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2016 DIGILAW 837 (JHR)

Madan Prasad v. State of Jharkhand

2016-05-13

D.N.PATEL

body2016
ORDER : Learned counsel for the petitioner submitted that this application has been preferred under Subsection 6 of Section 11 of the Arbitration and Conciliation Act, 1996 in view of arbitration clause no. 23 of an agreement dated 21st July, 2003 which is at Annexure1 to the memo of this application. 2. Clause no. 23 of the agreement reads as under: “Clause 23: In case any dispute or difference shall arise between the parties or either of there upon any question relating to the meaning of the specifications, designs, drawings and instructions here before mentioned or as to the quality of workmanship or materials used on the work or as to the construction of any of the conditions or any clause or thing there in contained or as to any question, claim, rights of the parties, or any matter, or things whatsoever in any way arising out of or relating to the contract designs, drawings specifications, estimates, instruction order of these conditions or otherwise concerning the work or the execution, or failure to execute the same whether arising during the progress of the work of alter the completion or abondment thereof or as the breach of those contract then either party shall forthwith give to the order notice of such dispute or difference and such dispute or difference shall be referred to the Superintending Engineer of the circle and his decision there on shall be final, conclusive and binding on all the parties.” 3. It is further submitted by learned counsel for the petitioner that the dispute has arisen between the parties arising out of the aforesaid contract and, hence, notice was given on 12th July, 2007 for appointment of the Arbitrator, but, the opposite parties have not appointed any Arbitrator and, therefore, this application has been preferred. 4. Learned counsel for the opposite parties submitted that in fact there is no arbitration clause in the agreement mainly for the reason that vide Resolution dated 18th November, 1992 which was published in extra ordinary Gazette by the erstwhile State of Bihar, clause no. 23 of F2 Contract has been abolished. In view of this notification, clause no. 23 cannot be given any effect and, hence, there is no arbitration clause, at all. 5. 23 of F2 Contract has been abolished. In view of this notification, clause no. 23 cannot be given any effect and, hence, there is no arbitration clause, at all. 5. Having heard learned counsels for both the sides and looking to the facts and circumstances of the case, it appears that (i) An agreement has been entered into between the parties on 21st July, 2003 which is at Annexure-1 to the memo of this application. (ii) There is arbitration clause no. 23 for deciding the disputes between the parties by the Arbitrator. (iii) Despite the notice given on 12th July, 2007 by the petitioner which is at Annexure-8 to the memo of this arbitration application, neither reply has been given nor any Arbitrator has been appointed by the opposite parties. (iv) The contention raised by the learned counsel for the opposite parties has already been decided in the case of M/s. Lokeshwari Builders Pvt. Ltd. v. State of Jharkhand reported in 2006 (3) JCR 353 (Jhr). Paragraph nos. 3, 4, 5, 6, 7, 8, 17, 18, 22 and 23 thereof read as under: “3. Respondent No. 3 filed counter affidavit stating inter alia that Clause23 of F2 Contract had been abolished vide Government of Bihar, R.C.D. Resolution No.- A2/Niam-08/1992 6113(5), dated 18.11.1992 and it was published in the extra ordinary issue of Gazette and the petitioner is fully aware about the abolishment of Clause-23 of F-2 Contract. According to respondent there is no such Arbitration Clause and, therefore, question of reference of dispute for adjudication does not arise. Respondents have also denied the fact that there was any condition for supply of Bitumen by the Department, rather the Contractor had to manage himself for purchase of Bitumen from Indian Oil Corporation, Hindustan Petroleum or Bharat Petroleum Corporation. The respondents have taken various other defences in respect of their case that difference of amount is not payable by the respondents. 4. Petitioner has annexed xerox copy of the original agreement entered into between the petitioner and the Executive Engineer, as Annexure 2 to the application. From perusal of the said contract dated 23.5.2002, it transpires that Clause-23 still exists in the said Contract. 4. Petitioner has annexed xerox copy of the original agreement entered into between the petitioner and the Executive Engineer, as Annexure 2 to the application. From perusal of the said contract dated 23.5.2002, it transpires that Clause-23 still exists in the said Contract. Clause 23 of the Contract reads as under: “Clause 23: In case any dispute or difference shall arise between the parties or either of there upon any question relating to the meaning of the specifications, designs, drawings and instructions here before mentioned or as to the quality of workmanship or materials used on the work or as to the construction of any of the conditions or any clause or thing there in contained or as to any question, claim, rights of the parties, or any matter, or things whatsoever in any way arising out of or relating to the contract designs, drawings specifications, estimates, instruction order of these conditions or otherwise concerning the work or the execution, or failure to execute the same whether arising during the progress of the work of alter the completion or abondment thereof or as the breach of those contract then either party shall forthwith give to the order notice of such dispute or difference and such dispute or difference shall be referred to the Superintending Engineer of the circle and his decision there on shall be final, conclusive and binding on all the parties.” 5. Learned counsel for the petitioner firstly drawn my attention to Annexure-2, which is a Xerox copy of the original contract and submitted that in the original contract, clause-23 still exists and it was not deleted. Learned counsel submitted that even in reply to the notice by which petitioner invoked Clause-23 of the Contract respondents never refuted the claim of the petitioner for reference of dispute to arbitration. According to the learned counsel even if any resolution was taken for deletion of Clause-23 of the contract, the same having not been deleted in the instant contract, petitioner is entitled to invoke the said clause. Learned counsel for the petitioner relied upon the decision of a Division Bench of this Court in the case of M/s Sharda Construction v. State of Jharkhand and others, (2004) 4 JCR 786 . 