TMI Blog2005 (9) TMI 617X X X X Extracts X X X X X X X X Extracts X X X X ..... e employer or the contractor is dissatisfied or if the Engineer fails to give notice of his decision on or before the eighty-fourth day of the receipt of reference, then Clause 67.1 of the agreement empowers the employer or the contractor, on or before the seventieth day after the day on which notice of such decision is received, or after the expiry of seventieth day on which the period of 84 days expires, to give notice to the other party, with a copy for information to the Engineer of its intention to commence arbitration as per procedure prescribed therein. 3. Clause 67.2 contemplates that where notice of intention to commence arbitration has been given, the parties shall attempt to settle their dispute amicably before the commencement of arbitration. It further provides that unless the parties agree otherwise, arbitration may be commenced on or before the fifty-sixth day after the day. on which notice of intention to commence arbitration of such dispute was given, even if no attempt at amicable settlement thereof has been made. Clause 67.3 contemplates adjudication of a dispute by a Committee of three arbitrators in case any dispute in respect of which the decision of the En ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lure of respondent No. 1 to comply with the final and binding decision of the Engineer. Respondent No. 1 concurred to the said reference vide letter dated 17.6.2002 and had appointed Shri G.S. Mann as their arbitrator. After some correspondence, the Indian Roads Congress, respondent No. 2, sent a panel of five persons and the two appointed arbitrators nominated Shri B.R. Jauhar as the Presiding Arbitrator. Subsequently, Shri R.C. Kehar, substituted the arbitrator appointed by the petitioner after the resignation of Hon'ble Mr. Justice K.N. Singh. Sometime later, Shri Hakam Singh, Superintending Engineer, filled up the vacancy caused on account of resignation of Shri G.S. Mann, the arbitrator appointed by respondent No. 2. The arbitration proceedings are now being conducted by the Arbitral Tribunal consisting of Shri B.R. Jauhar, Shri R.C. Kehar and Shri Hakam Singh in which respondent No. 1 is participating. The said proceedings are still pending final adjudication. 6. Respondent No. 1 vide letter dated 30.6.2004 invoked Clause 67 of the contract and nominated Shri G.S. Mann, Superintending Engineer (Retd.) as their arbitrator for the arbitration of disputes against the deci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certificate or valuation of the Engineer, the matter in dispute shall, in the first place, be referred in writing to the Engineer, with a copy to the other party. Such reference shall state that it is made pursuant to this Clause. Not later than the eighty-fourth day after the day on which he received such reference the Engineer shall give notice of his decision to the Employer and the Contractor. Such decision shall state that it is made pursuant to this Clause. Unless the contract has already been repudiated or termination, the Contractor shall, in every case, continue to proceed with the Works with all due diligence and the Contractor and the Employer shall give effect forthwith to every such decision of the Engineer unless and until the same shall be revised, as hereinafter provided, in an amicable settlement or an arbitral award. If either the Employer or the Contractor be dissatisfied with any decision of the Engineer, or if the Engineer fails to give notice of his decision on or before the eighty-fourth day after the day on which he received the reference, then either the Employer or the Contractor may, on or before the seventieth day after the day on which he received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inee within sixty days after receipt of notice for the appointment of such Arbitrator, the Chairman of the Executive Committee of the Indian Roads Congress shall appoint upon request from either party and from such panel. The decision of the majority of the Arbitrators shall be final and binding on the parties. All awards shall be in writing and such awards shall state reasons for the amounts awarded. Save as aforesaid and/or otherwise provided in the contract, the arbitration shall be conducted in accordance with the provisions of the Indian Arbitration Act, 1940 or any statutory modification or enactment thereof and shall be held at such place and time in India as the Committee of Arbitrators may determine. Neither party shall be limited in the proceedings before such arbitrator/s to the evidence or arguments put before the Engineer for the purpose of obtaining his decision pursuant to Sub-clause 67.1. No such decision shall disqualify the Engineer from being called a witness and giving evidence before the arbitrator/s on any matter whatsoever relevant to the dispute. Arbitration may be commenced prior to or after completion of the Works, provided that the obligations of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ime limit is to be ignored in terms of the provisions of Section 28 of the Contract Act. Still further, the respondent is entitled to seek extension in time in filing of objections as it is a case of extreme hardship, in terms of Section 43(3) of the Act. It is submitted that, in fact, a petition to seek extension of time is pending before the learned District Judge, Patiala. It is submitted that the objection against decision in respect of Claim No. 1 dated 7.6.2001 is delayed by only 12 days, whereas the decisions of the Engineer dated 21.6.2001 and 4.7.2001 had been disputed within three years of such decisions. Therefore, the dispute between the parties is liable to be adjudicated upon by an Arbitral Tribunal in terms of the agreement between the parties. It is in exercise of such right, the Arbitral Tribunal stands constituted consisting of respondents No. 3 and 4. It is further argued that the petitioner had a right to challenge the constitution of such Arbitral Tribunal in terms of Section 16 of the Act. Since the petitioner has not objected to such an Arbitral Tribunal in terms of the remedy provided under the Act, the writ petition is not maintainable. 12. It was furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent has a right to establish before the Arbitral Tribunal that the decisions of the Engineer in respect of Claim Nos. 1, 3 and 4 are not legally or factually sustainable. The failure to lodge any protest within the time prescribed cannot be extended to mean that the Arbitral Tribunal is denuded of the power and jurisdiction to adjudicate the dispute between the parties. The reference of dispute to the arbitration itself connotes that the Arbitral Tribunal has to decide on the legality, validity and justifiability of the claim of the parties. The Arbitral Tribunal constituted at the instance of petitioner is not analogous to Executing Court but is required to decide the claim raised by the petitioner on merits. Respondent No.1 has a right to prove before such Arbitral Tribunal that the claims of the petitioner, though decided by the Engineer, are not sustainable either in law or in fact. Thus, when an Arbitral Tribunal is seized of the disputes between the parties, the constitution of another Arbitral Tribunal in respect of those very issues, which are already pending adjudication is clearly without jurisdiction and not sustainable. All issues arising between the parties are requi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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