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2020 DIGILAW 164 (JK)

R. K. Enterprises v. State Of J&K

2020-03-12

GITA MITTAL

body2020
JUDGMENT 1. I have heard Mr. Uday Bhaskar, learned counsel for the petitioner and Mr. S.S. Nanda, learned Sr. AAG on this Arbitration Application under Section 11(6) of the J&K Arbitration and Conciliation Act, 1997 , seeking reference of disputes which have arisen between the parties, through an independent Arbitrator. 2. It is undisputed that the petitioner was allotted the contract for construction of providing and laying 50 mm thick bituminous macadam and 20 mm thick open graded premix carpet with pavers and Hot Mix Plant on the New Bus Stand Rajouri (Phase-I) and a contract dated 3 rd of September, 2011 was entered into between the parties. 3. The petitioner has submitted that certain disputes have arisen between the parties on account of extra work which the petitioner was required to do and refusal of the respondent to pay for the same. The petitioner has submitted that the General Conditions of the contract formed part of the contract and that Clause-24 whereof contains the disputes redressal mechanism. The relevant extract of Clause-24 reads as follows:- '24. DISPUTE & ARBITRATION a) In case of any dispute between the contractor and department whatsoever the case shall be referred to the Director Local Bodies Jammu. The Executive Engineer on receipt of such reference from either party shall function as arbitrator and his decision as arbitrator shall be binding on both the parties.' 4. The petitioner has submitted that in view of the disputes between the parties with regard to the payment for the extra/additional work of providing seal coat and tack coat over graded premix carpet, the petitioner addressed a letter dated 26 th of July, 2013 for referring the disputes between the parties to arbitration. 5. The request was rejected by the respondent No. 3 by a letter dated 26 th of August, 2013. It is pertinent to mention that in this letter the respondent No. 3 has not disputed the existence of the arbitration agreement but rejected the demand of the petitioner on the ground that as per the report from the Assistant Executive Engineer, there was no separate order for laying the seal coat and tack coat and that no claim has been made in this regard. 6. 6. The petitioner is stated to have served another letter dated 9 th of September, 2013 responding to the letter dated 26 th of August, 2013 of the respondents and again requested for reference of the disputes to arbitration. 7. As the respondents failed to respond favourably despite passage of 30 days from the date of original request, the petitioner has filed the instant Arbitration Application under Section 11(6) of the J&K Arbitration and Conciliation Act, 1997 on 26 th of September, 2013, seeking appointment of an Arbitrator by this court. 8. On behalf of the respondents, objections stand filed and the matter has also been vehemently opposed by Mr. S.S. Nanda, learned Sr. AAG for the respondents. I find in the objections that the respondents did not dispute the allotment of work to the petitioner as claimed, however, a dispute is raised with regard to the assignment of the excess work. The respondents have contended that the work of providing the seal coat and tack coat was part of the work originally allotted to the petitioner and for this reason nothing extra was to be paid. In my view, the above claim of the petitioner and the stand of the respondent by itself shows that there is a dispute which is pending between the parties. 9. The respondents, however, have not disputed the bindingness of Clause 24 of the General Conditions of the contract as the governing agreement between the parties. In view thereof, there is a valid, binding and existing arbitration agreement between the parties. 10. Admittedly, despite service of the request dated 26 th of July, 2013 repeated in the rejoinder dated 9 th of September, 2013, the respondents have failed to appoint an Arbitrator within a period of 30 days from the date of service of this communication. In this background, the respondents have forfeited their right to find an Arbitrator. There is thus no impediment to the grant of the prayer made in the petition. 11. In view of the Jammu and Kashmir Reorganization Act, 2019, the Central Arbitration and Conciliation Act, 1996, is applicable to the present proceedings. It is, therefore, directed as follows: i) The disputes between the parties are referred to Mr. Anuj Dewan Raina, Advocate, who shall arbitrate the matter in accordance with the schedule to the Arbitration and Conciliation Act, 1996. In view of the Jammu and Kashmir Reorganization Act, 2019, the Central Arbitration and Conciliation Act, 1996, is applicable to the present proceedings. It is, therefore, directed as follows: i) The disputes between the parties are referred to Mr. Anuj Dewan Raina, Advocate, who shall arbitrate the matter in accordance with the schedule to the Arbitration and Conciliation Act, 1996. ii) The parties shall be at liberty to file detailed claims and counter claims before the learned Arbitrator. iii) The Arbitrator shall render his award within the prescribed statutory period. iv) The Arbitrator shall be entitled to fix his own fee in terms of the Schedule to the Central Arbitration and Conciliation Act, 1996. v) The Arbitrator shall also be entitled to all incidental expenses which shall be incurred by the petitioner. vi) The fee and the expenses shall be paid by the petitioner at the first instance. The same shall form part of the costs which are finally awarded by the Arbitrator. 12. This application is allowed in the above terms.