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2007 Supreme(Mad) 3109

High Court of Judicature at Madras
THE HONOURABLE MRS. JUSTICE PRABHA SRIDEVAN
Ennore Port Limited, rep. by Company Secretary, Chennai
Versus
Skanska Cementation India Limited, Chennai & Others
O.P.No.244 of 2005
Decided On : 25-09-2007

Advocates:
For the Petitioner:------ For the Respondent: ------¬

Procedure laid down in the agreement should have been adopted for commencing arbitration.

Headnote:Arbitration and Conciliation Act, 1996-Sections 34 and 43-Arbrators award-challenge to-Arbitrators cannot ignore mandatory clauses of the agreement-earlier request made treated as in advertent-fresh procedure started-held, claimant cannot revive his right again by making request purported under clause 67.

Judgment :-

Prbha Sridevan, J.

According to the petitioner, the award suffers from illegality and the arbitrators have ex¬ceeded the parameters of the power and have committed misconduct and therefore, the award deserves to be set aside.

.2. The petitioner called for competent offers by open tender for construction of Port Site Access Roads and Bridges for the pro-posed Coal Port Project (Contract No. ECPP¬C2). Trafalgar House Construction (India) Ltd. submitted their offer. The respondent is the successor in interest of Trafalgar House Construction India Ltd. Haskoning Royal Dutch Consulting Engineers and Architects of Netherlands were engaged as Project Consultant for planning, design and implementation of the project. The petitioner is the successor in interest of Madras Port Trust. There was a formal agreement incorporating the letter of acceptance, clarifications, specifications, terms and conditions and was executed on 26. 1996. The work was to be completed within 15 months from the date of commencement. The date of commencement is 30.6.1996 and therefore, the due date for completion would be 9. 1997. The work could not be completed within the stipulated period. An extension was granted till August 1998. The project was completed only on December 1998. The contract provides for issue of defects liability certificate by the Engineer, who is none other than the project consultant regarding satisfactory completion. This certificate was issued along with a covering letter dated 21. 2000. According to the respondents, the delay was "due to various reasons not attributable to themselves" and since all outstanding works have been completed to the satisfaction of the Engineer, the respondents felt entitled to make certain claims arising out of differences in the interpretation of certain clauses of the contract and on account of the breach. A claim statement was submitted by the respondent on 5. 2000. The petitioners contention that this is a final statement of claim is denied by the respondent. According to them, the notice under clause 67.1 was issued only on 1. 2002. This was rejected on 6. 2002. The arbitration commenced. The respondents filed their statement of defence and a written statement was filed where a supplementary claim was made by the petitioners. According to them, claim Nos. 1 and 9 are not arbitrable. Claim Nos. 7, 9 and 10 are not included in the final statement and therefore, liable to be rejected. No oral evidence was adduced by either party and they relied mainly on documentary evidence. The following claims were made:

.3. The learned counsel for the petitioner submitted that the scope of works and the de¬scription of the same is set down in the agreement. Technical Specifications of the contract can be referred to in paragraph Nos. 301.1, 301.2 and 301.3 etc. The settlement of disputes initially by the Department that is the Engineers decision would be crucial and thereafter, there is dispute resolution by the Arbitrator. The manner in which the dispute shall be referred for the Engineers decision is as per Clause 61. It could be amicably settled as per Clause 67.2 and a decision in respect of which the Engineers decision has not become final and binding pursuant to Clause 67.1 and an amicable settlement has not been reached within the period mentioned in Clause 67.2, shall be referable for arbitration as per Clause 63. Clause 67.3 has been subsequently amended and there is no dispute that this amended 67.3 alone rules the field now. The learned counsel submitted that the Arbitrators power to review and revise the decision, opinion, instruction, determination, certificate or valuation of the Engineer relating to the dispute is subject to the limits prescribed under Clause 65. Clause 67.5 provides for matters which are exceptions to Clause 67.3 and matters which shall not be a subject of reference to arbitration. The draft final statement which is to be submitted by the contractor upon completion would











































































































































































































































































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