IMPORTANT POINTS
Constitutional remedy by way of writ petition is always available to an aggrieved party.
Arbitration clause in an agreement cannot ipso facto render a writ petition "not maintainable", more so when respondent not taking any objection on that ground.

JUDGMENT

SHIVA KIRTI SINGH, J.

1. Heard the parties. Leave granted.

2. This appeal is directed against final judgment and order dated 12.01.2011 passed by the Division Bench of Patna High Court in L.P.A. No.762 of 2009 whereby the Letters Patent Appeal preferred by the respondents herein was allowed and order of the learned Single Judge dated 18.02.2009 in Writ Petition bearing C.W.J.C. No.10173 of 2008 was set aside on the sole ground that there was an arbitration clause in an agreement between the parties and since such alternative remedy was not availed by the appellant, the writ petition itself was not maintainable.

3. Learned counsel for the appellant has assailed the aforesaid order of the Division Bench on facts as well as on law. On law, it was contended that the writ petition could not have been held not maintainable, more so when no such objection was taken by the other side. On facts, it was submitted that the agreement noticed by the Division Bench no doubt contained an arbitration clause entitling either of the parties to invoke arbitration by the concerned Superintending Engineer in case of any dispute arising out of the agreement but the Division Bench failed to notice that the agreement itself was no longer in existence because the work was completed long back and payments including payment on account of labour escalation costs amounting to Rs.9.53 lacs was paid in February 1992. Thus, according to the appellant, the agreement dated 06.02.1989 had worked itself out and it was much later that a dispute arose when the respondent authorities withheld the security amount of the appellant of Rs.30 lacs for a long period. On persistent demand, Rs.20 lacs out of the security amount, was returned after 10 years in December 2002 and that too without any interest. At that stage appellant came to know that Engineer-in-Chief vide an order dated 09.06.2001 had ordered for making a recovery of Rs.9.53 lacs from the appellant which had been paid long back on account of labour escalation cost.

4. The appellant preferred a writ petition bearing C.W.J.C.No.3686 of 2005 to claim the interest on undue delay in refunding the security deposit and against the direction for recovery of labour escalation cost. The respondents did not raise plea of arbitration clause and that writ petition was disposed of on 20.09.2006 allowing 12% interest on account of delay in payment of security amount. The issue of labour escalation cost was remanded back to the concerned Engineer-in-Chief who was directed to pass a reasoned order after hearing the appellant or his representative, within a fixed period. The appellant was granted liberty to seek his remedy if he was aggrieved by the order that may be passed by the Engineer-in-Chief.

5. The respondents preferred a Letters Patent Appeal bearing No.877 of 2006 in which also they did not raise the issue of alternative remedy by way of arbitration clause.

The LPA was disposed of on 11.12.2007 with the following direction :

"........ Since the matter is going on remand, the State has to apply its mind afresh to the facts and circumstances of the case and, therefore, the direction, as quoted above would be juxtaposition to the order of remand. The question of payment of interest by either side, however, will abide by the ultimate determination of the question by the State of Bihar. It goes without saying that the matter would be examined and re- determined by the State expeditiously."

6. The Engineer-in-Chief passed a fresh order on 21.05.2008 against the appellant over-ruling the various grounds and objections raised by the appellant in his representation relating to merits of the matter as well as jurisdiction of the Engineer-in-Chief who, according to appellant, had no role in the issue which was to be finalized at the stage of Executive Engineer and the Superintending Engineer. The appellant challenged the order of Engineer-in-Chief through writ petition bearing C.W.J.C. No.10173 of 2008 which was allowed b