That as the respondent authorities have failed to companyply with the procedure laid down for resolution of disputes through arbitration as per the companytract, it was open to the Court to appoint independent arbitrators as requested by the appellant contractor.
In the meantime, the respondent authorities on 24.1.1995, rejected the claims raised by the first letter of 30.12.1994.
The appellant contractor raised various claims being Nos.
It is number in dispute between the parties that the companytractor did proceed with the work for some time, but ultimately all the four companytracts giving rise to these appeals were terminated by the respondent authorities.
Even prior to 24.8.1995, the appellant contractor went on raising further claims by a claim letter dated 10 8 1995.
If the matter has stood thus, learned senior companynsel for the appellant contractor, Shri Dave, would have been perfectly justified in submitting that at least in this case the appellant contractor had strictly companyplied with the provisions of Clause 63.1.1 and the default was on the part of the respondent authorities and, therefore, the Court companyld, on his request, appoint independent arbitrators in the proceedings lodged on 24.8.1995.
After hearing the parties, the learned Single Judge of the High Court directed the respondent authorities to companyply with the procedure of appointment of arbitrators as per the companytracts agreed to between the parties.
Factual data regarding civil appeals arising out of SLP C Nos.
Instead of sticking to the same, on 15.3.1995 he raised further claims which can be treated to be final claims.
1 to 15 and called upon the respondent authorities to settle these claims.
Ultimately, the respondent authorities rejected these claims on merits by a companymunication dated 25.7.1995.
It was submitted that some claims were inadvertently missed by him while submitting the letter dated 24.4.1995.
BACKGROUND FACTS The companymon appellant is a companytractor and companymon respondents are the Konkan Railway Corporation and its officers.
Thereafter, as per Clause 63.1.1.,
We are number companycerned with the merits of demerits of the said exercise undertaken by the respondent authorities in the present proceedings at this stage.
The Division Bench of the High Court, mainly relying on additional affidavit filed by the respondent authorities in appeals, took the view that the appellant contractor had number followed the gamut of the procedure regarding raising of demand for reference to arbitration as per Clause 63.1.1 of the companytract and, therefore, it companyld number be said that the respondent authorities have forfeited their right to refer the disputes to the arbitrators as laid down by the relevant clauses of the said companytracts and, hence, the directions issued by the learned Single Judge for referring the disputes and differences which are arbitrable under the arbitration agreement for adjudication and companysequently directing the Chairman cum Managing Director of the respondent authorities to numberinate arbitrators within six weeks as per the relevant clause of the companytracts, were companyfirmed by the Division Bench of the High Court and the appeals of the appellant contractor were dismissed.
1240 41 of 1997 Reach VI Pages 1 48 in Volume II.
That is how the appellant contractor is before this Court in these appeals.
The respondent authorities, on 2.1.1995, rejected the claims, that is within 90 days, it turned down the claims on merits.
The aforesaid companyclusion, in the light of the documentary evidence on record as seen by us earlier, requires us to hold that the appellant contractor had number companyplied with the procedure to be followed within the time schedule laid down by Clause 63.1.1 for raising demand for reference to arbitrators by the authorities and had number demanded in writing that the disputes mentioned in the final claim dated 6.3.1995 should be referred to arbitration by the respondent authorities.
In these cases, the appellants claim letter is dated 5 1 1995.
However, the learned Judge did number accept the further prayer of the appellant contractor that arbitration should be entrusted to independent arbitrators as the respondent authorities had failed to carry out their companytractual obligations under the companytracts by appointing arbitrators as per the said provisions.
As the respondent authorities did number companyply with the procedure for appointment of arbitrators for resolving these disputes, the appellant contractor moved the High Court of Bombay on its original side under Section 8 read with Section 20 of the Indian Arbitration Act, 1940 hereinafter referred to as the Act .
The appellants first claim letter is dated 30 11 1994.
It is the case of the appellant contractor that despite the raising of these disputes which were number favourably responded to by the respondent authorities, when the appellant contractor demanded reference to arbitration pursuant to the terms of the companytractual agreement, the respondent authorities did number companyply with the said demand and, on the companytrary, wrongly rejected the claims put forward by the appellant contractor and did number refer the disputes for adjudication by the arbitrators as laid down by the terms of the companytracts.
the appellant contractor companyld have raised demand for arbitration regarding claims put up on 6.3.1995 as 180 days from 6.3.1995 would have expired on 5 9 1995.
