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2013 Supreme(Chh) 303

HIGH COURT OF CHHATTISGARH, BILASPUR
SANJAY K. AGRAWAL, J.
P. C. JAIN - Applicant
Vs.
STATE OF C.G. & ANOTHER - Respondents
Arbitration Application Nos. 82-85 of 2013
Decided on: 31-10-2013

Advocates:
Advocate Appeared
Shri Rahul Jha, Advocate, for the Applicants.
Shri Vinay Harit, Dy. Advocate General, for the State/non-applicants.

Headnote:

Arbitration and Conciliation Act, 1996 – Section 11 – Chhattisgarh Madhyastham Adhikaran Adhiniyam, 1983 – Section 2 – Arbitration Board – Authorities – Applicant has challenged same agreement before Superintending Engineer vide application submitted disputing action of termination of contract and raised quantified claim for settlement of dispute and payment – When no response was received by applicant as per Clause 29 of agreement again preferred an appeal to Chief Engineer vide letter authorities under agreement failed to decide and settle dispute – Held, Agreement has been invoked in its true letter and spirit, and when dispute was not settled, this application was filed of fact that there is valid and enforceable agreement between parties applicant is a party and non-applicant has failed to act on request of applicant for appointment of an Arbitration Board and considering that arbitral dispute has arisen out of contract agreement this Court is of opinion that a case for appointment of an Arbitrator is made out to adjudicate dispute arisen between parties – Agreement, a request was made to State Government for constitution of an Arbitration Board but neither Board was constituted nor dispute was settled leading to filing of this application – Application Allowed.

ORDER

1. This order shall govern the disposal of Arbitration Applications No.82, 83, 84 and 85 of 2013 as the question of law involved in all the four applications is one and the same. However, for the sake of convenience, Arbitration Application No. 82 of 2013 is taken-up as the lead case.

2. All the four arbitration applications are filed by applicant-P.C. Jain under Section 11(6) of the Arbitration and Conciliation Act, 1996 (henceforth 'the Act, 1996') seeking appointment of an Arbitrator in terms of agreement dated 04/06/2011 entered into between the applicant and the non-applicants.

Facts:

3. Facts leading to filing of the lead case, i.e., Arbitration Application No. 82 of 2013 may briefly be noted thus:

3.1 On 04/06/2011, the non-applicants issued the work order and the agreement bearing No. 25/DL/2011-12 was executed by the parties and thereafter, the agreement was terminated vide order dated 28/02/2012 stating inter alia that applicant has failed to complete the work by stipulated date of completion.

3.2 Being aggrieved with the order of termination of contract, applicant has challenged the same under Clause 29 of the agreement before the Superintending Engineer vide application dated 29/03/2012 submitted on 31/03/2012 (Annexure-A/5), disputing the action of the termination of contract and raised the quantified claim for settlement of the dispute and payment. When no response was received by the applicant as per Clause 29 of the agreement, again preferred an appeal to the Chief Engineer vide letter dated 27/06/2012 (Annexure- A/6). Both the authorities under the agreement failed to decide and settle the dispute, therefore, the applicant referred the matter as per Clause 29 of the agreement to the State Government for constitution of Arbitration Board as per the provisions of agreement for settlement of dispute vide letter dated 11/10/2012 (AnnexureA/7), but neither the Board was constituted nor the dispute was settled.

3.3 It was further pleaded that since the work of drilling of tubewell was awarded by the non-applicants to the applicant which does not fall within the ambit of works-contract as defined under Clause (i) of sub-section (1) of Section 2 of the Chhattisgarh Madhyastham Adhikaran Adhiniyam, 1983 (for short "the Adhiniyam, 1983").

3.4 The notices were issued to the State/non-applicants on 21/10/2013 and time was sought to file reply. On 29/10/2013, Mr. Vinay Harit, learned Deputy Advocate General appearing on behalf of the State/non-applicants would submit that State is not proposing to file reply and he would be making submission.

Submission of counsels :

4. Mr. Rahul Jha, learned counsel appearing for the applicant would submit that applicant has raised the dispute as per Clause 29 of the agreement firstly before the Superintending Engineer on 31/03/2012 (Annexure-A/5) thereafter, before the Chief Engineer on 27/06/2012 (Annexure-A/6) and ultimately, when both the parties have failed to settle the dispute, he has made a request to the State Government for constitution of an Arbitration Board (Annexure-A/7) vide letter dated 11/10/2012. When no action was taken, he has left with no other option except to make application before this Court for appointment of an Arbitrator under Section 11 (6) of the Act, 1996. He would further submit that under Clause 29, an agreement was entered into between the parties, in which, he was party to contract and there is valid and enforceable agreement between the parties, The Chhattisgarh High Court is appropriate High Court for appointment of an Arbitrator. He would finally submit that drilling of tube wells is not a subject matter of the agreement of works contract, therefore, the sole Arbitrator be appointed to resolve the dispute.

5. Per contra, Mr. Vinay Harit, learned Deputy Advocate General appearing for the non-applicants/State would submit that the applicant has failed to make out a case for appointment of Arbitrator and would further submit that the drilling of tube-well is










































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