M V V SATYANARAYANA Vs. UNION OF INDIA

JUDGEMENT

(1.) By this application, filed under Sec. 11 (5) and (6) of the Arbitration and Conciliation Act, 1996, the applicant seeks to appoint an Arbitrator and refer the dispute for adjudication.

(2.) It is stated that the applicant is a contractor, executing civil works. In response to the tender notice published by the respondents for construction of 3rd B.G. Electric Loco Shed to home 100 Locomotives at Kazipetand also for construction of Inspection shed and examining pits with attached repair section, the applicant submitted his tender on 07-08-1998, which was accepted by the respondents as a successful bid on 09-12-1998. In terms of the acceptance letter, the value of the work was Rs. 1,01,84,182-70 ps for both the schedules A and B works which are to be executed within a period of four months from the date of acceptance letter i.e. the work has to be completed on or before 08-04-1999. It is further stated that the parties have entered into an agreement dated 09-02-1999. As per the said agreement, the applicant was under an obligation to maintain the works other than track work for the period of six months from the certified date of completion. The general conditions of the contract governing the Engineering Department of South Central Railway and special conditions of the contract were made part of the agreement. Clauses 63 and 64 of the General Conditions of Contract contemplate arbitration in case of disputes between the parties.

(3.) It is stated that as per the acceptance letter, the applicant has to deposit a sum of Rs.3,00,000/- towards security deposit, but, however, as the applicant has already deposited one lakh of rupees towards EMD and requested the respondents to recoverthe balance from the running bills and accordingly, the respondent has recovered the balance amount of Rs.2,00,000/- towards security deposit. Clause-2 of the Special Conditions of the Contract states that the quantities mentioned in the tender schedule are only approximate and during the actual execution of the work, there may be variation in the quantities and such variations up to 25% beyond the agreement does not vitiate the contract. If the respondents desire to execute any additional quantities and extra items and quantities beyond 25% of the agreement quantities, rates shall be arrived through negotiations.