IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R. Subhash Reddy, Vipul M Pancholi, JJ.
IMC Limited – Appellant
Vs.
Board of Trustees of Deendayal Port Trust – Respondent
Letters Patent Appeal No. 1059 of 2018, Civil Application No. 1, 2 of 2018, Special Civil Application No. 5694 of 2018
Decided On : 28-09-2018
Constitution of India, Article 226 or 227 – Letters Patent – Clause 15 – Work Contract – Breach of agreement – Arbitration clause – Non-payment of licence fees, non-payment of liquidated damages, non-payment of remuneration of independent engineer, non-payment of royalty as agreed, non-payment/ non-reimbursement of taxes and duties, losses and damages – Held, no petition can be maintained for appointment of an arbitrator in absence of any such concluded contract governing the clause for appointment of an arbitrator – Suppression of terms governing tender process and concluded contract and as matter of fact, it was found arbitration clause contained in contract would come into picture only on placement of the purchase order – Appeal dismissed [Para 38, 39, 43]
R.Subhash Reddy, J.
This Letters Patent Appeal is filed under Clause 15 of the Letters Patent by the original petitioner in Special Civil Application No.5694 of 2018 aggrieved by the judgment of the learned Single Judge dated 24.07.2018. The said petition was filed with the prayers which read as under:
"(a) That this Hon'ble Court be pleased to issue a Writ of Certiorari/ a Writ in the nature of Certiorari and/or any other appropriate writ, order, or direction calling for the records and proceedings relating to Impugned Order dated March 14, 2018 (with reasons as recorded on March 26, 2018) and be pleased to quash and set aside the same;
(b) Pending the hearing and final disposal of this Petition, this Hon'ble Court be pleased to stay the proceedings before the Hon'ble Arbitral Tribunal qua the Petitioner;
(c) Pending the hearing and final disposal of this Petition, this Hon'ble Court be pleased to stay the effect, implementation and operation of the Impugned Order dated March 14, 2018 (with reasons as recorded on March 26, 2018);
(d) For ad-interim reliefs in terms of prayer clauses (b) and (c) above....."
2. The factual matrix of the case which relates to filing of this appeal, in brief, is as under:
2.1 The 1st respondent Kandla Port Trust (renamed as Deendayal Port Trust referred to as "the DPT" hereinafter) is a Major Port constituted under Section 3A of the Major Port Trusts Act, 1963. Vide Resolution 08.12.2005, 1st respondent Trust has decided to develop Berth Nos.13 to 16 by private participation on Build, Operate and Transfer ("BOT" basis). Acting on the Resolution, notice inviting tenders was published inviting bids from the prospective parties for the respective berths in two-stage process for selection. Request for Qualification provided the eligibility criteria for enabling a prospective bidder to participate in the process for the said project, while awarding of concession was to be evaluated on the financial bids of the prospective bidders. The prospective bidders were expected to evaluate the feasibility of facilities and the project before placing the bid.
2.2 Pursuant to notice inviting tenders, the appellant M/s.IMC Limited submitted its bid for licence of Berth No.15. The bid of the appellant-Company was accepted and a Letter of Intent for Award of Concession was issued to M/s.IMC Limited on 07.12.2010. Vide communication dated 27.01.2011, the appellant-Company was conveyed by the 1st respondent DPT that it was required to form a Special Purpose Vehicle ("SPV").
2.3 The appellant IMC constituted Special Purpose Vehicle (SPV) i.e. JRE Infra Private Limited - the 2nd respondent herein (hereinafter referred to as "JRE" or "SPV") which has executed the Concession Agreement with the Concessioning Authority. The Concession Agreement has an arbitration clause, as a part of the dispute resolution mechanism. Disputes having arisen, the 1st respondent alleging breach of agreement, invoked arbitration clause and initiated arbitration proceedings. Learned Arbitral Tribunal, comprising of Justice (Retd.) R.C.Lahoti, Former Chief Justice of India (Presiding Arbitrator), Justice (Retd.) J.M.Panchal and Justice (Retd.) A.R.Dave (Presiding Arbitrators), is constituted.
2.4 Broadly, the claims made by the first respondent DPT / claimant can be categorised for non-payment of licence fees, non-payment of liquidated damages, non-payment of remuneration of independent engineer, non-payment of royalty as agreed, non-payment/ non-reimbursement of taxes and duties, losses and damages caused to the 1st respondent and non-payment of cost towards assessing the replacement cost. The 2nd respondent- JRE filed Statement of Defence in the arbitration proceedings and also preferred Counter Claim. On completion of pleadings, before recording evidence, the 1st respondent DPT moved an application for impleadment of appellant IMC as a party
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