Delhi High Court
R.D.Construction vs The General Manager Northern ... on 14 December, 2018
$~4
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 14.12.2018
+ ARB.P. 13/2018
R.D.CONSTRUCTION ..... Petitioner
Through Mr. Manjit Singh Ahluwalia, Adv.
versus
THE GENERAL MANAGER NORTHERN
RAILWAY & ORS. ..... Respondents
Through Mr. Amitava Poddar, Adv.
CORAM:
HON'BLE MR. JUSTICE RAJIV SHAKDHER
RAJIV SHAKDHER, J.: (ORAL)
1 This is a petition under Section 11 of the Arbitration and
Conciliation Act, 1996 (in short '1996 Act').
2 Notice in this petition was issued on 28.02.2018. Since then,
the respondent has filed a reply to the petition. Based on the
averments made in the reply, learned counsel for the respondent
argued that the petitioner did not execute the job which was assigned
to him under the subject contract.
2.1 Furthermore, it is claimed under Clause 4 of the Special
Conditions of Contract that the petitioner is required to bear the
burden of taxes.
2.2 On being queried, learned counsel for the respondent does not
dispute the fact that an arbitration agreement obtains between the
parties.
3 The record shows that the respondent had floated a tender in
July, 2014 for supplying, stacking and loading of 60,000 (Sixty
thousand) cum 65 mm gauge stone Machine crushed into Railway
Wagon including all Leads & Lift at ballast Sub Depot 4 at
Tuglakabad (hereafter referred to as 'subject works') The total
consideration for the subject works was fixed at Rs.6,27,60,000/-.
4 The petitioner, evidently, submitted the bid qua the subject
works which resulted in the petitioner being declared successful.
5 It is the petitioner's case that there was a delay in execution of
the works as the work site was given to it after a delay of 8 months
and 22 days.
6 The petitioner claims that on account of the delay in handing
over the site and intervention of monsoon etcetra the execution of the
work was disrupted.
6.1 It is, however, averred by the petitioner that despite this
hardship, it was able to supply 6617 cum by 09.11.2015 i.e. 11% of
the contracted quantity and that it had targeted that the work would be
completed by 28.06.2016.
7 The petitioner also claims that between November and
December, 2015, it had to pay Environment Compensation Charge (in
short 'ECC'). Directions in that behalf were issued by the Supreme
Court. According to the petitioner, this resulted in the price of
transportation being enhanced.
8 The petitioner claims that despite all these difficulties, it
continued with the work though a demand was raised in terms of
Clause 4 of the Special Conditions of Contract on 04.07.2016 for
payment of ECC by the petitioner.
9 In sum, the petitioner asserts that the dispute with the
respondent is with regard to claims which have arisen on account
delay in handing over the work site and the burden of ECC it had to
bear for transportation of the contracted material.
9.1 The petitioner claims that these aspects were brought to fore in
the notice dated 08.09.2017.
10 Furthermore, it is averred that request was made to the
respondents to appoint an Arbitrator in view of the disputes having
erupted in terms of clause 64 of the general terms and conditions of
the subject contract.
11 It appears that the respondents, via communication dated
27.11.2017, responded to the aforementioned notice and called upon
the petitioner to indicate clearly as to the claims that are to be
adjudicated upon. It appears that the aforementioned communication
was followed by a reminder dated 23.02.2018.
12 It is in these circumstances that the petitioner has approached
the Court.
13 Learned counsel for the parties have argued in line with the
pleadings filed in the matter.
13.1 Mr. Amitava Poddar, who, appears for the respondents, during
the course of arguments, made three submissions:
(i) First, the petitioner never completed the work assigned to
it under the subject contract.
(ii) Second, under Clause 4 of the Special Conditions of
Contract, ECC is required to be paid by the petitioner.
(iii) Third, since the claims to be adjudicated were not
delineated in the request for appointment of an Arbitrator the
respondents did not accede to the request.
14 Mr. Ahluwalia contends to the contrary.
15 I have heard learned counsel for the parties and perused the
record.
16 According to me, the first two submissions made by the learned
counsel for the respondents relate to the merits of the case. As to
whether or not, the petitioner completed the work assigned under the
contract and as contended on behalf of the respondents that the
burden of ECC is to be borne by the petitioner, are aspects which are
not to be examined in a Section 11 petition.
17 Insofar as the third contention is concerned, which is that the
respondents did not appoint an Arbitrator as in the notice triggering
the arbitration agreement, there was no articulation of the claims,
which had to be adjudicated, in my view, is a defence which is not
made out. The simple reason why I have reached this calculation is
that a perusal of the notice would show that the petitioner has, in fact,
articulated what its grievance was. A perusal of the request would
demonstrate clearly as to what were the legal claims of the petitioner,
if the matter was referred to the Arbitrator. Therefore, the contention
raised by the respondents that the demand for arbitration did not
specify the matter qua which the disputes had arisen, in my view, is
not tenable.
18 Therefore, having regard to the aforesaid, I am inclined to allow
the petition. Accordingly, Mr. Lal Singh, former Additional District
Judge (Mobile No.9910384617), is appointed as an Arbitrator in the
matter. Learned Arbitrator will be paid his fee as per the provisions of
the Fourth Schedule appended to the 1996 Act. The petition filed
under Section 9 will be placed before the learned Arbitrator, who will
treat the same as an application under Section 17 of the 1996 Act.
Learned Arbitrator will rule on the application after giving
opportunity to both sides.
19 The petition is disposed of in the aforesaid terms.
RAJIV SHAKDHER
(JUDGE)
DECEMBER 14, 2018
A
