M/S Sipl Infracon vs M/S Cabcon India Private Limited
2021 Latest Caselaw 5269 Patna

          IN THE HIGH COURT OF JUDICATURE AT PATNA
                            REQUEST CASE No.3 of 2021
     ======================================================

M/s SIPL Infracon, Krishna Nagar, Bela, Muzaffarpur, Pin-843116, a proprietorship firm through its Proprietor-Prashant Saurabh, Male, aged about 47 years, son of Shree Chandeshwar Prasad Sharma, resident of Mohalla- Krishna Nagar, Opposite of Nayan Deep Eye Hospital, Bela, Police Station- Bela, Muzaffarpur, Pin-843116.

... ... Petitioner/s

Versus

1. M/s CABCON India Private Limited, First Floor, The Terminus Building, BG-12, Action Area-1B, New Town, Kolkata-700156.

2. The Managing Director, CABCON India Private Limited, First Floor, The Terminus Building, BG-12, Action Area-1B, New Town, Kolkata-700156.

... ... Respondent/s ====================================================== Appearance :

For the Petitioner/s : Mr. Navendu Kumar, Advocate Mr. Chrayesh Bharadwaj, Advocate For the Respondent/s : Mr.Sanjay Singh Thakur, Advocate Mr. Parijat Saurav, Advocate ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE

ORAL JUDGMENT

Date : 17-11-2021

Heard learned counsel for the parties.

Petitioner has prayed for the following relief(s):-

" for appointment of arbitrator in terms of section 11(6) of the arbitration and conciliation act 1996 under the circumstances that the respondents have failed to adhere to the terms and condition of the agreements contained in work order number - CIPL/DDUGJY-SBPDCL/PSS/CIVIL/17-18/49 dated 02.06.2017, WO/BHP/DDU/17-18/022 dated 03.12.2017 and also some work orders for which a formal contract was not executed; and further failed to respond to the request for arbitration by an independent arbitrator, the notice whereof was given through speed post on 01.12.2020."

Patna High Court REQ. CASE No.3 of 2021 dt.17-11-2021

Having heard learned counsel for the parties, this

Court is inclined to allow the petition filed under Section 11 (6)

of the Arbitration and Conciliation Act, 1996.

Undisputedly, as is evident from the objection

petition filed by the respondents, the parties entered into a

written agreement dated 2nd June, 2017 in relation to execution

of certain public works.

Orally, it is argued that copy of the agreement

containing the arbitration clause was not supplied to the

petitioner. This Court does not find any favour with the

submissions so made, moreso, in view of the objection petition

filed by the respondents wherein they themselves admit the

existence of the arbitration clause contained in the agreement

with the sole objection in relation to the jurisdiction of this

Court to entertain the petition.

Inviting attention to the clauses 37 and 38 of the

agreement (Work Order dated 02.06.2017), learned counsel for

the respondents raises the preliminary jurisdictional issue of this

Court to entertain the present petition.

Clauses 37 and 38 read as under:

"37) ARBITRATION All disputes or differences and/or claims between the Parties hereto arising out of Patna High Court REQ. CASE No.3 of 2021 dt.17-11-2021

and/or in connection with and/or in consequence of and/or relating to this contract shall be referred to the adjudication of two arbitrators, one to be nominated by each party. And these two arbitrators so appointed shall mutually appoint the third arbitrators (who shall be presiding arbitrator. In the event the two arbitrators fail to appoint the third arbitrator. Such arbitrator shall be appointed in accordance with the provisions of the Arbitration & Conciliation Act, 1996 (Arbitration Act). The arbitration proceedings shall be conducted in accordance with the provisions the Arbitration Act 1996 and or as amended from time to time. Venue of such Arbitration shall be in the city of Kolkata. The language shall be English. The award shall be binding on parties and the cost of arbitration to be shared equally by the parties."

"38) Jurisdiction The Courts at Kolkata alone and no other courts shall have jurisdiction to entertain, try and or determine the existence validity or otherwise of the contract including the arbitration agreement and all proceedings arising thereunder and the award if any made thereunder and in case the arbitration proceedings becomes infructuous, the courts at Kolkata alone and no other court shall have jurisdiction to receive, try and determine any claim or disputes arising under this contract and/or relating to the same in any way whatsoever."

