Cherian Varkey Construction ... vs The Additional Secretary To ...
2021 Latest Caselaw 12306 Ker

               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                               PRESENT

                THE HONOURABLE MR. JUSTICE GOPINATH P.

      FRIDAY, THE 07TH DAY OF MAY 2021 / 17TH VAISAKHA, 1943

                           AR.No.43 OF 2020


PETITIONER:

               CHERIAN VARKEY CONSTRUCTION COMPANY (PVT) LTD.,
               ENGINEERS AND CONTRACTORS, V FLOOR, ALFA PLAZA,
               K.P. VALLON ROAD, KADAVANTHRA, KOCHI - 682 020,
               REPRESENTED BY ITS AUTHORIZED SIGNATORY,
               GEORGE VARKEY.

               BY ADVS.
               SANTHOSH MATHEW
               SRI.ARUN THOMAS
               SRI.JENNIS STEPHEN
               SRI.VIJAY V. PAUL
               SMT.KARTHIKA MARIA
               SMT.VEENA RAVEENDRAN
               SRI.ANIL SEBASTIAN PULICKEL
               SMT.DIVYA SARA GEORGE
               SMT.JAISY ELZA JOE
               SHRI.ABI BENNY AREECKAL
               SMT.LEAH RACHEL NINAN

RESPONDENTS:

      1        THE ADDITIONAL SECRETARY TO GOVERNMENT,
               ADDITIONAL SKILL ACQUISITION PROGRAMME (ASAP),
               DEPARTMENT OF HIGHER EDUCATION, 3RD FLOOR,
               TRANS TOWER, VAZUTHACAUD P.O.,
               THIRUVANANTHAPURAM - 695 014.

      2        THE CHIEF EXECUTIVE OFFICER,
               ADDITIONAL SKILL ACQUISITION PROGRAMME (ASAP),
               3RD FLOOR, TRANS TOWER, VAZUTHACADU,
               THIRUVANANTHAPURAM - 695 014.

               BY ADVS. SRI.P.M.SHAMEER, GP
                        SRI.K.V.MANOJ KUMAR, GP


     THIS ARBITRATION REQUEST HAVING COME UP FOR ADMISSION       ON
07.05.2021, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:
 AR.No.43 OF 2020

                               -2-

                           ORDER

Dated this the 7th day of May 2021

The petitioner is a contractor engaged in the

construction business. Following the successful

selection through a tender process, the petitioner

entered into an agreement with the 1st respondent

for the construction of Additional Skill

Acquisition Programme (ASAP) - Community Skill

Park at Pandikkad in Malappuram for a total sum of

Rs.10,93,48,182/-.

2. The petitioner claims to have completed

the work in accordance with the agreement (marked

as Annexure A1) on 22.10.2018. Certain disputes

that arose were referred to the Dispute Resolution

Board (DRB) in terms of Clause 30 of the General

Conditions of Contract. A reference to the Clause

shows that if either of the parties have a dispute

with the decision of the DRB, they may refer such

dispute to arbitration within a period of 28 days AR.No.43 OF 2020

of the written decision by the DRB failing which,

the decision of the DRB shall be final and

binding.

3. The petitioner claims that they received

the letter intimating the decision of the DRB on

30.05.2020 and since they had objections regarding

the findings and conclusions of the DRB, on

03.06.2020, they had issued notice of arbitration

with respect to the findings and conclusions of

the DRB. The notice (Annexure A5) also expressed

the intention of the petitioner to approach this

Court for appointment of an Arbitrator as the

arbitration Clause empowering the 1st respondent to

appoint an Arbitrator was contrary to the law laid

down by the Supreme Court in Perkins Eastman

Architects DPC & Anr v. HSCC (India) Ltd. [AIR

2020 SC 59] and that of the Bombay High Court in

Lite Bite Foods Pvt Ltd v. Airports Authority of

India [2019 SCC OnLine Bom 5163] and that of this AR.No.43 OF 2020

Court in Aculife Healthcare Private Ltd. v. The

Kerala Medical Service Corporation Ltd. [ILR

2019(3)Kerala 208]. It is in the background of the

aforesaid facts that this petition has been filed

seeking the appointment of an Arbitrator for

adjudication of disputes that have arisen between

the parties.

4. When the above Arbitration Request was

pending before this Court, the petitioner filed IA

No.1 of 2020 supported by an affidavit dated

24.11.2020, pointing out that apart from the

disputes referred to the DRB, there are certain

other unresolved disputes between the parties

which had arisen much after the adjudication and

decision by the DRB regarding the earlier disputes

between the parties. It is pointed out in the

affidavit dated 24.11.2020 that in respect of

various deductions, the petitioner had

communicated his objections and had requested that AR.No.43 OF 2020

the matter be placed before the DRB to be

constituted afresh, since the earlier constituted

DRB had already ceased to function. In respect of

an amount of Rs.15,59,150 which according to the

petitioner, it was made to believe that there was

no dispute, the petitioner had approached this

Court through W.P.(C)No.12580 of 2020. In that

writ petition, a statement has been filed by the

respondents stating that the amount of

Rs.15,59,150/- had already been paid, taking into

account other deductions effected.

