POORANCHANDRA AGRAWAL Vs. UNION OF INDIA AND ORS.

JUDGEMENT

(1.) This petition under Article 227 of the Constitution of India by the petitioner is directed against the order dated 07.03.2005 passed in the proceedings initiated by the petitioner in the Court of Additional District Judge, Bhopal, under Section 8 of the Arbitration Act, 1940 (herein after referred to as 'Act of 1940'). Since the application for appointment of Arbitrator has been rejected by the Court below, this writ petition is required to be filed.

(2.) The facts giving rise to filing of the writ petition in brief are that a tender was floated by the respondents-Railways for certain work. The petitioner was interested to take part in the said tender proceedings and obtained a tender document. The tender document contained certain annexures where in the first sheet of the tender document a condition was specifically prescribed in paragraph 4 that a formal agreement is required to be executed in case the tender is accepted and till such formal agreement is executed, the tender itself shall constitute a binding contract between the contractor and the Railways, subject to the modification as may be mutually agreed in between the parties. Annexure-I, part of the tender document, further prescribes the second sheet, which include the instructions to the tenderers and conditions of tenders. It was specifically prescribed that the documents mentioned in Clause (1) of this sheet will form the part of the tender/ contract. It was further provided that general conditions of contract and standard specification for materials and work as laid-down in the Works Hand Book and Sanitary Works Hand Book of Railway as amended/corrected would form the part of the tender document.

(3.) On acceptance of the tender submitted by the petitioner, a memo was issued to the petitioner on 03.03.1989 by the competent authority of the respondents calling upon him to furnish the security amount and to execute the formal agreement. It is the case of the petitioner that a formal agreement was signed by the petitioner and was given to the respondents-authorities for signing the same and to return one copy to the petitioner. However, despite long lapse of time, formal agreement was not signed by the respondents nor the copy thereof was returned to the petitioner. It is contended that this was the reason the execution of formal agreement between the petitioner and the Railways could not be completed.