Patna High Court REQ. CASE No.3 of 2021 dt.17-11-2021

Undoubtedly, clause 38 confines the jurisdiction

only with respect to the Court at Kolkata, but the position is not

as simple as is so projected by the respondents, in view of a

subsequent communication dated 13th June, 2017 addressed by

the petitioner to the respondents which reads as under:

                          "To                                13.06.2017
                                   The Project Manager
                                    Cabcon India Pvt. Ltd
                                   Aara, Bhojpur, Bihar

Sub: Regarding Clause no.37 and 38 of work order issued by you dated 11.06.2017

Dear Sir

I Prashant Saurabh, Prop: SIPL Infracon is working with your company as a sub-contractor. I have started the work in Katariya PSS in 17 th April 2017. I am about to finish the boundary wall work of pss. Now at 11.06.2017 my work order comes to me through mail. I read carefully this work order and found some clause which is not acceptable to me. I am not agree to accept the clause no.37 and 38 of this work order. My office is in Muzaffarpur (Bihar), my work place is Bhojpur (Bihar), and if I have any problems with you in future I will have to go in Kolkata High Court Jurisdiction, that is not acceptable.

So Please finalize my till date work and settle my account because I am not in a position to continue the work with clause no.37 and 38.

If you want to continue with me in this project, please release me this clause no.37 and 38. Any dispute between your company and me will dissolve only in the jurisdiction of Patna High Court. And this will apply in all upcoming work order if I continue with your company.

Please answer me immediately.

Patna High Court REQ. CASE No.3 of 2021 dt.17-11-2021

Thanks and Regards Sd/ Prashant Saurbh Proprietorship Firm M/s SIPL Infracon"

In fact, the authorized officer of the respondent, in

writing, requested the petitioner to continue with the work, as

per his opinion, there would be no dispute in future. Also, this

communication of the petitioner was forwarded to the Head

Office at Kolkota. It is with this assurance, as is so averred by

the petitioner that with effect from 13th June, 2017, he not only

continued to execute the work in terms of the work order, but

also the additional work so allotted subsequently by the

respondents in the year 2018-19.

The petitioner has averred all this in paragraphs 4

and 5 of the petition to which there is no denial by the

respondents.

Undisputedly, the work order was placed upon the

petitioner within the State of Bihar; the work was to be and was

executed in Bihar; the bills were raised from Bihar; the

payments were also made in Bihar; the respondent had posted

its supervisor in Bihar who was supervising the work here. Most

crucially, the work order containing clauses 37 and 38 is not

signed by the petitioner and the moment he received the same, Patna High Court REQ. CASE No.3 of 2021 dt.17-11-2021

he immediately protested against the inclusion of clauses 37 and

38 conferring the jurisdictional issue to the Courts at Kolkata, to

which not only an assurance was meted out by the respondent's

authorized representative, but the communication forwarded to

the Head Office at Kolkata to which the respondents did not

object in the negative. Thus, the parties, on the jurisdictional

issue contained in the work order were ad idem with its

exclusion.

In view of the aforesaid bundle of facts, the

respondents' objection vis-à-vis jurisdictional issue of this Court

with respect to present petition only merits rejection, more so, in

view of the law laid down by this Court in Bharat Aluminum

Company v. Kaiser Aluminium Technical Services INC.

(2012) 9 SCC 552; Swastik Gases Private Limited v. Indian

Oil Corporation Limited, (2013) 9 SCC 32; Exl Careers v.

Frankfinn Aviation Services (P) Ltd. (2020) 12 SCC 667.

It has come on record that the petitioner has been

making request seeking appointment of the Arbitrator. Clause 37

was invoked. Disputes are in existence. They are civil in nature

and in relation to the agreement dated 2 nd June, 2017. In view of

the same, petition needs to be allowed.

As such, as jointly prayed for, Hon'ble Mr. Patna High Court REQ. CASE No.3 of 2021 dt.17-11-2021

Justice Mr. Rakesh Kumar, a former Judge of this Court is

appointed as learned Arbitrator to adjudicate all disputes

arising out of agreement dated 02.06.2017 entered into

between the parties to the lis.

All pleas and issues raised, on merits, are left

open to be considered and decided by the learned Arbitrator.

Learned Arbitrator shall be entitled to fee as per

the Schedule of the Act.

Since the dispute arises out of an agreement of

the year 2017, the hearing be expedited.

Parties undertake to fully cooperate and not take

any unnecessary adjournment.

It is expected of the learned Arbitrator to decide

the issues expeditiously.

Joint Registrar (List) is directed to communicate

the order to the learned Arbitrator.

Learned counsel for the parties also undertake to

communicate the order to the learned Arbitrator. In fact, they

volunteered to appear before him, through digital mode on

30th November, 2021 and apprise him of the passing of the

order.

Parties shall file their statement of claims before Patna High Court REQ. CASE No.3 of 2021 dt.17-11-2021

the learned Arbitrator on such date of hearing which he may

fix, as per mutual convenience.

The Request Petition stands disposed of in the

above terms.

Interlocutory Application(s), if any, shall stand

disposed of.

                                                                    (Sanjay Karol, CJ)
Ashwini/Sujit
AFR/NAFR
CAV DATE
Uploading Date          20.11.2021
Transmission Date