Klen & Marshalls Manufacturers … vs Power Grid Corporation India Ltd. … on 9 September, 2015

Through: Sh. S.B. Upadhyay, Sr. Advocate with
Sh. P.K. Mishra, Advocate.
1. This common judgment will dispose of two cross appeals- one
preferred by the Power Grid Corporation of India (PGC)- i.e FAO (OS)
460/2011 and the other, by Klen and Marshalls Manufacturers & Exporters
Ltd (“Klen”) – FAO (OS) 654/2010. Both are directed against different
findings of the Learned Single Judge rendered in OMP 262/2003 (by PGC)
and OMP 88/2006- by Klen.
2. The facts necessary to decide the two appeals are that on 10.01.1995
PGC issued a Letter of Award to Klen for supply of line material (Bersimis
Conductors and Earth wires) which was to be used by the contractors of
PGC, i.e M/s Cobra, towards erection of towers and stringing, as part of the
larger World Bank funded project of power evacuation from Jammu and
Kashmir to other beneficiary neighboring states. In terms of the contract, the
supplies were to be completed within 24 months, i.e by 10.01.1997. PGC
contended that the delivery time was extended; firstly by a year. This was
without prejudice to PGC’s rights to recover liquidated damages. Alleging
that despite two extensions, Klen did not supply the entire contracted
quantities and that substantial quantities of conductors remained unsupplied,
PGC terminated the contract, on 03.09.1998. This led to disputes.
Eventually, under Sections 8 and 11, of the Arbitration Act, 1996 this Court
appointed a Sole Arbitrator, viz. Justice P.K. Bahri (Retired). The arbitral
tribunal, by award dated 09.05.2003, directed payment of US $ 1435006/-
by PGC with a further amount of `45,10,798/- in Klen’s favour. The
payments were directed to be made by PGC within two months, failing

FAO(OS) 654/2010 & FAO(OS) 460/2011 Page 2
which a further liability to pay 12% interest from the date of award, in the
event of default in payment of the awarded amount. PGC was awarded some
amounts, by way of liquidated damages.

Source: Indian Kanoon

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