M/S Vijay Electricals vs Bharat Sanchar Nigam Limited ...
2023 Latest Caselaw 5606 Raj

[2023:RJ-JD:25710]

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR S.B. Arbitration Application No. 36/2020

M/s Vijay Electricals, (Registered Partnership Firm) 26-Siyal Sadan, Adarsh Nagar, Gayriyawas Road, Nr. Abhinav School, Udaipur (Raj.) Through Its Partner Mr. Pankaj Siyal, Age About 36 Years, S/o Shri Vagat Lal Ji Siyal, R/o 26-Siyal Sadan, Adarsh Nagar, Gayriyawas Road, Nr. Abhinav School, Udaipur (Raj.)

----Petitioner Versus

1. Bharat Sanchar Nigam Limited, (A Govt. Of India Undertaking) Through Chairman And Managing Director, Bsnl Bharat Sanchar Bhavan, Harish Chandra Mathur Lane, Janpath, New Delhi - 110001

2. Bharat Sanchar Nigam Limited, (A Govt. Of India Undertaking) Chief General Manager, Sardar Patel Marg, Government Press, Jaipur

3. General Manager Telecom, District Bhilwara, Bharat Sanchar Nigam Limited, Bhilwara (Raj.)

----Respondents

For Petitioner(s) : Mr. Tribhuvan Gupta For Respondent(s) : Mr. Kamal Kishore Dave

HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI

Order

04/08/2023

1. The instant arbitration application has been filed by the

applicant under Section 11 of the Arbitration and Conciliation Act,

1996 (hereinafter referred to as 'Act of 1996') claiming the

following reliefs:-

"It is, therefore, most respectfully prayed that this request application may kindly be allowed and this Hon'ble Court may be pleased to appoint Arbitrator for the adjudication of the dispute and claim of the petitioner against the respondents and he may kindly be called upon to enter into the reference in respect of claims of the petitioner against the respondent and to pass appropriate award in accordance with the provisions of the contract and the law.

Cost of this application may kindly also be allowed in favour of the applicant/petitioner."

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2. The applicant is a registered partnership Firm and the

respondent-Bharat Sanchar Nigam Limited (BSNL) invited a tender

for Optical Fiber (OF) Cable Construction, laying & allied works for

National Optical Fiber Network (NOFN) Projects, Bhilwara; the

applicant applied for the said tender and the same was awarded to

the applicant; whereafter the applicant has commenced the

works; the petitioner issued bill no. 136 dated 25.03.2019 and

made a request for payment before the respondent-BSNL towards

the work done by the applicant, and also sent the reminder notice

therefor; whereafter the dispute in question arose between the

parties.

2.1. Thereafter, the applicant, through its Counsel, served a

notice on 02.12.2019 to the respondent-BSNL with a request for

appointment of an Arbitrator to resolve the dispute, as per Clause

17 of the Agreement.

3. Learned counsel for the applicant submits that the

respondent-BSNL has not paid the due amount towards the work

done by the applicant, as per the contract in question, and

therefore, for resolution of the dispute that arose between the

parties, the matter deserves to be referred for arbitration, while

appointing an independent and impartial Arbitrator, as per Clause

17 of the agreement; furthermore, the issue of limitation is also

not involved in the present case. The said Clause 17 is reproduced

as hereunder:

"17. Arbitration:

17.1 In the event of any question, dispute or difference arising under this agreement or in connection there-with

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except as to matter the decision of which is specifically provided under this agreement the same shall be referred to sole arbitration of the Chief General Manager, Jaipur Rajasthan or in case his designation is changed or his office is abolished then in such case to the sole arbitration of the officer for the time being entrusted whether in addition to the functions of the Chief General Manager Jaipur Rajasthan or by whatever designation such officers may be called (hereinafter referred to as the said officer) and if the Chief General Manager Jaipur Rajasthan or the said officer is unable or unwilling to act as such to the sole arbitration or some other person appointed by the Chief General Manager, of the said officer. The agreement to appoint an arbitrator will be in accordance with the Arbitration and Conciliation Act 1996. There will be no objection to any such appointment that the arbitrator is BSNL Servant or that he has deal with the matter to which the agreement relates or that in the course of his duties as BSNL Servant he has expressed his views on all or any of the matter under dispute. The award of the arbitrator shall be final and binding on the parties. In the event of such arbitrator to whom the matter is originally referred, being transferred or vacating his office or being unable to act for any reasons whatsoever such Chief General Manager or the said officer shall appoint another person to act as arbitrator in accordance with terms of the agreement and the person so appointed shall be entitle to proceed from the stage at which it was left out by his predecessors.

