Point of Law: 2020 Rules which came into force from the date of their publication in the Official Gazette, i.e. 12.02.2020, cannot be given retrospective effect. The intention of Government of India to make the 2020 Rules prospective is very clear from the notification dated 12.02.2020. In any event, subordinate legislation cannot be given retrospective effect unless the parent statute specifically provides for the same.

JUDGMENT :

SAUMITRA DAYAL SINGH, J.

1. Heard Sri. Rahul Agarwal, learned counsel for the applicant and Sri. Navneet Chandra Tripathi, learned counsel for the opposite party.

2. Present is an application filed under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the ‘Act’). The application was filed on 12.07.2019 with a prayer to appoint an independent arbitrator, to adjudicate the disputes that have arisen between the parties under a written contract dated 01.03.2010 entered into between the applicant and the Chief Project Manager, Railway Electrification for the work “Design, Supply, Erection, Testing and Commissioning of 25 KV, AC, 50 Hz, Single Phase, Traction Overhead Equipments, Switching Stations, Booster Transformer Stations, LT Supply Transformer Stations and All Ancillary Equipments Madurai (Excl.)-Tuticorin- Vanchimaniyanchi-Nagercoil (Excl.) of Southern Railway” valued at Rs. 24,97,54,357/- (Rupees Twenty Four Crores Ninety Seven Lakhs Fifty Four Thousand Three Hundred Fifty Seven only).

3. Before approaching this Court, the applicant had issued the statutory notice dated 31.12.2018, invoking arbitration. Referring to Section 12(5) of the Act (as enforced w.e.f. 23.10.2015), the applicant expressed its desire for appointment of an independent arbitral tribunal and for that purpose nominated a retired Judge of this Court. It required the opposite party to nominate an arbitrator of its choice so that the two arbitrators (thus appointed), may nominate a third arbitrator. The three arbitrators together were to constitute the arbitral tribunal.

4. In response to the above notice, on 21.01.2019, the opposite party denied the request for arbitration. It stated, under Clause 1.2.54(b)(i), the arbitration could be sought only after 120 days and before completion of 180 days from the date of presentation of the final bill. Since, the final bill payment was made on 13.06.2016, the request for arbitration first made on 31.12.2018, was outside the said period. Therefore, it was stated to be lacking in locus-standi. Second, it was stated that the ‘No Claim Certificate’ issued by the applicant while obtaining the final payment contained an undertaking to the following effect:

“1. The undersigned is in receipt of the above referred letter in connection with the subject matter. Your attention is invited to Tender Clause No. 1.2.54(b)(i) wherein it is clearly stated that after 120 days but within 180 days of his presenting final claim on disputed matters shall demand in writing that the dispute or difference be referred to arbitration. But it is to inform that you had advised vide your Letter No. TPL/RLY/VPT/019/3006-2 dated 30.06.2016 that you had received the final Bill payment on 13 June, 2016. As you have failed of seek any redressal of grievance within the aforesaid period, your demand for arbitration does not have any locus-standi at this distant date.

2. It shall be also noted that you have submitted a “No Claim Certificate” under Signature and seal of firm, in which it states “should any claim be raised by us in future under this agreement, the same shall be nullified by virtue of this indenture.”

3. Similarly, your attention is invited to Clause No. 17 of the “Preamble” (Page No. 8 of the tender paper) which states that General Conditions of Contract of concerned Railway as amended for advance correction slips issued up to date shall be part of the contract. The clause no. 63 of latest GCC provides that no such notice of dispute shall be served later than 30 days after the date of issue of completion certificate by the Engineer. The Completion Certificate was issued on 15.03.2015. Hence, it is regretted to inform you that Railway is not in a position to entertain your demand for arbitration at this farthest date as the same is not admissible at this juncture.”

Third, referring to Clause 17 of the Preamble to the agreement and thereby invoking Clause 63 of the General Conditions of Contract (herei