Subaya Constructions Company Limited vs The Chief Engineer Twad Board

R. Subbiah, J.—The writ petitions have been filed for issuance of Writ of Mandamus directing the respondents to pay the petitioner a sum of Rs.7,68,78,555/- and Rs.6,06,54,417/- as per the written decision of the Adjudicator dated 01.08.2013, together with interest at the rate of 8% per annum as per clause 43.1 of the agreement between the petitioner and respondents.

Since the issued involved in both the writ petitions are one and the same, these writ petitions are disposed of by way of common order.

It is the case of the petitioner that the first respondent has called for tenders for providing the Underground Sewerage Scheme to Sivagangai Municipality Package-I and Underground Sewerage Scheme to Ramanathapuram Municipality Package-III. The petitioner participated in the tender. The tender value for the work under the Underground Sewerage Scheme to Sivagangai Municipality Package -I is Rs.12,46,43,802/- and the tender value for the work under the Underground Sewerage Scheme to Ramanathapuram Municipality Package-III is Rs.9,87,57,743/-. It is the further case of the petitioner that though he was ready to commence the work, the respondent did not hand over the entire site to the petitioner. The respondent has also not furnished the levels, drawings and specifications or instructions for commencing and executing the work. Because of the respondents'' failure and negligence, the petitioner incurred severe loss to the tune of Rs.7,47,86,281 in respect of the Underground Sewerage Scheme to Sivagangai Municipality Package-I and Rs.5,92,54,645/- in respect of the Underground Sewerage Scheme to Ramanathapuram Municipality Package-III. The petitioner has sent several letters to the respondents claiming compensation amount. But the respondent failed to give the compensation amount. The petitioner requested the respondent to resolve the dispute as per clause 24(1) of the agreement. The respondent consented to refer the dispute to a mutually agreed Adjudicator as per clause 25 of the agreement between the parties. Accordingly, the dispute was referred to the Adjudicator. The Adjudicator, after hearing both sides and after perusing the records furnished by the petitioner and respondents, decided the dispute by his written decision dated 01.08.2013 and further held in his order that the respondents did not hand over the entire site on the start date, as per the agreement condition 21.1 and the respondents did not make payments within 28 days from the date of certification of the engineer and hence, as per agreement clause 43(1), the respondents are liable to pay compensation at Rs.7,47,86,281 and Rs.5,92,54,645/- respectively in respect of both the schemes together with interest at 8% per annum. Thus, the learned counsel for the petitioner submitted that in this matter, a direction may be given to the respondents to pay the said amounts as per the written decision of the Adjudicator, together with interest at 8% as per clause 43(1) of the agreement.

The learned counsel for the respondent has filed a detailed counter inter alia stating that the Adjudicator has not come to any categorical conclusion and he has only directed the respondent to consider the petitioner''s request as per the clause in the agreement. The only remedy available to the writ petitioner is to invoke the clause of Arbitration. In fact, there is no positive order for payment of compensation by the Adjudicator. The respondents are even ready to refer the dispute to the arbitrator, as per clause IV of Special condition of contract, since the tender amount is more than Rs.9 crores and the matter should be decided by the 3 Arbitrators, namely one appointed by department, one appointed by the petitioner and the 3rd arbitrator is through the consensus of the above said 2 arbitrators. Thus, they sought for dismissal of the writ petitions.

Today, when the matter is taken up for consideration, the learned counsel for the petitioner submitted that since there is a written decision by the Adjudicator in his favour, the petitioner need not invoke the clause of Arbitration, and it is for the respondent to refer the matter for arbitration, if the respondent does not agree with the written decision of Adjudicator. But the respondents are not ready to refer the matter to arbitration. Hence, a direction may be issued to the respondent to pay the compensation as per the written decision of the Adjudicator, dated 01.08.2013.

The learned counsel for the respondents submitted that they have settled the entire final bill to the petitioner and as such they do not have any dispute to refer the matter to the Arbitrator. The petitioner was claiming only compensation, by making certain allegations against the respondent. Under the said circumstances, it is for the petitioner to invoke the clause of Arbitration. It is the further submission of the learned counsel for the petitioner that there is no positive direction by the Adjudicator to pay the compensation amount to the petitioner. The adjudicator has only directed to consider the petitioner''s request as per the clause in the agreement.

Heard the submissions made on either side and perused the materials available on record.

It is the case of the respondent that they do not have any dispute to refer the matter to the Arbitrator. Since they have settled the final bill, according to the respondent, it is for the petitioner to invoke the clause of arbitration, since the petitioner is claiming only compensation amount by making certain allegation against the respondent. But according to the petitioner as per the written decision of the adjudicator, the respondent is liable to pay the compensation amount.

Irrespective of the submissions made by the learned counsel appearing on either side, I am of the considered opinion that the entire issue arises only based on a contractual obligation and as such, the same cannot be adjudicated in the writ proceedings under Article 226 of the Constitution of India. Further as per clause 25.3 of the agreement either party may refer a decision of the Adjudicator within 28 days of the Adjudicator''s decision. Hence, in my considered opinion, if the petitioner feels that if he is entitled for the amount, he has to work out his remedy only as per the clause in the agreement. This Court cannot give a direction to the respondent to pay the compensation amount in the writ jurisdiction. Hence, the writ petition is liable to be dismissed in limini on the ground that the same is not maintainable. Accordingly, these writ petitions are dismissed. Consequently, connected M.P.(md).Nos.1 & 1 of 2013 are also dismissed. No costs.