Punjab-Haryana High Court
M/S Mohinder Singh Govt Contractor vs Union Of India And Others on 22 April, 2024
Author: Sanjeev Prakash Sharma
Bench: Sanjeev Prakash Sharma
Neutral Citation No:=2024:PHHC:053587-DB
122 IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
2024:PHHC:053587-DB
CWP-8994-2024 (O&M)
Date of Decision: 22.04.2024.
M/s Mohinder Singh Govt. Contractor ...Petitioner
Vs.
Union of India and others ...Respondents
CORAM: HON'BLE MR. JUSTICE SANJEEV PRAKASH SHARMA
HON'BLE MRS. JUSTICE SUDEEPTI SHARMA
Present Mr. Sandeep Singh, Advocate for the petitioner.
***
SANJEEV PRAKASH SHARMA, J.(Oral)
1. Clause 25 of the general conditions of the contract provides for
disputes resolution mechanism and the same reads as under:-
i) If any dispute or differences of any kind what-so-ever
arise between the Authority, its authorized representatives
and the contractor in connection with or arising out of this
contract or the execution of work, these shall be resolved
as under.
ii) Whether before its commencement or during the progress
of Project/Work or after the termination, abandonment or
breach of the contract, the dispute shall, in the first
instance, be referred for settlement to the Engineer of the
work and he shall, within a period of sixty days after
being requested in writing by the contractor to do so,
convey his decision to the contractor. Such decision in
respect of every matter so referred shall, subject to
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arbitration as hereinafter provided, be final and binding
upon the Contractor. In case the work is already in
process, the contractor shall proceed with the execution of
the work on receipt of the decision of the Engineer as
aforesaid with all due diligence, whether any of the parties
requires arbitration as hereinafter provided or not.
iii) If the Engineer has conveyed his decision to the contractor
and no claim for arbitration has been filed by the
contractor within a period of sixty days from the receipt of
the latter communicating the decision, the said decision
shall be final and binding upon the contractor and will not
be a subject matter of arbitration at all.
iv) If the Engineer fails to convey his decision within a period
of sixty days from the date on which the said request was
made by the contractor, he may refer the dispute for
arbitration as hereinafter provided.
v) All disputes or differences in respect of which the
decision is not final and conclusive shall, at the request of
either party made in communication sent through
registered A.D. post, be referred to the sole arbitration of a
Superintending Engineer of Greater Ludhiana Area
Development Authority acting as such at the time of
reference unless debarred from acting as an Arbitrator by
an order of the Authority, in which event, the Employer
shall appoint any other technical officer of the department
to act as an arbitrator on receipt of a request from either
party.
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vi) The Employer shall have the authority to change the
arbitrator on an application by either the contractor or the
Engineer requesting change of arbitrator giving reasons
thereof, either before the start of the arbitration
proceedings or during the course of such proceedings. The
arbitration proceedings would stand suspended as soon as
an application for change of Arbitrator is filed before the
Employer and a notice thereof is given by the applicant to
the Arbitrator. The Employer after hearing both the parties
may pass a speaking order rejecting the application or
accepting to change the arbitrator or simultaneously,
appointing a technical officer as Arbitrator under the
contract. The new arbitrator so appointed may enter upon
the reference afresh or he may continue the hearings from
the point these were suspended before the previous
arbitrator.
vii) The reference to the arbitrator shall be made by the
claimant party within one hundred twenty days from the
date of dispute of claim arises during the execution of
work. If the claim pertains to rates or recoveries
introduced in the final bill, the reference to the arbitrator
shall be made within six calendar months from the date of
payment of the final bill to the contractor or from the date
a registered notice is sent to the contractor to the effect
that his final bill is ready by the Engineer (whose decision
in this respect shall be final and binding) whichever is
earlier.
