Vishav Construction Co. v. General Manager, Northern Railway
2012-10-12
A.K.SIKRI
body2012
DigiLaw.ai
JUDGMENT Mr. A.K. Sikri, C.J.: (Oral) - The petitioner has filed the instant application under Section 11 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as ‘the Act’), seeking appointment of an Arbitrator to adjudicate the disputes/differences which according to the petitioner have arisen out of agreement No. 607/ASR dated 04.-03.2008 which was entered into between the applicant and the Railways. 2. It is not in dispute that as per Clause 64 of the General Conditions of Contract, such disputes and differences are to be adjudicated upon by the Arbitrator appointed by the competent authority of the Railways. The respondent has infact even appointed an Arbitrator on the demand of the applicant herein. However, only one claim, namely, Claim No.1, which is in the sum of Rs.40,000/- on account of the alleged wrong and illegal deductions from the final bill, that is referred. In the present petition, the applicant has raised as many as seven claims. The applicant wants that that claims also to be referred to the said Arbitrator. 3. The stand of the respondent is that these are ‘excepted matters’ referred to in Clause 63 of the General Conditions of Contract and because of that reason the claims are not referred. 4. Arbitration Clause as per the General Conditions of Contract is Clause 64 (1) (i) which reads as under:- “64(1)(i) : Demand for Arbitration:- In the event of any dispute or difference between the parties hereto as to the construction or operation of this contract, or the respective rights and liabilities of the parties on any matter in question, dispute or difference on any account or as to the withholding by the Railway of any certificate to which the contractor may claim to be entitled to, or if the Railway fail to make a decision within 120 days, then and in any such case, but except in any of the ‘excepted matter’ referred to in clause 63 of these conditions, the contractor, after 120 days but within 180 days of his presenting his final claim on disputed matter, shall demand in writing that the dispute or difference be referred to arbitration.” From the reading of the aforesaid clause, it is clear that those matters which are specified in Clause 63 are to be treated as ‘excepted matters’ and are thus not referable.
Clause 63 of the General Conditions of Contract is in the following terms :- “63. Matters finally determined by the Railway:- All disputes and differences of any kind whatsoever arising out of or in connection with the contract, whether during the progress of the work or after its completion and whether before or after the determination of the contract shall be referred by the contractor to the Railway and the Railway shall within 120 days after receipt of the Contractor’s representation make and notify decisions on all matters referred to by the contractor in writing provided that matters for which provision has been made in clauses 8(a), 18, 22 (5), 39, 43(2), 45(a), 55, 55-A (5), 57, 57-A, 61(1), 61(2) and 62(1)(b) of General Conditions of Contract or in any clause of the Special Conditions of the Contract shall be deemed as ‘excepted matters’ and decisions of the Railway Authority, thereon shall be final and binding on the contractor provided further that ‘excepted matters’ shall stand specifically excluded from the purview of the arbitration clause and not be referred to arbitration.” As per the aforesaid clause, those claims for which a provision has been made in clauses 8(a), 18, 22 (5), 39, 43(2), 45(a), 55, 55-A(5), 57, 57-A, 61(1), 61(2) and 62(1)(b) of General Conditions of Contract and claims arising out of the Special Conditions of Contract are non-arbitral. 5. Having regard to the aforesaid provision, let us examine the nature of claims preferred by the applicant in this petition. Claim No.2 is on account of idling of labour for the period 09.10.2007 to 20.12.2008. It is the submission of the applicant that as per clause 36 of the General Conditions of Contract, the applicant is entitled to the claim of idling of labour, jamadar and Supervisor and since this occasioned due to the fault of the respondent, the petitioner is entitled to claim the amount spent on the aforesaid grounds which according to the applicant comes to Rs.25,57,700/-. 6. As per Clause 14.3 of the General Conditions of Contract, no such claim is admissible. However, on the basis of the aforesaid clause, the respondent cannot refuse to refer the claims. Whether the matter is Arbitral or not is one issue and whether a particular claim is sustainable on merits or not is entirely a different issue.
6. As per Clause 14.3 of the General Conditions of Contract, no such claim is admissible. However, on the basis of the aforesaid clause, the respondent cannot refuse to refer the claims. Whether the matter is Arbitral or not is one issue and whether a particular claim is sustainable on merits or not is entirely a different issue. The respondent can refuse to refer the claim only if it falls in any of the clause specifically stipulated in Clause 63 of the GCC. Clause 14.3 of the GCC does not find mention in clause 63 as extracted above. 7. Claim No. 3 is on account of prolongation of the work by the Railway. It is alleged that the work got prolonged by 56 days and the applicant has claimed loss of profit for these 56 days at the rate of Rs.1775.30 paise per day. Again such type of claim is not covered by any of the ‘excepted category’. The same would be the position qua claims No. 4 and 5 which relate to the interest as well as claim No. 6 whereby the applicant is claiming costs of the litigation. As per Clause 64.6 of the GCC, costs is to be shared by the parties. However, again that can be, at the most, defence of the respondent-Railway before the Arbitrator and on this basis the respondent cannot refuse to refer the claim. In so far as claim No. 7 is concerned, the learned counsel for the applicant could not show the basis or rational of this claim. 8. In view of the aforesaid discussion, the respondent is directed to refer claims No. 2 to 6 as well to the Arbitrator within a period of one month. 9. With these observations, the petition stands disposed of.