Judgment:
* IN THE HIGH COURT OF DELHI AT NEW DELHI % Order delivered on: May 15, 2013 + ARB.P. 138/2012 M/S JATINDER CONSTRUCTION CO. ..... Petitioner Through: Dr.G. Lal, Advocate versus MCD & ANR. Through: ..... Respondents Mr.Himanshu Upadhyay, Adv. CORAM: HON'BLE MR. JUSTICE MANMOHAN SINGH MANMOHAN SINGH, J.
(Oral) 1. The petitioner has filed the present petition under Section 11(2) & (6) of the Arbitration and Conciliation Act, 1996 for appointment of a sole independent arbitrator.
2. Brief facts as culled out from the petition are that the petitioner was awarded the work of construction of Staff Quarters of Health Personnel at Mehrauli in Ward No.170, South Zone, by the Executive Engineer vide W.O. not EE-Project South II/Sys/2009-2010/58 dated 11.11.2009 of a contractual amount of `3,53,12,519/-. The entire work was to be completed within 15 months starting from 21st November, 2009 for which the petitioner made all necessary and adequate arrangements of labour, materials, machineries and supervisory staff.
3. It is stated in the petition that the said staff quarters were to be constructed in place of existing three blocks of staff quarters which were under occupation on the date of the award of work. The work of demolition of the existing staff quarters was awarded separately to the petitioner through a separate contract but the existing quarters were not made available for demolition. By letter dated 16th February, 2010, the concerned Executive Engineer supplied layout plan showing architectural drawing and structural details only for one block which was after four months from the date of award of work.
4. By letter dated 27th December, 2010, the concerned Executive Engineer admitted that vacant staff quarters were handed over by the Medical Officer Incharge PHC on 3rd December, 2010. Thereafter, various communications were exchanged between the parties.
5. Due to non-handing over of site, the work force remained unutilized. Many disputes arose between the parties. By notice dated 17th February, 2011, the petitioner claimed damages and by letter dated 20th May, 2011, the petitioner requested the concerned Executive Engineer to settle the dispute. When he failed to settle the claims, a notice dated 8 th June, 2011 was served upon Superintending Engineer requesting him to settle the claims. Thereafter, a notice dated 28th July, 2011 requesting him to settle the claims who also failed to settle the claims. Since the tender documents contained arbitration clause i.e. clause 25, finally a notice dated 8th October, 2011 was served upon the Commissioner MCD and requested to appoint a sole arbitrator within thirty days from the date of notice. However, he failed to appoint the Arbitrator. The details of the claims have been given in para 7(xv) of the petition. Hence, the present petition.
6. Notice of the petition was served upon the respondents. The reply has been filed by the respondents.
7. Learned counsel for the respondents has opposed the prayer made in the petition on the ground that clause 10 of N.I.T. not EE Project South I/SZ/TC/09-10/04 dated 18th May, 2009 specifically mentioned that in addition to all related circulars/office order issued by the MCD shall be followed. On 11th December, 2006, by way of circular the MCD decided that the arbitration clause in various contract being adopted in MCD should be deleted with immediate effect. It was also argued that in the copy of the work order it was also mentioned that any clause in the tender documents/general which have been amended/added/deleted by any such circular/office order issued by MCD till the date of issue of this NIT shall be applicable. Therefore, the circular dated 11th December, 2006 deleting the arbitration clause adopted by the MCD will be applicable to the present case and the petitioner has no right to invoke arbitration clause 25 and refer the dispute to arbitration under Section 11 of the Arbitration and Conciliation Act, 1996.
8. It is contended by the learned counsel appearing on behalf of the petitioner that the tender documents issued to the petitioner were containing various terms and conditions including arbitration clause and the notice inviting tender does not mention anywhere that arbitration clause included in the tender documents would not be applicable. Even there is nothing mentioned in the award letter dated 11th November, 2009 issued to the petitioner about the office order dated 11th December, 2006. It is alleged by him that the respondents never informed about the circular/office order dated 11th December, 2006. Therefore, the arbitration clause as included in the tender documents would be applicable to the work in question.
9. At the time of hearing, respondents counsel has referred the circular but was unable to give positive reply to the query as to whether any point of time, copy of the said circular/office order dated 11 th December, 2006 was sent to the petitioner or there is any material placed on record in order to show that the petitioner was aware about the same except he submits that the said circular was uploaded on internet and therefore the presumption is that the petitioner must be aware about the same.
10. Learned counsel for the petitioner on the other hand submits that at the time of supplying the tender document, copy of the circular was in their knowledge and did not inform the petitioner about it, though no doubt, work order contained that all circulars of MCD shall be followed. But the petitioner never assumed that prior to grant of work order, there is a circular about the deletion of Arbitration Clause 25. In fact the tender documents issued to the petitioner were containing various terms and conditions including arbitration clause. The Executive Engineer never presented the formal agreement for signing by the petitioner. Copy of NIT and notice inviting tender do not mention anywhere about the deletion of arbitration clause nor about the circular dated 11th December, 2006. Therefore, plea raised by the respondents is without any force.
11. After having considered rival submissions of the parties, this Court is of the view that due to peculiar facts and circumstances in the present case, in the absence of any material produced by the respondents about the information of circular No.6 dated 11 th December, 2006 issued by respondents to the petitioner, the prayer made in the petition is allowed.
12. Accordingly, the disputes are referred to the arbitration, to be conducted under the aegis of Delhi High Court Arbitration Centre and its rules and the fee shall also be paid to the sole arbitrator as per rules thereof. The Arbitrator appointed by the Delhi High Court Arbitration Centre shall give prior notice before commencing the proceedings.
13. The petition stands disposed of.
14. A copy of the order be sent to Delhi High Court Arbitration Centre. Copies of this order be given dasti to the learned counsels for the parties. A copy of the order be also sent to the learned sole Arbitrator. (MANMOHAN SINGH) JUDGE MAY 15.2013