RAJ ELECTRICALS Vs. BSES RAJDHANI POWER LTD

JUDGEMENT

(1.) This application has been made under Section 9 of Arbitration and Conciliation Act by the petitioner/applicant for granting an interim injunction against the respondent restraining respondent from disconnecting supply of electricity to the petitioner or from taking direct control of distribution of electricity and directing the respondent to maintain status quo in respect of the agreement entered into between parties till the decision of the dispute by the arbitrator.

(2.) The brief facts relevant for the purpose of deciding this application are that Delhi Vidyut Board (DVB), the earlier body responsible for supply and distribution of electricity in the city, had entered into an agreement with the petitioner under a scheme whereunder the unauthorized colonies were provided electricity through contractors. DVB was supplying electricity to the petitioner at single point and the petitioner contractor was supplying electricity to the cluster of houses in unauthorized colony. The petitioner contractor was called Single Point Delivery Contractor. The agreement was entered into for a period of seven years and could be renewed for further period by mutual consent. The agreement was terminable by either party in case of certain eventualities. The relevant clauses of the agreement providing for termination of the agreement are as under: PAYMENT TERM (Clause 14) Payment of the fees shall be made monthly against certificate from the ?Officer? about the work performed. If the agreement is terminated early by one party, the party in default will pay suitable liquidated damages to compensate for the loss suffered by the other party on the account of such termination. TERMINATION OF DEFAULT (Clause 7 of Additional Terms and Conditions of Contract) Specific events of default will entitle the DVB to terminate the agreement, the party committing an even of default which is.- If the agreement is terminated early by one party, the party in default will pay suitable liquidated damages to compensate for the loss suffered by the other party on account of such termination. The agreement can however otherwise be terminated by either party by giving six months notice. Agency shall indemnify DVB against any claims, demands, costs and expenses whatsoever which may be made against it, because of failure of the agency or its any representative in the performance of their duties and negligence, any accident or injury to any person or untimely payment to any employee. FALL BACK AGREEMENT (Clause 8 of Additional Terms and Conditions of Contract) In the event of failure of the agency to fulfill its obligations, duties and responsibilities as per the agreement terms, DVB shall have all the rights, at any time to resort to fall back agreement. Under this plan, DVB shall take charge after giving suitable notice and can recover from the security deposit the losses suffered due to such failure, if the security deposit is insufficient the agency shall pay the difference to DVB failing which DVB shall have right to recover the same through legal or other means. The DVB shall have the right in such circumstances to mange the system itself after taken charges of the facilities as above or through any other agency as it may deem fit and no claim of agency for compensation in this aspect shall be entertained.

(3.) Clause 11 of the additional terms and conditions of the contract provided that in case of disputes, the same shall be settled by mutual discussion. Failing the same, the disputes will be referred to arbitration.