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viii) It shall be an essential term of this contract that in order to
avoid frivolous claims, the party invoking arbitration shall
specify the disputes based upon facts and calculations
stating the amount claimed under each claim and shall
furnish a "deposit-at-call" for ten percent of the amount
claimed, on a scheduled bank in the name of the
Arbitrator, by his official designation who shall keep the
amount in deposit till the announcement of the award. In
the event of an award in favour of the claimant, the
deposit shall be refunded to him in proportion to the
amount awarded with respect to the amount claimed and
the balance, if any, shall be forfeited and paid to the other
party.
ix) The provisions of the Arbitration and Reconciliation Act,
1996 or any other statuary there under or modification
thereof and for the time being in force shall apply to the
arbitration proceedings under this clause.
x) The arbitrator shall award separately giving his ward
against each time claim and dispute and counter claim
raised by either party giving reasons for his award. Any
lump sum award shall not be legally enforceable.
xi) The independent claims of the party other than one
seeking arbitration as also the counter claims of any party
shall be entertained by the arbitrator.
xii) The venue of arbitration shall be such place or places in
Punjab or Chandigarh as may be fixed by the arbitrator in
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his sole discretion. The work under the contract shall
continue during the arbitration proceedings.
xiii) The stamp fee due on the award shall be payable by the
party as desired by the Arbitrator and in the event of such
party's default, the stamp fee shall recoverable from
another sum due to such party under this or any other
contract.
xiv) Neither party shall be entitled to bring a claim for
arbitration, if it is not filled as per the time period already
specified or within six months of the following:-
a) Of the date of completion of the work as certified by
the Engineer or
b) Of the date of abandonment of the work or breach of
contract under any of its clauses, or
c) Of its non-commencement or non resumption of work
within 10 days of written notice for commencement or
resumption as applicable or
d) Of the cancellation, termination or withdrawal of the
work from the contractor in whole or in part and / or
revision for closure of the contract, or
e) Of receiving an intimation from the Engineer that the
final payment due or recover from the contractor had been
determined, for the purpose of payment/adjustment
whichever is the latest. If the matter is not referred to
arbitration within the period prescribed above, all the
rights and claims of either party under the contract shall
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be deemed to have been fortified and absolutely barred by
the time for arbitration and even for civil litigation.
xv) No question relating to this contract shall be brought
before any civil court without first invoking and
completing the arbitration proceedings, if the issue is
covered by the scope of arbitration under the contract. The
pending arbitration proceedings shall not disentitle the
Engineer to terminate the contract and to make alternate
arrangement for completion of the works.
xvi) The arbitrator shall be deemed to have entered on the
reference on the day, he issues notices to the parties fixing
the first date of hearing. The arbitrator may, from time to
time, with the consent of the parties enlarge the initial
time for making and publishing the award.
xvii) The expiry to the contractual time limit, whether
originally fixed or extended, shall not invalidate the
provisions of this clause.
xviii) The jurisdiction of Civil Court for matter under dispute
shall be on the basis of the location of the office of the
Engineer.
2. Keeping in view the aforesaid, it is apparent that the provisions
of Arbitration and Conciliation Act, 1996, will have an application, if there is
a dispute arising between the parties on any issue in relation to the terms and
conditions of the contract.
3. Learned counsel has invited attention to Clause 42 relating to the
change/variation in taxes and its implication and submits that in accordance
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with the change in the rates of taxes from 12% to 18%, Direction Committee
of the Chief Engineer, held a meeting on 28.02.2023 and agreed to release the
additional amount by applying the differential component of 5.35%.
However, in spite of the decision taken, the same has not been implemented
in respect of the petitioner and accordingly he has approached this Court
seeking mandamus.
4. We find that the contract entered into between the parties is a
non-statutory contract and a writ petition for implementation of conditions of
the contract would not lie and would not be maintainable, in view of the
judgment passed by the Hon'ble Supreme Court in the case of M.P. Power
Management Company Ltd. vs. M/s Sky Powre Southeast Solar India Pvt.
Ltd. and others 2023 (2) SCC 7.
5. We also find that as there is a arbitration clause, the dispute can
very well be taken up by the petitioner before the appropriate forum. In these
circumstances, no interference is made out.
6. In view of the above, the writ petition is dismissed while
granting liberty to the petitioner as above.
7. All pending misc. application(s) also stand disposed of.
(SANJEEV PRAKASH SHARMA)
JUDGE
(SUDEEPTI SHARMA)
JUDGE
22.04.2024.
rajesh
1. Whether speaking/reasoned? : Yes/No
2. Whether reportable? : Yes/No
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