UNION OF INDIA THROUGH PCMM vs EMAMI AGROTECH LTD.

Judgment text excerpt

ARBP-458-2021-F.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO. 458 OF 2021 WITH Digitally INTERIM APPLICATION NO. 3020 OF 2021 signed by SHRADDHA IN SHRADDHA KAMLESH KAMLESH TALEKAR TALEKAR Date: ARBITRATION PETITION NO. 458 OF 2021 2025.02.26 11:03:37 +0530 Union of India through PCMM, Central Railway ...Petitioner Versus Emami Agrotech Ltd. ...Respondent/Orig. Claimant Mr. T.J. Pandian a/w. Gautam Modanwal and Noorjahan Khan, for Petitioner. Ms. Priyanka Desai a/w. Mr. Rohit Balani i/b M/s. The Fort Circle, for Respondent. CORAM : SOMASEKHAR SUNDARESAN, J. Reserved on : February 20, 2025 Pronounced on : February 26, 2025 JUDGEMENT : Context and Factual Background: 1. The challenge in this Petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (“the Act”) is to an arbitral award dated February 1, 2020 (“ Impugned Award”), which allows a claim made by the Respondent, Emami Agrotech Ltd. (“ Emami”) against the Petitioner, the Central Railway (“Central Railway”). Page 1 of 16 February 26, 2025 Shraddha ARBP-458-2021-F.doc 2. The Central Railway had deducted an amount of Rs. 48,75,400 from the amounts payable to Emami towards purchase of bio-diesel, primarily in reliance upon a “Fall Clause” contained in: (i) the purchase order dated January 19, 2016 issued by Central Railway to Emami (“Purchase Order”); and (ii) the Indian Railways Standard Conditions of Contract (“Standard Terms”). 3. A brief summary of the factual matrix would be necessary. Pursuant to a tender floated by the Central Railway, Emami made a bid dated October 29, 2015, for supply of 4,100 kilolitres 1 (“KL”) of bio-diesel at an “all-inclusive rate” of Rs. 45,300 per KL. The destinations at which the bio-diesel was to be del