Research › Search › Judgment

Jharkhand High Court · body

2022 DIGILAW 1066 (JHR)

Ram Kripal Singh Construction Private Limited v. State of Jharkhand

2022-08-25

SUJIT NARAYAN PRASAD

body2022
ORDER : 1. Reference may be made to order dated 28th July, 2022, whereby and whereunder Mr. Anish Kumar Mishra, learned AC to Senior SC-I appearing for the respondents-State has sought for time to take instruction. 2. The record suggests that the rejoinder affidavit has been filed on 29.07.2022, whereupon the Court has put a query upon learned counsel for the petitioner as to how rejoinder affidavit has been filed when there is no counter affidavit on the record. 3. Upon this, learned counsel for the petitioner-applicant has submitted that he has received a copy of the counter affidavit, therefore, he had filed rejoinder to the counter affidavit. 4. This Court, on submission has put a query upon learned counsel appearing for the State that as to whether any counter affidavit was filed or not. 5. Learned State counsel, upon taking instruction, has submitted that due to inadvertence though copy of counter affidavit was served upon the petitioner but could not file the counter affidavit in Court, therefore, seek leave of this Court to file the same now. 6. This Court, considering the prayer made on behalf of learned counsel for the State, hereby directs to keep the aforesaid counter affidavit on record. 7. Accordingly, the counter affidavit has been taken on record. 8. The matter has been taken up with the consent of learned counsel for the parties. 9. This application has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 seeking direction for appointment of sole Arbitrator in view of the Arbitration Clause stipulated under Clause 25 of the agreement dated 18.01.2018. 10. The brief facts of the case, as has been enumerated in the instant arbitration application, read as under: The petitioner/applicant is a construction company mainly engaged in Government Civil Contracts, such as, road construction projects, building construction projects and highway and bridge projects etc. It has been stated that an agreement being SBD No. 08/2017-18 dated 18.01.2018 was entered into between the petitioner and respondents for the work of widening to two lane with paved shoulder and improvement of NH 114(A) from Km 251.400 to Km 290.00 under NH(O) in the State of Jharkhand for the year 2017-18 for a total value of Rs. 69,70,92,178.00. It has further been stated that the date of commencement of the said work was 23.01.2018 and completion period was 18 months, i.e. 22.07.2019. 69,70,92,178.00. It has further been stated that the date of commencement of the said work was 23.01.2018 and completion period was 18 months, i.e. 22.07.2019. But due to some reason, the work could not be completed within the stipulated period of time, therefore, the petitioner sought extension till 31.01.2020 vide letter dated 09.08.2019, which was extended till 30.12.2019. On completion of the said project the petitioner got completion certificate vide letter no. 664 dated 30.12.2019 and raised final bill amounting to Rs. 4,38,97,185.00/- alongwith interest, royalty and GST Reimbursement but the respondent had caused quite delay in releasing the final bill so submitted by the petitioner. Therefore, the petitioner constrained to invoke Clause 25.3 of the Conditions of Contract and proposed the dispute to refer to a sole arbitrator, which did not evoke any response, hence the instant arbitration application. 11. Learned counsel for the petitioner/applicant has submitted that since the claim which has been raised has not been settled, therefore, the dispute has been raised and when the dispute has not been resolved, request was made for appointment of Arbitrator as per the condition stipulated under Arbitration Clause 25.2 of the contract. 12. Learned counsel for the State respondent, by taking the plea inter-alia taken in the counter affidavit, has submitted that there is no dispute as such. There is also no requirement to refer the dispute before the Arbitrator for its adjudication. It has further been contended that the petitioner failed to complete the work within stipulated period of time and on his request extension of time was granted and on completion of work, the final bill was submitted by the petitioner, which was paid but after payment of final bill the contractor requested for extra payment on account of interest on delayed payment, difference amount of royalty and GST reimbursement and later requested for appointment of sole arbitrator but the matter could not be resolved. It has further been submitted that there is no dues of the work as the bills produced by the petitioner have been paid without delay, therefore, there is no need to appoint an Arbitrator. 13. It has further been submitted that there is no dues of the work as the bills produced by the petitioner have been paid without delay, therefore, there is no need to appoint an Arbitrator. 