M.J.S. CONSTRUCTION Vs. UNION OF INDIA

JUDGEMENT

(1.) The prayer made in the present application filed under Sec. 11(6) of the Arbitration and Conciliation Application Act, 1996 (hereinafter referred to as the "Act") is for appointment of an Arbitrator for resolution of dispute between the parties.

(2.) The arguments, raised by learned counsel for the applicant, are that upon participating in the tender, the applicant-firm was issued Work Order No. 15 dated August 18, 2015 for construction of 30 bedded hospital in Cantt. General Hospital, Kanpur. As per applicant-firm, when after completion of the work final bill amounting Rs.3,17,98,239.70 was produced for payment, an amount of Rs.53,60,466.51 remained unpaid. The applicant kept on requesting the respondents to release the balance payment, however, when for quite long time, the payment was not made despite repeated requests made by the applicant-firm, the applicant invoked arbitration clause as contained in Clause 25 of General Conditions of Contract for Central P.W.D. Works, 2014 seeking appointment of an Arbitrator for resolution of dispute between the parties, for the purpose notice dated July 9, 2021 was issued. However, respondents vide letter dated October 8, 2021 refused to appoint Arbitrator stating that there is no need for appointment of Arbitrator as Clause-16 of the contract agreement dated December 26, 2014 excludes the dispute from the purview of arbitration and it shall be decided by the Board which shall be conclusive and binding on the contractor.

(3.) He further submitted that rejection of request of the applicant for appointment of Arbitrator placing reliance on Clause 16 of agreement is totally illegal as in terms of the Clause-16 of the agreement, the decision taken by the respondent is final and thus no remedy is left with the applicant. Any such condition would be in violation of Sec. 28 of the Contract Act, as the applicant cannot be made remediless for resolution of his grievance.