Delhi High Court
M.P.Tyagi Engineers & ... vs Union Of India & Anr on 10 November, 2017
$~18
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ARB.P. 429/2017
Date of decision: 10th November, 2017
M.P.TYAGI ENGINEERS & CONTRACTORS ..... Petitioner
Through Ms.Seema Singh, Adv.
Versus
UNION OF INDIA & ANR ..... Respondents
Through Mr.Jaswinder Singh, Adv.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
NAVIN CHAWLA, J. (Oral)
1. This petition under Section 11(6) of the Arbitration and
Conciliation Act, 1996 (hereinafter referred to as the 'Act') has been
filed by the petitioner praying for an appointment of Sole Arbitrator to
adjudicate the dispute between the parties.
2. The respondent had floated a tender "Special Repair to OFFRS
MD ACCN BLDG No. P-111, 112 at DK-I, P-119, P-120 at RRRC
and Repair Works of certain bldg in the area of age B/R-I under GE
(Central) Delhi Cantt.-10". The petitioner participated in the tender
and was issued an Acceptance Letter No.8815/C-75/25/E8 dated
15.02.2016.
3. Condition No.70 of the General Terms and Conditions 'IAFW-
2249' contains an arbitration agreement between the parties.
ARB.P. 429/2017 Page 1
4. As certain disputes have arisen under the agreement, the
petitioner invoked the arbitration clause vide its notice dated
08.06.2017 calling upon the respondent to appoint an Arbitrator for
adjudication of the disputes. The respondent have not acted upon the
said request, therefore, the present petition has been filed by the
petitioner praying for appointment of a Sole Arbitrator.
5. The respondent has filed its reply. As far as the appointment of
arbitrator is concerned, it is contended that in terms of sub-para 2 of
General Condition No.70 and the first Proviso thereto reference to
arbitration cannot be made at this stage inasmuch as the work is not
complete and there is a case of abandonment of the work.
6. To consider the above submission, I first quote relevant
paragraphs from Condition No.70 of the General Conditions:
"70. Arbitration.- All disputes, between the parties to
the Contract(other than those for which the decision
of the C.W.E. or any other person is by the Contract
expressed to be final and binding) shall, after written
notice by either party to the Contract to the other of
them, be referred to the sole arbitration of an
Engineer officer to be appointed by the authority
mentioned in the tender documents.
Unless both parties agree in writing such
reference shall not take place until after the
completion or alleged completion of the Work or
termination or determination of the Contract under
Condition Nos. 55, 56 and 57 thereof.
Provided that in the event of abandonment of
the Works or cancellation of the Contract under
ARB.P. 429/2017 Page 2
Condition Nos. 52, 53 or 54 hereof, such reference
shall not take place until alternative arrangements
have been finalized by the Government to get the
Works completed by or through any other Contractor
or Contractors or Agency or Agencies."
7. A reading of the above clause would show that reference to
arbitration cannot be made till at least "alleged completion of work".
In the present case in paragraphs 22 and 23 of the petition, the
petitioner making reference to its letters dated 15.05.2017 and
25.05.2017 alleges that the work has already been completed and
quarters have been handed over to the respondent who has further
handed them over to the users of the same. Paragraphs No.22 and 23
are quoted herein below:
"22. It is submitted that despite of numerous
difficulties faced by the Petitioner in completing the
Work could complete the Work on site by 15.05.2017
and the said fact was intimated to the Respondents
also further requested vide Letter dated 25.05.2017 to
provide the Completion Certificate along with the
cleared Final Bill & Final RAR of the executed work.
The Copy of Letter dated 15.05.2017 ,25.05.2017 is
annexed herewith as "ANNEXURE Pl6(Colly).
23. It is humbly submitted that the despite of the huge
losses the respondent work was completed in all
aspects and the site was handed over back to the
respondent furthermore the quarters were handed
over to the users by the Respondent in all respects
without any discrepancies pointed out by the users.
ARB.P. 429/2017 Page 3
The Photographs exhibiting the completed work at the
site is annexed herein as "ANNEXURE P 17"."
8. In view of the submissions made in paragraphs No.22 and 23,
the bar contained in sub para 2 of General Condition No.70 would not
apply. The same view has been taken by this Court in its order dated
21.09.2017 passed in Prem Construction Company v. Union of India
& Ors., Arb. P. 426/2017.
9. Learned counsel for the respondent further contends that vide its
letter dated 31.01.2017 the respondent has pointed certain defects in
the work carried out by the petitioner and same have not been rectified
and, therefore, the work cannot be said to have been completed and,
should be treated as abandoned. This however, in my view cannot
stall the appointment of an Arbitrator but shall be one of the disputes
to be adjudicated by the Arbitrator.
10. In view of the above, the present petition is allowed. I hereby
direct that the parties shall appear before the Delhi International
Arbitration Centre (DIAC) who shall appoint a Sole Arbitrator to
adjudicate the disputes between the parties. The arbitration and the
fee shall be governed by the rules of the DIAC.
11. The parties to appear before DIAC on 30th November, 2017 at
2:00 PM.
12. With the above directions, the petition is disposed of.
Dasti.
NAVIN CHAWLA, J
NOVEMBER 10, 2017/vp
ARB.P. 429/2017 Page 4
