IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.GIRI THURSDAY, THE 6TH AUGUST 2009 / 15TH SRAVANA 1931 WP(C).No. 21697 of 2009(F) -------------------------- PETITIONER: ------------------ E.K.ABDUL HAMEED, IYYAKKATTIL HOUSE, P.O.MAYANAD, KOZHIKODE - 673 008. BY ADV. MR. C.P.MOHAMMED NIAS RESPONDENTS: --------------------- 1. THE RAILWAY DIVISIONAL MANAGER (COMMERCIAL), PALGHAT DIVISION, SOUTHERN RAILWAY, PALGHAT - 678 002. 2. UNION OF INDIA, REPRESENTED BY ITS SECRETARY, DEPARTMENT OF RAILWAYS, NEW DELHI. BY MR. N.B.SUNILNATH, SC, RAILWAYS THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06/08/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: kkms/ V.GIRI, J. = = = = = = = = = = = = = = == = = = = = = W.P.(C). No. 21697 OF 2009 = = = = = = = = = = = = = == = = = = = = = Dated this the 6th day of August 2009. JUDGMENT Petitioner responded to Ext.P1 tender relating to the right to collect fees from the vehicle parking stand at Karur Railway Station, Palaghat. The tender was accepted by the respondents. Ext.P1 agreement was executed on 20.09.2007 between the petitioner and the respondents. The licence fees was fixed at Rs.12,12,100/- for the period of the contract, currently due to expire on 31.12.2009, payable in six instalments of Rs. 2,02,017/-. 2. While so on 28.01.2009, first respondent issued Ext.P4 letter alleging that the petitioner had occupied an additional area of 1110 Sq. Mts. and is therefore bound to pay licence fee for the additional area also. The total licence fee was therefore determined by the respondent at Rs. 24,71,867/- and the instalments were worked out at Rs. 4,11,978/-. 3. Petitioner did not accept the stand taken in Ext.P4 as per Ext.P5 and thereafter reaffirmed the stand in Ext.P7, which W.P.(C). No. 21697 OF 2009 2 was sent in reply to Ext.P6 communication sent by the respondent, reiterating the demand contained in Ext.P4. While matters stood so, by Ext.P9, a communication has been sent by the Railway Divisional Manager (Commercial) to the Manager, Panjab National Bank, Mankavu, Calicut, intimating that the petitioner's contract has been terminated and therefore, the bank guarantee furnished at the instance of the petitioner by way of a security deposit, effected at the time of execution of Ext.P3 agreement may be invoked. Petitioner has approached this Court challenging Exts.P4, P6, P7 and P9. 4. I heard learned Counsel for the petitioner and the learned Standing Counsel for the Railways. 5. Learned Counsel for the Railways brings to my notice Clause 64 in the general conditions of the contract executed between the petitioner and the Railways. The same provides for an arbitration in the event of a dispute or difference between the parties as to the construction or operation of the contract. Clause 64 (3)(a)(2) provides that in cases where the total value of the contract exceeds Rs.10 Lakhs, the Arbitration will be hold by W.P.(C). No. 21697 OF 2009 3 a Tribunal consisting of 3 gazetted railway officers of the grade mentioned there. In the instant case, though there is no demand as such by the petitioner for reference of the dispute to be arbitrated, I am of the view that since factual disputes are involved and resolution of the same will require evidence on both sides, and since there is an arbitration clause in the general conditions, it is appropriate that all disputes between the petitioner on one hand and Railways on the other arising from the demand made in Ext.P4, including the right of the Railways to demand an invocation of the bank guarantee furnished by the petitioner shall be decided by the competent Arbitration Tribunal. It is ordered accordingly. 6. The competent authority of the Railways shall refer the dispute raised by the petitioner in relation to Exts. P4, P6, P7 and P9 to the competent Arbitration Tribunal within 30 days from the date of receipt of a copy of this judgment. Since the term of the agreement Ext.P3 is scheduled to expire on 31.12.2009, petitioner shall be permitted to continue to operate as a licence under Ext.P3 till 31.12.2009, but the petitioner shall W.P.(C). No. 21697 OF 2009 4 operate as a licencee only in relation to the parking stand comprising the area, that is specifically scheduled in Ext.P3 agreement. In other words, he shall not extend beyond the parking stand specifically mentioned in terms of Ext.P3. He shall also pay the balance instalments, if any, due under Ext.P3. The further amounts demanded made by the respondents shall abide by and be recovered only subject to the decision taken by the Arbitration Tribunal. The writ petition is disposed of as above. (V.GIRI) JUDGE kkms/