M/s Vijay Rice and General Mills Ltd. & Anr. v. Punjab State Civil Supplies Corp. Ltd. & Ors.
FAO-CARB-22-2025 (O&M), Decided on: 08.07.2025
Coram: Hon’ble Mr. Justice Anil Kshetarpal & Hon’ble Mr. Justice Rohit Kapoor
- Scope of Interference under Section 34 of Arbitration Act
– Court reiterated that interference is limited to grounds under Section 34, including patent illegality and violation of “most basic notions of justice” as clarified in Ssangyong, DMRC, OPG Power, and Patel Engineering.
– Mere disagreement with arbitral findings or minor contractual infractions are not sufficient to set aside the award. - Objection of Excess Allotment of Paddy — Rejected
– Although the initial milling capacity was 2,250 MT, the appellant accepted additional 1,749 MT voluntarily.
– Court held: No coercion or violation of public policy; receipt of paddy was admitted in writing. - Interest at 13% vs. Claimed 12% — Justified
– The increase was based on Government of Punjab’s circular dated 18.02.2013, binding on both parties.
– Hence, no excess or unauthorized interest imposed. - Price of Rice Charged — Not Governed by GOI Rate
– Contract was between appellant and PUNSUP (state agency); GOI fixed price for 2011 not applicable in 2013 dispute.
– Appellant did not raise this objection before arbitrator or in Section 34 petition. - Gunny Bag Charges and VAT — No Perversity Found
– Arbitrator’s award based on retention of 99,180 gunny bags at notified rates.
– VAT was applicable and payable; no illegality or irrationality shown.
