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1986 Supreme(Cal) 217

High Court Of Calcutta
D. K. SEN, S. K. SEN
NAGENDRA NATH - Appellant
Versus
STATE OF WEST BENGAL - Respondent
Appeal 354  Of  1976
Decided On : 05/21/1986

A party cannot invoke the writ jurisdiction of the court to enforce a contractual right to arbitration when the Arbitration Act provides a specific and exhaustive mechanism for resolving such disputes.

Headnote:

ARBITRATION ACT, 1940 - SEC. 20 - CONTRACTUAL DISPUTE - REFERRAL TO ARBITRATION - WRIT JURISDICTION - MAINTAINABILITY - MINISTERIAL ACT - CONTRACTUAL RIGHT - ENFORCEMENT.

Fact of the Case:

The appellant, a contractor, submitted a tender for construction work and received a work order after the specified date. The appellant claimed entitlement to an enhanced rate sanctioned for contracts awarded before the specified date. The appellant's request for arbitration was denied, prompting him to file a writ petition seeking a mandamus to compel arbitration and a certiorari to quash the denial.

Finding of the Court:

The court held that the appellant's right to have the dispute referred to arbitration was primarily a contractual right that could be enforced through the special provisions of the Arbitration Act. The court found that the appellant was not entitled to invoke the writ jurisdiction of the court for the enforcement of such a right.

Issues: 1. Whether referring a dispute to arbitration is a ministerial act that can be compelled through a writ petition. 2. Whether the appellant's right to have the dispute referred to arbitration is a contractual right that can be enforced through the Arbitration Act.

Ratio Decidendi: 1. The Arbitration Act, 1940 is a self-contained and exhaustive code that provides for the resolution of disputes through arbitration. 2. The appellant's right to have the dispute referred to arbitration is a contractual right that can be enforced through the special provisions of the Arbitration Act. 3. The appellant was not entitled to invoke the writ jurisdiction of the court for the enforcement of such a right.

Final Decision: The court dismissed the appeal, upholding the decision of the lower court that the appellant's writ petition was not maintainable and that the appellant should pursue his remedy under the Arbitration Act.

SHYAMAL KUMAR SEN, J.

( 1 ) THIS appeal is against the judgement and order dt. July 18, 1976 of the learned single Judge in the first Court whereby the learned Judge was pleased to discharge the Rule Nisi issued and dismissed the writ petition of the appellant.

( 2 ) THE appellant, the writ petitioner in the first Court is a Contractor. He submitted a tender in the name Messrs. Chakraborty and Company being Tender No. 2/esi of 1966-67 for a part of the work in the construction of a 300 bedded general hospital, excavation of a tank and for raising the site under the E. S. I. Scheme at Budge Budge in the district of 24 Parganas under the Presidency Circle. The said tender was opened in Feb. 1976. By a registered letter dt. 25th April, 1966 the respondent 5, the Executive Engineer, Eastern Circle, Public Works Department acting on behalf of the State of West Bengal accepted the appellant's tender for the above noted work at the rate of 24. 5%. A registered letter dt. 25th April, 1966 was issued by the respondent 5 on behalf of the State of West Bengal the respondent No. 1 in favour of the appellant which was treated as a formal work" order.

( 3 ) BY a letter dt. 27th Feb. 1967 the Secretary, P. W. D. , West Bengal intimated that the Governor had been pleased to sanction, inter alia, enhancement by 15% over the accepted tender including sanitary and plumbing works which had commenced earlier than the 1st April, 1966 but had not yet been completed. The sanction of enhancement by 15 per cent ensured to the benefit of the contractors who are making construction works in respect of E. S. I. hospital division under the territorial jurisdiction of the Presidency Circle. The appellant having been awarded the said work of construction of E. S. I. hospital in the Presidency Circle expected to get the advantage of the said enhancement as sanctioned. But since the appellants contract had been accepted and the work order was also issued after the 1st April, 1966 he was not allowed the said enhancement as sanctioned. The appellant made a representation to the authorities that the acceptance of tenders had been delayed by the authorities and considerable time was taken in issuing the approval of the terms and the work could have been started well ahead of 1st April, 1966 but such representation was not entertained and was refused. Clause 25 of the terms and conditions of the contract between the parties provided for arbitration and read as follows :"cl. 25- Except where otherwise provided in the contract all questions and disputes relating to the meaning of the specifications, designs, drawings, instructions herein before mentioned, and as to the quality of workmanship or materials used on the work or as to any other question, claim, right, drawings, specifications, estimates, instructions, orders or those conditions or otherwise concerning the works of the execution, or failure to execute the same whether arising during the progress of the work, or after the completion or abandonment whereof shall be referred to the sole arbitration of the Chief Engineer of the Department. Should the Chief Engineer before any reason unwilling or unable to act as such arbitrator such questions and disputes shall be referred to an arbitrator to be appointed by the Chief Engineer. The award of the arbitrator shall be final, conclusive and binding on all parties to this contract. "the appellant asked for arbitration in terms of the above clause in respect of his claim for enhanced rates as sanctioned and also in respect of a supplementary bill. The authority concerned referred the dispute relating to the supplementary bill to arbitration the authority concerned refused to refer the dispute arising out of the appellant's claim for enhanced rates. The appellant was intimated that the Government had carefully considered the claim but regretted its inability to refer the same to arbitration.

( 4 ) THE appellant, therefore, moved this Court in its constitutional wr







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