Decor India Though Its Sole Proprietor v. Union Of India & ANR.
$~1 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ARB.P. 268/2018 DECOR INDIA THOUGH ITS SOLE PROPRIETOR ..... Petitioner Through: Mr.Navneet Duggar, Mr.Manoj Kumar, Advs.
versus UNION OF INDIA & ANR.
..... Respondents Through: Mr.Anil Panwar, CGSC with Ms.Anoosha S.Panwar, Mr.Abhimanyu Chauhan, Advs.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
O R D E R
% 18.07.2018 This petition under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'Act') has been filed by the petitioner seeking appointment of an Arbitrator for adjudicating the disputes that have arisen between the parties in relation to the Agreement dated 23rd November, 2013 whereby the respondents had awarded the work of Construction of Lecture Theatre cum Laboratory Complex at IIT Delhi SH: Design, Manufacture, Supply and Installation of Modular Fixed Chair and Desk System made of Stainless Steel Frame & Moulded Ply in Lecture Hall at IIT Delhi in favour of the petitioner.
The said Agreement contains an Arbitration Agreement between the parties in form of Clause 25 thereof, as amended by the Director General on 23.05.2011 vide notification No. DG/CON/255, reproduced herein below:- Clause If contractor If the contractor
25 (i) considers any work demanded of him to be outside the requirements of the contract, or disputes any drawings, record or given in writing by the Engineer-inCharge on any matter in connection with or arising out of the contract or carrying out of the work, to be unacceptable, he shall promptly within 15 days request Superintending Engineer in writing for written instruction or decision.
Thereupon, Superintending Engineer shall give his written instructions or within a period of one month from the receipt of the contractor's letter.
considers any work demanded of him to be outside requirements of the contract, or disputes any drawings, record or given in writing by Engineer-in-Charge any matter in connection with or arising out of the contract or carrying out of the work, to be unacceptable, he shall promptly within 15 days request Superintending Engineer in writing for written instruction or decision.
Thereupon, Superintending Engineer shall give his written instructions or within a period of one month from the receipt of the contractor's letter.
If the Superintending Engineer fails to give his instructions or decision in writing within the aforesaid If the Superintending Engineer fails to give his instructions or decision in writing within the aforesaid
period or if contractor is dissatisfied with the instructions or Superintending Engineer, contractor may, within 15 days of the receipt Superintending Engineer's decision, appeal to the Chief Engineer who shall afford an opportunity to the contractor to be heard, if the latter so desires, and to offer evidence in support of his appeal. The Chief Engineer shall give his decision within 30 days of receipt of contractor's appeal.
If contractor is dissatisfied with this decision, contractor shall within a period of 30 days from receipt of decision, give notice to the Chief Engineer for appointment arbitrator prescribed proforma as per Appendix XV, failing which the said period or if contractor is dissatisfied with the instructions or Superintending Engineer, contractor may, within 15 days of the receipt Superintending Engineer's decision, appeal to the Chief Engineer who shall afford an opportunity to the contractor to be heard, if the latter so desires, and to offer evidence in support of his appeal. The Chief Engineer shall give his decision within 30 days of receipt of contractor's appeal.
decision shall be final binding and conclusive and not referable to adjudication by the arbitrator.
each such dispute and giving reference to the rejection his disputes by the Chief Engineer. The Dispute Redressal Committee (DRC) shall give his within a period of 90 days from the receipt of Contractor's appeal.
The constitution of Dispute Redressal Committee (DRC) shall be as indicated in Schedule 'F'. If the Dispute Redressal Committee (DRC) fails to give his decision within the aforesaid period or any party is dissatisfied with the decision of Dispute Redressal Committee (DRC), then either party may within a period of 30 days from the receipt of the decision of Dispute Redressal Committee (DRC), give notice to the Chief Engineer for appointment arbitrator prescribed proforma as per Appendix XV, failing which the said
decision shall be final binding and conclusive and not referable to adjudication by the arbitrator.
It is a term of contract that each party invoking arbitration must exhaust aforesaid mechanism settlement claims/disputes prior to invoking arbitration.
Disputes having arisen between the parties, the petitioner invoked the Arbitration Agreement vide its letter dated 14th December, 2017. The said request was, however, turned down by the Chief Project Manager on the ground that as the petitioner had failed to apply to the Dispute Redressal Committee (DRC) within 30 days of decision of Chief Engineer and its application to the DRC was time barred, the petitioner was not entitled to seek appointment of an Arbitrator. The petitioner, therefore, filed the present petition. Counsel for the respondents submits that the petitioner is not entitled to invoke the Arbitration Agreement as the petitioner had failed to approach the DRC within the time prescribed under Clause 25 of the Agreement. He submits that due to such failure of the petitioner, the petitioner has lost its right to agitate its claim. In this regard, he places reliance on the judgment of this Court in United India Insurance Co. Ltd. vs. Karam Chand Goel MANU/DE/4493/2009
and of the Supreme Court in National Insurance Co. Ltd. vs. Sujir Ganesh Nayak & Co. & Anr. MANU/SC/0491/1997.
I do not find any force in the submission made by the counsel for the respondents. Section 28 of the Indian Contract Act, 1872 declares any condition in the Agreement which extinguishes the right of any party thereto or discharges any party thereto from any liability, under or in respect of any contract on the expiry of a specified period, so as to restrict the right of such party from enforcing its rights, as void. This Court has considered the effect of the amendment made to Section 28 of the Contract Act in the judgment of Pandit Construction Company vs. Delhi Development Authority 2007 (3) ARBLR 205 Delhi and has negated similar argument of the respondent therein.
In view of the above, I see no impediment in appointing a Sole Arbitrator for adjudicating the disputes that have arisen between the parties in relation to the abovementioned Agreement. I accordingly appoint Ms.Meera Bhatia, Advocate, R/o D-200, Defence Colony, New Delhi-110024, Mobile-9810076748 as an Arbitrator. The Arbitrator shall give her disclosure statement under Section 12 of the Act before proceeding with the reference. The petition is allowed in the above terms with no order as to costs.
Dasti.
NAVIN CHAWLA, J JULY 18, 2018 RN