BHARAT CONSTRUCTION CO LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THE Bharat Construction Co. Ltd., now in liquidation, have appealed against an order of S. R. Das Gupta J., dated 16-2-1953, by which the learned Judge stayed a suit brought by them in exercise of his powers under Section 34, Arbitration Act. THE stay was resisted on the ground that the arbitration agreement upon which the respondent was relying had become infructuous, inasmuch as no arbitrator, answering the description given in the agreement, was or could any longer be available. That argument did not appeal to the learned Judge who rejected it and ordered a stay of the suit.

(2.) THE facts are simple. It appears that in 1944, the then Government of India called for tenders for the construction of certain structures intended for military purposes and a tender was submitted by the appellants on 26-4-1944, and accepted on the 12th of May following. THE work was to be carried out in accordance with the terms and conditions of Contract Form No. I.A.F.W-2159 and the amendments thereto, including the schedules, specifications and plans contained in and attached to the form. Clause 35 of the contract provided for the decision of disputes and it was divided into two paragraphs. THE first paragraph was concerned with questions relating to the meaning of specifications, drawings and instructions contained in the contract and to the quality of workmanship or materials used on the work. As regards such questions, the "C. R. E. U. S. Works" were to be the sole deciding authority. THE second paragraph, which has given rise to the question involved in this appeal, was in the following terms: "All other disputes and differences the settlement of which is not provided for under any other clause of this Contract and which shall arise either during the progress of the work or after completion thereof concerning the work or the execution or maintenance thereof or the construction or meaning of these conditions of contract or as to any other matter arising out of or relating to the contract or the work to be executed or payments to be made in pursuance thereof shall be referred to the sole arbitration of Major General I/C, Administration, Eastern Command whose decision shall be final, conclusive and binding on all parties to the contract."

(3.) IT is not disputed that work under the contract was done. According to the respondent, upon whom the rights and liabilities of the old Government of India under the contract have admittedly devolved, the appellants were fully paid off. According to the appellants, some of the bills are still outstanding.