K M CONSTRUCTION Vs. EASTERN RAILWAYS

JUDGEMENT

(1.) The petitioner M/s. K.M. Construction has filed the instant application under sections 5, 11 and 12 of the Arbitration Act, 1940 (hereinafter referred to as the Act) making following prayers:

(2.) Briefly stated the case of the petitioner is that pursuant to the notice issued by the respondent inviting tenders for design and construction of platform shed for new platform facilities the petitioner submitted tender which was duly accepted by the respondent for the aforesaid construction work whereupon a formal agreement was entered into by and between the parties and the provisions of the General Conditions of Contract and Standard Specification of Eastern Railways formed a part of the said agreement. The aforesaid agreement contained an arbitration clause being clause 63(1) of the General Conditions of Contract and Standard Specification of Eastern Railways. In spite of best efforts on the part of the petitioner, the aforesaid works could not be completed within the stipulated period by reason of various acts of neglect and/or laches and/or defaults on the part of the respondent. As disputes and differences arose between the parties the petitioner by its letter dated 22nd December, 1995 inter alia submitted its claim for Rs. 15,83,000/- and called upon the respondent to seek a reference to arbitration for settlement of the said disputes and claims as mentioned in the said letter. By the letter dated 2nd December, 1996 the respondent, inter alia, appointed Sri N.K. Sinha and Sri A. Bandhapadhyay as Joint Arbitrators and referred the disputes, claims, counter-claims to the said Joint Arbitrators for arbitration or publication of an award in terms and scope of the arbitration clause. By the order dated 25th April, 1997 passed in CAP No. 69 of 1996 (K.M. Construction v. The General Manager & Anr.) this Court directed the said Joint Arbitrators to commence the proceedings and complete the same and publish the award within four months. By and under the cover of the letter dated 31st December, 1996 the petitioner submitted a copy of the petitioner's statement of facts and claims before the Joint Arbitrators and sent a copy of the same to the respondent. The Joint Arbitrators entered into reference on 8th May, 1997 and the said fact was communicated to the petitioner by a letter written on the same date. In spite of direction of the said Joint Arbitrators to the respondent to submit the counter-statement within 15 days from the receipt of the aforesaid letter the respondent caused undue delay and ultimately submitted its counter-statement of facts on 14th October, 1997. Thereafter the Joint Arbitrators scheduled the first hearing on 8th July, 1998 which was more than one year after having entered upon reference. The said fact of scheduling the first hearing on 8th July, 1998 was communicated to the petitioner by the Joint Arbitrators by the letter dated 17th June, 1998. On 8th July, 1998 though a formal hearing was held neither any direction was issued nor any minutes were recorded by the said Joint Arbitrators. Since 8th July, 1998 no further hearing has been held nor any date has been scheduled and/or fixed for hearing by the Joint Arbitrators. The said Joint Arbitrators failed to use all reasonable dispatch in entering upon reference and proceeding with the same and making an award as already more than one and half years passed since the Arbitrators entered upon reference.

(3.) It has been alleged by the petitioner that the said Joint Arbitrators have misconducted themselves or the proceedings. Under the above circumstances the petitioner seeks leave of the Court to revoke the authority of the said Joint Arbitrators Sri N.K. Sinha and Sri A. Bandhapadhyay and prays for appointment of independent Arbitrator/Arbitrators to adjudicate upon the disputes and differences between the parties.