RAJ KUMAR CONTRACTORS Vs. BAREILLY DEVELOPMENT

JUDGEMENT

(1.) By means of this application filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (the Act in short) the applicant M/s. Raj Kumar Contractors, through its partner Shri Raj Kumar Wadhwa (applicant in short) has prayed for appointment of Arbitrator/Arbitrators as provided in the arbitration clause in the contract entered into between the parties.

(2.) The case of the applicant is that it is a partnership firm which undertakes building construction work on contract. It entered into an agreement dated 20.1.1996 with the respondents for the construction of Middle Income Group and Low Income Group houses in Nehru Enclave Scheme in Saidpur Hawkins, Bareilly at the site to be provided by the respondents. The work was to commence by 25.1.1996 and was to be completed by 24.10.1996. According to the applicant a work order was issued to the applicant and mobilization advance of Rs. 13,56,652/- by means of a cheque dated 24.2.1996 was also given. Despite the letter dated 29.2.1996 sent by the applicant to the respondents for .the demarcation of the site and handing over possession of the land nothing was done and ultimately by letter dated 6.4.1996 the applicant was informed that it was not in the knowledge of the respondents that the proposed site had already been returned by the Ceiling Department to the land holders way back in the year 1992 hence the consent of the applicant was required for an alternative site and in the meantime the applicant was directed to return the mobilization advance. As the applicant had, in the meantime, incurred expenses by placing orders for materials and they were being asked to refund the mobilization advance without there being any fault on the part of the applicant, a dispute arose between the parties which was liable to be referred to Arbitrators as per Clause 32 of the general conditions of contract. The applicant sent a registered notice dated 9.6.1996 calling upon the respondents to appoint the required Arbitrators as per the terms and conditions of the contract bond dated 20.1.1996 and to refer the matter to the said Arbitrators within one month from the date of receipt of the registered notice. However there was no response. In the meantime, as the respondents were threatening to recover the mobilization advance and also to encash the Bank Guarantee given by the applicant they were constrained to file a Misc. Suit No. 200 of 1996 under Section 9 of the Arbitration and Conciliation Act before the civil court for injunction. The applicant also approached this court by means of the present, application.

(3.) On notice being issued to the respondents they have filed a counter-affidavit denying, inter alia, that any work order was given to the application pursuance of the contract. It was also stated that as the proposed site was not available the applicant was provided with an alternative site at Priyadarshini Nagar which was accepted by them and they also started the work. The mobilization advance given for the purpose of construction of houses in the Nehru Enclave is being utilized by. the applicant at the work site in Priyadarshini Nagar. Consequently, there was no question of referring any matter to arbitration in terms of the agreement dated 20.1.1996 and the present application was misconceived.