Clause 7(iii) of the agreement reveals that in the event of failure of the miller to supply the rice within the stipulated period, he shall be liable for an interest at the rate of 21% per annum on the basis of economic cost of left over stock/quantity of paddy/rice and the decision of the MD in that behalf shall be final. The clauses of the agreement also show that the shortage on the part of the miller would be recovered at 1.5 time the economic cost of equivalent paddy according to the variety involved. No doubt, as per the aforesaid clauses of the agreement, the excepted matters' were to be determined by the Managing Director himself and were not to be referred for arbitration, but the Managing Director of the Corporation had no judicial power under the agreement. If the miller fails to supply the rice as per the clauses of the agreement, then who is to decide those matters regarding the payment of the price of left over stock and interest for late delivery. In that situation, only the Arbitrator, who will be either the Managing Director himself or any other person appointed by him in that behalf, will decide the said matters. No doubt, the excepted matters' cannot be referred to arbitration as per the clauses of the agreement, but that does not mean that the MARKFED cannot recover the price of the left over stock/shortage and the interest for late delivery, as provided in the agreement. Even otherwise, there is no other remedy available to the Corporation to recover the amount of the alleged `excepted matters' except by including the same in its claim submitted before the Arbitral Tribunal.”
