LAKESHWARI BUILDERS PVT. LTD Vs. STATE OF JHARKHAND

JUDGEMENT

(1.) IN this application under Section 11(6) of the Arbitration and Conciliation Act 1996 the petitioner has prayed for appointment of an Arbitrator to adjudicate the dispute exists between the petitioner and the respondents with regard to payment of difference of cost of material

(2.) THE facts of the case lie in a narrow compass: The respondent -Road Construction Department invited tender for the work of widening and strengthening of Kandra -Khuti Ichagarh Road. The value of work was Rs. 6,31,56,890/ -. The petitioner being the lowest bidder was allotted work and agreement was executed on 23.5.2002. As per direction of respondent No. 4 Executive Engineer, R.C.D. Road Division Jamshedpur, the petitioner commenced the work for completing the same within the specified time. According to the petitioner, in terms of Clause 23 of the Contract any dispute or differences arises between the parties shall have to be referred to Superintending Engineer of the Circle for decision. Petitioner's case is that as per special condition all materials was to be supplied from P.W.D. godown and empty Bitumen drams was to be returned in good conditions by the contractor to the godown wherefrom Bitumen was issued. It is alleged that the respondent -Department did not supply Bitumen and the contractor was asked to purchase the Bitumen from the market. The rate of the Bitumen was fixed by the department at the time of execution of agreement. Further case is that petitioner was made to understand that the price fixed by the department for the Bitumen, if enhanced, it was to be paid by the department. Petitioner accordingly requested the Department to pay difference of costs of Bitumen, which was rejected by the Executive Engineer on the ground that the work was not completed within the specified time Consequently disputes arose between the parties and the petitioner vide letter dated 13.6.2005 requested respondent No. 3 Superintending Engineer to appoint Arbitrator amongst three names given by it as per Clause -23 of the agreement for adjudication of the dispute. It is stated that respondent No. 3 did not take any action for appointment of Arbitrator nor respondent No. 4 passed any order on the representation of the petitioner. Hence the application.

(3.) PETITIONER has annexed xerox copy of the original agreement entered into between the petitioner and the Executive Engineer, as Annexure 2 to the application. From perusal of the said contract dated 23.5.2002, it transpires that Clause -23 still exists in the said contract. Clause 23 of the Contract reads as under: Clause 23: In case any dispute or difference shall arise between the parties or either of there upon any question relating to the meaning of the specification, designs, drawings and instructions herein before mentioned or as to the quality of workmanship or materials used on the work or as be the construction of any of the conditions or any clause or thing there in contained, or as to any question, claim rights, or liabilities of the parties, or any clause or thing whatsoever, in any way arising out of or relating to the contract designs, drawings, specifications estimates, instructions order or these conditions or otherwise concerning the work, or the execution, failure to execute the same whether arising during the progress of the work, or after the completion or abandonment thereof, or as to the breach of this contract, then either part shall forthwith give to the other notice of such dispute or difference and such dispute or difference shall be referred to the Superintending Engineer of the Circle and his decision thereon shall be final conclusive and binding on all the parties.