UNION OF INDIA Vs. BHARAT CHARCOAL CO LTD

JUDGEMENT

(1.) THIS is an application for stay of a suit under Section 34 of the Indian Arbitration Act. The respondent is a contractor. There are three contracts subsisting between the respondent and the Government. They are (1) Contract No. 22/CKP/56-57, (2) Contract No. 5/CKP/57-58 and (3) Contract No. 6/CKP/57-58. The Government entered into the contracts with the contractor for certain works to be done for the South Eastern Railway. The suit has been instituted by the contractor for three several sums alleged to be due and payable by the Government under the three said contracts.

(2.) IT is contended in the petition that the dispute in suit is covered by the arbitration clause in the contract and that the conditions laid down in Section 34 of the Indian Arbitration Act have been complied with in the instant case.

(3.) THE first point urged by Mr. Mukherjee is that there is no dispute to be adjusted by arbitration. In respect to the two contracts, namely, Contracts Nos. 5 and 6/CKP/57-58, there is no dispute and it Is admitted that a substantial sum of money is due and payable to the contractor by the Government. THEre is no dispute also in respect to the remaining other contract as well. In respect to this contract a final bill has been tendered by the contractor and the Government has accepted it and made an 'on account payment'. THE contractor has also submitted a no claim 'certificate'. Liability to pay has not been disputed. Apart from the Government's failure to pay, there is no dispute between the parties. Mere failure to pay is not however such a dispute that can be adjusted by arbitration under the arbitration clause in the contract.