mgn IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.2867 of 2002 Prestress (India) Pvt. Ltd. & Anr. ..Petitioners vs. General Manager (Works) Central Railway and Ors. ..Respondents Mr. P.S. Jetly with Mr. G.S. Jetly, Senior Counsel and Mr. Atul S. Tungare, for the Petitioners. Mr. R.V.Desai, Senior Counsel with Mr. Suresh Kumar for the respondents. CORAM : F.I. REBELLO & D.G. KARNIK, JJ. DATED : 25th SEPTEMBER , 2009 P.C. The petitioner had approached this Court contending that in terms of the contract signed between the parties Railways had to reimburse the turnover tax to the petitioners. They have failed to do so. Petition was admitted. Respondents have filed their reply. Learned Counsel has drawn our attention to Clause 2900 which provides for Arbitration, which reads as under:- “2900. Arbitration: (A) In the event of any question, dispute or difference arising under these conditions or any special conditions of contract, or in connection with this contract (except as to any matters the decision of which is specially provided for by these or the special conditions) the same shall be referred to the sole arbitration of a Gazetted Railway Officer appointed to be the arbitrator, by the General Manager in the case of contracts entered into by the Zonal Railways and Production Units; by any Member of the Railway board in the case of contracts entered into by the Railway Board and by the Head of the Organisation in respect of contracts entered into by the other organisation under the Ministry of Railways. The gazetted Railway Officer to be appointed as arbitrator however will not be one of those who had an opportunity to deal with the mattes to which the contract relates or who in the course of their duties as railway servant have expressed views on all or any of the matters under dispute or difference. The award of the arbitrator shall be final and binding on the parties to this contract.” Our attention is invited to the judgment of the Supreme Court in Empire Jute Company Limited & Ors. vs. Jute Corporation of India Limited & Anr., (2007) 14 S.C.C. 680. 2. The petitioners have based their contention on para. 2.2 and 4 of the Agreement signed between the parties. On the other hand on behalf of the respondents reference is made to letters dated 8th August, 2001, 31st July, 2002 and 4th October, 2002 which is also the correspondence on record. It is the submission on behalf of the respondents that turnover tax is not part of sales tax and as such the petitioners herein are not entitled to reimbursement. 3. Considering the controversy and Section 8 of the Arbitration & Conciliation Act, 1996, in our opinion though the petition was admitted considering the judgment of the Supreme Court in Empire Jute Company Limited (supra) we refer the matter to an Arbitrator to be appointed in terms of the contract between the parties and the dispute in terms of Clause as earlier reproduced. The following dispute is to be decided by the Arbitrator to be appointed by the respondents:- “Whether the petitioners are entitled to receive turnover tax from the Central Railways on supply of complete finished sleepers in view of clause 2.2 of the contract agreement No.W 188.C 361/CS-145 dated 30-01-2002.” 4. On behalf of the respondents learned Counsel submits that they will appoint an Arbitrator within four weeks from today. 5. The Arbitrator to decide the controversy as referred and dispose of the same according to law. (D.G. KARNIK,J.) (F.I. REBELLO,J.)