M/s. Maveric Developers and Colonizers Pvt. Ltd. vs State of Rajasthan and Others

Ajay Rastogi, J.—Instant application has been filed u/S. 11 of the Arbitration & Conciliation Act, 1996 for appointment of Arbitrator.

The applicant is a private limited company registered with Registrar of Companies, Rajasthan. The respondents invited NIT No. 7/2007-08 for construction of OHSR-15 Lac. Litre at Aanted and the applicant submitted tender for the said work and being found eligible, the work contract was awarded to him vide Work Order No. 4059 dt. 15.06.2007. It is not disputed that a contract agreement executed between the parties contain arbitration Cl. 23 to resolve arbitral dispute, if arises out of the terms & conditions of contract agreement. For ready reference, Cl. 23 is reproduced ad infra:-

Clause-23. Standing Committee For Settlement of Disputes: If any question, difference or objection, whatsoever shall arise in any way, in connection with of arising out of this instrument, of the meaning of operation of any part thereof, of the rights duties or liabilities of either party then, save in, so far, as the decision of any such matter, as herein before provided has been otherwise provided for and whether it has been finally decided accordingly, or whether the contract should be terminated, or has been rightly terminated, and as regards the rights or obligations of the parties, as the result of such termination, shall be referred for adjudication to the empowered Standing Committee, which would consist of the followings:

i) Administrative Secretary concerned.

ii) Finance Secretary or his Nominee, not below the rank of Deputy Secretary and/or Chief Accounts Officer.

iii) Law Secretary of his nominee, not below the rank of Joint Legal Remembrancer.

iv) Chief Engineer-cum-Additional Secretary of the concerned department.

v) Chief Engineer concerned (Member Secretary)

The Engineer-in-Charge, on receipt of application alongwith non refundable prescribed fee, (the fee would be two percent of the amount in dispute, not exceeding Rs. One Lac) from the Contractor, shall refer the disputes to the Committee within a period of one month from the date of receipt of application.

Procedure and Application for referring cases or settlement by the Standing Committee shall be, as given in Form RPWS 90.

As it reveals, a dispute arose between the parties arising from the contract agreement executed between the parties and in order to settle and to refer the dispute to Standing Empowered Committee, a notice dt. 01.07.2012 was sent by the applicant invoking Cl. 23 of the Contract Agreement which came to be served indisputably in the office of respondents on 07.09.2012 and the present application came to be filed on 17.07.2013 by that point of time, no steps were taken by the respondents informing the applicant regarding matter being referred to the Standing Empowered Committee invoking Cl. 23 of the Contract Agreement.

Reply to the application has been filed by the respondents and it has been averred that on the application which was filed by the applicant at one stage invoking Cl. 23 of the Contract Agreement, the Constitution of Standing Empowered Committee is under process.

Once the notice was served, within the statutory period of 30 days or thereafter indisputably, the respondents failed to refer the matter to the Standing Empowered Committee till filing of the application, it was open for the respondents to refer the matter to Standing Empowered Committee invoking Cl. 23 of the Contract Agreement but in the given case, no such material has come on record by which it could be established that the matter was ever referred to Standing Empowered Committee on or before filing of the present application that certainly seizes the power of the respondents and it is within the jurisdiction of this court and the Chief Justice or the Designated Judge holds jurisdiction to consider the application for appointment of Arbitrator u/S. 11(6) of the Act, 1996.

Consequently, the instant application succeeds & is hereby allowed and this court considers it appropriate to appoint Hon''ble Mr. Justice A.C. Goyal (Retd.)/D-19-B, "Seema Sadan", Meera Marg, Bani Park, Jaipur as sole Arbitrator to resolve the arbitral dispute. The cost of arbitration & fee of Arbitrator shall be determined in terms of the arbitration manual.

A copy of this order be sent to Hon''ble Mr. Justice A.C. Goyal (Retd.) and the parties are directed to appear before the Arbitrator on 05.07.2014 at 11:00 AM.