JUDGMENT 1. - This arbitration application u/s 11 of the Arbitration and Conciliation Act, 1996 (in short 'the Act of 1996') has been filed for appointment of the Arbitral Tribunal consisting of Sole Arbitrator for adjudication of all claims, disputes and differences arising out of the arbitration agreement No. EE/2/2006-07 dated 3.8.2006 executed between the Applicant and the Non-applicants, relating to the construction of roads under PMGSY in Baran Distt. Package No. WB-RJ-4-58. 2. At the outset, it is appropriate to mention that vide order dated 2.7.2012 passed by this Court, Mr.S.K.Damani, Power of Attorney holder of the Applicant has been permitted to appear on behalf of the Applicant in this arbitration application as an exceptional case. 3. Briefly stated, the facts of the case, as per the Applicant, are that the construction work of roads under PMGSY in Baran Distt. Package No. WB-RJ-4-58 was awarded to the Applicant for an amount of Rs. 2,12,64,754/- vide Agreement No. EE/29/2006-07 dated 3.6.2007 with the stipulated date of commencement and completion as 13.8.2006 and 12.5.2007 respectively. The work could not be progressed due to various hindrances and the performance of the work was accepted by the Non-applicants till 17.7.2008 without further extending the time from 12.5.2007 to 7.7.2008. During this period, the Non-applicants did not rescind the contract. The Chief Engineer rescinded the contract vide his office order No. 3372 dated 17.7.2008. The competent authority i.e. the Superintending Engineer, P.W.D. Baran initiated action under clause 44 of the Contract Agreement by imposing full 10% compensation amounting to Rs. 21,26,475/- and at the same time, also operated Clause 53 which provided for action to charge 20% on the remaining work. 4. The competent authority i.e. the Superintending Engineer, P.W.D. Baran initiated action under clause 44 of the Contract Agreement by imposing full 10% compensation amounting to Rs. 21,26,475/- and at the same time, also operated Clause 53 which provided for action to charge 20% on the remaining work. 4. It is further stated in the arbitration application that aggrieved by the order of the competent authority - Superintending Engineer, P.W.D. Baran dated 22.8.2008 (Item No. 7 in the Index to the Arbitration Application) the Applicant sent a representation dated 7.11.2008 through Registered A.D. post which was received on 17.11.2008 who was to convey its decision within a period of 45 days as per Clause 24 and 24.1 but no such decision was communicated, therefore, on account of failure on the part of the Non-applicants for not communicating the decision within 45 days, the Applicant was not required to file any appeal to the Empowered Standing Committee under Clause 24(2) and 24(3) of the Dispute Resolution System, as envisaged under Clause 24, therefore, the Applicant contractor can directly approach this Court under section 11 of the Act of 1996. It has been also stated that the bar of arbitration under Clause 25 is not applicable as the dispute redressal system under Clause 24 has failed on account of the fault on the part of the Non-applicants by not giving the decision within 45 days or till the filing of this arbitration application i.e. 20.1.2009 by the Superintending Engineer under Clause 24.1, and Clause 25 will not apply in this case. 5. In the aforesaid facts and circumstances of the case, the Applicant has filed the present arbitration application under section 11 of the Act of 1996 for appointment of the Arbitral Tribunal consisting of Sole Arbitrator. 6. Counsel for the Non-applicants filed reply and has raised the preliminary objection that the Applicant can approach this Court only on being dis-satisfied with the decision of the Empowered Standing Committee constituted for the purpose of redressal of dispute at the request of the Contractor. In the instant case, no such request has been made at the behest of the Applicant and he has rushed to this Court without resorting to all the remedies available under the contract, by filing the present arbitration application, which is not maintainable. In the instant case, no such request has been made at the behest of the Applicant and he has rushed to this Court without resorting to all the remedies available under the contract, by filing the present arbitration application, which is not maintainable. He has also raised the objection that the Applicant cannot be allowed to file the present arbitration application for appointment of the Arbitrator in view of the bar contained in Clause 25. 