5. It is a case of the petitioner that since

the issue in W.P.(C)No.12580 of 2020 is concerned

only the payment of amount of Rs.15,59,150/-, this

Court did not consider the newly arisen disputes

and since the DRB constituted previously had

ceased to function, this Court had directed the

learned Government Pleader to ascertain whether

the DRB could be constituted to consider the AR.No.43 OF 2020

subsequent disputes or whether the petitioner

could be permitted to raise new claims also before

the Arbitrator to be appointed by this Court in

this Arbitration Request. It is a case of the

petitioner that it is evident from the judgment in

W.P.(C)No.12580 of 2020 that this Court had

permitted all disputes including the fresh

disputes to be raised before the Arbitrator to be

appointed by this Court in this Arbitration

Request. It is also the case of the petitioner

that, accordingly, the petitioner had issued

Annexure A7 calling for the additional disputes or

the new disputes also to be referred to the

Arbitrator to be appointed by this Court in this

Arbitration Request.

6. I have heard the submissions of

Sri.Santhosh Mathew, the learned counsel appearing

for the petitioner and Sri.K.V.Manoj Kumar,

learned Government Pleader appearing for the AR.No.43 OF 2020

respondents.

7. The learned counsel for the petitioner

reiterates the contentions in this Arbitration

Request and also those set out in the affidavit

filed in support of IA No.1 of 2020.

8. The learned Government Pleader appearing

for the respondents, on the other hand, submits

that in the facts and circumstances of the case,

several of the disputes raised are not arbitrable

in terms of the provisions contained in the

agreement between the parties. However, he does

not dispute the legal position settled by Perkins

Eastman (supra) and other decisions relied upon by

the learned counsel for the petitioner.

9. In the entirety of the facts and

circumstances of the case, I am clearly of the

opinion that the petitioner is entitled to an

order appointing an Arbitrator under Section 11 of

the Arbitration and Conciliation Act, 1996 r/w the AR.No.43 OF 2020

Scheme for appointment of Arbitrators by the Chief

Justice of the High Court of Kerala, however,

subject to a right being reserved to the

respondents to contend that all or any of the

issues that may be raised before the Arbitrator

are not arbitrable either on account of failure to

refer them to arbitration within the time

specified after the decision by the DRB or on

account of the fresh disputes having not been

raised before the DRB or for any other reason.

Obviously these are matters that can be considered

by the Arbitrator to be appointed by this Court.

10. Therefore, I deem it appropriate to refer

the parties to arbitration for adjudicating the

disputes that have arisen between them under

Annexure A1 agreement as below:

                a)       I     hereby    nominate        Justice

        (Retd.)          A.M.Shafeeque,          "Marhaba"          ,

        House        No.CC           33/12,     Green        Ripple
 AR.No.43 OF 2020



       Road,       Swamipady,        Elamakkara       P.O.,

Kochi-682 025, former Judge of this

Court, as the sole Arbitrator to

adjudicate the disputes or

differences between the parties

arising out of Annexure A1 agreement

between them.

(b) A copy of this order shall

be communicated to the sole

Arbitrator by the Registry within a

period of one week from today.

(c) The Arbitrator is requested

to forward the statement of

disclosure under Section 11(8) read

with 12(1) of the Arbitration and

Conciliation Act, 1996 (as amended).

       The    disclosure        statement         shall    be

       placed       before          this     Court        for

       confirmation       of    the     appointment       of
 AR.No.43 OF 2020



        the    Arbitrator.    The   Registry     shall

        retain a copy of the original.

               (d) The   Arbitrator's    fee     shall

be governed by the Kerala High Court

(Fee Payable to Arbitrators) Rules,

2017 and both parties agreed that

the arbitration costs and fees shall

be shared equally.

This Arbitration Request is allowed as above.

Post on 28.05.2020 for the disclosure statement.

Sd/-

GOPINATH P.

JUDGE akv AR.No.43 OF 2020

APPENDIX PETITIONER'S/S EXHIBITS:

ANNEXURE A1 TRUE COPY OF THE AGREEMENT DATED 6.9.2016 ENTERED INTO BETWEEN THE PETITIONER AND THE 1ST RESPONDENT.

ANNEXURE A2 TRUE COPY OF THE DOCUMENT SHOWING DETAILS OF THE ITEMS REFEREED TO BE SETTLED BY DRB.

ANNEXURE A3 TRUE COPY OF THE DECISION REPORT SHOWING DETAILS OF THE DISPUTES REFERRED AND DECISIONS TAKEN BY DRB.

ANNEXURE A4 TRUE COPY OF THE LETTER NO.

ASAP/CSP/DRB/02/2019-20 DATED 22.5.2020 SENT BY THE ADJUDICATOR.

ANNEXURE A5 TRUE COPY OF THE LETTER DATED 3.6.2020 SENT BY THE PETITIONER TO THE 1ST AND 2ND RESPONDENTS AND ADJUDICATOR OF THE DRB.

ANNEXURE A6 A COPY OF THE JUDGMENT DATED 12.11.2020 OF THIS HON'BLE COURT IN WP(C)NO.12850 OF 2020.

ANNEXURE A7 A COPY OF THE LETTER DATED 19.11.2020.

RESPONDENT'S/S EXHIBITS:NIL.

//TRUE COPY// PA TO JUDGE