SURI CONSTRUCTION Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) THIS Application has been filed by the applicant-M/s. Suri Construction for appointment of an arbitrator in terms of the agreement which had been executed between the applicant and the respondent-State of Rajasthan while awarding a contract to the applicant/contractor for manufacturing and supply of PCC Blocks and precast sleepers in pursuance of a tender notice.

(2.) ADMITTEDLY, the dispute between the applicant and the respondent is confined to the question whether the amount of sales tax in regard to the goods supplied and manufactured is payable by the contractor or by the respondent-State. It appears that Clause 36 D of the agreement between the parties has clearly fixed the liability in regard to the payment of sales tax which lays down as follows:- " In respect of goods and materials procured by the Contractor for use in works under the contract, sales tax will be paid by the Contractor himself. but in respect of all such goods manufactured and supplied by the Contractor and works executed under contract, the responsibility of payment of sales tax would be that of the Engineer-in-charge. "

(3.) THEREFORE, while exercising its powers under Section 11 of the Act of 1996, it is considered legally permissible to assign the matter to the Standing Committee in the capacity of an arbitrator since the dispute to be decided lies clearly with the parameters of the deed of agreement itself and would thus lead to expeditious disposal of the matter.