7. Before proceeding to formulate the Questions - preliminary objection after consideration of the submissions made thereon, it would be appropriate to mention here that there is no dispute about the execution of the contract between the parties as well as the dispute raised by the Applicant before the Superintending Engineer, P.W.D. Baran on 17.11.2008 and therefore, I reproduce Clauses 24 and 25 of the bid document. The same are as under: Clauses 24 and 25 "24. Dispute Redressal System 24.1 If any dispute or difference of any kind what-so-ever shall arises in connection with or arising out of this Contract or the execution of Works or maintenance of the Works there under, whether before its commencement or during the progress of Works or after the termination, abandonment or breach of the Contract, it shall, in the first instance, be referred for settlement to the competent authority, described along with their powers in the Contract Data, above the rank of the Engineer. The competent authority shall, within a period of forty-five days after being requested in writing by the Contractor to do so, convey his decision to the Contractor. Such decision in respect of every matter so referred shall, subject to review as hereinafter provided, be final and binding upon the Contractor. In case the Works is already in progress, the Contractor shall proceed with the execution of the Works, including maintenance thereof, pending receipt of the decision of the competent authority as aforesaid, with all due diligence. 24.2 Either party will have the right of appeal, against the decision of the competent authority, to the Standing Empowered Committee if the amount appealed against exceeds rupees one lakh. 24.3 The composition of the Empowered Standing Committee will be: I. One official member, Chairman of the Standing Empowered Committee, not below the rank of Additional Secretary to the State Government. II. One official member not below the rank of chief engineer, and III. 24.3 The composition of the Empowered Standing Committee will be: I. One official member, Chairman of the Standing Empowered Committee, not below the rank of Additional Secretary to the State Government. II. One official member not below the rank of chief engineer, and III. One non-official member who will be technical expert of Chief Engineer's level selected by the Contractor from a panel of three persons given to him by the Employer. (emphasis supplied) 24.4 The Contractor and the Employer will be entitled to present their case in writing duly supported by documents. If so requested, the Standing Empowered Committee may allow one opportunity to the Contractor and the Employer for oral arguments for a specified period. The Empowered Committee shall give its decision within a period of ninety days from the date of appeal, failing which the contractor can approach the appropriate court for the resolution of the dispute. 24.5 The decision of the Standing Empowered Committee will be binding on the Employer for payment of claims up to five percent of the Initial Contract Price. The Contractor can accept and receive payment after signing as "in full and final settlement of all claims". If he does not accept the decision, he is not barred from approaching the courts. Similarly, if the Employer does not accept the decision of the Standing Empowered Committee above the limit of five percent of the Initial Contract Price, he will be free to approach the courts applicable under the law." Clause 25 25. Arbitration 25.1 In view of the provision of the clause 24 on Dispute Redressal System, it is the condition of the Contract that there will be no arbitration for the settlement of any dispute between the parties." Questions - Preliminary Objections (i) All the remedies available to the Applicant under Clause 24 of the Dispute Resolution System, more particularly sub clauses (2),(3) and (4) have not been availed of by the Applicant by not filing an appeal to the Empowered Standing Committee, therefore, the present arbitration application is not maintainable. (ii) There is bar for arbitration under Clause 25. (ii) There is bar for arbitration under Clause 25. Question - Preliminary Objection No. (i) - All the remedies available to the Applicant under Clause 24 of the Dispute Resolution System, more particularly sub clauses (2),(3) and (4) have not been availed of by the Applicant by not filing an appeal to the Empowered Standing Committee, therefore, the present arbitration application is not maintainable. 8. Submission of counsel for the Non-applicant on the aforesaid preliminary objection No. (i) is that all the remedies available to the Applicant under sub clauses (2), (3) and (4) of the Dispute Resolution System have not been availed of by the Applicant by not filing an appeal to the Empowered Standing Committee, therefore, the direct approach to this Court by filing the present arbitration application is not maintainable. Counsel for the Non-applicants has not cited any judgment in support of his aforesaid submission. 9. Submission of the Power of Attorney Holder of the Applicant is that since the Superintending Engineer, P.W.D. Baran was at fault by not deciding his representation within 45 days under Clause 24.1, therefore, sub-clauses (2), (3) and (4) of Clause 24 of the Dispute Resolution System are not applicable, in support of which, the Power of Attorney holder placed reliance on the following judgments: (i) M.K. Shah Engineers & Contractors v. State of M.P., (1992) 2 SCC 594 , Para 17. 