, both Arbitration Application no. 08 of 2012 under Section 34 of the Arbitration and Conciliation Act. 25. Accordingly, objections are overruled and petitionis dismissed. In the facts and circumstances of the case the parties shall bear their own cost. " 7. Mr. Banerjee has assailed the judgment of the Commercial Court primarily on the ground son which the award was challenged before the said Court. His argument is that the award was perverse and that the Arbitral Tribunal had failed to take into account the contractual clauses. According to him, termination was done in appropriate manner. His submission is that the notice of suspension in terms of Clause 2. 8 was given on 12thDecember, 2011 followed by the termination letter of 9thFebruary, 2012. His client, according to Mr. Banerjee, had given sufficient time for taking remedial measures to the opposite parties, but when the same was not undertaken, the State had no other option but to terminate the contract. Mr. Banerjee further contended that there was no evidence before the learned Tribunal to come to a conclusion that the notice of suspension stood diluted....