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2005 DIGILAW 168 (JHR)

Daya Shankar Rai v. Central Coalfields Limited

2005-02-23

M.Y.EQBAL

body2005
JUDGMENT M.Y. Eqbal, J. 1. In the instant application under Section 11(6) of the Arbitration and Conciliation Act, 1996 the petitioner has prayed for appointment of an independent sole Arbitrator for deciding the disputes raised by the petitioner with regard to his claim made to the respondents. 2. Petitioner was allotted a contract work by the respondents for the work of strengthening and widening of Roads from Khalari to Kalyanpur. Petitioner said to have completed the entire work. It is alleged that payment of Price- Escalation on labour, P.O.L. was agreed upon vide Clauses 15 and 16 of the General Terms and Conditions. Petitioners case is that respondents made part payment and inspite of repeated request the total claim of the petitioner has not been released. Petitioner, thereafter, raised disputes and called upon the respondents to appoint arbitrator for the Adjudication of the disputes. 3. The case of the respondent/ Central Coalfields Ltd. on the other hand is that petitioner has been paid full and final payment of Rs. 1,18,62,660.92 paise against their work done. The final escalation bill was also paid. All these bills have been duly accepted by the petitioner without any protest and they have accepted the final bill voluntarily and unconditionally. Petitioner also furnished certificate on the measurement book and in the final bill acknowledging that they have no dues outstanding against the management and their bill is in full and final settlement of their claims. According to the respondents, no disputes or differences therefore exists between the parties which warrant appointment of Arbitrator for resolving the alleged disputes. 4. I have heard Mr. Rajiv Ranjan, learned counsel for the petitioner and Mr. A.K. Srivastava, learned counsel for the respondents. 5. The main contention of Mr. Srivastava, learned counsel for the respondent/ CCL is that once the claim has been paid and the petitioner acknowledged payment in full and final settlement of their claim, the instant petition for appointment of Arbitrator is not at all maintainable. According to the learned counsel no disputes exists at all since all claims of the petitioner has been paid. 6. The question that falls for consideration in this petition is whether the claim has been finally settled by the respondents and the dispute no longer exists. According to the learned counsel no disputes exists at all since all claims of the petitioner has been paid. 6. The question that falls for consideration in this petition is whether the claim has been finally settled by the respondents and the dispute no longer exists. The Supreme Court in the case of Damodar Valley Corporation v. K.K. Kar, (1974)1 SCC 141 held that such question whether there has been a full and final settlement of claim under contract is itself a dispute arising upon or in relation to or in connection with the contract. These words are wide enough to cover the dispute sought to be referred. 7. Similarly, in the case of Bharat Heavy Electricals Limited v. Amar Nath Bhan Prakash, (1982)1 SCC 625 , their Lordships of the Supreme Court observed that whether there was discharge of the contract by accord and satisfaction or not is a dispute arising out of a contract and is liable to be referred to arbitration. 8. In the case of Jayesh Engineering Works v. New India Assurance Company Ltd., (2000)10 SCC 178 , their Lordships of the Supreme Court observed that whether any amount is due to be paid and how far the claim made by the claimant is tenable are matters to be considered by the Arbitrator and also whether payments have been made in full and final settlement are questions to be considered by the Arbitrator. 9. The ratio decided in the decisions referred to hereinabove has been followed by the Supreme Court in a recent decision in the case of N.T.P.C. v. Rashmi Construction, (2004)2 SCC 663 . 10. Be that as it may, under the Arbitration and Conciliation Act, 1996 there is no scope for the Chief Justice or his deligatee to enter into the controversy in a request petition under Section 11(6) of the said Act. The Chief Justice or his deligatee has no jurisdiction to find out whether the disputes exists and the contract subsists by appreciating the case of the respondents that the bills have been paid in full and final settlement of the claim. It is for the Arbitral Tribunal to go into these questions and to find out whether claim has been finally settled and alleged dispute is not referable to arbitration. 11. It is for the Arbitral Tribunal to go into these questions and to find out whether claim has been finally settled and alleged dispute is not referable to arbitration. 11. Admittedly, the contract between the petitioner and the respondents contains an arbitration clause according to which all disputes and differences are to be referred to arbitration. Petitioner invoked arbitration clause and by notice called upon the respondents to decide the disputes by arbitration and on the failure of the respondents to accede the request of the petitioner, the instant petition has been filed. 12. In the facts and circumstances of the case, the instant request petition is allowed and as jointly agreed Mr. Udai Shankar, Retired Chief Engineer, CMPDIL is appointed as sole Arbitrator. He is directed to enter into the reference and gave an award within a period of four months from the date of entering into the reference.