CHIEF ENGINEER Vs. BAKTHI CONSTRUCTIONS

JUDGEMENT

(1.) THIS appeal is directed against the judgment and decree dated 30-11-1998 passed in C.S.No. 832 of 1993, wherein Mr. R. Dhananjayan, retired District Judge was appointed as Arbitrator to resolve the dispute between the parties. The plaintiff/respondent herein filed C.S.No.832 of 1993 before the Original Side of this Court under Section 20 of the Arbitration Act, 1940 for direction to the defendants for production of agreement dated 21-10-1988 entered into between the plaintiff and the defendants in respect of the construction of boundary wall at Naval Air Station, Arakonam and refer the dispute between the parties to an independent arbitrator appointed by this Court. It is the claim of the plaintiff that an agreement was entered into between the plaintiff and the defendants for construction of a compound wall measuring 6.5 K.Ms. Though date was fixed for completion of the said work as 20-10-1989, the same was extended to 28-12-1990 and the work was completed on 31-12-1990. The plaintiff has submitted a bill for a total amount of Rs.1,09,67,690-34. It is stated that after submitting the bill, the plaintiff noticed that certain items of work carried out by it were not taken into account and entered in the measurement books included in the final bill. Hence, he submitted a letter dated 19-10-1991 for a sum of Rs.75 lakhs to the second defendant. By letter dated 30-01-1993, the second defendant informed the plaintiff that the Chief Engineer has rejected the claim of the plaintiff on the ground that "No claim certificate" was appended to the final bill submitted by the plaintiff and after submitting the "No claim certificate" the plaintiff is not eligible to claim any more amount on the said bill. As the dispute relates to the terms of the contract and as such the dispute has necessarily to be referred to an arbitrator and the defendants cannot reject the request in limine. In such circumstances, the plaintiff has prayed for appointment of an arbitrator to take a decision of their claims.

(2.) IN the written statement filed by the defendants, it is stated that the plaintiff has submitted a final bill on 9-3-1991 for a sum of Rs.1,16,58,763/- which included escalation amount and along with the bill it has furnished a certificate of no further claim under this contract beyond the net amount of the said bill. This certificate was given without any reservation. After furnishing the certificate, it is deemed that all other claims are waived and extinguished in terms of Condition 65 of the General Conditions of the contract forming part of the Contract Agreement. On 19-10-1991 the plaintiff has made a further claim of Rs.75 lakhs, 7 months after the submission of the final bill. After submitting the no claim certificate, the plaintiff is not entitled for any further claim under the said contract and the suit making further claim is liable to be dismissed.

(3.) IN the light of the fact that the order appointing a retired District Judge as Arbitrator was the subject matter of this appeal, Mr. C. Krishnan, learned senior Central Government standing counsel, suggested that in the event of this Court holding that the claim subsists and the same is arbitrable, Mr. Justice S. Marimuthu, retired Judge of this Court, may be appointed as Arbitrator. As to the above request of the learned senior Central Government standing counsel, Mr. N. Jothi, learned counsel appearing for the respondent, fairly states that he has no objection for appointment of Justice S. Marimuthu as Arbitrator. IN the light of our conclusion and in view of the agreement by both parties, Mr. Justice S. Marimuthu, a retired Judge of this Court, is appointed as Arbitrator to resolve the dispute with reference to the terms of the agreement dated 21-10-1988. The Arbitrator shall enter into the reference in two weeks from the date of receipt of a copy of this order and shall submit his Award thereon into this Court within six months after entering into the reference. The Arbitrator is at liberty to fix his remuneration.