P S JOHN Vs. VOLTAS LTD

JUDGEMENT

(1.) THE applicants have filed this application under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Act"), with a prayer that the disputes and differences that have arisen between the parties and as stated in their letter dated 10th August, 2006, be referred to arbitration in terms of the arbitration clause.

(2.) THE necessary facts are that M/s. Voltas Limited had made certain enquiries and in response thereto, the applicants had submitted their offer vide letter dated 24th February, 2006. THE terms and conditions were negotiated between the parties and a modified offer of the applicants was accepted by the respondents at a cost of Rs. 1,81,00,000/- stipulating the period of completion from 24th February, 2006 upto 15th May, 2006. This was subject to the conditions of tender document for electrical system between the owner and the respondents on back to back basis. THE reference to the tender document and the arbitration clause contained therein thus amounted to an arbitration clause between the parties, according to the applicants. THE work was awarded to the applicants by the Assistant General Manager, Special Project, (AC R BG), vide letter dated 24th February, 2006. In terms of clause 5 of the general conditions of the contract and the tender document, the disputes between the parties were required to be settled by arbitration. According to the applicants, the entire project was to be completed by 15th May, 2006, and after testing and commissioning the same was required to be handed over to the respondents. Upon completion of the work, the applicants have submitted their invoices right from the period 31st March, 2006 upto 5th August, 2006 for various amounts. Having failed to receive the payments, vide letter Advocate's letter dated 10th August, 2006, the applicants called upon the respondents, by putting forth the true and correct facts, to settle the claims as stated in the letter, failing which to appoint an arbitrator as per clause 5 of the general conditions of contract on back to back basis. THE respondents, vide their letter dated 29th August, 2006, disputed the existence of the arbitration clause and terminated the contract. This resulted in filing of the present application.