M.M.KUMAR, J.

1. The prayer made by the petitioners in this petition filed under Article 226 of the Constitution is to declare paras VIII and XV of Clause 25 of the arbitration agreement, dated 8-11-2002 (Annexure P-2 as illegal and ultra vires. It has further been prayed to quash letter dated 18-8-2006 (Annexure P-8), issued by the Arbitrator-cum-Superintending Engineer, respondent No.2, to the petitioner calling upon it to deposit 10% of the amount of the claim submitted by him as per Clause VIII of the contract agreement before entering into arbitration.

2. Brief facts of the case are that the petitioner, which is a registered company owned by the Government of India, is engaged, inter alia, in execution of construction projects of national importance. It has its registered office at New Delhi. The instant petition is filed through the General Manager (Law) Mrs. Meera Shankar, who has Power of Attorney in her favour (Annexure P-1). The State of Punjab, respondent No.1, issued tenders for the erection, testing, commissioning, starting, stabilization and operation, monitoring and performance of 152 MLD STP based on USAB Technology at Balloke Zone C Ludhiana under Satluj Ac