B. Engineers and Builders Ltd. Vs. State of Orissa and Two ors. - Court Judgment

SooperKanoon Citationsooperkanoon.com/537118
SubjectArbitration
CourtOrissa High Court
Decided OnMay-02-2008
Judge A.K. Ganguly, C.J.
Reported in2009(I)OLR761
AppellantB. Engineers and Builders Ltd.
RespondentState of Orissa and Two ors.
DispositionPetition allowed
Cases ReferredBhagheeratha Engineering Ltd. v. State of Orissa and Ors.
Excerpt:
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- sections 100-a [as inserted by act 22 of 2002], 110 & 104 & letters patent, 1865, clause 10: [dr. b.s. chauhan, cj, l. mohapatra & a.s. naidu, jj] letters patent appeal order of single judge of high court passed while deciding matters filed under order 43, rule1 of c.p.c., - held, after introduction of section 110a in the c.p.c., by 2002 amendment act, no letters patent appeal is maintainable against judgment/order/decree passed by a single judge of a high court. a right of appeal, even though a vested one, can be taken away by law. it is pertinent to note that section 100-a introduced by 2002 amendment of the code starts with a non obstante clause. the purpose of such clause is to give the enacting part of an overriding effect in the case of a conflict with laws mentioned with the.....
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a.k. ganguly, c.j.1. this petition has been filed under section 11 of the arbitration and conciliation act, 1996 (hereinafter referred to as the 'said act') for appointment of an arbitrator.2. the arbitration clause is as follows:25. procedure for disputes:25.1. the adjudicator shall give a decision in writing within 28 days of receipt of a notification of a dispute.25.2. the adjudicator shall be paid daily at the rate specified in the contract data together with reimbursable expenses of the types specified in the contract data and the cost shall be divided equally between the employer and the contractor, whatever decision is reached by the adjudicator. either party may refer a decision of the adjudicator to an arbitrator within 28 days of the adjudicator's written decision. if neither.....
Judgment:
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A.K. Ganguly, C.J.

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1. This petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'said Act') for appointment of an Arbitrator.

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2. The Arbitration Clause is as follows:

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25. Procedure for Disputes:

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25.1. The Adjudicator shall give a decision in writing within 28 days of receipt of a notification of a dispute.

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25.2. The Adjudicator shall be paid daily at the rate specified in the Contract Data together with reimbursable expenses of the types specified in the Contract Data and the cost shall be divided equally between the Employer and the Contractor, whatever decision is reached by the Adjudicator. Either party may refer a decision of the Adjudicator to an Arbitrator within 28 days of the Adjudicator's written decision. If neither party refers the dispute to arbitration within the above 28 days, the Adjudicator's decision will be final and binding.

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25.3. The arbitration shall be conducted in accordance with the arbitration procedure published by the institution named and in the place shown in the Contract Data.

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3. The contract data relating to Arbitration is as follows:

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Institution whose arbitration procedures shall be reached: Orissa Arbitration Tribunal.

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Arbitration will take place in accordance with: Orissa Arbitration Tribunal Act, 1979.

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4. The facts of the case are that the petitioner was awarded with the contract work for 'Remedial and Upgrading measures for Hydraulic gates and Operating equipment on right and left Spillway of Hirakud Dam Project' vide Agreement No. HDR NCB-2 of 1998-99 dated 26.9.1998. The total value of the contract work awarded to the petitioner, as per the original Agreement was Rs. 7,57,98,982.00 and the contract work was required to be completed within 17 calendar months. The case of the petitioner is that during execution of the contract work, due to increase in the existing items of work as well as many new items of work, the final value of the contract work was enhanced to Rs. 10,01,24,252.00. The petitioner's case is that the contract work could not be completed within the stipulated period due to increase in quantum of work and also due to delay in finalization of rates of extra items with approval of deviation of decision with regard to funding of the project etc. Accordingly the petitioner intimated the opposite parties regarding the impediments caused during execution of work and requested the Chief Engineer-opposite party No. 2 to close the contract with effect from 22.2.2004 and to process the final bill which is due to the petitioner for the work already executed. The Executive Engineer-O.P. No. 3 vide his letter dated 21.2.2005 rejected the claim of the petitioner for payment of the pending bills in respect of the contract work in question. Thereafter, the petitioner invoked Clause 24.1 of the Agreement and referred the dispute to the designated Adjudicator, Shri Dibakar Mishra, (Retd.) Engineer-in-Chief (Irrigation), for adjudication of the dispute. Thereafter, the Adjudicator issued notice to the opposite parties. After hearing the parties and on consideration of the materials on record, and also the documents/papers the Adjudicator vide his order dated 31.7.2005 awarded an amount of Rs. 46,10,980/- in favour of the petitioner. Since the said award of the Adjudicator was not acceptable by the petitioner, vide its letter dated 24.8.2005 petitioner intimated the Chief Engineer- O.P. No. 2 wherein the petitioner expressed its intention to refer the award of the Adjudicator to Arbitration. In the said letter, the petitioner furnished a panel of three names and requested the Chief Engineer-O.P. No. 2 to nominate any one of them the sole Arbitrator.

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On receipt of the said letter of the petitioner dated 24.8.2005, the Chief Engineer-O.P. No. 2 wrote a letter dated 27.8.2005 to the petitioner. In the said letter the Chief Engineer accepted the name of Justice Balakrushna Behera, a retired Judge of this Court for appointment as the sole Arbitrator. But, as no further step had been taken by the Chief-Engineer-O.P. No. 2 petitioner gave several reminders which are at Annexure-9 and 10. As despite several reminders opposite parties failed to take steps this Arbitration Petition has been filed on 12.09.2007 for appointment of an Arbitrator.

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5. In this matter, opposite parties have filed a counter affidavit. In the counter affidavit, the stand which has been taken is that the submission of panel of names by the petitioner is unwarranted and uncalled. In the counter affidavit, it has been mentioned that arbitration should take place in accordance with the Orissa Arbitration Tribunal Rules, 1979.

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6. In this case the admitted position is that the contract in question has been executed in 1998-99. The petitioner has thus admittedly entered into the contract after coming into effect of the said Act and after repeal of the 1940 Act. Under such situation, this Court already held that, the Orissa Arbitration Tribunal does not survive. It has been so held by this Court in the case of Bhagheeratha Engineering Ltd. v. State of Orissa and Ors. reported in 2007 (Supp. II) OLR 615.

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7. That being the position, this Court is of the opinion that in the instant case one Arbitrator is to be appointed by this Court under Section 11 of the said Act.

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8. In this case, since both the parties have agreed for the appointment of Mr. Justice Balakrushna Behera, a retired Judge of this Court, this Court appoints Mr. Justice Balakrushna Behera the sole Arbitrator to decide the dispute between the parties.

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9. The Arbitrator so appointed shall enter upon the reference within a period of four weeks from the date of service of this order upon him. The remuneration and other charges of the Arbitrator will be fixed by the Arbitrator himself. The Arbitrator after entering upon the reference shall decide the dispute between the parties within a period of six months.

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10. This petition is allowed to the extent indicated above.

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