Arbitration Case No. 23 of 2006 [1] IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH Arbitration Case No. 23 of 2006 Date of Decision: 19.01.2010 DhanRaj Kedia ..Petitioner Versus State of Haryana and others ..Respondents CORAM: HON'BLE MR. JUSTICE MUKUL MUDGAL, CHIEF JUSTICE 1.Whether Reporters of local papers may be allowed to see the judgment ? 2. Whether to be referred to the Reporters or not ? 3. Whether the judgment should be reported in the Digest? Present :- Mr. Vibhav Jain, Advocate, for the petitioner. Mr. B.S.Rana, Addl. A.G. Haryana for the respondents. *** MUKUL MUDGAL, C.J. (Oral) 1. This petition has been filed by the petitioner under Section 11(6) of the Arbitration & Conciliation Act, 1996 (for short ' the Act), for appointment of a sole Arbitrator to adjudicate upon the disputes between the parties. 2. Clause 25-A of the agreement contains the Arbitration Clause which reads as under:- “ Clause 25-A (1) If any dispute or difference of any kind whatsoever shall arise between the Governor of Haryana/his authorised agents and the contractor in connection with or arising out of the contract of the execution of the work that is (i) whether before its commencement or during the progress of the work or after its completion (ii) and whether before or after the termination abandonment of breach of the contract, it shall Arbitration Case No. 23 of 2006 [2] in the first instance be referred to for being settled by the Executive Engineer in charge of the work at the time and he shall within a period of sixty days after being requested in writing by the contractor to do so, convey his decision to the contractor and subject to arbitration as hereinafter provided such decision in respect of every matter so referred shall be final and binding upon the contractor in case the work is already in progress, the contractor will proceed with the execution of the work on receipt of the decision by the Executive Engineer-in-Charge as aforesaid with all due diligence whether he or the Governor of Haryana/his authorised agent requires arbitration as hereinafter provided or not if the Executive Engineer-in- charge of the work has conveyed his decision to the contractor and no claim to arbitration has been filled with him by the contractor within a period of sixty days from the receipt of letter communicating the decision the said decision shall be final and binding upon the contractor and will not be a subject matter of arbitration at all if the Exeutive Engineer in Charge of the work fails to convey his decision within a period of sixty days after being requested as aforesaid the contractor may within further sixty days, of the expiry of first sixty days from the date on which request has been made to the Executive Engineer-in- charge request the Engineer-in-chief, that the matter in dispute be referred to arbitration, as hereinafter provided. 2. All disputes or differences in respect of which the decision is not final and conclusive shall at the request in writing of either party, made in communication sent through registered AD post be referred to the sole arbitration of any serving Superintending Er. Or Chief Er. Of Haryana PWD B&R Branch to be nominated by designation by the Engineer in chief Haryana, PWD B&R Branch at the relevant time, it will be no objection to any such appointment that the arbitrator so appointed is a Government servent or that he had to deal with the matters to which the contract relates and that in the course of his duties as a Government servant he had expressed his views on all or any of the matters in dispute. The arbitrator to whom the matter is originally referred being transferred or vacating his office his successor in office as such shall be entitled to proceed with the reference from the stage at which it was left by his predecessor. xx xx XX 3. It is also a term of this arbitration agreement that no person other than a person appointed by the Engineer in Chief, Haryana, PWD B&R Branch shall act as arbitrator and if for any reason that is not possible the matter shall not be referred to arbitration at all. In all cases where the aggregate amount awarded exceeds Rs. 25,000/- (Rs. Twenty five thousand only) the arbitrator must invariably Arbitration Case No. 23 of 2006 [3] give reasons for his award in respect of each claim and counter claim separately.” 4. xx xx xx 5. xx xx xx 6. xx xx xx 7. It is also a term of this arbitration agreement that where the party invoking arbitration is the contractor, no reference for arbitration shall be maintainable unless the contractor furnishes to the satisfaction of the Executive Engineer in Charge of the work, a security deposit of a sum determined according to details given below and the sum so deposited shall on the termination of the arbitration proceedings be adjusted against the cost, if any, awarded by the arbitrator against the claimant party and the balance remaining after such adjustment in the absence of any such cost being awarded the whole of the sum will be refunded to him within one month from the case of award:- Amounts of Claims Rate of Security Deposit i) For claims below Rs. 10,000/- 2% of amount claimed ii) For claims of Rs. 10,000/- and above and below Rs. 1,00,000/- and above 5% of amount claimed Iii) For claims of Rs. 1,00,000/- and above. 10% of amount claimed. The stamp fee due on the award shall be payable by the party as desired by the arbitrator and in the event of such party's default stamp fee shall be recoverable from any other sum due to such party under this or any other contract.” 3. The Arbitration demand was made as per the said clause on 29.11.2004. It is contended by learned counsel for the petitioner that even though all the conditions supplied in agreement have been fulfilled, no appointment of the Arbitrator is being made by the respondents. 4. Learned counsel for the State of Haryana states that as per clause 25(A)(7) of the arbitration clause, petitioner is required to deposit security which he has not done. He further contends that until and unless the security is deposited by the petitioner as contemplated in the agreement executed between the parties, no Arbitrator can be Arbitration Case No. 23 of 2006 [4] appointed. On this learned counsel for the petitioner states that security deposit shall be made within a period of four weeks from today. 5. In view of the statements of counsel for the parties, this petition is disposed of with a direction that on deposit of the security by the petitioner within a period of four weeks from today, the respondents shall appoint an Arbitrator as per the arbitration clause and thereafter the statement of claim shall be supplied to counsel for the respondents within two weeks, who shall supply his response thereto within two weeks thereafter. The parties shall appear before the Arbitrator, to be appointed by the respondents not later than four weeks from the date of deposit of security on 27.03.2010 at 4.00 P.M. or on an agreed date convenient to the parties but not later than a fortnight from the date of exchange of pleadings as directed aforesaid. The Arbitrator shall make an endaveour to dispose of the reference not later than six months from the date of first appearance of the parties. The Arbitrator shall fix his own fee. Petition stands disposed of. (MUKUL MUDGAL) CHIEF JUSTICE 19.01.2010 'ravinder'