NAFR HIGH COURT of CHHATTISGARH, BILASPUR ARBR No. 20 of 2022 S.P. Singla Constructions Pvt. Ltd. Through Its Authorized Representative - Mr. A.K. Mirchandani, S/o Late Mr. Karamchand Mirchandani, Aged About - 76 Years, OfÏce At 1006-1007, Pearls Best Height - 1, A-5, Netaji Subhash Place, Pitampura, Delhi - 110034 ---- Applicant Versus

1. State Of Chhattisgarh Through - The Secretary, Public Works Department Mantralaya, Mahanadi Bhawan, Naya Raipur, Raipur Chhattisgarh

2. The Engineer In Chief Public Works Department, Bridge Construction Division, Rajnandgaon, Chhattisgarh ---- Respondents (Cause Title taken from Case Information System)

For Applicant : Mr. Aniruddha Wadhwa (through Video Conferencing) and Smriti Singh, Advocates.

For Respondents/State : Mr. Y.S.Thakur, Additional Advocate General Hon'ble Mr. Ramesh Sinha, Chief Justice

Order on Board

21/02/2024

1. This is an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 for appointment of an Arbitrator.

2. By way of this arbitration request, the applicant seeks constitution of an independent and impartial arbitral tribunal to adjudicate the claims of the applicant amounting to over Rs.4.16 crores against the respondent. The claim of the applicant arises out of the contract agreement between the applicant and the respondent for construction of a road over bridge on Mumbai Howrah Rail Line at KM 929/6 at Dongargarh.

3. The facts, in brief, as projected by the applicant is that the respondents invited Tenders for the construction of a Road-over-Bridge (for short, the RoB) on Mumbai Howrah Rail line at Km. 929/6 at Donargarh. The applicant’s bid of Rs. 8,67,00,000/- as against an estimated cost of Rs. 11,28,77,000/- was accepted by the respondents vide letter of acceptance dated 06.05.2006. Consequently, on 18.05.2006, a formal agreement No. 04/DL of 2006-07 was executed between the parties and under the terms of the said Contract, the same was to be completed within 18 months from the reckoned date. In terms of the said contract, the said Project required completion within 18 months, viz. by 17.12.2007, which was extended till 15.12.2012, on account of the unavoidable delays and disruptions that were occasioned in the course of performance of the said project on account of various acts of breach attributable to the respondents. According to the applicant, the aforesaid delays and disruptions have caused (and are continuing to cause) tremendous loss to the applicant. The applicant has time and again raised its claims with the respondent for (i) settlement of final payment including payment towards price escalation alongwith applicable interest; and (ii) discharge of its Performance Bank Guarantee for the sum of Rs. 43.35 lakh but the same remain unaddressed and unresolved. As such, disputes have arisen and continue to subsist between the parties which require a final resolution.

4. Mr. Aniruddh Wadhwa, learned counsel for the applicant submits that the said contract contemplates dispute resolution through arbitration as set out in Clause 1.17. However, it is pertinent to note that the said arbitration clause to the extent it contemplates resolution of disputes through arbitration in terms of the Madhya Pradesh Madhyastham Adhikaran Adhiniyam, 1983 is clearly unenforceable as the said project, being beyond the territorial limits of the State of Madhya Pradesh. The said project was undertaken by applicant in the State of Chattisgarh pursuant to execution of the a contract between the parties in the year 2006, which is much after the bifurcation of the State of Madhya Pradesh in terms of the Madhya Pradesh Reorganisation Act, 2000. Furthermore, even if for the sake of argument, the said Arbitration Clause could be said to be instead governed by the Chhattisgarh Madhyastham Adhikaran Adhiniyam, 1983, it would be pertinent to note that the definition of "dispute" in Section 2(1)(d) thereof is expressly limited to disputes for "ascertained money", and would not