KHANNA BUILDERS Vs. UNION OF INDIA

JUDGEMENT

(1.) -

(2.) THE petitioner was awarded the work for providing drainage arrangements in the Northern Colony at SSB within the operational jurisdiction of Northren Railway, New Delhi vide telegram dated 22nd July 1981. A formal agreement was executed between Northern Railway and the petitioner on 25th November 1981 THE work was to be completed by 22nd January 1982. However since some difficulties cropped up, on the request of the petitioner, the time was extended to 15th March 1982. Vide letter dated 18th March 1982, the petitioner informed to Railway Authority that the work had been completed and requested the authorities to prepare the final bill for payment of the dues. THE Railway Authorities however on 20th April 1982 wrote a letter to the petitioner that the work had not been completed and bad in fact been abandoned by the petitioner and the railways had therefore decided to terminate the contract and get the balance work done departmentally at the risk and costs of the petitioner. THE petitioner was also informed that the liquidated damages and losses incurred by the Railways would be reckoned from the dues of the petitioner available with the administration. Since under the agreement between the parties disputes in respect of the contract had to be resolved by arbitration, the petitioner filed a petition in this Court being Suit No. 63A/82 under Section 20 of the Arbitration Act for a reference. THE railways however objected the reference and raised a preliminary objection that since the petitioner had not made any demand for arbitration in the first instance to the railway authorities, the petition be dismissed as pie-mature. THE petitioner therefore withdrew the petition. THE petitioner thereafter wrote a letter on 8th August 1984 to the Railways claiming a sum of Rs. 1,65,911,15 and refund of <PG>124</PG> security amount of Rs. 13,000. THE railway authorities replied to his letter on 5th September 19 and asked the petitioner to meet the concerned officer to resolve the disputes by discussion. Since the disputes could not be resolved, the petitioner filed the present petition under Section 20 of the Arbitration Act.