13. Learned counsel for the petitioner has submitted, as would appear from the averment made in the counter affidavit, that the issue of dispute being not available is the main ground to object this application but it is nowhere apparent from the pleading made therein that the dispute is not arbitrable, therefore, whatever ground has been taken about the nonexistence of dispute according to the learned counsel for the respondent, the same is to be looked into by the Arbitrator only if the matter will be referred for its consideration/adjudication by appointing an Arbitrator in exercise of power conferred to this Court under Section 11(6) of the Act, 1996. 14. This Court has considered the aforesaid argument and before going into the Arbitration clause, deems it fit and proper to first consider the objection raised on behalf of the petitioner as per the counter affidavit, wherefrom it is evident that it is not the case of the State respondent that the dispute which is the subject matter of the lis is not arbitrable rather the only issue has been raised that the dispute which is being raised, cannot be allowed to be agitated by the petitioner since there is no latches on the part of the State respondent but the issue of latches and/or its attributability is not the subject to be looked into by this Court at the stage of reference while dealing with the application in exercise of power conferred under Section 11(6) of the Act, 1996. 15. The stand which has been taken by the State is required to be looked into by the Adjudicator. The question, therefore, only to be looked into is as to whether there is any Arbitration clause in the contract or not? 16. Admittedly, there is arbitration clause as would appear from Clause 25 of the Contract, which reads as under: “25. Procedure for Disputes 25.1 The Dispute Review Expert (Board) shall give a decision in writing within 28 days of receipt of notification of dispute. 16. Admittedly, there is arbitration clause as would appear from Clause 25 of the Contract, which reads as under: “25. Procedure for Disputes 25.1 The Dispute Review Expert (Board) shall give a decision in writing within 28 days of receipt of notification of dispute. 25.2 The Dispute Review Expert (Board) shall be paid daily at the rate specified in the Contract Date together with reimbursable expenses of the types specified in the Contract Data and the cost shall be divided equally between the Employer and the Contractor, whatever decision is reached by the Dispute Review Expert. Either party may give notice to the other to refer a decision of the Dispute Review Expert to an Arbitrator within 28 days of the Dispute Review Expert’s written decision. If neither party refers the dispute to arbitration within the next 28 days. The Dispute Review Expert’s decision will be final and binding. 25.3 The arbitration shall be conducted in accordance with the arbitration procedure stated in the Special Conditions of Contract.” 17. It appears from the record that the petitioner has made a request for resolution of the dispute invoking the arbitration clause, but even thereafter, the Arbitrator has not been appointed, therefore, left with no other remedy, has filed the instant application. 18. This Court, having heard learned counsel for the parties, going through the records and taking into consideration the consensus of the learned counsel for the respondent, is of the view that the instant application is required to be allowed. 19. This Court, after considering the objection as has been taken in the counter affidavit, is of the view that the same can well be agitated by the State respondent before the Arbitrator for its consideration and appreciation in accordance with law. Accordingly, liberty is granted to the State respondent to take available points/issues for its consideration before the Arbitrator. 20. Learned counsel for the parties have suggested the name of Hon’ble Mr. Justice (Retd.) Tapen Sen, Former Judge of the High Court of Jharkhand to act as an Arbitrator. 21. Accordingly, this Arbitration Application is being disposed of by appointing Hon’ble Mr. Justice (Retd.) Tapen Sen, Former Judge of the High Court of Jharkhand, presently residing at Flat No. 3903, Block-C, Sriram Gardens, Opposite Reliance Mart, Kanke Road, Ranchi, PIN-834008 as Arbitrator for resolution of dispute. 22. 21. Accordingly, this Arbitration Application is being disposed of by appointing Hon’ble Mr. Justice (Retd.) Tapen Sen, Former Judge of the High Court of Jharkhand, presently residing at Flat No. 3903, Block-C, Sriram Gardens, Opposite Reliance Mart, Kanke Road, Ranchi, PIN-834008 as Arbitrator for resolution of dispute. 22. The proposed Arbitrator is required to submit a disclosure in terms of Section 12 of Arbitration and Conciliation Act, 1996. 23. Learned Arbitrator would be free to lay down fees and other expenses towards conduct of the arbitration proceedings, however, keeping into account the ceiling prescribed under Schedule IV of the Act of 1996 as amended. 24. It is expected that the Arbitrator will conclude the proceeding within the timeframe as provided under the Act. 25. Let photocopy of the entire pleadings along with copy of the entire order sheet be sent to the learned Arbitrator by the Registry. 26. Both the parties shall co-operate in the hearing before the learned Arbitrator and they shall not ask for any unnecessary adjournment. 27. The instant arbitration application is allowed and accordingly, disposed of.