Delhi High Court
Bharat Rail Automations Pvt. Ltd. vs Union Of India & Anr. on 13 November, 2018
$~5
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 13.11.2018
+ ARB.P. 446/2018
BHARAT RAIL AUTOMATIONS PVT. LTD.
..... Petitioner
Through Ms. Madhumita Bhattacharjee and
Mr. Vidur Kamra, Advs.
versus
UNION OF INDIA & ANR.
..... Respondents
Through Mr. Jagjit Singh, Sr. Standing
Counsel with Mr. Vipin Chaudhary,
Advs.
CORAM:
HON'BLE MR. JUSTICE RAJIV SHAKDHER
RAJIV SHAKDHER, J.: (ORAL)
1 This is a petition filed under Section 11 of the Arbitration and
Conciliation Act, 1996 (in short '1996 Act'). The petitioner seeks
appointment of an Arbitrator as despite a notice being issued to the
respondents, the respondents have not appointed an Arbitrator to
adjudicate the disputes arising between the parties.
2 Notice in this petition was issued on 01.06.2018, when, Mr.
Jagjit Singh, Sr. Standing Counsel, entered appearance on behalf of
the respondents. Mr. Singh had, on that date, taken an objection with
regard to the maintainability of the petition on the ground that it was
ex-facie barred by limitation.
2.1 It was Mr. Singh's contention that since the notice invoking
arbitration was issued on 13.03.2015, the instant petition filed in 2018
could not be maintained.
2.2 The Court, on that date, had granted time to the respondents to
file their reply. The petitioner was also given opportunity to file a
rejoinder in the matter. The petition was listed for further hearing on
21.08.2018. On that date, further opportunity was given to the
respondent to file a reply, albeit, subject to payment of costs of
Rs.5,000/- to the petitioner.
3. Mr. Singh says that he has not been able to obtain appropriate
instructions in the matter and, therefore, no reply has been filed.
According to Mr. Singh, since, permission to file the reply was given
subject to payment of costs and, as the reply has not been filed, costs
need not be paid to the petitioner. The petitioner, on the other hand,
pressed for a disposal of the petition on merits as the matter has
lingered on for quite some time.
3.1 I tend to agree with the submission of the learned counsel for
the petitioner that the petition needs to be disposed of.
4 Broadly, the assertions made in the petition are as follows:
4.1 It appears that a tender was invited by respondent No.1 for
provisioning of Track Circuiting of Station yard at five Stations by
using Multi Section Digital Axle Counter in Basikirthpur- Mandi
Dhanaura section of Moradabad Division (hereinafter referred to as
"subject works"). The petitioner was declared successful in the
bidding process. A letter of acceptance was, consequently, issued on
29.06.2011 in favour of the petitioner. As per the contract entered into
between the parties, the tenure for execution of the subject works was
pegged at nine (9) months. The value of the contract was a sum of
Rs.2,20,94,319.88.
4.2 Concededly, the contract could not be completed in time. In
fact, it is the petitioner's case that extension was granted up to
31.12.2014 by the respondents, albeit, without levy of penalty. The
petitioner claims that the delay in execution of the work was on
account of hindrances, which were solely attributable to the
respondents. The petitioner also claims that till about March, 2015, it
had completed works worth Rs.2,18,42,259.85.
4.3 Since, the petitioner, purportedly, incurred losses on account of
prolongation of works due to alleged hindrances caused by the
respondents, it seeks to recover moneys on that account.
5. The petitioner, in this behalf, had issued a notice on
13.03.2015. Via this notice, not only claims which the petitioner
intended to get adjudicated were put forth before the respondents but
also the arbitration agreement was sought to be triggered. Thereafter,
the petitioner appears to have sent several reminders to the
respondents on that score. Since, the petitioner did not get a suitable
reply despite a reminder letter sent in the behalf as late as on
16.11.2017, it proceeded to approach this Court by way of the instant
petition.
6. Strangely, the respondents have chosen not to file a reply.
There is, thus, on the Court record, no rebuttal to the assertions made
in the petition. The arbitration agreement is contained in Clause 41 of
the contract obtaining between the parties. The said clause reads as
follows:
"41.0 SETTLEMENT OF DISPUTES:
41.1 The provision of Clauses 63 and 64 to the General
Conditions of Contract will be applicable only for settlement of
claims or disputes between the parties for values less than or
equal to 20% of the value of the contract, provision of Clauses
63 and 64 and other relevant clauses of the General
Conditions of Contract will not be application and arbitration
will not be remedy for settlement of such disputes.
41.2 The Contractor shall not be entitled to ask for arbitration
before the completion of the work assigned to him under this
contract. The Contractor shall seek reference to arbitration to
settle disputes only once within the ambit of condition 41.1
above.
41.3 Special condition vide ·Paras 41.1 and 41.2 shall prevail
over existing clauses 63 and 64 of the General Conditions of
Contract, other than provisions relating to "Excepted
Matters."
7. Ms. Bhattacharjee, who, appears on behalf of the petitioner,
says that if claims, which were referred to in the first notice of the
petitioner dated 13.03.2015 are added up, they are approximately in
excess of Rs. 3 crores.
8. Mr. Jagjit Singh says that though a reply has not been filed by
the respondents, the objection qua limitation taken, though orally, on
1.6.2018 should be kept intact to be advanced before the Arbitrator.
9. I have heard learned counsel for the parties and perused the
record.
10. Having regard to the assertions made in the petition and the fact
that the existence of the arbitration agreement is not disputed by the
respondents, I am inclined to allow the petition. In this regard, I am
fortified by the fact that the cumulative value of the claims sought to
be preferred is in excess of Rs. 3 crores.
11. Accordingly, Hon'ble Mr. Justice Nisar Ahmad Kakru, Former
Chief Justice, Andhra Pradesh High Court (Mobile No. 9419000938)
is appointed as an Arbitrator in the matter. Learned Arbitrator will be
paid fees as per the Fourth Schedule appended to the 1996 Act.
12. In view of the fact that the respondents took two dates to file a
reply and today, via Mr. Singh conveyed that they did not wish to file
a reply, I am inclined to impose costs in the sum of Rs.7,500/-. The
costs will be paid to the petitioner within four weeks from today.
13. The petition is disposed of in the aforesaid terms.
14. Needless to say that since reply has not been filed to the instant
petition, the learned Arbitrator will examine the defence of the
respondents on merits.
15. The Registry will dispatch a copy of this order to the learned
Arbitrator.
RAJIV SHAKDHER
(JUDGE)
NOVEMBER 13, 2018/A