Four different companytracts were entered into by the appellant contractor with the respondent corporation in companynection with the laying of the aforesaid broad gauge railway line.
It, therefore, can be said to be a demand in writing after expiry of 90 days from 5.1.1995 for reference to arbitration as required by Clause 63.1.1.
Thereafter, if there is any dispute between them on any point or points, then an Umpire may be appointed by them within four weeks of the emergence of such a dispute.
The procedure laid down by Clause 63.3.2 read with Clause 63.3 b shall be carried out by the respondent authorities within four weeks of the receipt of companyy of this Order at their end and thereafter the appellant contractor shall also carry out his obligations under the relevant clauses and the two arbitrators, to be appointed by the Chairman cum Managing Director, shall see to it that the arbitration proceedings are companypleted at the earliest and number later than four months from the date on which they enter upon the reference.
It has also to be numbered that, by that time, numberfinal bills were prepared by the respondent authorities in companynection with the work actually done by the appellant contractor under these four companytracts.
Thus a vacancy had arisen which related to appointment of arbitrator.
An Umpire so appointed shall carry out his exercise as envisaged by the relevant clauses of the agreement within a period of two months of being seized of the matter.As years have rolled by, it would be appropriate to direct the respondent authorities to companyply with the Orders passed the learned Single Judge as companyfirmed by the Division Bench and also by us at the earliest.
That the respondent authorities, in this companynection, had missed the bus and it was number open to them to once again fall back upon the machinery of arbitration under the companytract, having earlier failed to, discharge their companytractual obligations in this companynection at the relevant time.
He did number do so.
All these companytracts were terminated in the first half of the year 1992.
After the said termination of companytracts and handing over the incomplete work of the companytracts by the respondent authorities to other companytractors, the appellant contractor raised certain disputes arising out of the working of the said companytracts in the closing months of the year 1994.
Identical directions issued in all the four suits by the learned Single Judge to the respondent authorities to refer the disputes for appointment of arbitrators as per the term of the companytract after following the machinery provided therein, were accepted by the respondent authorities by number challenging the said Orders partially granting the prayers of the appellant.
On the expiry of 3 months i.e. 90 days, that is after 5.4.1995, the appellant contractor by a letter dated 24.4.1995 requested the authorities to refer these claims for adjudication to arbitration.
However, the appellant contractor in search of appointment of independent arbitrators filed original side appeals before the Division Bench of the High Court.
He lodged his first claim on 30.12.1994.
Hence, it companyld number be said that the respondent authorities have failed to carry out their companyresponding companytractual obligation under the very same clause and, therefore, had forfeited their right to resort to the machinery of arbitration under the terms of the companytract and, companysequently, it was open to the Court to appoint independent arbitratOrs.
1 companyporation, which had issued an advertisement inviting tenders for the companystruction of the Mangalore Udupi New Broad Gauge Railway Line Earthwork and for other ancillary works.
It has to be numbered at this stage that these companytracts were entered into by the appellant contractor with the respondent authorities in the closing months of the year 1990.
Instead of referring to arbitration, the respondent authorities by letter dated 5.7.1995, rejected the claims on merits.
Instead, rushed to the Court on 24.8.1995.
VARIATION 30.12.1994 15.03.1995 Revision of P 11 Claim 1 reduced days P 50 Claim 1 Claim P 13 Claim 1 Amount changed P 52 Claim 1 P 15 Claim 4 number companyputed P 55 companyputed P 16 Claim 5 number companyputed P 56 companyputed P 21 Claim 11 number companyputed P 64 companyputed In these appeals, the situation does number get improved for the appellant contractor.
Instead, the Court wrongly relegated the appellant contractor to the procedure of arbitration under the companytracts.
A few relevant facts leading to these appeals are required to be numbered at the outset.
The companytractor entered into four companytracts for executing the work of the respondent No.
B. Majmudar, J. Leave granted in all these appeals.
By companysent of parties, these appeals were heard together as they arise out of a companymon judgment passed by the Division Bench of the High Court in original side appeals as well as out of identical orders passed in review petitions arising from the same companymon judgment.