17. No one can be permitted to take advantage of one's own wrong. The respondent-State of M.P. cannot and could not have been heard to plead denial of the two appellant's right to seek reference to arbitration for non-compliance with the earlier part of clause 3.3.29. In the case of M/s. Chabaldas & Sons, the clause was complied with. Alternatively, even if it was not complied with in the case of M/s. Chabaldas & Sons, but certainly in the case of M/s. M.K. Shah, the fault for non-compliance lies with the respondent-State of M.P. through its officials. The plea of bar, if any, created by the earlier part of Clause 3.3.29 cannot be permitted to be set up by a party which itself has been responsible for frustrating the operation thereof. It will be travesty of justice if the appellants for the fault of the respondents are denied right to have recourse to the remedy of arbitration. The plea of bar, if any, created by the earlier part of Clause 3.3.29 cannot be permitted to be set up by a party which itself has been responsible for frustrating the operation thereof. It will be travesty of justice if the appellants for the fault of the respondents are denied right to have recourse to the remedy of arbitration. A closer scrutiny of Clause 3.3.29 clearly suggests that the parties intended to enter into an arbitration agreement for deciding all questions and disputes arising between them through arbitrator and there-by excluding the jurisdiction of ordinary civil courts. Such reference to arbitration is required to be preceded by a decision of the Superintending Engineer and a challenge to such decision within 28 days by the party feeling aggrieved therewith. The steps preceding the coming into operation of the arbitration clause though essential are capable of being waived and if one party has by its own conduct or the conduct of its officials disabled such preceding steps being taken, it will be deemed that the procedural pre-requisites were waived. The party at fault cannot be permitted to set up the bar of non-performance of pre-requisite obligation so as to exclude the applicability and operation of the arbitration clause. (ii) Nirman Sindia v. M/s. Indal Electomelts Ltd. Coimbatore & Ors., AIR 1999 Kerala 440 , Para 9. "9. The principle laid down by the apex Court in the decision in M.K. Shah Engineers & Contractors v. State of M.P., (1999) 2 SCC 594 : AIR 1999 SC 950 is squarely applicable to the facts of this case. In that judgment the Supreme Court has observed as follows (At p.957, para 17 of AIR): (emphasis supplied) "A closer scrutiny of clause 3.3.29 clearly suggests that the parties intended to enter into an arbitration agreement for deciding all the questions and disputes arising between them through arbitration and thereby excluding the jurisdiction of ordinary civil Courts. Such reference to arbitration is required to be preceded by a decision of the Superintending Engineer and a challenge to such decision within 28 days by the party feeling aggrieved therewith. Such reference to arbitration is required to be preceded by a decision of the Superintending Engineer and a challenge to such decision within 28 days by the party feeling aggrieved therewith. The steps preceding the coming into operation of the arbitration clause through essential are capable of being waived and if one party has been its own conduct or the conduct of its officials, disabled such preceding steps being taken, it will be deemed that the procedural prerequisites were waived. The party at fault cannot be permitted to set up the bar of non performance of prerequisite obligation so as to exclude the applicability and operation of the arbitration clause." (iii) Mumbai Metropolitan Region Development Authority v. Unity Infreaprojects Ltd., 2008 (4) Arb LR 313 (Bombay) , Para 28. "28. The contract inter alia defined the adjudicator as a person appointed jointly by the employer and the contractor to resolve disputes in the first instance. The engineer was defined to be the person named in the contract data. The contract data (page 96) did not name the engineer. The engineer was to be nominated by the Managing Director of Span Consultants Pvt. Ltd. On 24th June, 2004, the respondent submitted Bill Nos. 3,3A and 3B to the team leader who by his letter dated 2nd July, 2004 refused to certify the claim. On 16th July, 2004, Span Consultants, who were acting for the petitioner,, informed the respondent that Shri R.S. Gupta was designated as engineer under the contract. On 16th August, 2004, Bil Nos. 4,4A and 4B were submitted to the engineer for work done up to 14th August, 2004. On 21st August, 2004, the engineer rejected the bills stating that only Bill No. 4 would be