UNION OF INDIA Vs. SHYAMA CHARAN AGARWALA

JUDGEMENT

(1.) BY this petition, the petitioner -Union of India challenges the order passed by the Civil Judge, Senior Division, Vasco -da -Gama rejecting the application filed under section 8 of the Arbitration and Conciliation Act 1996, in Special Civil Suit no. 41/1996/B. The petitioner/Union had filed an application under section 8 of the Arbitration and Conciliation Act 1996 ("The Act") for referring the dispute raised by the respondent in the suit for arbitration.

(2.) THE respondent filed a special civil suit no. 41/1996/B in the Court of Civil Judge, Senior Division, Vasco da Gama praying for various reliefs. The respondent is a proprietor and carries on business as a contractor. He is enlisted in the department of MES in a "Special" class category. The petitioner -Union allotted certain contracts for civil works for construction of buildings to the respondent and the respondent had accepted the same through its acceptance letters. Certain disputes arose between the parties as regards working in restricted area, account of extra expenditure in respect of stone excavation, excavation of hard rock etc.. There were certain other proceedings between the parties, details of which are not necessary for the purpose of the present order. In the suit the respondent prayed for setting aside the letters issued by the petitioner -Union for cancelling the contracts and for prohibitory injunction. The respondent prayed for decree for an amount of Rs.8,00,00,000/ -along with interest at the rate of 24%.

(3.) THE respondent filed a detailed reply, opposing the application made by the petitioner -Union. The respondent contented that serious charges of fraud are made against the petitioner -Union; the subject matter of dispute raised in the suit is not capable of being referred for arbitration; the arbitrator chosen by the petitioner will not pass a legal and proper order; there are certain third parties involved in the suit; there are criminal proceedings pending between the parties; and the petitioner -Union has not produced copy of the original agreement along with the application. On these grounds the respondent resisted the application made by the petitioner -Union.