Arbitration - Appointment of Arbitrator - Section 11(6) of the Arbitration & Conciliation Act, 1996.

JUDGMENT

C. Hari Shankar, J. - The petitioner seeks, by this petition under Section 11(6) of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as "the 1996 Act"), the appointment of an arbitrator, on behalf of the respondent Engineers India Ltd. (hereinafter referred to as "EIL").

2. Before proceeding to examine the issue, a chronological recapitulation of the facts, to the extent necessary, may be beneficial.

3. On 20th August, 2010, a contract was executed, between the National Institute of Immunology (NII) and EIL. The NII acted, in the said contract, on behalf of itself, the RCB and the Translational Health Science and Technology Institute (THSTI). The contract noted the fact that the NII owned a site, where, by a Memorandum of Understanding dated 7th July, 2010, between the NII, RCB and THSTI, it had been decided to establish a Biotech Science Cluster (BSC) Campus. It was also observed, in the said contract that NII had selected EIL to provide Project Management Consultancy (PMC) services, as specified in the contract.

4. Annexure I to the contract set out the scope of services of EIL and the obligations of the owner (i.e. NII) thereunder. Annexure I-2 thereunder, provided for the responsibilities of EIL. Mr. Navin Kumar has relied on sub-clause (f) of Clause 1 of the said Annexure, whereas Mr. Vinay Kumar Garg, learned Senior Counsel appearing for the petitioner, had placed reliance on Clauses (f), (g), (h) and (o) thereof. These clauses may be reproduced thus:

"f. EIL shall sign agreements with Contractors on behalf of the OWNER.

g. EIL shall give periodically (but not later than once in a quarter) copies of the expenditure certified by a representative of EIL on the project, for reimbursement of expenditure incurred from the funds advanced to EIL. On completion of the work, the accounts of the work shall be closed and a final statement shall be submitted for settlement, along with refund of excess deposit received, if any, audited by EIL''s in-house Chartered Accountant. Owner reserves the right to get the work and payments made checked and audited by its own officers or an independent government private Agency.

h. The payments by the Owner shall be made by transfer of funds in a bank account to be opened in any of the Nationalized Banks/State Bank in the name of "EIL BSC account".

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o. EIL shall be fully responsible to defend suits or arbitration cases arising out of the project in connection with their own work between EIL & Contractor(s). All such arbitrations shall be decided by a sole arbitrator appointed by the appropriate authority of EIL out of the names of the arbitrators approved by the OWNER. Provision for this arrangement shall be made in the Construction agreement stipulating that Arbitrator shall give reasons for his award if a claim of any party exceeds Rs. One Lakh."

5. In March, 2011, bids were invited, by EIL, for civil, structural, electrical and other developmental works for the construction of the campus of Phase 1 of the Bio-Tech Science Cluster at Faridabad. Clause 1.1 of the Notice Inviting Bid (NIB) stated that EIL had been appointed as the Project Management Consultant (PMC), on behalf of the Bio-Tech Science Cluster for the implementation of the work. Vide Clause 1.2, EIL, on behalf of RCB, invited bids for civil, structural, electrical and other developmental works for construction of the Campus of Bio-Tech Science Cluster at Faridabad. The general covenants of the NIB were contained in the various sub-clauses of Clause 7.0 thereof. EIL reserved, under Clause 7.2, the right to complete evaluation of the comparative evaluation of the bidders, based on the details in the bid without seeking any additional information. Clause 7.4 reserved, with EIL, the right to assess the bidders'' capability and capacity to execute the work using inhouse information. Clause 7.5 stipulated that the complete bidding document was available on the website of EIL as well as of RCB. Clause 7.6 st