KATKAR ENGINEERS Vs. M.M.T.C. LIMITED

JUDGEMENT

(1.) THIS is an application under Section 11(5) of the Arbitration and Conciliation Act, 1996, hereinafter called as 'the said Act' for the appointment of Arbitrator.

(2.) IT is the case of the Applicants that the Applicants were awarded the work of screening of lumpy ore at Sanvordem by Work Order dated 3rd October, 1997 in terms of the agreement entered into between the parties. Clause 12 thereof provided that all the disputes, differences, arising out of or in connection with and/or consequences of or relating to the agreement whatsoever shall be referred to arbitration under the said Act. Since disputes and differences have arisen between the parties, the Applicants by letter dated 4th November, 1998 submitted certain claims to the Respondent which were denied and disputed by the Respondent by letter dated 16th November, 1998. The Applicants, therefore, by letter dated 28th January, 1999 called upon the Respondent to agree to concur with the appointment of Shri B.V. Khanolkar, retired Chief Engineer of the Irrigation Department of Government of Goa to be the sole arbitrator to decide the disputes and differences arisen between the parties under the contract. The claim of the Applicants was denied and contested by the Respondent by letter dated 11th February, 1999 stating that the Applicants cannot take recourse under the arbitration clause in the matter as the demands made by the Applicants have no sanctity in law besides being imaginary and cannot be equated with the disputes as contemplated under the arbitration clause in the agreement between the parties. The Applicants, therefore, filed the present application.

(3.) THE fact that certain disputes have arisen between the parties is not denied by the Respondent. The only contention which is sought to be raised on behalf of the Respondent is that the claim sought to be raised being of the nature of compensatory damages, it is outside the scope of the arbitration clause in the agreement. It is the contention of the Applicants that the said claim has been arisen in relation to anticipatory profits towards the employees, interest which the Applicants had to pay towards the amount invested for obtaining Bank Guarantee and various other expenditure incurred on the actual work carried out by the Applicants as well as the interest on the said different claims.