6. On the other hand, Mr. Learned counsel for the petitioner relied upon the decision of a Division Bench of this Court in the case of M/s Sharda Construction v. State of Jharkhand and others, (2004) 4 JCR 786 . 6. On the other hand, Mr. Manjul Prasad, learned counsel for the respondent-State firstly submitted that Clause-23 of the General Terms of the Contract was abolished vide Resolution dated 18.11.1992 and was published in the Official Gazette. Learned counsel therefore, submitted that by publishing in the Gazette it was notified to all concern regarding deletion of Clause23 from the contract. Learned counsel relied upon the decisions rendered in the case of B.K. Srinivasan and others v. State of Karnataka and others, (1987) 1 SCC 658 and in the case of M/s Pankaj Jain Agencies v. Union of India and others, (1994) 5 SCC 198 . 7. Learned counsel also drawn my attention to the PWD Rules, particularly Rule 165 and 169 and submitted that Arbitration Clause shall be deemed to have been deleted from the contract agreement. 8. The moot question that falls for consideration in this application is as to whether in view of the deletion/abolition of Clause 23 by Resolution dated 18.11.1992, there exists arbitration clause in the contract agreement in question. xxxxxxxxxxxxxxxx 17. The contention of the respondent-Department is that Clause 23 of F-2 Contract was abolished vide Resolution dated 18.11.1992 and it was published in the Gazette. A copy of the Gazette notification has been annexed as Annexure-A to the counter affidavit. It transpires from the said notification dated 18.11.1992 that the Government of Bihar took a decision to abolish Clause 23 of the F2 agreement which is an arbitration clause. It does not appear from the said notification that it was issued in exercise of statutory power. 18. Notwithstanding, the aforesaid Gazette Notification for abolition of Clause 23 of F2 Agreement, respondents entered into the instant agreement with the petitioner which was duly signed by the Executive Engineer, Road Construction Department. The instant agreement contains Clause 23, which is an arbitration clause. In Clause 27 of the contract it is clearly mentioned that the terms and conditions of the agreement have been read over and explained to the executants who is the Managing Director of the petitioner-company and the Executive Engineer, Road Construction Department. The instant agreement contains Clause 23, which is an arbitration clause. In Clause 27 of the contract it is clearly mentioned that the terms and conditions of the agreement have been read over and explained to the executants who is the Managing Director of the petitioner-company and the Executive Engineer, Road Construction Department. It is not the case of the respondents that petitioner was made aware about the abolition of arbitration clause 23 from the agreement by resolution of 1992 nor is the case of the respondents that before filing of the instant application, petitioner was intimated about the deletion of clause 23 of F2 agreement by Gazette notification. xxxx xxxx xxxx xxxx 22. Considering the fact of the case, I am of the view that principle of “Expressio Unios Est Exclusio Alterius” shall apply, according to which where there is an express mention in the instrument of a certain thing, it will exclude any other thing of a similar nature. It is well settled principle of law that when an terms of a contract or of a grant, or of any other disposition of property, have been reduced to the form of a document or of a contract then no evidence shall be given in proof of the terms of the contract except the document itself. In my view if a particular clause, although incorporated but excluded from the contract, parties against whom it is to be operated must be given reasonable notice of its nonexistence. 23. Considering the entire facts of the case, in my considered opinion clause 23 has been incorporated in the agreement duly consented by the petitioner and the Executive Engineer of the respondent after reading and fully understanding the contents of the said agreement. Since clause 23 does exists in the contract in question, the petitioner has rightly invoked clause 23 of the contract. Consequently, the instant application under Section 11(6) of the Arbitration and Conciliation Act for reference of dispute to arbitration as per Clause 23 is maintainable.” (emphasis supplied) In view of the aforesaid decision, the contention raised by the learned counsel for the opposite parties is not accepted because the very same Resolution dated 18th November, 1992 passed by the erstwhile State of Bihar removing clause no. 23 of F2 Contract has already been interpreted by this Court and this Court has referred the matter to the learned Arbitrator. 23 of F2 Contract has already been interpreted by this Court and this Court has referred the matter to the learned Arbitrator. (v) In fact looking to the contract between the parties, clause no. 23 is as it is in the contract. Clause no. 23 has not been removed from F2 Contract. Thus, both the parties have agreed upon clause no. 23 which is meant for reference of dispute to arbitration. 6. In view of the aforesaid facts, reasons and judicial pronouncement, there is existence of the contract between the parties and there is arbitration clause also and notice for appointment of the Arbitrator has also been given by the petitioner which has not been responded by the opposite parties. I, therefore, appoint Retired Hon'ble Mr. Justice D.G.R. Patnaik as learned Arbitrator. Learned Arbitrator is, hereby, requested to decide the dispute between the parties as referred to in this application, as early as possible and practicable, preferably within a period of six months from the date of commencement of the arbitration proceeding. 7. Learned counsels for both the sides jointly submitted that they shall cooperate the hearing before learned Arbitrator and they shall not ask for any unnecessary adjournment. 8. Registrar General of this Court is, hereby, directed to send copy of this arbitration application along with annexures and reply filed by the opposite parties to the learned Arbitrator, appointed by this Court, immediately. 9. Accordingly, this arbitration application is allowed and disposed of.