17.2 The arbitrator may from time to time with the consent of parties enlarge the time for making and publishing the award, Subject to aforesaid Indian Arbitration and Conciliation Act 1996 and the Rules made there under, any modification thereof for the time being in force shall be deemed to apply to the arbitration proceeding under this clause.

17.3 The venue of the arbitration proceeding shall be the Office of the Chief General Manager, Jaipur Rajasthan or

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such other Places as the arbitrator may decide. The Following procedure shall be followed:

17.3.1 In case parties are unable to reach a settlement by themselves, the dispute should be submitted or arbitration in accordance with contract agreement.

17.3.2 There should not be a joint submission with the contractor to the sole Arbitrator.

17.3.3 Each party should submit its own claim severally and may oppose the claim put forward by the other party.

17.3.4 The onus of establishing his claims will be left to the contractor.

17.3.5 Once a claim has been included in the submission by the contractor, a reiteration or modification thereof will be opposed.

17.3.6 The "point of defense" will basis on actual conditions of the contract.

17.3.7 Claim in the nature of ex-gratia payments shall not be entertained by the Arbitrator as these are not contractual.

17.3.8 The question whether these conditions are equitable shall not receive any consideration in the preparation of "points of defense".

17.3.9 If the contractor includes such claims in his submission, the fact that they are not contractual will be prominently placed before the Arbitrator.

17.3.10 All the disputes if any will be referred to arbitration will be governed by 1996 arbitration Act and will not be challenged in any court of law.

17.3.11 Any disputes arising out of the tender/bid document/evaluation of bids/issue of APO shall be subject to jurisdiction of the competent court at the place from there the NIT/tender has been issued.

17.3.12 Where a contractor has not agreed to arbitration, the dispute/claims arising out of the Contract/PO entered

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within him shall be subject to the jurisdiction of the competent court at the place where Contract/PO has been issued.

The award of the sole Arbitrator shall be final and binding on all the parties to the dispute."

4. On the other hand, learned counsel for the respondent-BSNL,

while opposing the submissions made on behalf of the applicant,

raises two preliminary objections; firstly, that pertaining to the

issue in question, the applicant has already preferred a writ

petition, wherein the objection regarding the arbitration has been

taken; the said writ petition is still pending adjudication and;

secondly, that the procedure prescribed for the arbitration, which

is a pre-requisite, so far as the present case is concerned, has not

been followed by the applicant. Therefore, as per learned counsel,

on such counts, the present application deserves dismissal.

4.1. It was also submitted that only the Chief General Manager of

the respondent-BSNL can be appointed as an arbitrator, and

therefore, the present application is not maintainable.

5. However, after making such submissions, learned counsel for

the parties jointly submits that in the present case, an

independent arbitrator may be appointed as the sole Arbitrator to

resolve the dispute between the parties.

6. After hearing learned counsel for the parties, this Court finds

that the limited issue in question falls within the ambit of Section

11 of the Arbitration and Conciliation Act, 1996.

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7. This Court is conscious of the judgment rendered by the

Hon'ble Apex Court in the case of Perkins Eastman Architects

DPC v. HSCC (India) Ltd., (2020) 20 SCC 760.

8. This Court is also conscious of the fact that any issue(s)

raised in the present petition as well as further issue(s) can be

raised by either of the parties before the Arbitrator, who in turn,

shall deal with the same, strictly in accordance with law.

9. Accordingly, this Court finds that the agreement clause,

relating to appointment of the Arbitrator, is required to be invoked

and as such, the application, filed by the applicant, is allowed and

while exercising the power conferred under Section 11 of the Act

of 1996, appoints Shri Mahendra Kumar Mehta, RHJS (Retd.),

R/o 100, Vinayak Nagar, New Mangalam Complex,

Shobhagpura, Udaipur (Rajasthan)- 313001, as the sole

Arbitrator to adjudicate the dispute between the parties. The

payment of cost of arbitration proceedings and arbitration fee shall

be made as per the 4th Schedule appended to the Act of 1996.

10. The intimation of appointment, as aforesaid, may be given

by the counsel for the parties as well as by the Registry to Shri

Mahendra Kumar Mehta. The above appointment is subject to

necessary disclosure being made under Section 12 of the Act of

1996.

(DR.PUSHPENDRA SINGH BHATI), J.

SKant/-

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