RSB PROJECTS LTD. Vs. RUIDP

JUDGEMENT

(1.) IN this application under Section 11(6) read with 43(3) of Arbitration and Conciliation Act, 1996 (for short '1996 Act') the applicant company seeks to appoint independent arbitrator.

(2.) THE facts are these: The applicant company entered into a contract for construction of raw water reservoir with earthen embankment and allied works at Sobhasar Headworks Bikaner under package No. BIK/WS/06 with the Rajasthan Urban Infrastructure Development Project (herein after 'RUIDP') in pursuance of the invitation of bid dated November 16, 2002. According to tender the work was to be started on March 31, 2003 and to be completed on September 30, 2004. Owing to reasons of delay attributable to RUIDP the work could be completed on January 31, 2005. The Superintending Engineer issued completion certificate of the work on February 25, 2006. The applicant company submitted final bill on July 21, 2005 for an amount of Rs. 8,26,29,992.07, out of which RUIDP paid only Rs. 6,47,54,778/ - inspite of passing the bill of Rs. 6,60,41,787/ -. Under Clause 21 of Section IV of the contract the disputes were to be adjudicated by the Arbitrator. Vide letter dated September 12, 2005 the applicant company invoked Clause 21.2 by applying to the Engineer -incharge for his decision on various unpaid items under the final Bill, as 7 items were excluded without any justification. Vide letter dated February 23, 2006 RUIDP pointed out that 6 claims were not being accepted. Vide letter dated November 24, 2006 the applicant company requested RUIDP for an amicable settlement. No response was received of the letter dated November 24, 2006. Hence vide letter dated February 27, 2007 the applicant company invoked Clause 21.3 of the contract seeking commencement of arbitration within a period of two months from the date of letter. Vide another letter dated May 15, 2007 the applicant company again sought for appointment of arbitrator. The Project Director vide letter dated June 8, 2007 responded the notice of applicant company informing the company that the dispute raised on November 12, 2005 had been rejected vide Engineer's letter dated February 23, 2006. Since the applicant company was required to seek arbitration within a period of 28 days of purported decision dated February 23, 2006, the request made vide letter dated November 24, 2006 and February 27, 2007 for amicable settlement was time barred as per Clause 21.3. Consequently the appointment of arbitrator could not be made.

(3.) THE respondent RUIDP submitted detailed reply to the application. In addition to parawise reply following preliminary objections have been raised: