KWALITY CONSTRUCTION ENGINEERS Vs. CENTRAL UNIVERSITY OF HYDERABAD

JUDGEMENT

(1.) This is an application under Section 11(6) of the Arbitration and Conciliation Act 1996 (for short 'the Arbitration Act') for appointment of sole arbitrator to decide various disputes arising out of the agreement dated 22-8-1990.

(2.) The admitted facts of the case, in brief, are that the petitioner-contractor had submitted its tender in answer to the notice inviting tenders issued by the first respondent for construction of indoor and outdoor stadiums at the University Campus in the year 1990. The petitioner-contractor's tender was accepted by the 1st' respondent and an agreement was executed. A Work Order bearing No. UH/Engg./308/90-91/162 was issued. The total value of the work was Rs. 32,74,899.00 and the work was completed by the petitioner-contractor in the month of November, 1992. Final bill of Rs. 15,042.00 was paid to the petitioner-contractor on 16-10-95 through cheque dated 28-9-1995. There was an arbitration clause in the agreement which is reproduced below : ARBITRATION CLAUSE 40 : Except where otherwise provided in the contract all questions and disputes relating to the meaning of the specifications, designs, drawings and instructions, hereinbefore mentioned and as to the quality of workmanship or materials used on the work or as to any other questions, claim, right or thing whatsoever, in any way arising out of or relating to the contract, design, specifications, estimates, instructions, orders or these conditions or otherwise concerning the works, or the executions or failure to execute the same whether arising during the progress of the work or after the completion or abandonment thereof shall be referred to the sole arbitration of the person appointed by the Vice-Chancellor, University of Hyderabad. There will be no objection to any such appointment if the arbitrator so appointed is a Government servant or University Employee and that he had to deal with the matters to which the contract relates and that in the course of his duties as Government or University Employee, he had expressed views on all or any of the matters in dispute or difference. The arbitrator to whom the matter is originally referred being transferred or vacating his office or being unable to act for any reason the Vice-Chancellor shall appoint another person to act as arbitrator in accordance with the terms of the contract. Any such person shall be entitled to proceed with the reference from the stage at which it was left by his predecessor. It is also a term of this contract that no person other than a person appointed by the Vice-Chancellor as aforesaid should act as arbitrator and if for any reason, that is not possible the matter is not to be referred to arbitration at all. In all cases where the amount of the claim in dispute is Rs. 50,000.00 (Fifty thousand only) and above, the arbitrator shall give reasons for the award. Subject as aforesaid, the provisions of the Arbitration Act, 1940 or any statutory modification or reenactment thereof and the rules made thereunder and for the time being in force shall apply to the arbitration proceedings under this clause. The arbitrator may, from time to time with the consent of the parties enlarge the time for making and publishing the award. It is also a term of the contract that if the contractor does not make any demand for arbitration in respect of any claim(s) in writing within 90 days of receiving the intimation from the Engineer-in-charge, that the bill if ready for payment, the claim of the contractor will be deemed to have been waived and absolutely barred and the employer be discharged and released of all liabilities under the contract in respect of these claims. It is a term of the contract that the party invoking arbitration shall specify the dispute or disputes to be referred to arbitration under this clause together with the amounts claimed in respect of each dispute.

(3.) On 25-3-1996 the petitioner-contractor intimated the second respondent that there were certain disputes arising out of the said contract dated 22-8-1990 and they should be referred to be settled by the arbitrator in accordance with Clause No. 40 of the agreement. The Registrar of the 1st respondent through letter dated 17-5-1996 refused to refer the alleged dispute to the arbitrator, inter alia, on the ground that the claim is barred by limitation.