processed. A reference had to be made to the adjudicator within 14 days. The reference to the adjudicator was made on 3rd September, 2004, within 14 days of the rejection of the claim by the engineer on 24th August, 2004. Under the contract, the adjudicator had 28 days to take his decision. This period was to expire on 1st October, 2004. On 23rd October, 2004, the adjudicator issued a communication that the period of 28 days reserved for him to arrive at his decision would commence with effect from the date on which the respondent filed its reply in the matter. This period was to expire on 1st October, 2004. On 23rd October, 2004, the adjudicator issued a communication that the period of 28 days reserved for him to arrive at his decision would commence with effect from the date on which the respondent filed its reply in the matter. The petitioner has not asserted in its submissions in this court that the adjudicator had the power to do so. Now Clause 24.1 defines a dispute as having arisen if the contractor believes that the decision taken by the engineer is either outside the authority given to the engineer by the contract or that the decision was wrongly taken. The decision of the engineer was to be referred to the adjudicator within 14 days. A dispute arose immediately upon a reference being made by the respondent to the adjudicator. The adjudicator took no decision within 28 days. The respondent invoked arbitration by a letter dated 27th October, 2004. The invocation of arbitration was clearly competent upon the failure of the adjudicator to render his decision within a period of 28 days of the receipt of a notification of the dispute under Clause 25.1 of the contract. Clause 25.3 of the General Conditions of Contract contains a provision for arbitration. There is absolutely no valid ground to assert that the invocation of the arbitration was premature. The adjudicator having failed to render his derision within 28 days of his appointment, the respondent was within its right in invoking arbitration. The view taken by the arbitral tribunal on this aspect of the matter is correct and does not warrant any interference." 10. On consideration of the aforesaid judgments of the Supreme Court, Kerala High Court and Bombay High Court, I am of the view that since the fault for non compliance of the Clause lies on the Non-applicants, the Non-applicants cannot be allowed to take advantage of their own wrong for pleading denial of contractor's right to seek arbitration on the ground of non-compliance of the arbitration clause. The present case is squarely covered by the aforesaid judgments. The Question - Preliminary Objection No. (i) relating to the preliminary objection raised by the Non-applicants has no substance, therefore, untenable.Question - Preliminary objection No. (ii) - There is bar for arbitration under Clause 25. 11. The present case is squarely covered by the aforesaid judgments. The Question - Preliminary Objection No. (i) relating to the preliminary objection raised by the Non-applicants has no substance, therefore, untenable.Question - Preliminary objection No. (ii) - There is bar for arbitration under Clause 25. 11. Submission of counsel for the Non-applicants is that there is bar of no arbitration under Clause 25, therefore, the present application is not maintainable whereas submission of the Power of Attorney holder is that clause 25 has been preceded by Clause 24 and the said Clause 25 has been incorporated in view of Clause 24 of the Dispute Redressal System as would be evident from Clause 25 itself. Clause 24.1 has not been complied with by the Non-applicants, therefore, the Non-applicants cannot be allowed to take advantage of their own wrong and the said bar is not applicable. Question - Preliminary Objection (ii) relating to the preliminary objection No. 2 has no substance and the same is also not tenable, therefore, the arbitration application filed by the Applicant is maintainable. 12. I have gone through the record of the arbitration application and further considered the rival submissions along with the citations. 13. In view of the above, I deem it proper to appoint the Arbitral Tribunal consisting of the Sole Arbitrator in this arbitration application. 14. Accordingly, the arbitration application is allowed and Mr.S.K.Bakliwal, Retired Chief Engineer, Residing at 3-Ta-1, Jawahar Nagar, Jaipur is appointed as the Sole Arbitrator and the matter is referred to him for resolving the dispute between the parties arising out of the arbitration agreement No. EE/2/2006-07 dated 3.8.2006. The Sole Arbitrator will fix his fee according to the Arbitration Manual. All objections would be open to be raised by the Non-applicants before the Sole Arbitrator regarding merit of the claim. 15. A copy of this order be sent to the Sole Arbitrator - Mr. S.K. Bakliwal, Retired Chief Engineer, Residing at 3-Ta-1, Jawahar Nagar, Jaipur.Application Allowed. *******