IMPORTANT POINT
The court emphasized the necessity of appointing an independent Sole Arbitrator for arbitration disputes, following the principles established in prior Supreme Court judgments.

JUDGMENT :

SACHIN DATTA, J. (Oral)

1. The present petition has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter ‘the A&C Act’) seeking appointment of a Sole Arbitrator for adjudicating the disputes between the parties.

2. The disputes between the parties have arisen in context of the contracts bearing agreement no.74-W/3/2/348/WA/LKO dated 10.06.2011(Arb.P.1716/2024); agreement no.74-W/3/2/349/WA/LKO dated 10.06.2011 (Arb.P.1717/2024); agreement no.74-W/3/2/350/WA/LKO dated 15.07.2011(Arb.P.1715/2024); agreement no. 74-W/3/2/352/WA/LKO dated 15.07.2011(Arb.P.1718/2024) wherein the petitioner was engaged for carrying out earth work and blanketing in embankment and cutting including mechanical compaction for doubling of the Zafrabad-Utratia section of Lucknow Division of Northern Railway.

3. The relevant contractual conditions in the aforementioned agreements contain the following identical provision for dispute resolution, which is as under:-

63. Matters finally determined by the Railway – All disputes and differences of any kind whatsoever arising out of or in connection with the contract, whether during the progress of the work or after its completion and whether before or after the determination of the contract, shall be referred by the contractor to the GM and the GM shall within 120 days after receipt of the contractor’s representation make and notify decisions on all matters referred to by the contractor in writing provided that matters for which provision has been made in clauses 8, 18, 22(5), 39, 43(2), 45(a), 55, 55-A(5), 57, 57A,61(1), 61(2) and 62(1) to (xiii) (B) of General Conditions of contract or in any clause of the special conditions of the contract shall be deemed as ‘excepted matters’ (matters not arbitrable) and decisions of the Railway authority, thereon shall be final and binding on the contractor; provided further that ‘excepted matters’ shall stand specifically excluded from the purview of the arbitration clause.

64 (1) (i) - Demand for Arbitration

In the event of any dispute or difference between the parties hereto as to the construction or operation of this contract, or the respective rights and liabilities of the parties on any matter in question, dispute or difference on any account or as to the withholding by the Railway of any certificate to which the contractor may claim to be entitled to, or if the Railway fails to make a decision within 120 days, then and in any such case, but except in any of the “excepted matters” referred to in Clause 63 of these conditions, the contractor, after 120 days but within 180 days of his presenting his final claim on disputed matters shall demand in writing that the dispute or difference be referred to arbitration.

64 (1) (ii) - The demand for arbitration shall specify the matters which are in question, or subject of the dispute or difference as also the amount of claim item wise. Only such dispute(s) or difference(s) in respect of which the demand has been made, together with counter claims or set off, given by the Railway, shall be referred to arbitration and other matters shall not be included in the reference.

64 (1) (ii) - (a) The Arbitration proceedings shall be assumed to have commenced from the day, a written and valid demand for arbitration is received by the Railway.

(b) The claimant shall submit his claim stating the facts supporting the claims along with all the relevant documents and the relief or remedy sought against each claim within a period of 30 days from the date of appointment of the Arbitral Tribunal.

(c) The Railway shall submit its defence statement and counter claim(s), if any, within a period of 60 days of receipt of copy of claims from Tribunal thereafter, unless otherwise extension has been granted by Tribunal.

(d) The place of arbitration would be within the geographical limits of the Division of the Railway where the cause of action arose or the Headquarters of the concerned Railway or any other place with