M/S Manickam Enterprisesm/S Manickam Enterprises v. The Adhyaksha And ORS

IN THE HIGH COURT AT CALCUTTA

[ CIRCUIT BENCH AT PORT BLAIR ] *** AP/5/2023 M/s Manickam Enterprises Vs.

The Adhyaksha and others Mr. Gopala Binnu Kumar ... for the petitioner Mr. Shatadru Chakraborty Mr. Dibesh Dwivedi ... for the respondent no.2 February 9, 2024 [SR] Item No.8 The petitioner seeks appointment of an arbitrator by way of the present application filed under section 11(6) of The Arbitration and Conciliation Act, 1966. The relief claimed arises out of an Agreement bearing No.SE/ZP/PB/2008-2009. The Court is informed that the parties executed the agreement in December, 2008.

The scope of the agreement was that the petitioner would install a R.O Plant with distribution Pipeline at Dhanikari under Zilla Parishad, South Andaman District. The first page of the agreement mentions the amount put in tender, Earnest Money and the time for completion of the agreement.

Learned counsel appearing for the petitioner alleges that the petitioner, despite procuring the material for commissioning of the plaint, initially could not make much headway since the respondents failed to hand over the land in question to the petitioner.

Counsel submits that the petitioner was constrained to make arrangements for "Ward and Watch" for the material already procured and brought to the site and was further constrained to make a set of 4 claims before commencement of the contract. Counsel submits that the present set of 12 claims which were made by invocation of the arbitration agreement on 10th February, 2023 was after completion of the contract and on a completely different set of disputes.

Learned counsel appearing for the respondents/Zilla Parishad submits that the petitioner's claim for appointment of arbitrator is hit by Res judicata/ constructive Res judicata since an arbitrator has already adjudicated on the petitioner's claims and made an award on 30.12. 2017 and corrected on 20.01.2018. Counsel submits that the petitioner's claims have already been allowed in execution proceedings. The record before the Court shows that the agreement executed between the parties was to be governed under the General Conditions of Contract (GCC) for Central Public Works Department (CPWD), 2008. The relevant part of the agreement refers to Section 25 of the GCC which provides for settlement of disputes and arbitration.

A construction of this clause is not called for at this stage since the parties have already participated in arbitration which culminated in the award of 30.12.2017/20.01.2018. The only question before the Court is whether the petitioner's present claims would be hit by the principles of Res judicata. This Court is of the view that an issue of nonarbitrability would usually be grounded on a time-barred claim established by the party who opposes arbitration or where the arbitration agreement is itself obliterated for some intervening circumstances. All other issues, including that of Res judicata, are within the decision-making domain of the arbitrator. Needless to say, both parties will be given the opportunity of arguing their respective cases.

In any event, the set of claims which was decided by the learned arbitrator appear to be totally different from the present claims which have specifically been set out in the notice under section 21 of the 1996 Act dated 10th February, 2023. Even a cursory perusal of those claims makes it clear that the claims were made post-performance.

Once the existence of the arbitration agreement is established and the dispute is found directly to be relatable to the arbitration agreement, nothing much remains for a section 11 Court to decide. It is evident that there is a dispute between the parties. This would be underscored by the respondents' reply to the invocation notice wherein the respondents have

summarily rejected the petitioners' claims on the ground that the petitioners have already been paid in the execution proceedings of 2018.

NTPC Limited vs. M/s SPML Infra Limited (2023) 9 SCC 385 held that a referral Court may reject claims which are manifestly non-arbitrable.

This Court has found the petitioner's claims to be arbitrable in the facts of the present case.

AP/5/2023 is accordingly allowed and disposed of by appointing Mr. Kalyan Jyoti Sengupta, former Chief Justice of the Andhra Pradesh High Court to act as the Arbitrator for resolving the disputes and differences between the parties in terms of the arbitration agreement and subject to the learned arbitrator communicating his consent in the prescribed format within three weeks from the date of communication of this order to the learned arbitrator.

The petitioner's advocate on record will forward the requisite details of the petitioner along with the communication as directed above.

Parties to act on a server copy of this order duly downloaded from the official website of the Hon'ble High Court at Calcutta.

( Moushumi Bhattacharya, J. )